Procurement: What – How? | onfidentiality declarations in procurement: the assessment criteria
Article 2.23, paragraph 1, sub e of the Dutch Public Procurement Act provides the possibility to declare a procurement procedure confidential. In practice, this provision is rarely applied, resulting in limited case law. Recently, the District Court of The Hague issued a ruling concerning this article, clarifying the criteria against which a confidentiality declaration must be assessed.
The case centered on a confidentiality declaration applied by the Police regarding contracts related to software for investigative services. In summary proceedings, an entrepreneur contested this. The court assessed the confidentiality declaration based on the following criteria:
- Individual Contract: The confidentiality must pertain to a “distinguishable individual contract.” In my opinion, confidentiality covering a large number of contracts without individual assessment is not lawful. This is relevant to determine whether the intended goal could also have been achieved with less intrusive measures than a full confidentiality declaration. Additionally, the law prescribes a cautious approach towards confidentiality declarations (para. 3.9). A confidentiality declaration may cover a broader range of contracts or subjects, but for each individual contract, it must be separately assessed whether a confidentiality declaration is necessary and lawful in that specific case (para. 3.11).
- Interests: The contracting authority must clarify which interests are protected by the confidentiality declaration. Although the ruling involved “substantial security interests” (para. 3.21), this is not a strict requirement under Article 2.23 of the Procurement Act. Other interests may also be relevant. In my view, a link to the security interests mentioned in this article makes a confidentiality declaration more justifiable. Crucially, these interests must be concrete and subject to judicial review (para. 3.14).
- Alternatives: Finally, it must be possible to assess whether the interests can be protected with less intrusive measures than a confidentiality declaration. The court ruled that procurement for the contested contract is not impossible, but there is a risk that less reliable parties might participate and access the information. According to the court, a non-disclosure agreement (NDA) does not provide sufficient guarantees. In my view, this is a logical consideration but not always convincing, since the risk of less reliable parties is always present and an NDA does not offer complete assurance. However, I expect this consideration should be evaluated in light of the interests to be protected: the more significant those interests, the more likely less intrusive measures will be insufficient.
Bear in mind that a confidentiality declaration is an extensive measure: the specific procurement will not be made public. However, the declaration itself must be published in advance, as was recently done by the Ministry of Defence.
Ultimately, this remains an exception. The contracting authority must therefore clearly explain why this exception is necessary and demonstrate compliance with all criteria.
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? | 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.