Until recently, under Irish procurement law, the award of a contract could be automatically suspended by the commencement of legal action against a contracting authority in relation to the tender process and the authority could not apply to the Courts to have that suspension lifted pending a final determination of the case.
This position was confirmed by the Supreme Court in July 2014 in the case of OCS One Complete Solutions Ltd. v Dublin Airport Authority plc.
This has resulted in an unsatisfactory state of affairs ever since; many contract awards have since been delayed and in some cases, tender processes have been abandoned completely.
The Government has now sought to rectify the situation by amending the legislation in this area. The European Communities (Public Authorities’ Contracts) (Review Procedures) (Amendment) Regulations 2015 and the European Communities (Award of Contracts by Utility Undertakings) (Review Procedures) (Amendment) Regulations 2015 were both made on 30 April 2015, but have just been published. The latter instrument modifies the current legislation that was the subject of critical review in the Supreme Court.
The key points are as follows:
- The new Regulations apply to legal proceedings commenced before or after 30 April 2015; they therefore apply to award procedures that are currently suspended.
- In considering whether to lift the suspension and allow a contract to be concluded, notwithstanding any on-going legal proceedings, it appears that the Court is to consider whether it would have been appropriate to grant an injunction restraining the conclusion of the contract (in the absence of any automatic suspension applying).
- Only if it would not have been appropriate to grant an injunction in those circumstances may the Court order the suspension to be lifted, thereby permitting the contracting authority to conclude the contract. The Courts may order the suspension to be lifted subject to specified conditions.
- An exception appears to have been made for the OCS v Dublin Airport Authority plc case; the amendments to the legislation which permit the lifting of a suspension do not seem to be applicable to that particular case.
Although the new Regulations are not the model of clarity which one might have hoped for, Irish procurement law appears to be falling into line with practice in the UK and other EU jurisdictions, although the first case to test the Regulations in practice is now to be eagerly awaited.
It remains to be seen whether the new Regulations will trigger a wave of applications to the Courts in respect of award procedures that are currently suspended. It will also be interesting to observe how the standard rules on injunctive relief (including the law on cross-undertakings) will apply in this new context.