Procurement: What - How? | Freedom of choice in pricing

For the preparation of a housing plan, the condition of buildings needed to be assessed. During the tender process, it became apparent that information was unavailable for several buildings. Therefore, following questions from bidders via the request for clarification, the contracting authority allowed bidders to collect this information using a method of their own choosing. This could be done through a physical inspection (“schouw”) or by means of desk research.

The price difference between the winning bidder and the runner-up was so large that the runner-up suspected the winner had not included a physical inspection in their price. As a result, they requested the invalidation of the winner’s bid.

The preliminary relief judge ruled that indeed no physical inspection was included in the winner’s price. However, this was not required. The contracting authority did not demand that an inspection be conducted. Bidders were free to collect data on the condition of the buildings using any method they preferred. Since it was established that the winner performed desk research, which was an allowed method, the bid was deemed valid.

Freedom of choice allows bidders to execute the assignment according to their own insights. This can lead to (significant) price differences. This is acceptable, provided the reasons for such differences are clear. At the same time, it is important to ensure that this freedom does not cause ambiguity about the scope or lead to bids that are not comparable.

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.