Case T-392/15

European Dynamics Luxembourg SA and Others

v

European Union Agency for Railways

(Public service contracts — Tendering procedure — External Service Provision for development, studies and support for information systems for the European Union Agency for Railways — Ranking of a tenderer’s bid — Rejection of the tenderer’s bid — Duty to state reasons — Abnormally low tender)

Summary – Judgment of the General Court (Third Chamber), 4 July 2017

European Union public contracts — Conclusion of a contract following a call for tenders — Abnormally low offer — Obligation of the contracting authority to hear from the tenderer — Examination by the awarding authority of the abnormally low character of the tender — Elements to be taken into consideration

Acts of the institutions — Statement of reasons — Obligation — Scope — Assessment of the duty to state reasons by reference to the circumstances of the case — Obligation to communicate, following a written request, the characteristics and relative advantages of the tender accepted and the name of the tenderer

Judicial proceedings — Treatment of cases before the General Court — Protection given to parties against misuse of pleadings and other procedural documents — Reconciliation with the unfettered adduction of evidence — Use of a procedural document from another case — Requirement for the party producing the evidence to obtain the prior agreement of the party having lodged it in the other case — None

Actions for annulment — Interest in bringing proceedings — Interest to be assessed at the time at which an action is brought — An unsuccessful tenderer’s action directed against the contracting authority to reject its tender — Reference to a failure to state reasons — Provision of the grounds for the decision after the action was lodged but before the expiry of the time limit for bringing an action — Interest in bringing proceedings retained

The interest in bringing proceedings is an essential and fundamental prerequisite for any legal proceedings. It must, in the light of the purpose of the action, exist at the stage of lodging the action, failing which it will be inadmissible. Such an interest must continue until the final decision, failing which there will be no need to adjudicate. As regards an unsuccessful tenderer’s action directed against the decision of the contracting authority which it takes the view is vitiated by a failure to state reasons, the fact that the contracting authority has provided, after the action has been brought but before the expiry of the period for bringing proceedings, clarifications as to the grounds for the contested decision does not deprive the action of its practical effect. The contested decision adversely affected it at the time the action was brought. The annulment of that decision would result in the contracting authority having to re-evaluate the applicants’ tender, which is likely to procure them an advantage, since it is conceivable that upon completion of a re-evaluation, the Lot covered by that tender might be awarded to the applicants. Furthermore, the annulment of that decision might lead the contracting authority to make appropriate amendments to the appeal procedures for tenders in the future. (see paras 31, 34, 36, 37)

For a party to have an interest in bringing proceedings it is, necessary, but sufficient, that, by its outcome, the action for annulment brought before the EU Courts would be capable of benefiting the party which brought it. Therefore, applicants’ interest in bringing proceedings does not depend on the merits of their complaints. (see para 41)

See the text of the decision. (see para 45)

The principle of the unfettered evaluation of evidence means for the EU Court that the sole relevant criterion for the purpose of assessing the evidence adduced is its credibility. The principle of the unfettered adduction of evidence is the corollary to the principle of the unfettered evaluation of evidence, which confers on the parties the possibility to produce before the Court of the European Union any evidence lawfully obtained that they consider relevant to support their arguments. That unfettered adduction of evidence contributes to guaranteeing the parties’ right to an effective remedy enshrined in Article 47 of the Charter of Fundamental Rights of the European Union. The principles of unfettered evaluation and unfettered adduction of evidence must, however, be reconciled with the fundamental principles of EU law, such as the right to a fair trial and the equality of arms. Thus, the unfettered evaluation of evidence must be reconciled with the right of each party to defend its interests irrespective of any outside influences, in particular the public, and to be protected from the inappropriate use of its evidence. (see paras 50-53)

It follows from the principle of unfettered adduction of evidence that a party before the General Court is, in principle, entitled to rely on as evidence documents adduced in other legal proceedings in which it was itself a party. If that party had lawful access to that evidence and it is not confidential, the proper administration of justice does not, in principle, preclude its production before the General Court. Thus, a party to proceedings before the EU Courts is not to request the withdrawal of a procedural document if that document had already been produced by that party in other proceedings between the same parties. Furthermore, the agreement of the party from which the evidence emanates cannot be a precondition for the admissibility of evidence from another case before the General Court. Although the agreement of the party from which the evidence emanates can be a relevant factor in order to determine whether it is appropriate to use it, to require that that agreement is obtained as a precondition to its production before the General Court on pain of inadmissibility gives the party from which it emanates the power to exclude it depriving the General Court of the opportunity to rule on whether it is appropriate to use it and, therefore, to fulfil its obligation to offer each party a reasonable opportunity to present his case, including his evidence, under conditions that do not place him at a substantial disadvantage vis-à-vis his opponent, which is the basis of the principle of equality of arms. Therefore, it is for the General Court, in each case, to weigh the freedom to adduce evidence, on one hand, and, on the other, the protection against the inappropriate use of evidence of the parties to legal proceedings. (see paras 55, 56)

