Suspension of award of insurance brokerage pooling contract for Flemish government entities – statement of reasons for price investigation is mere boilerplate: estimate redacted, justification elements not concretely assessed, reasons communicated ex post via observations and intervention request
The Council of State suspended the award by the Flemish Community of an insurance brokerage pooling contract for Flemish government entities to NV A., because the first limb of the single ground was serious: the statement of reasons for the price investigation in the award report was mere boilerplate — the estimate was redacted, the three justification elements from the price justification were adopted without concrete assessment, and the redaction of essential reasons in the version communicated to the applicant violated the formal statement of reasons obligation.
What happened?
The Flemish Community tendered a service contract for 'Insurance brokerage pooling for Flemish government entities' with a four-year term, through a competitive procedure with negotiation (Article 38 §1(1)(c) of the 2016 Act). Three tenderers submitted offers. NV A.'s price was approximately 75% lower than the average of the other two. After a price investigation at the initial offer stage (Article 36 §1 Royal Decree), NV A. submitted a detailed price justification. After negotiations and final offers, the contracting authority concluded the price was not abnormal. Final scores: NV A. 94.50/100 (55/55 on price), NV B. (applicant) 56.49/100, NV A.B. 52.34/100. On 5 December 2024, the contract was awarded to NV A. The version of the award report communicated to the applicant had large sections redacted: the estimate, total prices, and substantive justification elements. The Council found the statement of reasons was mere boilerplate — it merely listed titles from the price justification without concretely explaining why these justified the abnormally low price. The redaction of the estimate, total prices and justification elements was not justified by confidentiality concerns. Additional reasons communicated after the suspension application was filed did not cure the original deficiency. The first limb was serious. Suspension was ordered.
Why does this matter?
This ruling has significant practical implications for price investigations. First, the statement of reasons for accepting a price justification cannot be mere boilerplate — the authority must concretely explain why the justification elements explain the apparently abnormal price. Second, systematic redaction of the estimate, total prices, and substantive justification elements can violate the formal statement of reasons obligation. Third, additional reasons communicated ex post via observations or intervention requests do not cure the original deficiency.
The lesson
Provide a concrete, substantive statement of reasons for the price investigation in the award report. Do not merely reproduce headings from the price justification. Assess per element whether confidential treatment is truly necessary, weighing this against the statement of reasons obligation. Where the price is approximately 75% lower than competitors, the Council expects an all the more thorough and concrete statement of reasons.
Ask yourself
As a contracting authority: have you concretely justified in the award report why the price justification is acceptable, or have you merely reproduced headings? Have you redacted the estimate and total prices? If so, is this truly necessary to protect commercial interests, or are you withholding essential reasons? As a tenderer: can you understand from the communicated version why the chosen tenderer could offer a drastically lower price?
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 →