Government offices, municipalities, local and regional councils, governmental companies and other public or quasi-public entities, are often required to engage in a public tender proceeding for the purpose of purchasing products or services.

GKDM accompanies its clients during the pre-tender stage as well as after the choosing of the winner, including in regards to examining the validity of bids, fulfilling pre-qualifications and in regards to legal aspects of the contracts which form a part of the public tender. When required, GKDM assists in the drafting of bids for the tender in collaboration with business professionals who specialize in the analysis of financial feasibility of participation in the tender.

GKDM litigates Administrative Appeals in Administrative Courts in cases in which clients seek to challenge the tenders’ committee’s decision, to annul a win, or to protect a win from cancellation.

What are the principles of a public tender?

The objective of the public tender process is to ensure protection of public monies and public resources, to make certain that their distribution is executed in an egalitarian manner while safeguarding the integrity of the process without bias and without corruption. Similarly, the tender is intended to make sure that the procuring authority enters into an optimal transaction from a financial standpoint.

The principle of equality and integrity has a central position in conducting the public tender. These are aimed to give a fair and equal chance to every person to compete in order to win the tender.

The complexity of public tender proceedings at times permits bidders to “trick” and mislead or confuse the tenders’ committee which is responsible for choosing the winning bid. In other cases the tenders’ committee may be negligent in its role. It may even be that tenders are “tailored” to fit specific bidders.

Therefore, declaring a bid as the winner is not necessarily the “end of the game”. It is necessary to examine whether the tenders’ committee lawfully reached its decision. Amongst other things it is necessary to examine whether the bid which was chosen fulfills the requirements of the pre-qualifications which were determined in advance (or whether the requirements were changed retroactively), whether valid bank guarantees were provided, whether the members of the tender’s committee are not biased by a conflict of interests, whether the bid which was chosen is a valid bid or manipulative (for example – “zero pricing” certain items and “overpricing” others, or different pricing for the same exact items), whether the bid which was chosen is not a losing bid (that is to say, such that the execution of the works will be done at no profit or at a loss), and other considerations.

If it is revealed that a winning bid or the bidding process are improper or countermand the requirements of the law then it is possible to petition the Administrative Court and to seek the annulment of the tender or the annulment of the win and the declaration of a different winner.

However, it is necessary to keep in mind that the court does not substitute its judgment for the committee’s professional judgment. Therefore it is important to make certain that the administrative petition is based on facts, is drafted in a professional legal manner, and indicates substantive defects which go to the heart of the matter and which justify judicial interference.

If you have any questions regarding Tenders, please contact us.

The above is an overview and does not constitute a legal advice. Professional legal advice requires individual examination of the specific circumstances.

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