The Cabinet Office has published a consultation document seeking views on options for amending the statutory time limit for bringing proceedings for breach of the public procurement rules. The European Court of Justice (ECJ) recently held, in the Uniplex case, that the current limitation rules in the UK public procurement Regulations do not comply with EU law.
The current rules
Under the current rules proceedings to challenge a decision by a contracting authority for alleged breach of the public procurement rules should be brought "promptly and in any event within three months from the date when grounds for the bringing of the proceedings first arose, unless the Court considers that there is good reason for extending the period". A recent amendment to the definition of "promptly", following the implementation of the new EU Remedies Directive (Directive 2007/66), ensures that proceedings never need to be brought before the expiry of the 10/15 day standstill period.
The Uniplex judgment
In the Uniplex judgment of 28 January 2010, the ECJ held that:
- time should not start to run until the date on which the claimant knew, or ought to have known, of the alleged breach of the procurement rules; and
- the requirement to bring proceedings promptly, which leaves the court with the discretion to dismiss an application even where the three month time limit has not yet expired, is inconsistent with EU law as it is not precise and makes the limitation rules uncertain.
Accordingly, the Cabinet Office is now consulting on two changes
that need to be made to the UK public procurement rules to ensure
compliance with EU law:
- the time limit must run from when the claimant knew or ought to have known of the infringement; and
- the uncertain nature of the requirement to act "promptly" must be removed.
For more details on the Uniplex case see our previous
law-now.
Options for consultation
The Cabinet Office is now seeking views on three
options.
Option 1: shortening the time period to 10/15 days from
the date of knowledge of the infringement. This
would comply with the provisions of Directive 2007/66 but would
give the court no discretion to extend the time limit. Whilst
the time limit is short, it is the same as the conventional
standstill period for bringing a challenge for pre-contractual
remedies (rather than damages). From the claimant's
perspective this is a short time period within which to mobilise
resources. But the option does provide legal certainty for
contracting authorities by applying a universal period for bringing
all proceedings (other than claims for
ineffectiveness).
Option 2: a longer period of possibly 30 days from date of
knowledge is fixed. Again, this would provide no
discretion to the court, thus increasing certainty at the expense
of flexibility, but also providing a significantly longer time
period for bringing a claim. A 30 day time limit would bring
this into line with the time limit applicable for ineffectiveness
claims where the conclusion of the contract has been advertised or
notified to the claimant.
For both Options 1 and 2, the Cabinet Office is seeking views on
how "date of knowledge" should be defined.
Option 3: a 10/15 day period running from date of
knowledge, but with discretion to extend to either a period shorter
than three months or to three months. This option
would give the court greater flexibility than that afforded by
Option 1 where the circumstances make this appropriate. The
Cabinet Office notes that adding the discretionary element would
reduce certainty for contracting authorities but would mitigate the
limitations of having a fixed short time limit for bringing a
claim.
The Cabinet Office seeks views by 19 January 2011
and will publish a summary of the results in due course, and lay
the relevant amending regulations before Parliament. It also
states that it will issue guidance on the rule change.
A link to the consultation document can be found here.
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.
The original publication date for this article was 26/11/2010.