JUDGMENT OF THE COURT OF FIRST INSTANCE (Fourth Chamber)
10 September 2008 (*)
(Public service contracts – Community tendering procedure – Rejection of bid – Selection and award criteria – Obligation to state reasons)
In Case T‑272/06,
Evropaïki Dinamiki – Proigmena Sistimata Tilepikinonion Pliroforikis kai Tilematikis AE, established in Athens (Greece), represented by N. Korogiannakis and N. Keramidas, lawyers,
applicant,
v
Court of Justice of the European Communities, represented initially by M. Schauss and then by D. Guild, acting as Agents,
defendant,
APPLICATION for the annulment of the decision of the Court of Justice of 20 July 2006 not to accept the tender submitted by the applicant in response to the call for tenders of 5 July 2005 for services to maintain, develop and support computer applications, and to award the contract to the successful tenderer,
THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES (Fourth Chamber),
composed of O. Czúcz (Judge Rapporteur), President, J.D. Cooke and I. Labucka, Judges,
Registrar: C. Kantza, Administrator,
having regard to the written procedure and further to the hearing on 19 February 2008,
gives the following
Judgment
Background to the litigation
1 The award of service contracts by the Court of Justice is subject to the provisions of Title V of Part One of Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (OJ 2002 L 248, p. 1) (‘the Financial Regulation’) and to the provisions of Commission Regulation (EC, Euratom) No 2342/2002 of 23 December 2002 laying down detailed rules for the implementation of the Financial Regulation (OJ 2002 L 357, p. 1) (‘the implementing rules’). Those provisions are based on the relevant Community directives and, in particular, as regards service contracts, on Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts (OJ 1992 L 209, p. 1), as amended by Directive 97/52/EC of the European Parliament and of the Council of 13 October 1997 (OJ 1997 L 328, p. 1) and replaced by Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (OJ 2004 L 134, p. 114).
2 The applicant is a company governed by Greek law, active in the area of information technology and communications.
3 By a contract notice of 5 July 2005, published in the Supplement to the Official Journal of the European Union (OJ 2005 S 127) under reference 2005/S 127‑125162, the Court of Justice issued a call for tenders for the provision of services to maintain, develop and support current or future computer applications.
4 Section III.2.1.3 of the contract notice reads as follows:
‘Technical capacity – means of proof required:
Brief description of the professional activities undertaken by the company which are relevant to this invitation to tender.
Summaries containing [three] references for work carried out by the company, or by the partner companies in a consortium, during the past [three] years, involving research, development, maintenance or support of IT applications in both of the following functional fields: computerisation of judicial and/or administrative procedures in the civil service; documentation and collaborative work in document preparation.
Summaries containing [three] references for work carried out by the company or by the partner companies in a consortium, during the past [three] years, involving quality assurance plans in both of the following functional fields: computerisation of judicial and/or administrative procedures in the civil service; documentation and collaborative work in document preparation.
Description of how the technical division(s) is/are structured within the company or consortium.
…
Description of IT skills centres within the company, citing in each case the particular field covered, the number of IT staff working there, and the centre’s geographic location.’
5 The tender specifications define the assessment criteria as follows:
‘5.1 Assessment of tenders
Tenders will be assessed in three stages:
– checking of the exclusion criteria;
– shortlisting of no more than five tenderers;
– comparison of tenders on the basis of the award criteria … and award of the contract to two firms.
…
5.3 Selection criteria
…
Tendering firms will be assessed on the basis of the profile that emerges from analysis of the following factors:
– the experience and references of the firm and associated firms in equivalent projects in the following functional domains (35 points):
(1) computerisation of judicial and/or administrative procedures in the public service;
(2) documentation and collaboration in the preparation of documents;
in each of these two domains 15 man/years’ experience in each of the last three years is required.
…
– capacity for intervention in situ and speed of intervention, expressed as a number of hours worked (15 points);
…
– availability of computer skill centres (10 points) …
Tendering firms scoring a minimum of 70 points will go forward to the award procedure.
5.4 Award criteria
…
Tenders will be classified in order to identify the most economically advantageous tender, i.e. the bid with the best quality/price ratio [with the quality and price criteria counting for 60 and 40 points respectively].’
6 On 9 January 2006, the applicant submitted a bid in response to the call for tenders.
7 By letter of 20 July 2006, the Court of Justice informed the applicant that its tender had not been selected as the applicant did not fulfil the criteria to go forward to the award stage and that it had the possibility to obtain additional information on the grounds for rejection of its bid.
8 By letter of 24 July 2006, the applicant requested the Court of Justice to provide it with the following information: the name of the successful tenderers; the reasons for the decision and the criteria which the applicant’s tender had not satisfied; the scores obtained in respect of each award criterion for the applicant’s technical offer and that of the successful tenderers; a comparison of the applicant’s financial offer and that of the successful tenderers. The applicant also requested a copy of the evaluation committee’s report.
