Court dismisses late procurement challenge

The High Court in Ireland dismissed proceedings in LOC8 Code Limited v the Department of the Environment, Climate and Communications, Capital Business Support Services Ireland Ltd (trading as EirCode) and An Post ([2023] IEHC 752).

The procurement challenge was brought by LOC8 Code Limited in respect of the award of a contract in 2013, following a tender process in 2011, to develop, implement, maintain and promote the national postcode system, Eircode.

In 2011, LOC8 Code Limited sought to have the tender process terminated on the basis that it was excluded from competing because the PQQ required bidders to have a €40 million turnover. The Court dismissed the current proceedings on the basis that they were brought very considerably out of time under the Remedies Regulations. Even if they did not fall to be struck out under the Remedies Regulations, they were out of time under Order 84 (Judicial Review) of the Rules of the Supreme Court. Claims concerning conspiracy, breach of competition law, breach of State aid rules and interference with the conclusion of contracts were vague, inadequately particularised, and derivative to the public procurement claim.

LOC8 Code Limited claimed that it only became aware in 2018 of an alleged decision in 2013 to allow the contract to be used for services other than post. The Court considered that the challenge should have been brought in 2011, but that even 2018 would have been too late.


Internal Market Emergency and Resilience Act

Political agreement has been reached on a proposal for a Regulation to be known as the Internal Market Emergency Resilience Act. It is intended to put in place a framework to enable the EU to better anticipate, prepare for and respond to the impact of future crises.

The framework will include provisions for procurement, in exceptional circumstances, of crisis-relevant goods and services. This is set out at Part V (pages 93-98) of the Council's negotiating mandate here. Procurements may be carried out by the Commission on behalf of two or more Member States, or jointly between Member States.

If the procurement is being led by the Commission, and when justified by extreme urgency or when strictly necessary to adapt to unforeseen circumstances in the evolution of the emergency, the Commission may make contract modifications or allow other Member States to join a signed contract. If the procurement is being done by Member States, they must make best efforts to consult each other and the Commission and to coordinate their actions.

Once the Regulation comes into force, Member States will have 18 months to implement the new rules. Further information is available from the Council here and the Commission here.

Net-Zero Industry Act

Political agreement has been reached on a Regulation known as the Net Zero Industry Act, intended to ensure access to a secure and sustainable supply of net-zero technologies.

The Council's negotiating mandate indicates that the Regulation will impose certain requirements in relation to procurement processes for strategic net-zero technologies (which are listed at Article 3b and which include, for example, solar, wind, energy storage, grid and other technologies). The Regulation will require contracting authorities to apply minimum requirements for environmental sustainability. They will also have to apply resilience contribution requirements (in certain circumstances) if there is a non-EU country dependence of more than 50% for a specific technology or its components.

The Regulation will also provide for streamlining of the permit-granting procedure for certain manufacturing projects. Further information is available from the Commission here and the Council here.


New Procurement Regime

Provisions of the Procurement Act 2023 listed here are in force or will come into force on 1 April 2024 (Procurement Act 2023 (Commencement No. 1 and Saving Provision) Regulations 2024). This concerns section 117, which applies to single source defence contracts.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.