JUDGMENT OF THE COURT OF FIRST INSTANCE (Fourth Chamber)
1 July 2008 (*)
(Public procurement – Community tendering procedure – Rejection of tender – Selection criteria – Award criteria – Obligation to state reasons)
In Case T‑211/07,
AWWW GmbH ArbeitsWelt-Working World, established in Göttingen (Germany), represented by B. Schreier and V. Wellens, Lawyers and G. Dennis, Solicitor,
applicant,
v
European Foundation for the Improvement of Living and Working Conditions, represented by C. Callanan, Solicitor,
defendant,
APPLICATION for annulment of the decision of the European Foundation for the Improvement of Living and Working Conditions of 17 April 2007 rejecting the applicant’s tender in a Community public procurement procedure for the provision of services of information and analysis on quality of work and employment, industrial relations and restructuring covering the European level,
THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES (Fourth Chamber),
composed of O. Czúcz, President, J.D. Cooke (Judge-Rapporteur) and I. Labucka, Judges,
Registrar: C. Kantza, Administrator,
having regard to the written procedure and further to the hearing on 29 January 2008,
gives the following
Judgment
Background to the claim
1 The defendant, the European Foundation for the Improvement of Living and Working Conditions (‘the Foundation’), is a Community body established by Council Regulation (EEC) No 1365/75 of 26 May 1975 (OJ 1975 L 139, p. 1). Its aim is that of contributing to the planning and establishment of better living and working conditions through action designed to increase and disseminate knowledge likely to assist this development.
2 The applicant, AWWW GmbH ArbeitsWelt-Working World, is a company specialising in research in the areas of industrial relations, working conditions and human resource management. In recent years it has carried out a number of research contracts for the Foundation.
3 On 19 January 2007, the Foundation published in the Supplement to the OfficialJournal of the European Union (OJ 2007 S 13) an invitation to restricted tender (accelerated procedure) for the provision of ‘information and analysis on quality of work and employment, industrial relations and restructuring covering the European level’ (Reference No 2007/S-13-014125).
4 The tender procedure provided for the selection in a first stage of a limited number of tenderers from which would be chosen in the second stage the tenderer to whom the contract would be awarded.
5 The call for tenders provided that in the second stage the offers would be evaluated by reference to the criteria and the points for each criterion indicated in brackets as follows:
‘1. Knowledge and Experience (55)
(a) Quality of proposal for presenting short reports with data, statistical findings and commentary for publishing, including web, using concise, non-biased, readable and correct English (20);
(b) Methodology for information gathering ensuring impartiality and objectiveness (15);
(c) Understanding of relevant policy issues and developments at national level in all three requested areas of work, of relevant EU practice and policies and of the importance of reporting in a tri-partite context (10);
(d) Understanding of the Foundation’s requirements in relation to analysing statistical data and to conducting European comparative research (10).
2. Ability to deliver the specified service (25)
(a) Set-up to ensure complete coverage of all three requested areas of work: quality of work and employment, industrial relations and company restructuring. Tenderers must also provide evidence of knowledge of social partners’ positions in the areas of interest (15);
(b) System to fulfil the technical requirements for formatting and delivery of news reviews and reports on data for web publishing (10).
3. Quality control (20)
(a) Quality assurance method (10);
(b) Proposed approach to supplying content and a work plan to meet stated deadlines for delivery of products (10).’
6 On 26 January 2007, the applicant submitted its first stage tender to the Foundation.
7 By an email of 16 February 2007, the applicant asked the Foundation if it was possible in the course of the second stage of the procedure to provide an additional curriculum vitae for a person it proposed to include for the purposes of providing the relevant services.
8 By an email in reply of the same date, the Foundation replied as follows:
‘… Please note that the technical capacity of tenderers was checked during the first phase of this procedure. Your company has already shown the required capacity and was therefore invited to the second phase of the procedure. During this second phase the quality of your proposal will be assessed. The CV of any additional person will not be taken into consideration at this stage.
However, the possibility of using additional persons, not mentioned during the first phase can be dealt with by showing resources as evidenced on how your company is going to fulfil some of the award criteria: i.e.:
2. Ability to deliver the specified service
(a) Set-up to ensure complete coverage of all three requested areas of work: quality of work and employment, industrial relations and company restructuring.’
9 Having been selected, along with five other tenderers, to take part in the second stage of the procedure the applicant submitted its detailed bid on 21 February 2007.
