Selection & Award Criteria Glenn Fletcher Achilles Information Limited

1. services for professional procurement be better informed, make better decisions Selection & Award Criteria Glenn Fletcher Achilles Information Limited

2. The EU rules – room for some discretion • Regulations do not set out in detail the purchasing process • No explicit methodology for the assessment of suppliers, either at the selection or the award stage • Some scope for commercial discretion, within the provisions and principles of the EU rules • The courts have distinguished between selection criteria and award criteria...

3. Selection and award stages differ • In principle any EU/EEA/GPA must be allowed to take express interest in the contract • Outside regulated procurement the buyer would select suppliers using knowledge of the market • The aim of selectionrules under the EU rules is to ensure principles of equal treatment and non-discrimination are followed (necessitating adequate transparency): who can play? • The aim of the award rules is to determine the ‘best’ offer: who is the fastest?

4. Selection criteria principles • Selection criteria • To assess supplier capacity to perform the contract (legal status/technical/financial/ability) • Contract notice has fields for setting out required selection information • Information usually obtained in PQQ • Objective and non-discriminatory criteria for selecting bid list must be disclosed (EBS case)

5. Limitations on selection criteria • Choice of the evidence sought and selection criteria level required are for purchaser to establish but must be • Relevant • Proportionate • Non discriminatory • Allow adequate competition • Not the same as award criteria (Transporoute case and Lianakis case) • More about this later

6. Setting criteria that are relevant to the contract How many suppliers? Implications of criteria for SMEs’ access to contracts How much discretion can be applied in judging suppliers’ selection information ‘Adequate’ financial capacity? Scope for supplier challenge to criteria Use of references/past experience and supplier visits Selection issues

7. Collecting selection information • Contract notice has fields for setting out required selection information • Information usually obtained using a PQQ • Could be used to disclose selection criteria? • Less scope for this in public sector (role of approved lists and Constructionline?)

8. Compiling the shortlist • Bid-list selected using objective and non-discriminatory criteria in respect of supplier capacity & capability • Exhaustive list of information permitted under Regulations 23 - 26: • Mandatory exclusions • Legal status • Financial capacity • Technical capacity • Ability (works and services)

9. Compiling the shortlist • Treatment of health & safety (Greenwich case) • Relevance of past performance (Luck case) • Minimum bid-list numbers • 5 in Restricted Procedure • 3 in Competitive Dialogue & Negotiated Procedures

10. Selection and award under open procedure • Open procedure • Reject bids that fail criteria for exclusion • Reject bids that fail to meet any minimum levels of capacity • Evaluate all remaining tenders using award criteria

11. Selection and award under restricted procedure • Restricted procedure • Reject expressions of interest that fail criteria for exclusion • Reject expressions of interest that fail to meet any minimum levels of capacity • Shortlist for invitation to tender using objective criteria • Evaluate tenders using award criteria

12. Selection and award under negotiated and competitive dialogue procedures • Negotiated/competitive dialogue procedure • Reject expressions of interest that fail criteria for exclusion • Reject expressions of interest that fail to meet any minimum levels of capacity • Shortlist for invitation to tender using objective criteria • Evaluate tenders (and subsequent negotiations) using award criteria

13. Disclosure of selection criteria • Must disclose in the notice (or PQQ) • Minimum capacity required of supplier (if any) • (If further selection intended) the objective criteria for selection • Need not be weighted/ranked (unlike award criteria) • A minimum criterion cannot be applied if not disclosed (Aquatron) • Scoring system must be disclosed if formulated in advance (EBS)

14. Duty to disclose selection criteria • 2009 Amending Regulations require that a supplier that is not selected is notified of failure • Include reasons in letter • How much detail must be disclosed? • Link with standstill letter requirement for award stage

15. Case study 1

16. Award criteria - principles • Most economically advantageous tender or lowest price • Provided these are • Relevant to the contract (EVN) • Measurable (Concordia Bus) • Assessed professionally (SIAC) • Disclosed to suppliers before they tender (Concordia Bus) • Regulation 30 contains a non-exclusive list of examples of criteria

17. Disclosure of award criteria • Criteria for award must be disclosed in OJ notice or contract documentation • Where ‘most economically advantageous tender’ used, the criteria making up that assessment must be disclosed • Note that a criterion cannot be applied if it has not been disclosed • Relative weighting of each criterion, (or range of weighting) is the normal approach • In some cases relative importance (ranking) may be used (justifiable case, e.g. complexity)

