Staying on the rails across the border

From devolved Scottish authorities crossing the border, to recent activity at the Technology and Construction Court (TCC ), Burness Paull’s procurement team brings you its latest updates.

Cross-border procurement

The Procurement Act 2023, which celebrates its first birthday on 24 February, applies to public procurement across the UK. There is, however, an express carve out for "devolved Scottish authorities", who continue to conduct procurements in line with the Public Contracts (Scotland) Regulations 2015 and the Utilities Contracts (Scotland) Regulations 2015 (the “Scottish Regulations”).

UK suppliers bidding for contracts in England / Wales / Northern Ireland and in Scotland have been required to get to grips with the requirements of two co-existing procurement regimes. So, too, should contracting authorities that wish to avail themselves of cross-border procurement opportunities. 

The Procurement Act 2023 applies in full where a devolved Scottish authority wants to award a contract under:

• a joint procurement with a contracting authority in England, Wales or Northern Ireland;
• a procurement conducted by a UK body that is acting as a centralised procurement authority; and
• a framework (or dynamic market) that has been established by a UK body.

It is the latter scenario that most often occurs, with devolved Scottish authorities regularly looking to Crown Commercial Service frameworks (for example) as a route to market. But in so doing, devolved Scottish authorities enter into the ambit of the Procurement Act, while – until recently – simultaneously remaining subject to the requirements of the Scottish Regulations.

The Cross-Border Public Procurement (Miscellaneous Amendment) (Scotland) Regulations 2025 (the “Cross Border Regulations”) have brought much needed clarity to authorities engaging in cross-border procurement. 

In particular, they amend the Scottish Regulations to clarify that when a devolved Scottish authority awards a contract under a UK procurement (eg. a CCS framework), the Scottish Regulations are largely disapplied.

Ticket to success

In January, the TCC in London dealt with an application to lift the automatic suspension in relation to a procurement exercise run by Transport for London (TfL) in a case brought by the unsuccessful bidder (Cubic Transportation Systems Ltd v Transport for London [2026] EWHC 61 (TCC)). 

The procurement was for a seven-year contract (which could be extended by up to a further five years), with an approximate value of £800m, for revenue collection services. 

The claimant, CTSL, was the incumbent, and raised a challenge against TfL’s decision, arguing a range of serious breaches of the Public Contracts Regulations 2015.  

In seeking for the suspension to be lifted, TfL addressed each strand of the well-established American Cyanamid test:

• First, is there a serious issue to be tried? TfL accepted that there was a serious issue to be tried for the purpose of the application – it maintained that there was no merit, but recognised that case law advises not to run a “mini-trial” in these types of interim hearings.
  
  
• If so, would damages be an adequate remedy for the claimant(s) if the suspension was lifted and they then succeeded at trial? TfL successfully argued that damages were an adequate remedy for CTSL, notwithstanding the high value and prestige of the contract, so the second element of the test was not met.
  
  
• Would damages be an adequate remedy for the contracting authority if the suspension remained in place and it succeeded at trial? The court found that damages would not suffice for TfL, particularly recognising that there is a real interest in improvements being implemented by Indra, the successful bidder, which would be advantageous to passengers, who would otherwise suffer detriment which cannot be compensated in damages.
   
• Where there is doubt as to the adequacy of damages for either of the parties, which course of action is likely to carry the least risk of injustice if it transpires that it was wrong; that is, where does the balance of convenience lie? Here, the court was clear on the adequacy of damages assessment. It was, however, also mindful of the inevitable delay in the case being determined – of up to two years – even where the claimant sought an expediated trial, which was key to the balance of convenience. 

The court therefore ordered that the automatic suspension be lifted, allowing TfL to proceed with its award of the contract to the successful bidder.

Costs

TfL’s success in its application to lift the suspension was not the end of the journey – it continued along the tracks to arrive at a successful costs award. CTSL accepted the principle that it was liable for TfL’s costs for the application, but did not accept the amount claimed by TfL – £1,201,444.75 (following detailed assessment). 

TfL’s position was that CTSL should make payment to account of 60% of that sum – around £720,000, while CTSL sought to pay £300k. Having considered the significant contract value claim, and the very substantial volume of documents and evidence, the court considered that on detailed assessment, TfL would recover at least the £720k sought and ordered CSTL to make payment to account of that sum.

The interested party / successful bidder, Indra, was derailed in its application for its costs in respect of the application. The court reserved the matter of its costs, on the basis that it was not the right stage of proceedings to make that determination and, to add further complexity, found that the statement of costs submitted by Indra was not entirely related to the application to lift the suspension. 

For potential interested parties, it is reassuring to see that costs associated with its participation in an application to lift the prohibition are not rejected out of hand, but a reminder that the court will carefully apply the principles set out in Bechtel Ltd v High Speed Two (HS2) Ltd [2021] EWHC 640 (TCC) before it awards costs. 

It will be interesting to see if the litigation journey continues in this case, and if the 18 months to two years for the case to be heard is accurate.  

To get help managing procurement, from tendering to litigation, get in touch with our cross-border procurement team for tailored advice at the earliest stage.

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