9 By letter of 3 August 2006, the Court of Justice gave details of the names of the successful tenderers and provided a table comparing the results obtained by them and by the applicant. It also informed the applicant that since its tender had not satisfied the selection criteria no financial evaluation had been carried out.
10 By letter of 7 August 2006, the applicant stated that the information provided by the Court of Justice did not allow it to understand how the applicant’s tender had been compared with those of the successful tenderers, particularly as regards its experience and references, its capacity for intervention in situ and its capacity to assume the responsibilities of the contract. It also asked the Court of Justice to disclose the financial offers of the successful tenderers.
11 By letter of 23 August 2006, the Court of Justice informed the applicant that at the end of the selection procedure it had received a score of more than 70 points, but that it had finished in sixth place. Consequently, its tender was not considered in the award phase, as the number of candidates which could participate in that procedure had been limited to five.
12 The Court of Justice went on to provide the following additional explanations:
– for the criterion concerning experience and references, the applicant had obtained a score of 17.25 points out of 35, because some of the applicant’s references concerned activities which had been carried out more than three years previously, other references did not contain the relevant certificates or reference letters for ‘work carried out’ and no reference was dedicated to a quality assurance project;
– for the criterion concerning the capacity of intervention in situ and speed of intervention, expressed as a number of hours worked, since the time given in the applicant’s tender (48 hours) was longer than that given in other tenders, the applicant had obtained 10.5 points out of 15;
– as regards the criterion relating to the availability of computer skill centres, the applicant’s tender did not indicate either the specialisations of each of those centres or the number of persons employed there and had obtained 6.67 points out of 10.
13 In the same letter, in reply to the applicant’s request that the financial offers of the successful tenderers be disclosed, the Court of Justice pointed out that the choice of tenderers was based not only on a price ratio, but also on a quality ratio. Even if the applicant had been among the five successful candidates in the selection phase, it would not have succeeded in the award phase, since its total score, taking into account its hypothetical result in respect of the pricing criteria, would have been 77.91 points, whereas those of the successful tenderers were 81.62 points and 83.71 points respectively.
Procedure and forms of order sought
14 By application lodged at the Registry of the Court of First Instance on 29 September 2006, the applicant brought the present action.
15 Upon hearing the report of the Judge Rapporteur the Court (Fourth Chamber) decided to open the oral procedure. By way of measure of organisation of procedure it put certain written questions to the parties and invited the Court of Justice to furnish certain documents including, in particular, a copy of the report of the evaluation committee. The parties complied with these requests within the time fixed.
16 At the hearing on 19 February 2008 the Court, by way of measure of organisation of procedure pursuant to Article 64(3) of its Rules of Procedure and without prejudice to the possible application of Article 67(3) of those Rules, ordered the production by the Court of Justice within 10 days of a full version of the evaluation committee report, including its annexes, and for this purpose did not close the oral procedure at the end of the hearing.
17 The Court of Justice complied with this request by the Court within the time fixed.
18 By decision of 9 July 2008 the Court decided to close the oral procedure, having decided that it was not necessary to include the document thus produced in the case-file.
19 The applicant claims that the Court should:
– annul the decision of the Court of Justice not to accept its bid and the decision to award the contract to the successful tenderers;
– order the Court of Justice to pay the costs, even if the application is unsuccessful.
20 The Court of Justice contends that the Court should:
– dismiss the action;
– order the applicant to pay the costs.
Substance
21 In support of its application for annulment, the applicant relies on two pleas in law. The first plea alleges infringement of the Financial Regulation, of the implementing rules and of Directive 2004/18/EC, together with infringement of the principles of equal treatment and transparency. The second plea alleges manifest errors of assessment.
Arguments of the parties
22 In its first plea, the applicant argues that the evaluation committee incorrectly interpreted the provisions of the contract notice regarding the references to be provided by candidates for the purposes of assessing their technical capacity.
23 It claims that all project references submitted in its tender concerned projects carried out during the previous three years, as section III.2.1.3 of the contract notice required. However, the evaluation committee took into account only the references relating to projects which were initiated and completed during the previous three years, including that in which the contract notice was published (2003, 2004 and 2005) (‘the relevant period’).
24 In its second plea, the applicant submits, firstly, that the contracting authority committed a manifest error of assessment by not taking into account the applicant’s references relating to the projects which were partially completed during the relevant period, including those concerning the ‘EUR‑Lex’, ‘ESP5’, ‘Circa’, ‘SEI‑JOS’, ‘IDA Tools’, ‘Stadium’ and ‘Chopin’ projects.
25 Secondly, it submits that the contracting authority committed a manifest error of assessment by disregarding certain of the applicant’s references because they did not contain certificates or reference letters.
