Main contacts: David Marks and Sue Hankey
Rejection of low tender unlawful
The European Court of Justice (ECJ) has confirmed
that an awarding authority cannot reject abnormally low tenders
unless it follows the verification procedure.
In 1995 the awarding authority, a Genoese local
health authority, published an invitation for tender. The
applicants submitted the lowest tender. The authority automatically
excluded this bid because it was abnormally low, but it did not
attempt to verify the tender because Italian law allows the
exclusion of public works tenders which are more than 20% cheaper
than the average. The applicants claimed this was contrary to the
Directive, which states that abnormally low tenders can be rejected
only after the contracting authority has undertaken the
verification procedure. Until the end of 1992 this verification
procedure could be dispensed with in exceptional circumstances.
The ECJ ruled that there were no exceptional
circumstances and confirmed that the exception was available only
for procedures where the definitive award was made by 31 December
1992. The present award had been made much later.