Procurement: What – How? | Beware of vague reference requirements
Be cautious when formulating reference requirements. Without realising it, you may unintentionally include ambiguous conditions – and that can be fatal to your procurement process. For example, the term "properly" in a reference requirement recently became the subject of legal discussion. The preliminary relief judge ruled that, as a result, the procurement had to be halted.
One of the bidders submitted a reference for a project they had previously carried out for the same organisation now issuing the procurement. This bidder was excluded because, according to the contracting authority, the referenced work had not been performed ‘properly’. Although the work was completed and paid for, the contracting authority was not satisfied with ‘the manner in which it was carried out’.
The bidder did not accept this and initiated interim relief proceedings. In the judge’s ruling, it was assessed whether the reference requirement was sufficiently clear. Although the contracting authority intended to apply an objective assessment, it also wanted to take into account the satisfaction of the referee. However, according to the judge, this latter aspect was not evident from the wording of the reference requirement. The requirement was too ambiguous and therefore not transparent. The conclusion: the procurement had to be halted and possibly restarted.
It is reasonable to assess, through references, whether work has been performed in accordance with contractual and technical requirements (and paid for). Contracting authorities may also request the satisfaction of referees regarding the execution. However, this must be clearly stated in the procurement documents, for example by explicitly requesting a satisfaction statement.
Such a statement, however, is not always easy to obtain. Some referees may be unwilling to cooperate, or it can take considerable time to obtain the appropriate signature. This may disadvantage bidders. In my view, contracting authorities can handle this in several ways:
- Do not require a satisfaction statement, but contact the referee directly yourself. This way you obtain the desired information without the bidder being dependent on someone else’s timing.
- Allow the satisfaction statement to be submitted later, and not necessarily together with the bid.
In all cases, it must be clear when the threshold of ‘satisfaction’ has been met. One referee may be stricter than another – and this should not be decisive.
Blog Series 'Procurement: What – How?'
This blog is part of the series ‘Procurement: What – How?’, in which Joris Bax, attorney at Brackmann, shares his insights and reflections on current topics in procurement and construction law.
Procurement: What – How? | Transparency in Tender Amendments
Amending a contract during a tender procedure often leads to headaches. What exactly can you change – and how should you go about it? In a recent and highly relevant ruling, the preliminary relief judge in Rotterdam addressed the key question: to whom must a change be disclosed?