26 The Court of Justice rejects the arguments put forward by the applicant. It denies that the evaluation committee had mistakenly interpreted the conditions of the contract notice relating to references furnished by tenderers and also denies the alleged errors of assessment concerning the references which the applicant furnished.
Findings of the Court
27 It must be recalled at the outset that, in accordance with settled case-law, the statement of the reasons on which a decision adversely affecting a person is based must allow the Community Court to exercise its power of review as to its legality and must provide the person concerned with the information necessary to enable him to decide whether or not the decision is well founded (Case 195/80 Michel v Parliament [1981] ECR 2861, paragraph 22, and Case C‑166/95 P Commission v Daffix [1997] ECR I-983, paragraph 23).
28 Accordingly, the fact that a statement of reasons is lacking or inadequate, hindering that review of legality, constitutes a matter of public interest which may, and even must, be raised by the Community Court of its own motion (Case 18/57 Nold v High Authority [1959] ECR 41, at p. 52, and Case C‑166/95 P Commission v Daffix, cited above, paragraph 24).
29 Although the applicant has not in the present case raised a failure to state reasons, the Court considers that, in the circumstances set out below, it must examine the question as to whether the Court of Justice has discharged the obligation upon it to state reasons.
30 It follows from the above summary of the pleas in law and arguments put forward by the applicant that the present action was formulated on the basis of information furnished by the Court of Justice in its letters of 3 and 23 August 2006, in response to the applicant’s request for the reasons upon which the decision was based in accordance with Article 100(2) of the Financial Regulation.
31 Thus, the pleas in law advanced against the contested decision are confined to putting in issue the way in which the references supplied by the applicant in accordance with the contract conditions were evaluated, these references being relevant only at the selection stage of the procedure. In other words, the present case has been brought upon a basis induced by the reasons given by the Court of Justice, to the effect that the applicant’s bid had been excluded at the end of the selection stage upon the ground that the bid had been placed in sixth position in accordance with the evaluation criteria for that phase of the procedure and that only five tenderers had been retained for consideration at the award phase.
32 However, the documents produced by the Court of Justice on foot of the measure of organisation of the procedure (see paragraph 15 above) show that the information given to the applicant in the letters of 20 July, 3 and 23 August 2006 was wrong and did not reflect the true basis upon which the decision to award the contract to the two successful tenderers had in fact been taken by the Court of Justice.
33 On the basis of the proofs which have been furnished to it, the Court finds that what happened during the course of the evaluation procedure was as follows:
– on 21 June the Informatics and New Technologies Division of the Court of Justice (‘the Informatics Division’) presented to the evaluation committee its report No 16/2006 on the call for tenders Ref. CJ AM 13/2004, containing an evaluation by reference to both the selection and the award criteria;
– the Informatics Division informed the evaluation committee that on the basis of this evaluation six tenderers including the applicant had received the minimum 70 points in the evaluation of the selection criteria stage. However, the applicant, with 70.1 points, was placed in sixth position. Accordingly, only the bids of the other five tenderers had been evaluated at the phase of the award criteria;
– in the evaluation of the bids by reference to the award criteria, the Informatics Division had placed the two tenderers who were subsequently successful in first and second position and recommended that the committee should award them the contract;
– at its meeting on 12 July 2006 the evaluation committee had considered the Informatics Division report but decided to postpone its decision on the award of the contract and to await additional information which it requested from the Informatics Division;
– on 18 July 2006, the Informatics Division furnished a supplementary report entitled ‘Addendum to Report No 16/2006’; this report, together with its annexes, clearly shows that the Informatics Division had carried out a new evaluation of the award criteria in order to take into account the applicant’s bid as well as the five bids which had previously been assessed;
– for the two categories of award criteria, the Informatics Division had placed the applicant’s bid in fourth position for quality (38.13 points out of 60) and in second place on price (39.18 points out of 40). On the combined quality/price criteria the applicant’s bid had been placed in fourth position with a total of 77.91 points out of 100;
– on 20 July 2006, the Court of Justice informed the two successful tenderers of the award of the contract and informed the applicant that its bid had been rejected.
34 The description of the conduct of the evaluation procedure as set out in the preceding paragraph does not establish that, on the one hand, the applicant’s bid had been rejected on the grounds that it had been placed in sixth position at the end of the selection stage or, on the other hand, that no technical and financial evaluation of the bid had been made.
35 The formal decision to award the contract to the two successful tenderers was in reality taken on the basis of the supplementary report of 18 July 2006, which includes an evaluation of all six bids which had attained 70 points at the selection stage, including that of the applicant. The applicant’s bid was not therefore rejected at the end of the selection stage but upon the basis that it had been placed in fourth position at the end of the award stage. Moreover, this fact was known to the Court of Justice when it sent its letter of 20 July 2006 to the applicant.
