The judgement in ParkingEye Ltd v Velindre University NHS Trust & Cardiff and Vale University Health Board (handed down on 1 May 2026) has been received as a significant shift in how courts will approach interim relief in public procurement challenges under the Procurement Act 2023 and is being greeted as a positive development by challengers.
In the first decision to interpret the new test under the Procurement Act 2023 for lifting the automatic suspension of contract award, the Court confirmed that test is substantially different to the old regime (known as the “American Cyanamid” test, which often hinged on whether the challenger could be compensated in damages). Now, Courts will be more empowered to give greater weight to the public interest in ensuring contracts are entered into only following procurement procedure which has been carried out lawfully.
Background
In ParkingEye, the incumbent provider of parking management services challenged the outcome of a procurement for a replacement contract by issuing proceedings within the standstill period; which then triggered the automatic suspension prevented the new contract being awarded. As is usual practice, the defendants then applied to lift that suspension under section 102 of the Procurement Act 2023, arguing that maintaining it would delay important benefits (like improved systems and revenue-sharing for hospital parking) and that the claimant could be adequately compensated by damages if it ultimately succeeded. Under the old law, such arguments may have sufficed to lift the suspension, enabling the authority to sign the contract immediately. However, in this case the application was refused and the suspension was maintained, ensuring the contract award remained on hold pending trial.
New Test -v- Old Test
Under the Public Contracts Regulations 2015, applications to lift an automatic suspension were governed by the American Cyanamid injunction test, which considered (in summary): whether there is a serious issue to be tried; adequacy of damages for both challenger and defendant; where does the balance of convenience lie. In practice, if a court considered that monetary compensation would adequately remedy the challenger’s loss, the suspension was generally lifted and the contracting authority could proceed with contract award (at which time, challengers often then withdrew their claim entirely).
Now, following section 102 of the Procurement Act 2023 the court must balance multiple factors in one evaluative exercise, considering: (1) the public interest, including (i) upholding the principle that public contracts should be awarded lawfully and (ii) avoiding undue delay in the supply of essential goods or services; (2) the interests of suppliers, including whether damages are an adequate remedy for the claimant; and (3) any other relevant matters.
The weight to be given to each of these factors is a matter for the court to determine, but the consideration of adequacy of damages – once the decisive factor under PCR 2015 – no longer has the significance it had before. Indeed, in ParkingEye, the court appears to accept that damages could in fact be an adequate remedy for the claimant and that any reputational harm was not irreparable, yet the application to lift the suspension was still refused.
The court gave significant weight to the statutory public interest factors, especially the importance of lawful procurement and the principle that a contract should not be awarded until any dispute over its lawfulness has been resolved (which marks a distinction to the position often taken under the old regime, where “public interest” focussed instead on expediting delivery of public service needs). Interestingly, the court noted that no arguments were made in relation to award to the successful bidder (who would be awarded the new contract, subject to resolution of the challenge) having substantial urgency; highlighting that such matters could indeed be relevant for consideration in future matters.
Overall, the judgment indicates a higher bar for lifting suspensions and provides that, although there is no automatic presumption either way, lifting the suspension will generally require either a “very persuasive countervailing public interest” or an overriding private interest on the facts. In practice, this appears to signal that contracting authorities will no longer be able to rely on routine arguments about inconvenience or desire to start the contract; a truly compelling justification will have to be provided.
Bidder-Friendly Change in Law
Under the previous regime, Northern Irish courts appeared to take a more interventionist approach to maintain automatic suspensions, often aligned with robust judicial management to achieve an expedited trial. The court fee to commence proceedings in Northern Ireland remains significantly lower than in England and Wales and with the importance of public sector contracts to the Northern Ireland economy, it will not be long until the Northern Irish courts are active in the development of this line of authority.
ParkingEye is therefore broadly seen as helpful to bidders involved in public tenders and particularly incumbent providers (either where they are bringing the challenge or just benefitting from someone else challenging an award, resulting in an unexpected extension of the existing contract duration). The new regime will also give some encouragement to challengers if their strategy is to try to “keep alive” the ultimate goal of being awarded a contract (rather than being consigned to pursuing only damages as monetary compensation).
However, there must be a note of caution. While the new regime appears to be more bidder-friendly in principle, it does not remove all practical hurdles for challengers and one key survivor from the old system is the cross undertaking in damages, meaning that where a suspension remains in place, the challenger would be required to undertake to compensate the authority (and/or other entities) for any losses caused by the delay in awarding the contract should the claim ultimately fail. Requiring the challenger to have the financial backing and confidence to potentially pay damages to the authority if they lose the case (e.g. extra costs or lost benefits due to the delayed contract) remains a significant consideration for bidders contemplating a challenge.
Conclusion
ParkingEye has quickly been recognised as a landmark judgment in UK procurement law, showing that the Procurement Act 2023 has meaningfully changed the remedies landscape. The court’s approach under the new regime differs markedly from the approach taken under the old law, shifting the focus toward preserving the integrity of procurement and requiring stronger justification to displace an automatic suspension. For bidders, this is a positive development offering a better chance to ultimately be awarded the contract still on the table, rather than just a consolation by way of damages award. For authorities, it raises the stakes of a challenge and demands more rigorous grounds to lift a suspension. Going forward, while it remains early days and further cases will refine the exact parameters, this judgment sets a clear tone under the new law: “the courts do not too lightly lift the suspensions”.
