Procurement law: Three key points to remember going into 2022

As we enter a new year, many involved in public procurement are looking forward to significant changes which are in the pipeline.

The Cabinet Office issued its response to the Green Paper on Transforming Public Procurement in December – read our initial comments on that here, with more to come shortly.

However, there were also a number of major developments over the past year which you should bear in mind when planning your approach to procurement over the next 12 months.

Here are the headlines as we see them:

1 - Introducing Find a Tender

Technically, this change happened one hour before the start of 2021 as the Brexit transition period ended at 23:00 on 31 December 2020. Bidders and contracting authorities alike were familiar with the Official Journal of the European Union’s Tenders Electronic Daily (OJEU/TED), and then moved to the UK Government’s Find a Tender Service (FTS).

FTS is now the online portal for all high value notices in the UK. As part of the procurement regime’s transparency requirements, all contracts over the relevant threshold must be advertised there within relevant time limits. Adverts must include enough detail to ensure a fair competition. In Scotland, the requirement to use Public Contracts Scotland has remained in place in parallel.

2 - Trade and Cooperation Agreement

The TCA between the EU and the UK was signed on 30 December 2020, applied provisionally as of 1 January 2021 and came into force on 1 May 2021. Many of the requirements for procurement are the same as were in place under EU law. Notably, however, health care services and defence are excluded from the TCA.

One new requirement brought in by the TCA was for EU-owned suppliers based in the UK to be treated no less favourably than UK-owned suppliers based in the UK. This is not equivalent to the previous open market between the EU and the UK, but does still provide some protection for EU-owned bidders.

The TCA also protects the ability for contracting authorities to take into account environmental, labour and social considerations when selecting a bidder. This is perhaps a sign of things to come, and fits with ongoing interest from the UK government in “social value” in public procurement. This is less of a new concept in Scotland where we have had the “sustainable procurement duty” since 2014.

3 - Four interesting procurement cases

R (Good Law Project Ltd) v Secretary of State for Health and Social Care [2021] EWHC 346 (Admin)

Although not the biggest story involving the former health secretary this year, this case grabbed an unusual number of headlines for public procurement. The challenge concerned the failure to publish contract award notices relating to the procurement of goods and services for responding to COVID. What was legally interesting about the case was the question of standing. The claimants were a not-for-profit campaigning company and three MPs – not unsuccessful bidders or incumbent contractors as we’re used to seeing. The court held that all of the claimants in this case could have had standing, but that the MPs did not in this case as there was a better-placed challenger available (the Good Law Project).

R (Good Law Project Ltd) v Minister for the Cabinet Office [2021] EWHC 1569 (TCC)

Similar to the case above, this was a challenge brought by the Good Law Project against a Government Minister. It also involved procurement of services relating to COVID and addressed the question of the standing of the claimant. The Cabinet Office contracted a company to provide focus group services relating to the pandemic without any advertised tender process. Standing was based on the Good Law Project’s sincere interest in promoting good public administration, the lack of any better placed challengers (as no other economic operators had had the opportunity to bid for the contract), and the public interest in the claim being heard given the gravity of the issues raised.

Bechtel Limited v High Speed Two (HS2) Limited [2021] EHWC 458 (TCC)

This was a claim brought by an unsuccessful bidder for a contract to be the “construction partner” for a new railway station in West London, part of the ongoing HS2 project. The claimant – alleged breach of the duties of equal treatment, transparency, non-discrimination and proportionality in the conduct of the procurement competition. Although Bechtel pointed to various alleged issues with the process, the court would only interfere with the evaluation if there had been a “manifest error” – a high threshold, equivalent to irrationality in public law generally. Contracting authorities will take some comfort from this judgment as it shows a willingness to give a certain margin of discretion to evaluators.

Aquila Heywood Ltd v Local Pensions Partnership Administration Ltd [2021] EWHC 114 (TCC)

This case concerned the automatic suspension of a contracting authority’s right to enter into a contract where the decision has been challenged. The defendant pensions administrator’s award of an IT contract was challenged – they conceded that there were errors in the evaluation process and re-evaluated the tenders. A second contract award was made in favour of the same bidder as the first. A dispute arose over costs relating to the challenge and the lifting of the suspension. The headline, though, was that the suspension had never applied to the second award, even though it was a re-evaluation of a challenged award with the same outcome. This would suggest that contracting authorities need not apply for an automatic suspension to be lifted if they re-evaluate bids for a contract – unless, of course, the subsequent award is challenged separately.

Looking ahead

Although 2023 is set to be the year that the UK Government’s new procurement regime comes into force, 2022 will be a significant year in determining what that will look like. Interested parties will want to keep track of what’s happening – and every procurement and tender can bring its own fresh challenges!

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