10 By letter of 17 April 2007, the Foundation informed the applicant that its tender had not been accepted, on the ground that it did not represent the best quality/price ratio (‘the contested decision’). It also indicated to the applicant that it could obtain additional information on the grounds for the rejection of the bid and that the Foundation would not sign the contract with the successful tenderer for two weeks from the day following the date on which that letter was sent.
11 By letter of 26 April 2007, the applicant requested the Foundation to provide detailed information on the quality/price ratio of its bid in comparison with the other bids and put to it a series of questions as to the evaluation of its bid.
12 By letter of 15 May 2007, the Foundation sent the applicant an extract from the report on the evaluation of bids, which gave the points attributed to its bid and to the bid of the successful tenderer in respect of each of the award criteria, together with a summary of the assessment of the two bids in the light of the criteria.
13 The applicant’s bid in the sum of EUR 69 900, was accorded a total of 70 points on award criteria and 999 points on price/quality ratio. The price tendered by the successful tenderer was EUR 75 000. That bid gained 76 points on award criteria and 987 points on price/quality ratio.
14 By letter of 18 May 2007, the applicant repeated its request for additional information on the assessment of its bid. It complained to the Foundation that it had received no reply to the questions which it had raised in its letter of 26 April 2007 and that the award procedure had not been carried out in a correct and fair way. It also raised a series of additional questions relating to the characteristics and merits of the successful bid.
15 A further exchange of letters took place on 4 and 13 June 2007.
Procedure and forms of order sought
16 By application lodged at the Registry of the Court on 13 June 2007, the applicant brought the present action.
17 By a separate document lodged at the Registry of the Court on 18 June 2007, the applicant applied for interim measures under Article 104 of the Rules of Procedure of the Court of First Instance and Articles 242 and 243 EC, seeking, principally, suspension of the implementation of the contested decision and, in the alternative, an order for all necessary measures to prevent implementation of the contested decision and, in particular, prohibiting the Foundation from awarding the contract to the successful tenderer.
18 By order of 14 September 2007, the judge hearing the application for interim measures rejected the application and reserved costs.
19 On 4 September 2007 the Foundation lodged its defence.
20 On 9 October 2007, the Court (Fourth Chamber) decided, pursuant to Article 47 of the Rules of Procedure, that a second round of pleadings was not necessary.
21 Upon hearing the report of the Judge-Rapporteur, the Court decided to open the oral procedure. By way of measures of organisation of the procedure, the Court directed the Foundation to produce certain documents. The Foundation complied with this request within the time stipulated.
22 The applicant claims that the Court should in effect annul the contested decision. At the hearing, the applicant also asked the Court to order the Foundation to pay the costs.
23 The Foundation claims that the Court should:
– dismiss the application;
– order the applicant to pay the costs.
Law
24 In support of its application the applicant raises two pleas in law. The first alleges a failure to state reasons and the second non-compliance with the selection and award criteria governing the procurement procedure.
The first plea in law: failure to state reasons
Arguments of the parties
25 In the first place, the applicant maintains that the contested decision is wholly devoid of reasoning. It complains that only extracts from the Evaluation Report have been furnished to it and these do not explain adequately why the contract has been awarded to another tenderer.
26 It points out that in its letter of 26 April 2007 it had raised a series of questions relating to the application of the award criteria to which the Foundation refused to give any answer in its letter of 15 May 2007.
27 Further, the applicant claims that the Evaluation Report on its bid is vitiated by a formal defect in that it is not signed by the persons responsible for the assessment.
28 During the hearing, the applicant added that the absence of any signature on the extracts from the report attached to the letter from the Foundation of 15 May 2007 called into question the authenticity of those documents, and, as a result, the entire credibility of the purported reasons for the contested decision.
29 The Foundation maintains that it complied fully with its duty to provide reasons for decisions taken by it in a public procurement procedure in accordance with Article 74 of its Financial Regulation, as adopted by its Administrative Board on 28 March 2003, and with the rules for the implementation of the Financial Regulation (‘the Implementing Rules’), in particular Article 149(3) of those rules. It adds that the awarding authority is not obliged to give tenderers details of the comparison of their bids with the bid of the successful tenderer.
30 The Foundation points out that the applicant was informed in the letter of 17 April 2007 that its bid had been rejected because it did not present the best price/quality ratio. It adds that this letter had also indicated that the applicant could, upon request, obtain additional information on the reasons for the rejection.
31 Moreover, in the letter of 15 May 2007, in reply to the request for additional information made on 26 April 2007, the Foundation had given the applicant detailed information, including extracts from the Evaluation Report which gave the points for its bid and those for the successful bid in respect of each head of the award criteria.
