Public procurement law: Correction of incorrect tenders possible at any time

Public procurement law: Incorrect tenders may be corrected at any stage of the procedure

The Higher Regional Court of Düsseldorf has given public contracting authorities a treat in its decision of January 12, 2015: A public contracting authority that discovers a significant error in the award documents before the contract is awarded may still correct it even if the tender has already taken place.

The fact that there is a fundamental right of the contracting authority to make corrections of significant errors in the award documents before awarding the contract is nothing new. Now, however, the OLG Düsseldorf has ruled that even a submission that has already taken place does not preclude such an error correction. This is because the contracting authority cannot, in principle, be obliged to award a contract on the basis of a call for tenders which it has identified as being defective. The decision as to how and to what extent the contracting authority rectifies an identified tendering error is subject to its freedom of design.

According to the court, first of all, there is a possibility for the contracting authority to postpone the entire procedure.

However, according to the OLG Düsseldorf, it is also conceivable that the contracting authority limits itself to individual sub-items in connection with the deferral if these sub-items do not influence the price structure of the overall offer in a relevant manner. If the order of bidders changes in a second bidding round, this must be accepted by the companies participating in the competition. This applies all the more so in the case of pure price competition, where even a minor deviation in the bid prices can be decisive for the award decision.

Here the minds of the jurisprudence divide

The Dresden Higher Regional Court sets clear limits as far as the relegation of the proceedings to partial positions and the resulting change of price structures is concerned. The limits consist of a so-called “de minimis threshold”. According to the Dresden Higher Regional Court in its ruling of July 23, 2013, if the price items to be corrected account for approx. 15% of the bid totals, it is necessary to obtain new bids in order to counteract distortions of competition.

However, the OLG Düsseldorf does not fully share this view: fair competition can no longer be guaranteed if the items affected by the change co-determine the price structure of the offers in other respects and affect the price structure of the offer in a relevant manner. In this respect, both courts go one way. The fork in the road here lies in the fact that the OLG Düsseldorf does not want to tie such an influence to a “threshold value” of approx. 15% of the bid amounts. It sees ambiguities arising already from the question on which basis such a “de minimis threshold” should be determined. For example, the average of the bids submitted could be used, or the best bid or the contract value estimated in advance by the contracting authority, which is generally not made public, could be used as a basis.

However, the OLG Düsseldorf also takes a critical view of the de minimis threshold set by the OLG Dresden because it does not see any substantive arguments that would make it seem plausible that individual prices of a bid have an influence on the other price components of the bid on the basis of their percentage share in the total contract value.

The Düsseldorf Higher Regional Court refrained from referring the matter to the Federal Court of Justice. Such a referral is intended by law whenever a Higher Regional Court wishes to deviate from the legal opinion of another Higher Regional Court. In this case, submission is therefore not necessary, since the question in dispute between the OLG in connection with the “de minimis threshold” is not relevant to the decision in the dispute.