Ask the contracting authority to justify your price — and they discover where your offer doesn't match the specifications
ENERGYS, ranked first with the lowest offer for the HVAC of the Iris-Sud hospital, is declared irregular for abnormally low prices — and the Council of State refuses to suspend because its own price justification revealed it had not bid on all technical specifications.
What happened?
On 17 January 2016 the Hôpitaux Iris-Sud (HIS) publish a contract notice for a new medico-technical building on the Etterbeek-Ixelles site. Lot 3 — HVAC equipment and installations — is awarded by open adjudication. The specifications are extensive: 8 pages of general clauses, 63 pages of technical description, 147 pages of technical prescriptions, 24 pages of annexes and a 77-page price schedule. Eight offers are submitted. At opening, ENERGYS is ranked first — lowest price. Its deviation from the average is 10.82% below — under the 15% threshold of Article 99 of the Royal Decree of 15 July 2011 which triggers a presumption of abnormal price on the total amount. On 7 April 2016 HIS asks ENERGYS to justify the unit prices and subtotals of item 13 (electrical equipment), item 17 (insulation) and item 21 (miscellaneous works). HIS's criterion: a deviation greater than 15% per item compared to the average for that item among the other bidders. ENERGYS replies on 14 April 2016 with its price justification. On 27 May 2016 the HIS board of directors decides to award lot 3 to NV CLOSE for 3,915,873.38 EUR ex VAT (4,738,206.79 EUR incl. VAT) and to declare ENERGYS's offer null and void for abnormally low prices. The analysis report identifies six specific items where 'the abnormally low character results from material non-compliance with the specifications and/or calculation errors': no single supplier for electrical equipment, missing UPS for regulation and fire panel, incomplete lead shielding of pipes crossing operating rooms, insufficient insulation thickness on heating pipes outside the protected volume, valve diameters too small (DN15) for the valve insulation, and — most revealing — for item 21.13 (all contractor obligations) a mention of 227 needed drafting hours of which only 120 were budgeted. On 1 July 2016 ENERGYS files an extreme urgency suspension. It raises three grounds, the third split into six branches. The Council rejects the request. First, it dismisses the motivation ground: HIS explicitly referred to the analysis report, and ENERGYS's own third ground — which criticises the motivation item by item — proves it understood the motivation perfectly. Second: the fact that Article 99 of the Royal Decree of 15 July 2011 creates a presumption only on the total amount (>15% deviation with at least four bidders) does not preclude a contracting authority from examining a unit price that appears abnormal on the basis of Article 21. On the third ground the Council reaches the substantive core. It examines three of the six branches and holds these alone sufficient to support the rejection: • Second branch (operating room shielding): the specifications required shielding 'of equipment crossing the operating rooms', which meant shielding over the full length. ENERGYS tried to justify by reference to the NCRP 147 standard and argued that shielding the passages was sufficient — but that implicitly admitted non-compliance with the specification. • Fifth branch (DN15 valve diameters): HIS reproached ENERGYS for using DN15 diameters that were insufficient compared to those prescribed in the specifications. ENERGYS responded with a count of pieces — but that is a different reproach than diameter size. • Sixth branch (227 vs. 120 drafting hours): ENERGYS itself listed 227 needed drafting hours under lump-sum item 21.13, but only 120 hours in the price. Its later explanation — 107 hours allegedly spread across other lump-sum items — did not convince the Council. When asked to justify the total price for 'all contractor obligations', you cannot suddenly relocate half the volume to other items. These three branches alone justify the rejection. The Council does not even examine whether the first, third and fourth branches (where ENERGYS appeared to have strong arguments around 'supplier' versus 'manufacturer', misreading of the price schedule, and correct distribution of insulation across multiple items) are serious — ENERGYS has no remaining interest in them. The suspension is rejected. ENERGYS pays 700 euros in procedural compensation to HIS plus 200 euros in other costs. Several documents in the administrative file remain provisionally confidential.
Why does this matter?
A price justification is not a formality. It is a piece of evidence the contracting authority may use to scrutinise your offer — not only for price coherence, but also for technical compliance. If your justification reveals deviations from the specifications (shielding, diameters, scattered lump-sum items), the contracting authority can declare your offer irregular for abnormal prices stemming from non-compliance. It is in effect a reverse trap: you are invited to defend your price and end up providing the evidence of your own irregularity. Furthermore: the 15% threshold of Article 99 of the Royal Decree of 15 July 2011 applies only to the total amount of the offer. Contracting authorities can examine unit prices that deviate strongly per item from the average — under Article 21, without the threshold. Bidders who only watch the 15% total deviation underestimate that risk.
The lesson
When you receive a price justification request, treat it as a second tender submission. Re-read your own offer and the specifications, item by item for each item queried. Ask yourself two questions for each explanation: (1) does my justification show I comply with ALL the technical specifications, or do I implicitly admit I deviated from a standard? (2) does my explanation shift items or hours to other lump-sum items in a way the contracting authority cannot verify? Be careful with references to 'general standards' (such as NCRP 147 in this case) when the specifications are stricter — that reference is an admission of deviation, not of compliance.
Ask yourself
You have received a price justification request for three items with a deviation of more than 15% per item. Your overall offer is 10% below the average — no Article 99 presumption. But is your justification a price explanation (construction economics, technical solutions, favourable conditions), or does it slip into a technical justification that accidentally reveals you 'optimised' on a specification? If your explanation contains phrases like 'standard X is sufficient...' or 'we partly accounted for this under lump-sum item Y', stop and rework.
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 →