By Paul Emanuelli

This article is an excerpt from the 2021 edition of The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.

In its October 2016 decision in BAM PPP PGGM Infrastructure Cooperative U.a. v. National Treasury Management Agency, the High Court of Ireland ruled that the purchasing institution had the discretion to extend the bid submission deadline when technical factors relating to the bid submission portal and the complexity of the technical files impacted the bidders’ ability to submit all of their required documents on time. The dispute dealt with a tendering process for the design, finance, construction, and maintenance of a Central Quad and East Quad for the Dublin Institute of Technology. The tender call required the submission of hundreds of files. As the Court summarized, one of the bidders (referred to in the decision as Eriugena) had issues with the submission of some of its files on the online tendering system. The purchasing authority accepted the late submission of some of those files. That bidder was ultimately selected for contract award. A competing bidder brought a legal claim challenging the acceptance of the late bid. As the Court summarized, the purchasing authority defended its decision to accept the late bid submissions for the following reasons:

  1. Only 8 of the 280 documents were uploaded after the 17:00 deadline and those documents were received in complete form by 18:13. Of those 8 documents, documents 2 and 3 were repeat uploads that were also submitted prior to the deadline while documents 4–8 contained information that was already in other files that were uploaded prior to the deadline, leaving only document 1 as containing information that was not already submitted before the deadline.
  2. The authority confirmed through a clarification exercise that all the documents were created before the deadline since the bidder provided screenshots to that effect. This information was verified by the third-party bid portal service provider.
  3. The bidder had some difficulties in uploading the large documents which, in the opinion of the purchasing authority, was not wholly within the bidder’s control since the time to upload documents on the system varied due to a number of technical factors outside of the bidder’s control.
  4. No unfair advantage was gained by the bidder in completing the upload of a small number of documents after the deadline so the decision to accept the bid was a fair, reasonable, and proportionate exercise of discretion in the circumstances.

The Court upheld the decision to accept the late submissions since the purchasing authority guarded against any unfair advantage:

The central considerations and conclusions evident from this correspondence are firstly that the late documents were not created or modified after the Tender Deadline, and hence the tender was not “improved” post deadline; secondly that Eriugena encountered technical difficulties that were “not wholly within their control” in the uploading of the documents and particularly the large BIM files; thirdly that the late documents were uploaded within a short space of time after the deadline; fourthly that the “native” BIM files, the information in which forms the basis for Documents 4 – 8 being the BIM viewing tools, were uploaded prior to the deadline”; and fifthly that the Authority did not simply take Eriugena’s word for it but undertook appropriate investigations, looked at other available evidence, and took appropriate advice to verify the forgoing before reaching a decision.

As the Court noted, a review of the European procurement directive and the Irish procurement regulations was inconclusive in establishing a clear prohibition against accepting a late bid since the relevant case law appeared to recognize some limited discretion to waive a bid submission deadline:

Consideration of the Procurement Directive and Procurement Regulations is inconclusive, and all that can really be said is that they require the contracting authority to apply the principles of equal treatment, non-discrimination and transparency to relevant decisions. While the time limit for submitting tenders is referred to as a “deadline”, this is not further defined and there is no provision excluding the possibility that a contracting authority might have and exercise a discretion to extend time in an appropriate case. That deadlines are immutable is clearly not borne out as the provisions identified earlier do mandate an extension of time limits in certain circumstances (which don’t arise in the present case), where there is not necessarily any fault on the part of the tenderer.
There is no persuasive, let alone clear, authority of the European courts which states that a public procurement tender deadline is immutable or can never be extended. Rather the EU decisions show that the contracting authority must apply the General Principles when considering whether to accept late or omitted documents, or when raising queries after the tender date, or when availing of any discretion of this nature afforded to it under the applicable tender rules. This appears to be so even if the tender as submitted breaches requirements of the tender specification. Indeed, the principle of proportionality may impose a duty on the contracting authority to exercise a discretion to allow late filing or to seek clarification where there is ambiguity.
It appears that the European courts have been prepared, in limited circumstances, to sanction a contracting authority granting some leeway to tenderers where:
(1) discretion is afforded by the applicable tender rules, and/or
(2) the irregularity – be it error, ambiguity, omission or late filing – is the fault of the contracting authority, or is not the fault of or within the control of the tenderer, and
(3) the exercise of that discretion does not breach the principles of equality, proportionality and transparency (and in respect of these considerations there is no margin of appreciation), and
(4) there has been no manifest error in the exercise of the discretion by the contracting authority – and in this respect the courts concede a “margin of appreciation” to the awarding authority in relation to matters of judgment or assessment.
I am not persuaded by the suggestion in Professor Arrowsmith’s 3rd Edition that “…waiver of certain formalities such as the deadline for tenders may not be possible” or “should not be possible regardless of what is stated in the contract documents.” Even as posited this opinion is qualified, and insofar as it is based on the decision in Scan Office Design, I am not satisfied that that is an authority that can be relied upon for such a proposition – as Professor Arrowsmith herself acknowledges at para.7.163.
I find persuasive the judgment of Richards J in Leadbitter that the principle of proportionality applies, and that, at least before Directive 2014/24 became effective, (and during the period of this tender) – “There may be circumstances where proportionality will, exceptionally, require the acceptance of the late submission of the whole or significant portions of a tender…” The Authority relied on All About Rights Law Practice, R (on the application of) v The Lord Chancellor [2013] EWHC 3461, where Carr J appeared to go further in stating:
It is clear that in appropriate circumstances proportionality may require the acceptance of late submissions of a tender…if there are obvious slips which can readily and easily be put right without improvement to the bid or a disadvantage to others.
While there may be little practical difference between use of the words “appropriate” as opposed to “exceptional”, in my view the latter term better describes the abnormal circumstances in which a contracting authority may be duty bound to exercise a discretion to extend a tender deadline, and gives due emphasis to the rarity with which this might occur.
“Exceptional circumstances” would encompass failure to achieve deadlines as a result of power failure, or force majeure, but these are extremes, and the court should not attempt to define or thereby limit the scope of what might in a given set of circumstances be “exceptional”. Furthermore what might not seem exceptional at first glance must be considered in the context of all relevant facts, and might then be seen to reach the threshold of “exceptional” when viewed objectively, particularly from a tenderer’s perspective. Thus the Authority was entitled to consider Eriugena’s predicament in the context of a 31 week process, the expense involve, and the public interest in progressing the project rather than risking its abandonment.

The Court also rejected the complainant’s assertion that making deadlines flexible would cause an unacceptable degree of uncertainty in the tendering process since the principles of proportionately should leave it open for a purchasing institution to exercise a degree of discretion in the circumstances:

BAM argued that to allow deadlines to be flexible at the discretion of the contracting authority brings an unacceptable uncertainty to a process that has its origins in EU directives and is intended to be certain and structured. The analysis earlier in this judgment of the 2004 Directive and the 2006 Regulations undermines this argument, and I consider that the import of EU and UK case law relied upon by BAM as reflecting the EU position is further weakened by the more flexible approach now taken in the 2014 Directive. It is also answered by Leadbitter – there may be a discretion to accept a late tender, notwithstanding the uncertainty argument, albeit that it is only in “exceptional circumstances” that the contracting authority may enjoy such a discretion.
Although the facts in Azam are distinguishable – there was an egregious delay, entirely the fault of the tendering firm – I find the formulation of Briggs J in the High Court as most helpful, where he stated:
First, the principle of proportionality is capable of applying to the implementation of the terms of a procurement process. Secondly, it may permit and in certain cases even require the waiver of some term of the process, such as a deadline. Thirdly the question whether to permit a waiver of a deadline, or, which is in this case the same thing, to grant an extension of time, is pre-eminently the exercise of a discretion, in which the public authority is to be afforded a proper scope for the exercise of reasonable judgment. Fourthly, the concurrent obligations of equal treatment, good administration and transparency will often weigh against the exercise of such a discretion by waiver or extension of time, in particular where the publication of the tender includes (as in the present case) a statement that extensions of time will not be granted. Fifthly, although generally it will be appropriate to compare the prejudice which may be caused to the applicant for an extension by a refusal with the prejudice which might be caused by a grant of an extension, a primary consideration will be the question whether the need for an extension has arisen as the result of the applicant’s conduct (whether by act or omission) rather than by something which is either the fault of the public authority, or otherwise a matter entirely outside the applicant’s control.
The reference to “proper scope for a reasonable judgment” emphasises that the decision as to whether the extension resulted from “exceptional circumstances” is one for the Authority, and in respect of which it enjoys a margin for appreciation.
Azam concerned a refusal to extend a deadline which Briggs J considered, on the facts before him, was the same thing as a waiver of a deadline. The present case concerns the exercise of a discretion to accept late documents forming part of a tender, and a decision which effectively waived the deadline in respect of those documents. I do not discern, at least in the present case, any difference between such decisions, and therefore the same principles should apply. However one point of difference to note which is very relevant is that in Azam, the tender documents expressly made it clear that extensions of time would not be granted. In the present case there is no such provision in the ITN, although tenderers were reminded of the deadline in Circular CIR454 of 21 November, 2014.