See the text of the decision. (see paras 72-75)

Only exceptional circumstances may justify the EU Courts taking into consideration evidence adduced in the course of the proceedings. The same is true as regards an action brought by an unsuccessful tender against the decision of the contracting authority to reject its tender, since it is without waiting for the contracting authority’s answer to its specific request for a statement of reasons regarding the abnormally low character of the prices of the successful tenderers or allowing it a sufficient period of time to do so, even though the time limits for bringing proceedings did not preclude such a possibility, that the unsuccessful tenderer brought its action relying exclusively on a failure to state reasons for the contested decision, in particular, due to of the absence of a response to its request. The contracting authority, for its part, provided explanations as to the reasons for which the successful tenders did not appear to it to be abnormally low, at the end of a reasonable period. (see paras 74, 102)

Therefore, with regard to unsuccessful tenderers, Article 113(2) of Regulation No 966/2012 on the financial rules applicable to the general budget of the Union and Article 161(2) of Regulation No 1268/2012 on the rules of application of the Financial Regulation provide for reasoning in two stages. The contracting authority must first inform all unsuccessful tenderers that their tender has been rejected and the grounds for that rejection. Those reasons may be brief, given the opportunity provided for by that provision for the unsuccessful tenderer to request more detailed reasoning. Next, under the same provisions, if an unsuccessful tenderer which satisfies all the criteria for exclusion and selection makes a request in writing, the contracting authority is to communicate as soon as possible, and within 15 days at the latest from receiving the request, the characteristics and relative merits of the tender accepted and the name of the tenderer. That disclosure of reasons in two stages is not inconsistent with the purpose of the duty to state reasons, which, on the one hand, consists in making the persons concerned aware of the reasons for the measure and, thereby, enabling them to defend their rights and, on the other, enabling the Court to exercise its power of review. (see paras 78, 79)

See the text of the decision. (see paras 80, 106)

The assessment by the contracting authority of the existence of abnormally low tenders is made in two stages. In the first stage, the contracting authority must determine whether the tenders submitted appear to be abnormally low. The use of the verb ‘appear’ in Article 151(1) of Regulation No 1268/2012 on the rules of application of the Financial Regulation requires the contracting authority to carry out a prima facie assessment of the abnormally low character of the tender. Therefore, that Regulation does not require the contracting authority to carry out, on its own initiative, a detailed analysis of the composition of each tender in order to establish that it is not an abnormally low tender. Thus, in the first stage, the contracting authority need only determine whether the tenders submitted contain evidence likely to arouse suspicion that they might be abnormally low. That is the case in particular, where the price proposed in a tender submitted is considerably less than that of the other tenders submitted or the normal market price. If the tenders submitted do not contain such evidence and therefore, do not appear to be abnormally low, the contracting authority may continue the evaluation of that tender and the award procedure for the contract. However, if there is evidence which arouses a suspicion that a tender may be abnormally low, the contracting authority must, in the second stage, check the composition of the tender in order to ensure that it is not abnormally low. Where it carries out that check, the contracting authority must give the tenderer which submitted that bid the opportunity to set out the reasons why it considers its tender is not abnormally low. The contracting authority must then assess the explanations provided and determine whether the tender concerned is abnormally low, in which case it must be rejected. (see paras 87-89)

As to the scope of the contracting authority’s duty to state reasons when it considers that the tender accepted does not appear to be abnormally low, it is clear from Article 151(1) of Regulation No 1268/2012 on the rules of application of the Financial Regulation and, in particular, the fact that the contracting authority need, in the first stage, only carry out a prima facie assessment of the abnormally low character of a tender, that its duty to state reasons is limited in scope. To require the contracting authority to set out in detail why a tender does not appear to be abnormally low does not take into account the distinction between the two stages of the examination provided for by Article 151 of Regulation No 1268/2012.