The High Court in Denmark has gone against the practice from the Danish Com-plaints Board for Public Procurement in its long-awaited decision on the possibility for a public authority to collect supplementary information concerning references.
The case, which has been named the "Exponent-case", was mentioned in The Inter-national Procurement Post - Spring 2023.
On October 10, 2023, the High Court in Denmark chose to confirm the decision of a Danish district court from June 2022 allowing a public authority to collect supplementary information under the Danish Public Procurement Act § 159, stk. 5 (the Danish implementation of art. 56, litra 1 and 3 of Directive 2014/24/EU). The decision conflicts with the Complaints Board for Tenders' practice on the subject.
The main issue of the case is whether the contracting authority, Gentofte Municipality, was entitled to collect supplementary information from the winning bidder, Kruso A/S, after the bid was made and after the contract was awarded.
The High Court emphasised in its decision that the Public Procurement Act § 159, stk. 5, in compliance with the principles of art. 18, litra 1, of Directive 2014/24/EU.(§ 2 in the Danish Public Procurement Act) implies that a contracting authority can ask an applicant or bidder to supplement, clarify or complete an application or a bid by submitting relevant information or documentation within a reasonable deadline.
The information must not result in such an alteration of the application or bid, that it must be considered a new application/bid.
The right to request relevant information and documentation under the Public Procurement Act § 159, stk. 5, also applies to requirements that have the character of minimum requirements, cf. the provision's stk. 5 and 6 as well as the travaux preparatoires, unless it is explicitly stated in the tender documents that non-compliance with a minimum requirement will lead to rejection of the application or the bid.
In this regard, The High Court found that it did not explicitly appear from Gentofte Municipality's tender documents that non-compliance with a minimum requirement would lead to rejection.
Following this and taking into account the purpose of the Public Procurement Act § 159, stk. 5, the High Court found that Gentofte Municipality was entitled to ask Kruso A/S to submit supplementary references.
The High Court also found that Kruso A/S did not gain a competitive advantage by submitting the supplementary references after the bidding deadline. Since the references in addition were not to be evaluated, and as the supplementary references did in fact exist before the bidding deadline, the timing of the submission of the supplementary references could not lead to a different result.
The ruling from the High Court will - as was the case in the decision from the District Court – change the hitherto practice of the Complaints Board for Public Procurement, as there has generally been close to zero tolerance regarding the use of the Public Procurement Act § 159, stk. 5, when there have been minimum requirements for references.
Until now, the Complaints Board for Public Procurement has, referring to the Public Procurement Act § 159, stk. 6, decided, that if a requirement for a reference has been inserted as a minimum requirement, the contracting authority has neither been obliged nor entitled to supplement, clarify or complete information - and thus been prevented from using the option in § 159, stk. 5.
The strict practice in the form of a tendency towards zero tolerance, can be said to have exhausted the provision for its intended area of application, which resulted in an illusory power for the contracting authority.
The High Court's decision therefore first and foremost results in a welcome confrontation with this practice and gives contracting authorities the opportunity to use the power to a greater extent, in cases where there is a need to collect supplementary information regarding references.
However, contracting authorities must continue to be aware that there may be a legal risk in connection with the contracting authority's supplementation of references, where there is an actual selection among the bidders - and not just an objective determination of the references, as in this case.
Contracting authorities should always carefully consider the possibility and potential consequences before allowing supplementation according to § 159, stk. 5. It should also be pointed out that the contracting authority will never be obligated to collect new references, if the already submitted ones are insufficient.
Finally, contracting authorities should ensure that the tender documents do not hinder this supplementation opportunity by categorically stating that non-compliance with minimum requirements leads to rejection.
There was suspicion that the High Court was awaiting the EU Court of Justice's preliminary ruling in the Croatian case C-652/22, before it completed its own judgment in the Exponent-case.
One of the questions submitted in C-652/22 is whether art. 76 of Directive 2014/25/EU, in conjunction with Article 36 of the Directive, permits the contracting entity to take into account documents that the tenderer provided for the first time after the time for the submissions of tenders, where those documents were not included in the original tender and demonstrate circumstances that the tenderer did not indicate in the original tender.
The question is relevant, as the same provisions apply to Directive 2014/24/EU. However, we are still waiting for the decision regarding C-652/22.