The Court also recognized that a bidder should be able to show that the deadline was missed due to reasons beyond its control that were not its fault:

With regard to the question of fault, where a tenderer can demonstrate with appropriate evidence that it has acted responsibly and in accordance with the tender documents, and something occurs that is not within its control which has frustrated due compliance with a deadline, then there is prima facie a case made out for late acceptance/extension such that the contracting authority must consider exercising its discretion. I do not consider that the law requires that the problem that occurs must be entirely outside the control of the tenderer. Provided there is no clear or identifiable fault on the part of the tenderer, the contracting authority is entitled to exercise its discretion in favour of a tenderer if satisfied that there are decisive elements that were outside its control.
In this respect, the decision in Watters is consistent with this approach, but may be distinguished on its facts. There the applicant’s excuse for not quite meeting the deadline was that due to a request for additional information two days before the deadline they had to rewrite the application and they then experienced difficulty printing because of a “computer server problem”. However they failed to adduce evidence in the form of altered drafts or schedules of time spent on the rewrite, and the new material required was very limited. The court therefore held that the Sports Council was entitled to exercise its discretion not to accept the late tender. This is an example of a case where the applicant failed to discharge the onus of proving the case for an extension of the deadline – but it is not authority for the proposition that simply because the problem lay with the tenderer’s computer server no extension could be granted.

The Court ultimately determined that it was within the discretion of the authority to recognize the situation as being an exceptional circumstance and to treat the late submission as an administrative error that allowed for the extension of the bid deadline:

The discretion to extend time in exceptional circumstances that is justified by this case law does not mean that the express discretion that the court has found exists under Section 7.1 also requires proof of exceptional circumstances. However it does establish that in exercising the contractual discretion under Section 7.1 of the ITN the Authority must not infringe the principles of equal treatment/non-discrimination, proportionality and transparency.
Applying these principles to the facts, was the Authority entitled to consider that there Section 7.1 applied, or that there were “exceptional circumstances” such that it should not reject the late documents? If so, did the circumstances that NTMA relied on in the letter dated 6th, 19th and 24th March, 2015, infringe the principles of non-discrimination, equal treatment, transparency and proportionality? I am satisfied that on the evidence that was before it, the Authority was entitled to treat the late submission of documents as an administrative error and to accept the late documents and to proceed to evaluate them. Further, and in the alternative, I am satisfied that the authority was entitled to treat the circumstances giving rise to the late delivery of documents as “exceptional”.
The upload by Eriugena was a process that commenced two days before the deadline and resulted in the vast majority of the files being submitted before the deadline – with the remaining 8 files being submitted by 18:13, i.e. within one hour and thirteen minutes of the deadline. Three further factors forming the background to this are averred to on page 3 of the Decision Memorandum. Firstly, this was the first project of its kind where BIM modelling was being submitted electronically, and therefore was “… a relatively new process to both the [Authority] and Tenderers.” Secondly, the Authority was aware that the time taken to upload documents “can be variable, which may at least in part be due to internal IT systems”. Thirdly, as noted in the Decision document:
The [Authority] were not in a position to, and therefore could not, inform Tenderers of either how long it would take to upload Tenders or what specification of IT systems would be needed to interact in the most efficient way with Asite.
These factors were quintessentially administrative in nature and particularly relevant given that two of the three tenderers encountered unanticipated difficulties in uploading, and BAM had previously experienced problems of uploading at the draft Tender stage.
As to fault, a factor that must be considered in the context of “exceptional circumstances”, although not expressly acknowledged in the Memorandum, there is implicit in the statement that NTMA could not inform Tenderers of how long it would take to upload or what specifications of IT systems would be needed, and the later statement that Eriugena’s upload problems “were not wholly within their control”, that some of the blame/fault lay with the Authority.
…
BAM argued that the Authority erred in blaming the internet, and that all tenderers must be aware that its speed is variable, and it was up to each tenderer to make appropriate plans and to provide for contingencies. While there is some force to this argument it seems to me that it doesn’t preclude the Authority on appropriate evidence attributing fault to a third party whose operations are not under the control of a tenderer. If Eriugena had demonstrably left it too late in commencing the upload, or otherwise acted irresponsibly, that would be another matter.

