Suspension of tender annulment and Spoelepark Lokeren award — price justification rejected based on single negligible element (concrete slabs as profit item 0.37% of total price) without examining other justification elements is careless and inadequately motivated — specification clause on material recovery is not a clear ownership reservation
The Council of State suspended the City of Lokeren's decision to annul Hertsens Infra's tender for Spoelepark construction and award to De Saegher & Zoon, ruling that rejecting the price justification solely because the tenderer treated removable concrete slabs as a profit item was careless, since the item represented only 0.37% of total price, the specification clause was not a clear ownership reservation, and the authority had failed to examine any other justification elements.
What happened?
Lokeren tendered road, green area and sewer works for Spoelepark construction via open procedure with price as sole award criterion. Eight tenders were submitted. Hertsens Infra was the lowest bidder at €1,160,073.36. As the price was over 15% below average, a price justification was requested. Hertsens provided multiple justification elements including proximity, low overhead as family business, favourable annual material prices, own equipment via sister companies, and resale value of removable concrete slabs. The authority rejected the justification on one single ground: the tenderer treated the slabs as a profit item while the specification stated they remained city property. The Council ruled this was inadequate: the authority must examine a price justification in its entirety; rejection based on one element alone requires that element to be sufficiently weighty to undermine the entire justification; the profit item was negligible (€4,290 or 0.37% of total); the specification clause was not a clear ownership reservation but rather a possibility to recover; and post-hoc motivation in the respondent's brief cannot cure a formal motivation defect.
Why does this matter?
Authorities must examine price justifications in their entirety, not focus on a single element while ignoring others. Rejection based on one element alone requires it to be sufficiently weighty. A negligible profit item (0.37% of total) cannot justify rejection. Non-numerical elements can constitute valid price justification. Formal motivation in the award report is required — post-hoc reasoning is insufficient.
The lesson
Tenderers: build robust price justifications with multiple concrete elements — if one is challenged, the others should stand. If your justification is rejected based on one element while others are ignored, that is a strong ground for challenge. Authorities: examine all justification elements and discuss each in the award report. Do not reject based on a negligible element without weighing the whole justification.
Ask yourself
Does my price justification rest on multiple elements or just one? Has the authority examined all justification elements or focused on just one? Is the disputed element weighty enough to undermine the entire justification?
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 →