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Irish High Court clarifies the rules on eligibility

By May 13, 2022 No Comments
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The High Court recently considered a number of novel claims by Word Perfect Translation Services in relation to the legality of a tender process for a multi-supplier framework for Irish language translation services 1. These included challenges to the minimum turnover threshold and pricing imposed by the contracting authority as well as the rotation system that the authority proposed to use for the allocation of contracts under the framework.

However, a preliminary issue was raised in relation to the eligibility of Word Perfect to bring these challenges pursuant to the Procurement Regulations2  given that it did not actually submit a tender for the framework (choosing to commence legal proceedings instead).

It was not disputed that, under the Procurement Regulations, for an applicant to be entitled to challenge the award of a contract under a public procurement process, it must, save in exceptional circumstances, have submitted a tender for that contract. However, the question at issue in the case was whether the same pre-condition applies where a challenge is made to the legality of the competition rules, as distinct from a challenge to a contract award.

According to the Procurement Regulations, for a supplier to be eligible to challenge the procedures for awarding a public contract, it must have an ‘interest in obtaining’ the contract. It must also allege that it is harmed or at risk of being harmed by the alleged infringement (although this aspect was not a focus in the case).

The High Court found that, in general, only tenderers who actually submit a tender can demonstrate that they have an interest in obtaining the contract at issue and are therefore entitled to challenge the legality of the tender process. Potential tenderers or others who might be said to have some general interest in the contract, whether that is because of their involvement in a previous tender process or because they are a major supplier of the services in question in the market, do not have a sufficient interest in obtaining the contract and therefore cannot bring legal proceedings under the Procurement Regulations. This eligibility test is the same whether the challenge is to the tender rules or to the award of the contract itself and will be strictly applied.

There may be exceptional circumstances when the tender rules which are the subject of the complaint prevent a tenderer from submitting a tender, but these circumstances did not exist in the present case.

As Word Perfect was found not to be eligible to bring its procurement challenge, the Court did not proceed to rule on the substantive complaints that had been raised.

The High Court decision provides clear guidance to anyone considering challenging the rules of a tender competition. It may be tempting to launch a legal challenge without preparing a detailed tender response. However, notwithstanding any complaints it may have about the rules, a challenger will generally (assuming the tendering process is not halted by the authority) be required to submit a tender in order to demonstrate an interest in obtaining the contract and be treated as eligible to pursue those complaints under the Procurement Regulations.3

It should be noted however that there may be scope for a legal challenge to a procurement process to be brought by an operator which has not submitted a tender, or by a person who has a more general interest in the contract, under ordinary judicial review procedures rather than under the Procurement Regulations. A different (and arguably lower) eligibility test applies to ordinary judicial review proceedings.