32 The Foundation maintains that in so doing it complied with its duty to give reasons as required by the applicable rules. It contends that it is not obliged to furnish a breakdown of the marks given for each award criterion as it had in fact done or to furnish replies to the numerous questions which the applicant had raised. As appears clearly from the various letters exchanged, the applicant was given information well in excess of the minimum required by the applicable rules.
Findings of the Court
33 Article 149(3) of the Implementing Rules provides, in part:
‘… unsuccessful tenderers or candidates may request additional information about the reasons for their rejection in writing by mail, fax or email, and all tenderers who have put in an admissible tender may obtain information about the characteristics and relative merits of the tender accepted and the name of the successful tenderer, without prejudice to the second subparagraph of Article 100(2) of the Financial Regulation. The contracting authority shall reply within no more than 15 calendar days from the receipt of the request. …’
34 It is a settled case-law that a contracting authority fulfils its obligation to state reasons if it first informs eliminated tenderers immediately of the fact that their tender has been rejected by a simple communication citing no reasons, provided that it subsequently, if expressly requested to do so, furnishes them within 15 days with a reasoned explanation. Proceeding in that manner satisfies the purpose of the duty to state reasons in Article 253 EC, according to which the ‘reasoning’ followed by the authority which adopted the measure in question must be disclosed in a clear and unequivocal fashion so as, on the one hand, to make the persons concerned aware of the reasons for the measure and thereby enable them to defend their rights and, on the other, to enable the Court to exercise its supervisory jurisdiction (Case T‑19/95 Adia Interim v Commission [1996] ECR II-321, paragraphs 31 and 32, and Case T‑183/00 Strabag Benelux v Council [2003] ECR II-315, paragraphs 54 and 55).
35 The Court considers that in the present case the Foundation has fully satisfied the duty imposed upon it by Article 149(3) of the Implementing Rules and the case-law cited in the preceding paragraph.
36 Thus, in reply to the questions which had been raised in the request for additional information of 26 April 2007 on the second stage of the procedure, the Foundation had given, by way of annex to its letter of 15 May 2007 to the applicant, an extract from the report of the Evaluation Committee which contained a summary of the assessments of the applicant’s bid and that of the successful tenderer by reference to the award criteria.
37 In the case of the applicant this summary reads as follows:
‘Knowledge and Experience: The proposal scored well on this criterion, with documentation of the ability to present short reports for web publication. The submission relating to the understanding of relevant policy issues and developments was brief, however, and referred almost exclusively to other Foundation work.
Ability to deliver the specified service: The relatively small team involved raised concerns about back-up in the event of unavailability of one or other team member.
Quality control: The methods proposed for quality assurance were satisfactory.’
38 In relation to the successful tenderer, the summary reads as follows:
‘Knowledge and Experience: The proposal scored very well on this criterion, reflecting the range and depth of research knowledge in the team. The proposal showed a strong understanding of relevant policy issues and developments, and was convincing in relation to the Foundation’s requirements.
Ability to deliver the specified service: The set up clearly provides good coverage of the three areas of work, with convincing back-up. The experience cited of coordinating international projects and networks addresses an important challenge for the consortium.
Quality control: The proposal scored well on this criterion.’
39 On the basis of the above, the Evaluation Committee concluded that four of the six selected tenders fulfilled at least 70% of the award criteria. Those four tenderers were then assessed on the prices of their tenders.
40 In an annex to the letter of 15 May 2007, the Foundation also gave the applicant a further extract from the report of the Evaluation Committee which provided a breakdown of the marks scored by its bid and by the successful bid for each of the sub-criteria of the three main award criteria, namely knowledge and experience, ability to deliver the specified service and quality control (see above paragraph 5). This breakdown was as follows.
| | Successful bid | Applicant’s bid |
1. Knowledge and Experience (55) | 42 | 40 |
(a) (20) | 16 | 15 |
(b) (15) | 12 | 12 |
(c) (10) | 7 | 6 |
(d) (10) | 7 | 7 |
2. Ability to deliver the specified service (25) | 20 | 17 |
(a) (15) | 12 | 9 |
(b) (10) | 8 | 8 |
3. Quality control (20) | 14 | 13 |
(a) (10) | 7 | 7 |
(b) (10) | 7 | 6 |
Total (100) | 76 | 70 |
Price (for 2007) | EUR 75 000 | EUR 69 900 |
Quality/Price Weighting | 987 | 999 |
41 By replying in that way, the Foundation enabled the applicant to understand the precise basis of calculation of the assessment of its bid and that of the successful tenderer.
42 As is clear from the arguments advanced by the applicant in support of its second plea in law, this information enabled it to understand the basis of the decision to choose the successful bid and to reject its own.
