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Procurement e-briefing - July 2013

  • Ireland
  • General

09-07-2013

Copymoore Limited and Others and the Commissioner of Public Works in Ireland (High Court 29 May 2013) – Case Summary

An interesting recent judgment of Mr. Justice Hogan could have implications for a number of national framework agreements that have been put in place by the National Procurement Service (“NPS”).

By way of background, a circular was issued by the Department of Public Expenditure and Reform in July 2012 (see earlier e-briefing on this).  It notified public bodies of mandatory requirements to utilise central framework agreements put in place by the NPS, when procuring a range of commonly acquired goods and services (“Circular 06/12”).  These framework agreements relate to various supplies and services, namely stationery and office supplies, paper, janitorial supplies, ICT consumables, advertising, motor vehicles, energy and managed print services.

A number of managed print suppliers took a case against the Commissioner of Public Works in relation to the Managed Print Services Framework Agreement (the “MPS Agreement”).  They challenged the validity of Circular 06/12 and its mandatory requirement for use of the MPS Agreement by all public bodies, arguing that this precluded these suppliers from providing services to such bodies during the term of the MPS Agreement.  The applicants had not tendered to become parties to the MPS Agreement.  The annual turnover requirement to tender was €10,000,000 and some of the applicants may not have met this requirement.  The court ruled that the applicants did not have standing to challenge the award of the MPS Agreement as they had not tendered in the original competition.  However, the court determined that Circular 06/12 is ultra vires as incompatible with European Union law since it made the use of the MPS Agreement mandatory.  A key point was that this mandatory requirement was not part of the original tender procedure. 

The tender documentation for the MPS Agreement had stated that use of the framework agreement by the public sector was optional.  However, Circular 06/12 subsequently made use of the MPS Agreement mandatory. This had far reaching implications for the applicants, as they were effectively locked out of key public sector markets for a period of time.  The court stated that the Minister can, of course, exercise his executive powers to give general directions to the public sector by means of a circular, but this may not compromise rights or entitlements deriving from European Union law.  The making use of the MPS Agreement mandatory distorted the assumptions on which the entire tender process was based, thus inadvertently undermining a key objective of the Public Sector Directive (Directive 2004/18/EC).  The court concluded that Circular 06/12 is invalid and ineffective insofar as it makes the use of the MPS Agreement mandatory throughout the public sector.

Conclusions

Whilst this case determines that the use of the MPS Agreement cannot be mandatory, it will be interesting to see how this impacts on the other existing framework agreements that have been entered into regarding the other goods and services mentioned above. There is a question mark over the requirement for the mandatory use of these other framework agreements following this court ruling and its determination regarding the legal standing of Circular 06/12.  Unless it was clear from the outset of the procurement procedures for such framework agreements that these were for use by the entire public sector and were mandatory, they should not be managed in this way. Otherwise, they could be subject to legal challenge in the same way as the MPS Agreement.

Circular 06/12 will need to be amended to reflect this judgment and to ensure there is no legal uncertainty surrounding the other framework agreements and their use by the public sector.


Disclaimer

This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

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