Italy: "pre-litigation" dispute resolution regulation issued by the Authority for public procurement

13 March 2014

Simone Cadeddu, Alessandro Comino

The "pre-litigation" dispute resolution regulation issued by the Italian Authority for public procurement contracts (AVCP): a fast-track, low cost opportunity for economic operators and contracting authorities.

The Italian independent regulator supervising the award of public works, services and supplies contracts – Autorità per la vigilanza sui contratti pubblici di lavori, servizi e furniture - AVCP has issued a new version of a regulation establishing a "pre-litigation" dispute resolution procedure.

The "pre-litigation" procedure is an out-of-court dispute resolution tool that enables economic operators and contracting authorities to submit, individually or even jointly, an application to AVCP concerning disputes arising from public tender procedures covered by the Italian public procurement code (d.lgs. 163/2006).

The AVCP provides a quasi-adversarial procedure, which is concluded with the issue of a formal opinion by the Authority. While formally not binding, the opinion wields considerable persuasive force, as it is usually spontaneously followed by contracting authorities and administrative courts.

The "pre-litigation" procedure is a partial alternative to judicial review, as first instance judicial proceedings and AVCP "pre-litigation" can co-exist until a first instance judicial ruling is published, thus allowing private parties facing mandatory deadlines to initiate precautionary judicial proceedings while "pre-litigation" is pending. The "pre-litigation" can now be activated either during the tender procedure or after the final award and - in the case of a joint application - also in relation to issues concerning public procurement contract performance. "Pre-litigation" does not involve administrative costs, and the AVCP opinion is issued within 90 days from the date of the application.

The application must set forth the relevant facts and the legal arguments in support of the proposed solution. It can be submitted electronically, without specific formal requirements. The AVCP screens for relevance all applications submitted by private parties before processing them, while public-private joint applications are processed directly. The contracting authority is called upon not to take action that might compromise the resolution of the matter when private parties file an application, and has to commit to do so when the application is jointly filed or filed by the contracting authority itself. During the proceedings, AVCP may acquire additional elements, also electronically. Parties can submit briefs and additional evidence, and a final oral hearing can be arranged upon request.

The pre-litigation procedure before AVCP may therefore be a viable alternative to judicial review in cases where the matter is not of such value or importance to justify judicial proceedings. But It may also be used to effectively support judicial initiatives with an extremely influential opinion.