43 The Court notes that, in its letter of 26 April 2007, the applicant raised more than 25 questions with the Foundation as regards the assessment procedure and, in its letter of 18 May 2007, more than 40 further questions arguing in favour of its bid. In reality, the applicant’s criticism is that the Foundation has refused to enter into a debate with it on the merits of its offer as against those of the successful bid. No contracting authority is obliged, however, on the basis of its duty to state reasons for a decision rejecting a bid, to enter into such a debate.
44 The applicant’s argument alleging that there was a formal defect in the Evaluation Report (see paragraphs 27 and 28) must be rejected as wrong in fact. It is clear from the extracts from that report, produced in response to the Court’s order by way of measure of organisation of the procedure, that the report was in fact signed by the responsible members of the committee. Contrary to the applicant’s submission, the fact that the signatures did not appear on the extracts furnished in response to its request for reasons cannot affect either the credibility or the adequacy of the statement of reasons.
45 In the light of the above considerations the first plea in law must be rejected.
The second plea in law: non-compliance with the selection and award criteria
Arguments of the parties
46 In its second plea in law the applicant accuses the Foundation of having infringed the bid evaluation procedure by applying incorrect criteria and by basing its evaluation of the bid upon a clear internal contradiction.
47 In the first place, the Evaluation Committee, as appears from the summary of its report (see paragraph 37 above), called into question the ability of the applicant to provide the specified services notwithstanding the fact that the Foundation had confirmed, during the first stage of the selection procedure, that it had already proved that it had this capacity. Such ability, once demonstrated for the purposes of the selection stage, cannot be subjected to a reassessment in the award stage.
48 Secondly, the applicant maintains that the award of the contract was based mainly upon a criterion which does not appear in the invitation to tender. It appears, in effect, from the report of the Evaluation Committee that it was the particular experience of the successful tenderer in ‘coordinating international projects’ which was the main ground for award of the contract. However, that form of experience was not one of the criteria given in the invitation to tender.
49 Thirdly, the applicant maintains that in the extract from the Evaluation Report its knowledge and experience are wrongly put in question. It insists that it had successfully conducted this sort of work for the Network of European Observatories and other work in the field of observation over several years. The Evaluation Committee failed to take into consideration its extensive knowledge and long experience which accounted for 55% of the award criteria. The other bidders had far less knowledge and experience.
50 At the hearing, relying upon the judgment of the Court of Justice in Case C‑532/06 Lianakis and Others v Alexandroupolis and Others [2008] ECR I-0000, the applicant claimed that the Foundation had failed to comply with Article 138 of the Implementing Rules, which required it to specify in the invitation to tender the weighting which it proposed to apply to each of the criteria in calculating the quality/price ratio. The weighting used should have been notified in advance, so that the tenderers could take into account the parameters to be employed in assessing the bids which gave the best quality/price ratio.
51 The Foundation denies that there is any contradiction, inconsistency or error in the application of the selection criteria and the award criteria. It emphasises that the assessment procedure was carried out in a correct and fair manner and in accordance with the terms of the invitation to tender.
52 In the first place, the Foundation maintains that there is no inconsistency between the grounds given in the Evaluation Report and the email statement of 16 February 2007 which confirmed that the applicant had already proved its ability to provide the specified services.
53 The Foundation explains that at the first stage of the procedure it was required to make an assessment of each candidate’s ability to provide the services, while in the second stage, candidates who were invited to tender were required to put forward specific proposals as to how they would perform them in the light of the particular requirements of the invitation to tender at the second stage. In effect, the standard reply form at the first stage is equivalent to a prequalification questionnaire. The applicant was clearly on notice that the resources available to it would be regarded as part of the evaluation at the second stage.
54 Secondly, the Foundation denies the allegation that it was the successful tenderer’s experience in coordinating international projects that was the key reason for its being awarded the contract. The applicant has misinterpreted the extract from the Evaluation Report. The tenderer in question had given examples of its approach to set-up in an international context in describing its proposals to ensure complete coverage of the three requested areas of work and was awarded relatively high marks in that respect.
55 Thirdly, the Foundation contends that the applicant has misunderstood the nature of the first of the award criteria, ‘knowledge and experience’, for which 55 points were to be awarded at the second stage. The applicant relies on the fact that its knowledge and experience of such projects are allegedly greater than those of other tenderers in order to claim that it should, by reason of that fact alone, have obtained better marks than other tenderers under this heading. The Foundation claims that it did not evaluate the knowledge and experience of the applicant in isolation from the quality of its proposals but in the light of its particular proposals. It adds that the invitation to tender clearly indicated that the knowledge and experience of the tenderer would be taken into account under the award criteria only in the way in which those aspects ‘[would] apply for the purpose of this contract’.
