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The question of incumbent advantage

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By Victoria Fletcher


Published 30 October 2018


One of the key obligations in public procurement law is equal treatment. Contracting authorities often worry about how to ensure this when it knows its incumbent provider plans to bid in future opportunities and that incumbent has in-depth knowledge of the authority and its requirement.

The recent General Court judgment in Proof IT SIA v European Institute for Gender Equality (Case T-10/17), considered incumbent advantage and reiterates the general position.

Proof IT SIA ("Proof") were unsuccessful in an opportunity tendered by the European Institute for Gender Equality ("EIGE") for both website and intranet services. It brought a number of complaints:

  1. The contract award criteria were imprecise and the evaluation process lacked transparency.

  2. Manifest errors had occurred in respect of the evaluation of tenders.

  3. The contract award criteria were interpreted in such a way that the successful tenderer benefited from knowledge acquired in performing previously a similar contract with EIGE.

In respect of the third complaint, Proof asserted that the vague contract award criteria used gave the evaluation committee excessively broad discretion. This discretion allowed the panel to award more points to the successful tenderer because of knowledge that the provider had acquired during performance of a similar contract.

The evaluation report stated that the winning provider "presents a deep understanding of the objectives…that is at the same time holistic and highly specific" and "presents an understanding of the objectives in three levels: product development, IT infrastructure and use need levels". Proof queried the comment on IT infrastructure as this was not described in the tender specification nor was that information publically available. Further, the report praised the successful tenderer's proposal to split work into two categories. Proof noted that this was not a requirement laid down in the procurement documents.

The Court reiterated the general position that an incumbent provider or a subcontractor of an incumbent will inevitably have an advantage others tenderers will not. This is because they will have knowledge of the authority and/or the subject matter of the contract. Unless an incumbent is excluded from participating this will usually be the case.

Proof was unsuccessful in its challenge. There was nothing in the evaluation report which led to the Court concluding that the successful tenderer had benefited from its previous interactions with EIGE. It had been successful because its response was better. In any event the Court noted that Proof had experience of working with EIGE and had in fact presented its knowledge of EIGE's business as one of its strengths.

This case reminds contracting authorities that although they have a duty to neutralise incumbent advantage as much as possible, in order to present a level playing field, there will not automatically be unequal treatment if a tenderer has acquired an advantage through performance of a previous contract.