Subcontracting is allowed, but how you organise it is assessed: Pidpa keeps its SCADA framework award
An unsuccessful bidder for Pidpa’s SCADA framework agreement — estimated at 5,370,112 euros — complained that the contracting entity had penalised its tender merely because it subcontracted the PLC programming, but the Council of State found that the award report did not penalise the subcontracting itself but the concrete safeguarding of knowledge and continuity within that arrangement, and dismissed the application for suspension under extreme urgency on all three pleas.
What happened?
The inter-municipal water utility Pidpa tendered a public services contract for ‘the implementation and operational support of a SCADA system’: a framework agreement with an estimated value of 5,370,112 euros, placed in the utilities sectors through a negotiated procedure with prior call for competition (article 120 of the Law of 17 June 2016). After selection, eight bidders submitted an initial tender; the three best ranked, including F. and the eventual winner, were invited to negotiate. The negotiation meeting with F. took place on 21 May 2026 and was recorded in a negotiation note of 22 May 2026. All three then submitted a BAFO. On 26 June 2026 Pidpa’s board awarded the contract to the chosen bidder. F. sought suspension under extreme urgency on 14 July 2026. Before the pleas, a procedural detail deserves recording: both parties asked for confidential treatment of a series of documents, including the negotiation note. The Council found of its own motion that F. had quoted from that document expressly and at length in its own application — and again at the hearing — disregarding its own confidentiality request. It had thereby surrendered the document’s confidentiality. The first plea was the heart of the case: F. argued that Pidpa had repeatedly assessed its tender negatively solely because it relied on a subcontractor for the PLC programmers, thereby restricting de facto its right to subcontract. The Council read the award report itself. Under the sub-sub-criterion ‘organisational structure’ (10 points) F. scored 5 for its initial tender and 5.5 after the BAFO — the chosen bidder 7 and then 8. The reasoning did not mention subcontracting as such, but the fact that the PLC activities were structurally performed by an external partner, so that ‘the controllability and continuity of an essential part of the contract’ was not fully secured within the bidder’s own organisation. Under the sub-sub-criterion ‘project team and deployment of profiles’ (9 points) F. in fact obtained the highest score of all bidders for its initial tender — 6.3 against 5.4 for the winner — which in itself undercuts the claim of systematic penalisation; after the BAFO it stayed at 6.3 while the winner rose to 7.2, because its project team continued to rely long-term on the subcontractor without demonstrable in-house knowledge build-up, and because the combined execution of SCADA and PLC activities was itself new to F. Prima facie, the Council held, that reasoning does not show that the mere use of a subcontractor was assessed negatively; the criticism concerned the concrete shape of the cooperation. With that, the rest of the plea fell away: no breach of article 150, § 1, second paragraph of the Law of 17 June 2016, nor of articles 72, § 2 and 73 of the Royal Decree of 18 June 2017, nor of the contract documents, nor of patere legem. The second plea concerned equality during the negotiations. Here the Council stated a principle of wider reach: procedural equality requires that bidders have the same information and the same opportunities to improve their tender, but it does not entail access to the shortcomings of the other tenders before submitting a BAFO — article 13, § 1, of the Law of 17 June 2016 indeed forbids that. It suffices that all bidders are invited on equal terms to submit an improved tender and are pointed to their own weak points. That the clarifications requested differed per bidder follows logically from the content of their tenders. The negotiation note expressly invited F. to submit an ‘adapted tender’, defined in the contract documents as a tender economically more attractive than the original in the light of the award criteria; F. had moreover been told that lower prices were always allowed, including for items 3 and 7 about which it had asked. Decisive, finally, was F.’s own letter of 2 July 2026 to Pidpa, stating that in its BAFO it had ‘not merely made clarifications but substantially supplemented and strengthened its tender on several points’ — hard to reconcile with the claim that it was given no chance to improve. The third plea targeted the reasoning of the regularity check, which in the contested decision consisted of one sentence: ‘None of the tenders submitted had to be rejected on grounds of a substantial or non-substantial irregularity.’ The Council accepted that standard formula: where no particular problems arise, the authority need not explain for every conceivable aspect why a tender is not irregular; the formula shows at least implicitly that a check took place and that no apparently abnormal prices were found. Whether that statement is true concerns not the formal reasoning but its accuracy — and on that F. offered only doubt and assumptions, without a single indication. None of the three pleas was serious. The Council dismissed the application and ordered F. to pay the costs: 220 euros roll fee, 26 euros contribution and 770 euros procedural indemnity to Pidpa.
Why does this matter?
This judgment draws a line that often blurs in practice. An authority may not restrict the right to work with subcontractors — that is settled by article 150 of the Law of 17 June 2016 and articles 72 and 73 of the utilities Royal Decree, and Pidpa’s own contract documents expressly provided for it in articles 6.2 and 6.3. But the way a bidder organises that cooperation is a quality factor that may be weighed under award criteria such as ‘organisational structure’ and ‘project team’. The difference lies in the question asked: not ‘do you outsource?’ but ‘where does the knowledge sit, who steps in when things go wrong, and will that still hold in five years?’ A bidder who misses that distinction builds a plea on a premise the Council dismantles at once — and loses every derived complaint with it, since each of F.’s further arguments rested on that same premise. The judgment is also useful for what it says about negotiated procedures. It is tempting to infer from differences in requested clarifications that other bidders were given more chances. The Council reverses that: a BAFO is about remedying one’s own weak points, not a second chance based on what others did wrong, and article 13, § 1, precisely forbids the authority from sharing that information. Finally, two warnings about litigation. The standard formula on the regularity check holds as long as the applicant offers no more than doubt: criticism without any supporting indication is hopeless in extreme-urgency proceedings, where the Council reviews only prima facie. And a party that asks for confidentiality and then quotes the document at length in its own application waives that confidentiality itself — the Council says so of its own motion.
The lesson
If, as a bidder, you subcontract a technical core component, describe not only that you subcontract it but how you secure the knowledge, the steering and the continuity of it: who takes over in case of absence, how do you also build that expertise in-house, and what escalation lines run back to your own organisation? Pidpa did not penalise F. for its subcontractor but for the absence of that answer. Nor should you build a plea on the premise ‘I was penalised for outsourcing’ without first testing it against the literal text of the award report — if the premise falls, everything resting on it falls too. Explain, moreover, every provision you invoke: a list of articles and principles without showing how each was breached fails under article 2, § 1, of the general rules of procedure, and the Council will not construct your complaints for you. As an authority, this judgment confirms your margin of assessment, on one condition: that your award report assesses the quality of the cooperation and not its existence. Write it that way. A positive regularity check may be briefly reasoned as long as no particular problems arose — but that brevity protects you only if a genuine check lies behind it. And for both sides: what you want kept confidential, you do not quote in your own application.
Ask yourself
Does your tender describe how the knowledge of the subcontracted component is built up and secured within your own organisation, or do you stop at noting that a partner will handle it? Have you read the criticism in the award report word for word before summarising it as ‘they are penalising my subcontracting’ — and does that reading hold? Do you explain concretely, for every provision invoked, how it was breached, or do you rely on a list? Do you realise that a BAFO is about remedying your own weak points and gives you no right to see your competitors’ shortcomings? And as an authority: does your award report assess the organisation of the cooperation, or does it slide into penalising the mere fact of subcontracting?
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 →