Defence may exclude a company based on classified intelligence — without revealing what it is
The Council of State rejects the claim of a defence company excluded from a DEFRA research consortium based on classified military intelligence about the integrity of its sole shareholder — even though that information cannot be disclosed.
What happened?
A company submits a bid as part of a consortium for a DEFRA 2025 research call — Belgium's defence research programme. After the evaluation, the Director-General of the Royal Higher Institute for Defence informs the company that it cannot be retained as a partner. The reason: the Belgian military intelligence service (ADIV) obtained additional information about the company's sole shareholder after granting a NATO SECRET security clearance in May 2024. This information points to an 'integrity problem' that could cause reputational damage to Defence. The content is classified under the law of 11 December 1998 and cannot be disclosed — not even to the company itself. The company files an administrative appeal. The Director-General reconsiders but confirms his decision. The Council of State rejects all three grounds: (1) the formal motivation obligation must be reconciled with the statutory classification of intelligence — a brief motivation suffices when the authority indicates in general terms what considerations led to the decision; (2) the exclusion grounds from the Public Procurement Act do not serve as a binding 'reference framework' for DEFRA calls; (3) the mere fact that less drastic measures were conceivable concerns the appropriateness of the choice, not its legality.
Why does this matter?
This ruling addresses a fundamental tension in defence procurement: the company's right to know why it was excluded versus the need to protect classified intelligence. The Council of State accepts that a brief motivation may suffice when the underlying information is legally classified — an exception not found in regular public procurement. Anyone active in defence contracts or EU-funded security research should know that the rules here are fundamentally different.
The lesson
If you work on defence projects: today's security clearance does not protect you against tomorrow's exclusion. New intelligence about shareholders, directors or associated persons can surface at any time — and you will not see the content. Ensure your shareholder and governance structure is beyond reproach, because you cannot defend against what you cannot see.
Ask yourself
Working on a defence contract or security project? Has your shareholder structure changed recently, or have questions arisen about the integrity of anyone involved? Know that a previously granted security clearance offers no lasting guarantee.
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 →