Judgment of 12th January of 2024, of the NCAC (case 00218/23.8BEPRT), Portugal
Article(s) in Directive 2014/24/EU: Art. 22 and 56(3)
Topic: open procedure; exclusion of offer; formality; irregularity; principle of competition
Member State: PT
Court/rev. board: North Central Administrative Court (NCAC)
1. IMPLEMENTATION / RELEVANT NATIONAL LEGISLATION
Articles 50, 57, 70 (2), paragraph a), 72 (3), 97, and 146 (2), paragraph d), of the Portuguese Public Contracts Code (PCC).
2. FACTS
In an open procedure, one of the excluded bidders challenged the award decision, and his own exclusion, claiming that his offer should have been admitted and subsequently awarded.
The contracting authority had decided to exclude this bidder’s offer, since the prices presented in it were not in accordance with the final amended version of the tender documents (namely the “bill of quantities”, that is, the indication of the quantities of each material or work to be delivered/performed under the contract) made available on the electronic platform in which the tender took place. In fact, there had been a first version of the tender documents, but during the period for presentation of offers, the tender documents were amended (which is allowed by Portuguese law, provided there is an extension of the deadline). On this matter, article 50(8) of the PCC states that “clarifications, corrections and lists identifying mistakes and omissions detected by the economic operators must be made available on the electronic platform used by the contracting authority together with the parts of the procedure that are open for consultation, and all interested parties who have obtained the tender documents must be immediately notified of this fact”.
The bidder drafted his offer according to the first version of the documents, and not the second – and final – version.
The excluded bidder claimed that the contracting authority only submitted the new “bill of quantities” through a pdf. file – not including therefore, the editable excel file –, and that the bidders weren’t informed of this new amended version. All in all, the bidder claimed that the discrepancies between his offer and the second version of the bill of quantities included in the tender documents was not an essential element of the offer, meaning, according to him, that correction was possible.
3. JUDGMENT
The Court’s understanding was that the excluded bidder made clear he didn’t update his offer in accordance with the new conditions, therefore the decision was that the offer didn’t comply with the subject-matter and terms of the future contract, which could only lead to the exclusion of the offer.
In addition, the NCAC considered that such divergence between the offer and the tender documents could not be the object of clarifications or corrections, since the part of the offer affected by this situation regarded essential elements of the offer, which may not be subject to correction. Adding that the price was the award criteria and therefore the price on each offer was an essential element of the offer, the Court took the view that article 72(3) of the PCC could not be applied to the case. Considering this, the decision confirmed the first instance decision.
Article 72(3) of the PCC, which plays the role of article 56(3) of the 2014/24 Directive, is a provision that allows for the correction or supplementing of irregular tenders. When a formal irregularity of the tender can be corrected without damaging the principles – namely equal treatment and competition – the provision states that it should be corrected (the contracting authority has the mandatory duty to ask for the correction, if it is possible). However, not all irregularities can be corrected: only formal ones, which do not pertain to the contents. The NCAC stated, very clearly, that the principle of competition, one of the consequences of which is to reduce the exclusion situations to a minimum, only allows for correction in cases of non-essential formal irregularities. Given that the price was the award criteria, the correct indication of the quantities of each material or work to be performed under the contract was understood, by the NCAC, when missing, as a substantial irregularity.
The case brings to light the concept of “essential elements” of an offer, and the distinction between “formal” and “substantial” irregularities. Portuguese law does not define these concepts, and their determination and application to a certain case is frequently controversial. This case, as we saw, took the view that the situation in question amounted to a substantial irregularity, concerning an essential element (price).
Incidentally, it should be remarked that the contracting authority ended up cancelling the procedure, because it considered that none of the tenders was in conditions to comply with the rules of the procedure.
Link to the original decision: https://www.dgsi.pt/jtcn.nsf/89d1c0288c2dd49c802575c8003279c7/43e08dd8bbfd43d380258aa8003b07b9?OpenDocument
