Cheapest offer, yet only third: Getronics gets no second chance at ETNIC’s IT maintenance, because a bidder who knows the formula in the specifications needs nothing more than the scores
Getronics Belgium submitted the cheapest offer for the installation and maintenance of ETNIC’s IT equipment, but finished third with 79.32% behind Prodata Systems (82.99%) and challenged the award because it was not shown its competitors’ prices or the calculation, yet the Council of State dismisses the action: the specifications announced a ‘rule of three’ with the best offer as the benchmark, so stating the scores was enough, those scores proved correctly calculated, and Getronics did not prove that Prodata, as incumbent, could start sooner.
What happened?
ETNIC, the IT public enterprise of the French Community, issued specifications no. 0047-2008 on 15 January 2009 for a multi-year services contract with call-offs: installation of servers, network equipment, PC accessories and IP telephony at various sites (item 1) and IT and telecom interventions (item 2), by open call for tenders with Belgian and European publication. Article 21 of the specifications set five award criteria: costs (70%), flexibility and working method (20%), the period within which the bidder would start the services under item 1 (5%), and the length of the guarantee for item 1 (3%) and item 2 (2%). For the numerical answers — prices, durations and periods — ETNIC would apply a ‘règle de trois’, with the best offer for a criterion receiving the maximum. On 9 March 2009 five companies submitted offers: Amster, Damovo Belgium, Getronics Belgium, Prodata Systems and Systemat. On 28 July 2009 Getronics was told that its offer had been excluded for a substantial irregularity and that the contract was going to Amster. Three days later ETNIC suspended that award on account of ‘material errors’, on 5 August it withdrew it, and it re-analysed all the offers. On 18 August 2009 ETNIC approved a new analysis note, adopted its reasons as its own and awarded the contract to Prodata Systems. Getronics was now included in the comparison and, with the lowest price, received the full 70 points. But for flexibility and method it scored 8.15 against 11.23 for Amster and 7.77 for Prodata, for the start period 0.50 against 5.00 for Prodata, and for the guarantees 0.27 and 0.40 against 3.00 and 2.00 for Prodata. Final ranking: Prodata 82.99, Amster 81.70, Getronics 79.32 and Systemat 66.70. On 25 August 2009 Getronics received a non-confidential version of the decision, with the scores but without the others’ prices. An application to the president of the court of first instance to have the award disapplied was rejected on 9 November 2009. On 23 October 2009 Getronics sought annulment before the Council of State. It argued that the decision did not show how the price scores and the start-period scores had been calculated, that the basis of comparison for the rule of three had nowhere been defined, and that for the period ETNIC had in reality divided the points by the number of days proposed. In the alternative, the period criterion allegedly favoured Prodata, which according to Getronics already provided the services to ETNIC and could therefore propose a period of zero days. ETNIC explained that it multiplied the lowest price by the maximum number of points and divided by the price of the offer being scored; for the period it did the same with the lowest number of days, ‘brought up to at least one day’ because one cannot multiply by zero. It kept the competitors’ prices secret as business secrets. The Sixth Chamber, presided over by Odile Daurmont, held the plea admissible. ETNIC had adopted the analysis note, with the confidential data, in full as its statement of reasons, and had not excluded those data from the statement of reasons under article 4 of the Formal Reasons Act, as it could have done. The plea also concerned the decision itself, not only the version communicated. And Getronics retained an interest in its criticism of the price criterion, even though it had itself scored the maximum: it wanted to check that its competitors had not received too many points. On the merits the plea failed. The specifications stated that the best offer received the maximum; it followed that this offer was the basis of comparison. Getronics therefore knew the method, and merely stating the scores was enough to understand the assessment. Having examined the file, the Council also found that the rule of three had been correctly applied. As for the alleged favouring of Prodata, Getronics produced no convincing evidence that having previously provided such services makes it possible to start them sooner. The Council dismissed the action and ordered Getronics to pay the costs of 175 euros.
Why does this matter?
The judgment shows how far the duty to state reasons extends for purely arithmetical criteria. If the calculation method is set out in the specifications — here a rule of three with the best offer as the benchmark — the award decision need not spell out every calculation: the scores suffice, because the bidder can reconstruct the rest. An authority that does not put the method in the specifications does run that risk. The judgment is also instructive on confidentiality. ETNIC wanted to keep its competitors’ prices secret, but had included them in full in the reasons for its decision through the analysis note. The Council says that an authority can keep such data out of the formal statement of reasons if mentioning them would infringe the bidders’ privacy, but an authority that does not do so cannot argue that the version communicated could be incomplete. The judgment further confirms that a bidder that itself obtains the maximum score on a criterion still has an interest in contesting its competitors’ scores on that criterion. Finally, the case shows that the complaint ‘this criterion favours the incumbent’ must be substantiated concretely: a start period of zero days is not in itself proof of a discriminatory criterion.
The lesson
For contracting authorities: set out the formula for numerical criteria expressly in the specifications — which offer is the benchmark, how the others are recalculated, and what happens with an answer of zero (here zero days was brought up to one day, something better announced in advance). The scores will then suffice in the statement of reasons. If you do not want to disclose prices or other business secrets, keep them out of the formal statement of reasons deliberately and with reasons, rather than adopting an analysis note in full and afterwards supplying a stripped-down version. And think carefully about criteria such as a start period: an incumbent can easily enter a zero. For bidders: a low price only wins if the other criteria go your way — Getronics was the cheapest but lost on flexibility, start period and guarantee. Read the evaluation method in the specifications thoroughly and check the scores yourself. If you consider a criterion discriminatory, it is best to raise it before submission, and in any event you must be able to substantiate it concretely.
Ask yourself
Do your specifications state which offer is the benchmark for the rule of three and how the other offers are recalculated? Have you determined in advance what happens with a numerical answer of zero, for example a start period of zero days? Do you keep business secrets out of the formal statement of reasons deliberately and with reasons, or do you adopt an analysis note in full and later communicate a stripped-down version? Could a criterion such as the start period give the incumbent an advantage, and is that justified by the subject matter of the contract? As a bidder, have you recalculated your competitors’ scores yourself using the method in the specifications? Can you support an alleged favouring of the incumbent with concrete evidence?
About this database
The Council of State (Raad van State / Conseil d'État) is Belgium's supreme administrative court. In disputes over public procurement — from contract awards to tenderer exclusions — the Council of State is the final arbiter. The rulings in this database are summarised by TenderWolf in plain language, with practical lessons for tenderers and contracting authorities. View all rulings →