18. Disclosure of award criteria • A major reason for challenges in the UK courts • European Court case ATI sets out the key principles • UK courts have applied these • McLaughlin and Harvey (sub-criteria) • Lettings International (marking schemes) • Mears (model answers)

19. Discussions with suppliers – post tender clarification • Where open and restricted procedures are used the scope for discussing tenders is limited • Once tender submitted, clarification permitted e.g. • Correcting errors in tenders noted by the purchaser • Must clarify the offer made, not try to improve it (Adia Interim) • Discussions on contract conditions? • Competitive dialogue procedure provides explicitly for post tender discussion • Where negotiated procedure is used then discussions can be very broad, provided that within scope and on equal treatment basis

20. Staged evaluations • Often used where presentations, site visits and interviews are required • Can we invite only some suppliers based on initial evaluation? • Specific provision for staged evaluation in competitive dialogue and negotiated procedures – have to indicate in contract notice • Not permitted in open/restricted procedures?

21. Scope for discretion in assessing bids • Courts will not re-mark the bid evaluation (J Varney) • How do you deal with a tied result?

22. Amending Criteria • Criteria disclosed may influence a supplier’s decision to express interest in the contract • Courts have concluded that a change could lead to unequal treatment where all suppliers were not asked to tender against the amended criteria (EVN) • If award criteria disclosed in contract documentation rather than notice, suppliers could be asked to re-tender? • Amending criteria after tenders received (Irish Translation Services)

23. Disclosure of results of assessments - notification and standstill • Suppliers must be notified, with reasons, if they fail to be selected for a contract tender list • When a contract award decision has been made tenderers must be informed as soon as possible (contract decision notice) • This notification commences a standstill period between award decision and conclusion of contract • Cannot conclude contract earlier than this • If electronic or fax notification used the standstill period is 10 calendar days from notification • Otherwise it is 15 days from dispatch (e.g. by post) or 10 days from receipt

24. Contract decision notice • Notification must include • The award criteria • The name of winner, winning supplier’s score and the recipient’s own score • Precise details of when the standstill period ends • The reasons for the decision, including the characteristics and relative advantages of the successful tender • Regulations also cover notification in case of abandonment

25. Contract decision notice • Derogations from standstill • No contract notice required (e.g. Part B) • Only one tenderer and no ‘concerned’ candidates or tenderers • Award under a framework or dynamic purchasing system

26. The distinction between selection and award criteria • Supplier’s capacity v supplier’s offer • Why it matters

27. Selection v Award – interpreting Lianakis • European Court found the following criteria used by the authority to award the contract were unlawful: • Proven experience of the expert on projects over last 3 years • Firm’s manpower and equipment • Firm’s ability to complete the project by the deadline, together with the firm’s commitments and professional potential • Court found these relate “principally to the experience, qualifications and means of ensuring proper performance” • to suitability to perform the contract – i.e. selection, not award issues

28. Can never refer to experience Can only look at experience of individuals involved in the project Can refer to experience as evidence of quality when considering tenders No legal consensus on ‘right’ interpretation OGC favoured the third interpretation (Action note 04/09 of 29/4/09) European Commission favours the second interpretation (2011 proposal for new directives) Possible interpretations of ‘experience’

29. Case study 2

30. Summary – selection v award • Selection • to assess supplier capacity and capability • focuses on supplier’s characteristics & suitability to perform the contract • Some limitations on use of criteria in public sector • Award • to assess which tender is most economically advantageous • Considerable discretion to set the criteria • may only use criteria linked to subject matter of contract • Relevant case law: Lianakis, Lightways

31. Achilles EU Team • Glenn Fletcher Director, EU Procurement • Gail Wilson EU Services Manager • Liz Wilson-Lamb EU Procurement Advisor and Trainer • Emily Strange EU Procurement Advisor and Trainer • Anna Bourne EU procurement Advisor and Trainer • Laura Taylor Account Manager • Holly Cooney Account Manager • Jayne Wellman Administrator • Contact Number 01235 838115 • Associates • Professor Sue Arrowsmith Legal Expert • Susie Smith Senior Consultant and Lawyer