36 At the hearing the Court of Justice argued that the evaluation of the applicant’s bid by reference to the award criteria was merely an informal exercise designed to confirm the earlier decision to reject the bid at the selection phase. That argument cannot be accepted. The supplementary report of 18 July 2006 clearly shows that the bid had been fully evaluated at the award stage and had even been placed in second position on price. It was on the basis of that evaluation, which took into account the applicant’s bid, that the Court of Justice adopted its formal and definitive decision to award the contract to the two successful tenderers.
37 It is also apparent that, in formulating its present case, the applicant was induced into error by the description given of the evaluation of the references in the letters of 20 July and 3 and 23 August 2006. In particular this last letter suggests that the mark of 17.5 out of 35 points was attributable to the three factors cited at paragraph 10 above, including the fact that some of its references concerned activities which were carried out more than three years previously. The applicant, as is shown clearly in the application, interpreted this explanation to the effect that the references in question had not been taken into account in the evaluation of the selection criteria upon the ground that they covered work which had been commenced or finished on dates outside the relevant period, running from 1 January 2003 to 31 December 2005, even though the work was being performed during those years.
38 That interpretation was, in effect, further confirmed by the defence which, at paragraph 29, reads as follows:
‘First the applicant’s contention is misconceived in fact. Even though all the aforementioned references cover work carried out by the applicant or by the partner companies in a consortium during the past three years, it would have been contrary to the principles of transparency and equal treatment to take into account the work and activities which were carried out more than three years ago by the applicant. The [Court of Justice] indeed took into account the work carried out by the applicant or by the partner companies in a consortium during the past three years, excluding however the activities [relating to the projects “EUR-Lex”, “ESP5”, “Circa”, “SEI-JOS”, “IDA Tools”, “Stadium” and “Chopin”] which were anterior to this period.’
39 Although paragraph 29 of the defence is open to an interpretation to the effect that the references in question had been excluded from consideration only to the extent that they covered work performed outside the relevant period, the defence pleading did not correct the impression created by the letter of 23 August 2006. It was not until the Court of Justice, in its rejoinder, declared unequivocally that all of the references had been taken into account in respect of work performed during the relevant period that the applicant and the Court were able to understand that the meaning first given to the letter of 23 August 2006 was mistaken.
40 Moreover, it follows from the foregoing that the debate between the parties in the present case as to the validity of the evaluation of the references is in effect redundant in these circumstances, because the evaluation of the selection criteria is no longer relevant once the bid is admitted to the award stage. If the Court of Justice had informed the applicant of the fact that the limit of five tenderers at the outcome of the selection phase had not been applied and that its bid had been placed in fourth position at the end of the award stage, the present case might not have been brought, or, at the very least, would have been founded on a totally different basis.
41 As the applicant points out, Article 89(1) of the Financial Regulation requires that ‘all public contracts … comply with the principles of transparency, proportionality, equal treatment and non-discrimination’. Moreover Article 100(2) of the regulation provides that ‘[t]he contracting authority shall notify all candidates or tenderers whose applications or tenders are rejected of the grounds on which the decision was taken.’
42 It is undeniable that this last provision requires every contracting authority to give a tenderer the true reasons for the rejection of its bid. Moreover, the reasons given must reflect the actual conduct of the evaluation procedure. In that connection it must be recalled that the reasons given for a decision which has adverse effect must be logically compatible with the decision as adopted (see, to that effect, Case 2/56 Geitling v High Authority [1957] ECR 3, at p. 16).
43 A statement of reasons which does not identify the true basis upon which a decision rejecting a bid has been taken and does not reflect faithfully the manner in which the rejected bid has been evaluated is not transparent and does not fulfil the obligation to state reasons in Article 100(2) of the Financial Regulation.
44 It follows from the above findings that the decision rejecting the applicant’s bid disregarded the obligation to state reasons and that in consequence it is necessary to annul that decision, as communicated to the applicant by the letter of 20 July 2006.
45 As regards the applicant’s claim for annulment of the decision awarding the contract to the two successful tenderers, the Court finds it impossible to judge whether it is well founded because, as the obligation to state reasons was disregarded, no examination of the evaluation of the award criteria could take place in the present action.
Costs
46 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Court of Justice has been unsuccessful, it must be ordered to pay costs as applied for by the applicant.
On those grounds,
THE COURT OF FIRST INSTANCE (Fourth Chamber)
hereby:
1. Annuls the decision of the Court of Justice to reject the tender submitted by Evropaïki Dinamiki – Proigmena Sistimata Tilepikinonion Pliroforikis kai Tilematikis AE, as communicated to the latter by letter of 20 July 2006;
2. Orders the Court of Justice to pay the costs.
Delivered in open court in Luxembourg on 10 September 2008.