Public Procurement – Stepping up the Pace
08/05/2012
The Public Procurement (Miscellaneous Amendment) Regulations 2011 (Regulations) came into force on 1 October 2011, and have brought significant changes to the procurement environment.
Key Change
The key change is a substantial reduction in the time limit for bringing proceedings where a bidder perceives a tender process has breached the procurement rules. Until recently, bidders wanting to challenge had to commence their claim promptly, and in any event within 3 months from the date when grounds for bringing the proceedings first arose (subject to court discretion to extend the time limit where there was good reason for so doing). The difficulty however was that it was not always clear when the grounds first arose, or whether the claim had been brought ‘promptly’.
The Regulations aim to clarify the time limit for bringing proceedings and it is important that both contracting authorities and bidders are aware of the new provisions.
What is the new deadline?
As from 1 October 2011, the time limit (other than an ‘ineffectiveness’ claim) is as follows:
- 30 days from the date that the bidder first knew or ought to have known that the grounds for starting the proceedings first arose, subject to:
- discretion for the court to extend this where there is good reason for doing so, but only up to a maximum of 3 months.
The date of knowledge is not when full information about the breach has been obtained, rather it is when the bidder has sufficient knowledge to take an informed view about whether there has been an infringement.
How does this affect me?
- During a tender process, bidders often have concerns about how the procurement is being run. Historically such concerns were seldom raised due to the perceived risk of ‘biting the hand that feeds you.’ The new rules mean bidders no longer have the option of waiting until award notification before making a claim. The prospect of having to raise any potential concerns during the tender process is not an attractive option for bidders.
- If an infringement of the procurement rules is apparent from the PQQ or ITT documents, time starts to run from the date of those documents. Bidders may therefore face the unenviable task of potentially having to incur the cost, and diversion of resources, to determine whether or not to issue proceedings whilst the preparation of their bid is on-going.
- Bidders often engage with awarding bodies in an effort to resolve any perceived breach of the tender process. Given the short 30 day period, this may no longer be a viable option. Some sectors have raised concerns that this time constraint may result in increased litigation, as bidders issue protective claims to safeguard their position. From the awarding authority’s perspective, this is not an attractive prospect.
- The shorter timetable introduces an incentive for awarding bodies to exchange information and respond to bidders as quickly as possible. Prompt action will be required to avert proceedings being issued simply to protect against limitation or to assist the defence of a bidder’s application to extend the limitation period beyond 30 days, particularly in light of the automatic suspension provisions.
Conclusion
The Regulations clearly place increased emphasis on bidders who consider that there may have been a breach of the Regulations to act quickly.
Whilst the pressure on bidders has increased, the intention is that the Regulations should provide greater certainty for awarding bodies, successful tenderers and a quicker resolution of disputes. Awarding bodies and bidders will need to move quickly and co-operate throughout the tender process to avoid proceedings being issued unnecessarily. This is likely to prove a challenge for all parties involved.
If you wish to discuss any of the issues raised in this article, please contact:
Patrick Brown, patrick.brown@tughans.com, Telephone: 028 9055 3336
or
Kerry McCorkell, kerry.mccorkell@tughans.com, Telephone: 028 9082 0502
Disclaimer