56 Fourthly, the Foundation rejects the applicant’s allegation that other tenderers had far less experience than it in the areas in question. It explains that, at the end of the first stage, six candidates including the applicant were deemed to have satisfied the qualification requirements, including the requirement as to technical capacity to provide the services. As already noted at paragraph 55 above, those factors were taken into account in the second stage only to the extent that they related to ‘the way in which these aspects [would] apply for the purposes of this contract’. This condition was complied with in the assessment of the tenders.
Findings of the Court
57 So far as concerns the applicant’s first argument, alleging inconsistency between the contents of the Evaluation Report and the Foundation’s statement in its email of 16 February 2007 to the effect that ‘your company has already shown the required capacity’, it is necessary, as the Foundation correctly points out, to distinguish between the objectives of the two stages of the procedure for award of the contract.
58 During the first stage, the Foundation confines itself to checking, by reference to objective criteria, that the tenderers possess the economic, financial and technical abilities to provide the services required under the proposed contract and to an examination of the proofs offered as to the non-application of the exclusion criteria. This assessment does not involve any comparative evaluation of the tenders.
59 It is only at the second stage that the Foundation proceeds to carry out an assessment of the particular characteristics and merits of the individual bids. This distinction was explicitly indicated in the standard form of reply to the invitation to tender under heading ‘A: Evidence to be provided for the evaluation of the award criteria’ which stipulated:
‘As regards the award criteria in particular, the tenderers must indicate in the following tables the references of the documents contained in the proposal in which the information needed for their assessment is submitted.
With regard to this information it is noted that aspects such as experience, expertise, knowledge or skills, and methods and resources, or any other reference to existing capacities or qualities fall within the selection criteria (see section B) and will not be taken into account as award criteria.
The award criteria concern only the quality of the proposal that the tenderers submit for this contract. If information such as that mentioned in the preceding paragraph is used, the information taken into account under the award criteria may only concern the way in which these aspects will apply for the purposes of this contract.’
60 In referring, in the extract from the Evaluation Report, to the ‘ability to deliver the specified service’ the Evaluation Committee did not go back on the result of the selection stage but, in accordance with the extract reproduced in paragraph 59 above, assessed the quality of ability in the light of the specific proposals put forward by the applicant for carrying out the services.
61 As regards the second complaint against the Foundation (see paragraph 46 above), it does not appear from the Evaluation Report that the contract was awarded to the successful tenderer upon the basis of a criterion which was not included in the invitation to tender. Experience in coordinating international products was not, in itself, an award criterion. Nevertheless, there was no reason why the Foundation could not have regard to such experience in assessing the quality of a tenderer’s ability to cover the three required areas of work.
62 The Court considers that the third compliant is also unfounded. As already held in the examination of the first complaint above, the summary of the evaluation of the bid set out in the extract from the Evaluation Report does not call into question the knowledge and experience which the applicant had demonstrated. The second stage does not involve the awarding of marks for those factors but requires an assessment of their value in the light of the specific proposals put forward by the applicant for performance of the services. The mere fact that the applicant finds itself marked at a particular score in the course of such a comparative exercise does not involve calling into question the evidence it had provided.
63 As regards the argument put forward by the applicant at the hearing based upon the judgment of the Court of Justice in Lianakis (see paragraph 50 above), apart from the fact that this argument was not raised during the written procedure and must therefore be rejected as inadmissible, it is clear that in the present case, unlike the circumstances which were the subject of the judgment in question, no weighting coefficient was applied by the Foundation for the purpose of assessing the price/quality ratio. As appears from the table set out at paragraph 40 above, the calculation of the price/quality ratio was a simple division of the proposed price by the total number of points scored. The Foundation did not, therefore, derogate from the conditions set out in the invitation to tender during the procedure of assessing the bids.
64 In follows that the second plea must be dismissed as unfounded.
65 Accordingly, the application will be dismissed as unfounded.
Costs
66 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay costs if they have been applied for in the successful party’s pleadings. As the applicant has been unsuccessful, it will be ordered to pay the costs incurred by the defendant in accordance with the form of order sought by it.
On those grounds,
THE COURT OF FIRST INSTANCE (Fourth Chamber)
hereby:
1. Dismisses the action;
2. Orders AWWW GmbH ArbeitsWelt-Working World to pay the costs, including those incurred in the application for interim measures.
Delivered in open court in Luxembourg on 1 July 2008.