The Court therefore concluded that the authority “was entitled to decide to accept all the late documents and proceed to evaluation on that basis” and could rely on the exceptional circumstance principle to support that decision. The Court also ruled that acceptance of the late bid did not offend the non-discrimination rules that required equal treatment of bidders. The Court rejected the complainant’s assertion that it suffered a disadvantage in the process because it stopped working on its bid in time to meet the deadline, finding that there was no unfair advantage gained in the circumstances:

BAM did not experience problems uploading the final Tender, whereas the Authority accepted that Eriugena and Kajima did, and in this respect their situations differed. The Authority treated Eriugena and Kajima equally in accepting and considering the files uploaded late. The questions are whether the evidence accepted by the Authority provided an objective basis for the reasons given for this different treatment, and whether its decision resulted in impermissible discrimination.
I am satisfied that there was ample evidence before the Authority to justify it considering and deciding to treat Eriugena differently to BAM by accepting late files. Of relevance was the fact that electronic submission of the BIM files was a relatively new process, and the advice to the Authority was that the time taken can be variable and uploading can be problematic. Critically, there was evidence to support Eriugena’s contention that it experienced technical difficulties, that in effect none of the documents were modified after the deadline, and that the base information for the BIM files was derived from the native BIM files which were submitted in time. There was, therefore, an objective basis for different treatment.
BAM argued that it was disadvantaged in that it stopped working on developing its tender promptly in order to ensure compliance with the deadline; and concomitantly that the late acceptance of files afforded additional time to Eriugena (and Kajima) to review and work on their Tender(s) and that this discriminated against BAM. I do not accept these submissions. Firstly, the ITN and imposition of the deadline for submission of the Tender did not require, expressly or by implication, that the tenderers stop working on their tender documents when the Asite portal opened for final Tenders, or at any particular time, or at the same time. It was a matter for each tenderer to decide when to cease work on improving and finalising its tender files.
Secondly, the Authority took into account that Eriugena commenced its upload some two days before the deadline, and having conducted its investigation, the Authority based its decision on evidence of the completion of the material documents prior to the deadline. Thus, there was evidence that Eriugena started and pursued its upload in a timely manner, and that all its documents, including BIM files, were ready and last worked on prior to the deadline. Critical to this was the evidence of non-modification of documents post the deadline, and indeed Eriugena’s large BIM files were last worked on prior to 13:00 on 28 November. There was no evidence to suggest that Eriugena was attempting to or did take advantage of additional time that notionally became available because of the problems experienced in uploading – whether before or after the deadline. There was evidence that the files uploaded late did not “improve” Eriugena’s tender. On the facts of this case there was no question of “potential for abuse”, or risk that the late documents might express “second thoughts” or “change of position” – the risks adverted to by Purle QC in J.R. Jones – arising from the acceptance of the late documents.

