Press coverage of fraud at your competitor isn't enough to have them excluded — the contracting authority needs concrete proof
The Council of State rejects Alfa-Zet Systems' extreme-urgency suspension request against the award of the Fedorest cash-register contract to Euro-Tap-Control-Verkoop, because a fraud investigation reported in the press without concrete criminal-law evidence does not establish a 'serious professional misconduct' under article 61, §2, 4° of the Royal Decree on Procurement.
What happened?
On 19 October 2015 the Federal Ministry of Finance launched a procurement for the supply and installation of cash registers and POS software for the company restaurants of ADBA Fedorest. Procedure: simplified negotiated procedure with prior publication. Specifications no. Fedorest/MPO/011/2015. On 9 November 2015 the bids were opened — two bidders: Alfa-Zet Systems and Euro-Tap-Control-Verkoop. On 16 March 2016 the Ministry drew up an evaluation report and that same day decided to select both candidates and award the contract to Euro-Tap-Control-Verkoop. On 31 March 2016 Alfa-Zet brought an extreme-urgency suspension before the Council of State. Their argument was concrete: Euro-Tap-Control-Verkoop was caught up in a 'publicly disclosed fraud investigation' concerning software and VAT fraud. Both written press and television had given broad coverage to this judicial investigation. The Ministry could not have missed it — and should have excluded Euro-Tap-Control-Verkoop under article 61, §2, 4° of the Royal Decree on Procurement (serious professional misconduct) or 7° (false declarations or withheld information). By failing to do so — and without any motivation on the point — the Ministry breached the duty of care and the duty to give reasons. Euro-Tap-Control-Verkoop defended itself. They acknowledged in a 14 November 2013 letter to clients that they had 'received a visit from the judicial authorities', but argued that their clients had used their software 'in unauthorised ways' — comparable to an internet provider not being liable for a hacker's actions. They also stated explicitly that 'no one has reviewed any criminal file' — a fact Alfa-Zet did not contest. The Ministry added that it could not exclude on the basis of press coverage alone, and that no other documents on the alleged misconduct were available. The twelfth chamber (chair sitting in extreme urgency) sided with the defending party. The 'serious professional misconduct' ground requires the conduct to be assessed 'concretely and individually'. The acts Alfa-Zet attributed to Euro-Tap-Control-Verkoop were expressly disputed. No conviction, no criminal file anyone had reviewed, no concrete evidence of prosecution — although a conviction is not required to apply this ground, its absence 'contributes to the conclusion that the facts are not established'. A contracting authority cannot exclude on press coverage alone. Result: neither the 'serious professional misconduct' ground (art. 61, §2, 4°) nor the 'false declarations' one (art. 61, §2, 7°) appears established. The complaint that the Ministry 'did not adequately verify' or motivate therefore fails — if the exclusion ground itself isn't established, the authority cannot be faulted for not applying it. The single ground was held not serious. The extreme-urgency request was rejected, with court fees of €200 borne by Alfa-Zet and €150 by the intervening party.
Why does this matter?
Bid managers regularly face competitors with negative press coverage — fraud probes, VAT audits, liability claims. The temptation is to use this against a competitor in a procurement: 'the contracting authority should have excluded them'. This judgment sets the bar high. The facultative exclusion grounds (today restated in art. 69 of the 17 June 2016 Act and art. 70 of the 2017 Royal Decree, but the reasoning holds) require a concrete finding — not a pending investigation, not press coverage, not 'everyone knows'. Conversely: if you suspect a competitor of serious professional misconduct, bring hard documents to your complaint — a judgment, a definitive official report, a reasoned decision by a regulator. Otherwise your ground will be dismissed as 'not serious' without further review.
The lesson
If you object to a competitor being selected on the basis of alleged serious professional misconduct, bring concrete documents: a conviction, a definitive official report, a regulator's sanction decision. Press coverage and general notoriety are legally insufficient. A contracting authority cannot exclude on rumour alone — and if it doesn't, you cannot successfully hold it to account before the Council of State.
Ask yourself
Want to challenge a competitor on the basis of 'serious professional misconduct'? Ask yourself: do I have a final decision or a hard document establishing the fault — or only press clippings and hearsay? If the latter, your complaint in extreme urgency is unlikely to be 'serious' in the legal sense.
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 →