The Public Procurement (Miscellaneous Amendments) Regulations 2011 will come into effect on 1 October 2011. They change the time limits for bringing public procurement proceedings, and make certain other amendments summarised below. The changes apply to all the public sector, utility sector and recent defence and security public contracts rules, as well as to their relevant Scottish equivalents.
The new time limit for bringing procurement proceedings will be 30 days running from the date on which the claimant first knew, or ought to have known, that grounds for starting the proceedings had arisen (the “date of knowledge”), with Court discretion to extend this period up to an absolute maximum of three months. This will apply in all situations where the date of knowledge is 1 October 2011 or later.
Transitional arrangements apply so that where the date of knowledge occurs before 1 October 2011, the time limit will be three months from the date of knowledge, with open ended discretion for the Court to extend the limit.
The revision to the UK regulations stems from the ruling of the European Court of Justice in its Uniplex judgment of January 2010. In that case, the Court decided that the UK time limits were incompatible with EU law for two reasons:
- limitation periods should not start to run from the time when the alleged breach of the procurement rules occurred, but from the date of knowledge; and
- the old requirement to bring proceedings “promptly” was imprecise and made the limitation rules uncertain.
Issue/service of proceedings
The claimant must now simply issue the proceedings within the time limit, rather than also serve them on the defendant in that period. This deals with unintended problems in how the “deemed service” rules had affected the time limits introduced in 2009. The claimant must, however, serve the claim form within seven days of its issue (mirroring the obligation in judicial review proceedings).
The Regulations clarify the obligation on a contracting authority with regard to standstill notices (“Alcatel letters”). It will not be necessary to send such a letter to a tenderer “definitively excluded” from consideration at an earlier stage of the process, where the period for that tenderer to bring a challenge against his exclusion has expired (three months), or any such challenge has been heard by the court and the legality of the exclusion upheld.
Criteria for suspension of contract-making
The provisions in relation to automatic suspension on challenge are modified to provide that the contracting authority must refrain from entering into a contract where (i) a claim form is issued in respect of a contracting authority's decision to award the contract; (ii) the contracting authority has become aware that the claim form has been issued and that it relates to that decision; and (iii) the contract has not been entered into.
Criteria for the rejection of economic operators and transfer of functions
The Regulations update the grounds upon which a tenderer can be rejected, for example to provide for new criminal offences such as those under the Bribery Act 2010.
The amendments also reflect the transfer of responsibility for public procurement to the Cabinet Office. References to the Office of Government Commerce are removed.
The tightening up of the regime reflects recent practice following Uniplex, and emphasises that contractors contemplating a challenge to any tender process must move swiftly to identify and act upon breaches of the rules.