Furthermore, the Court ruled that the acceptance of the late bid was proportionate in the circumstances and that the decision to accept the bid was the least intrusive option available to the authority:

Proportionality
BAM contended that the decision to accept the late documents from Eriugena and Kajima was lacking in proportionality. In European Dynamics v European Central Bank [2014] T-553/11 at para.301 the General Court stated:
It should also be noted that the principle of proportionality requires that the acts of institutions, bodies and agencies of the Union should not exceed the limits of what is appropriate and necessary in order to attain the objectives pursued and that, where there is a choice between several appropriate measures, recourse must be had to the least onerous…
BAM argued that because the impugned decision breached a deadline provision, it seriously undermines the concept of deadlines in public procurement in Ireland and more broadly within the EU, which provides for objective legal certainty. This judgment has already dealt with the Authority’s discretion to accept late documents and found that the exercise of this does not per se breach EU directives or the general law.
BAM next contended that there was lack of proportionality as the acceptance of late documents resulted in the non-compliant tenders of Eriugena and Kajima being evaluated and Eriugena being appointed preferred tenderer – instead of BAM being appointed as the only compliant tenderer.
The court cannot accept that the impugned decision is disproportionate for a number of reasons. The project is a very large one and of significant public interest, relating as it does to the core development of an inner city university. As the ITN Important Notice indicated the Authority had as an objective that “…a healthy competition is maintained throughout all stages of the Tender Process”. This objective could have been lost if the late documents had not been accepted, with the distinct possibility that the competition would be abandoned with only one tender to evaluate and consequent delay in delivery of the project. The tender process up to 28th November had run over thirty one weeks, and was detailed and complex, involving significant resources and time on the part of each tenderer as the tenders were developed. This was the first time BIM models were submitted electronically as part of a final Tender. By the 17:00 deadline the vast majority of Eriugena’s tender files had been uploaded. For reasons already addressed in this judgment Eriugena’s late documents, with only one exception, effectively reflected documents or information submitted before the deadline, and none were modified post-deadline. The difficulty encountered by Eriugena appeared to be, if not the fault of the Authority, also not the fault of Eriugena.
The court is therefore satisfied that the decision taken was “the least onerous” option, and in accordance with the principle of proportionality. Indeed any other decision would have been open to the objection by Eriugena that it breached the principle of proportionality.

Finally, the Court rejected the argument that accepting the late bid breached transparency standards since the solicitation rules did not specifically allow for the acceptance of the late bid in the circumstances. As the Court noted, it would be impossible for a purchasing institution to prescribe all grounds upon which it could exercise its discretion to waive a bid deadline:

As to (1) it is beyond dispute that the submission of BIM files was a requirement of section 6 of the ITN, and that there was no indication in the ITN (or Circulars) that anything short of this, such as the native Revit BIM files, would be acceptable. All parties knew where they stood. However this did not in my view preclude the Authority from looking at objectively relevant considerations, including the nature and content of the documents, when deciding whether the late BIM files could be accepted. It would be unreasonable for there to be a requirement that in respect of a discretionary or general law power of this nature an ITN would be obliged to anticipate and describe all possible considerations or possibilities amounting to clerical or administrative errors, or constituting “exceptional circumstances” that might justify acceptance of late documents. Moreover the effect of the Authority’s decision was not to relax the requirement that BIM files be submitted with the final Tender, but only in relation to the timing of acceptance of such files.

In summary, the Court concluded that the late bid was due to a clerical or administrative error or that, alternatively, the purchasing institution had the discretion to waive the deadline due to exceptional circumstances and that the decision to accept the late bid did not infringe the general principles of equal treatment, non-discrimination, proportionality, and transparency. The Court therefore dismissed the complaint on all grounds. As this case illustrates, the decision to waive a bid submission deadline can be controversial and can subject the purchasing institution to complex legal challenges over what would otherwise appear to be relatively minor administrative irregularities. Purchasing institutions should therefore strive to streamline and simplify their bid submission procedures and should avoid placing strict timeframes around the submission of complex technical information. While electronic bid submission may be the preferred method for relatively simple bids, any bids that contain extensive information should allow for the physical submission of recorded files, or for the post-bid submission of technical information in subsequent stages that are not strictly tied to the bid submission deadline. Given the legal complexities that attach to formal bid deadlines, finding more practical solutions for the acceptance of complex technical bid submissions would be preferable to the time and cost involved in defending legal challenges arising out of administrative issues resulting from bid submission procedures.