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The Utilities Contracts Regulations 2006 (revoked)

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Point in time view as at 01/10/2011.

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[F1PART 9E+W+N.I.APPLICATIONS TO THE COURT

Textual Amendments

Interpretation of Part 9E+W+N.I.

45.(1)  In this Part, except where the context otherwise requires—

claim form” includes, in Northern Ireland, the originating process by which the proceedings are commenced;

“contract”, includes a framework agreement which the utility—

(a)

purports to have entered into, or to be intending to enter into, in accordance with these Regulations; and

(b)

has relied on, is relying on, or intends to rely on, for the purposes of regulation 17(1)(i) (award, without a call for competition, of contracts under a framework agreement);

declaration of ineffectiveness” means a declaration made under regulation 45J(2)(a) or 45O(3);

“economic operator” has the extended meaning given to it by regulation 45B(3);

grounds for ineffectiveness” has the meaning given to it by regulation 45K;

proceedings” means court proceedings taken for the purposes of regulation 45C; and

“standstill period”, and references to its end, have the same meaning as in regulation 33A.

(2) In this Part F2...any reference to a period of time, however expressed, is to be interpreted subject to the requirement that, if the period would otherwise have ended on a day which is not a working day, the period is to end at the end of the next working day.

Textual Amendments

Modifications etc. (not altering text)

C1Reg. 45(5) (as saved by S.I. 2009/3100, reg. 13) modified (1.10.2011) by The Public Procurement (Miscellaneous Amendments) Regulations 2011 (S.I. 2011/2053), regs. 1, 7 (with reg. 10)

Duty owed to economic operatorsE+W+N.I.

45A.(1)  This regulation applies to the obligation on a utility to comply with—

(a)the provisions of these Regulations, other than regulations 30(9) and 38; and

(b)any enforceable [F3EU] obligation in respect of a contract or design contest (other than one excluded from the application of these Regulations by regulation 6, 7, 8, 9, 11 or 34).

(2) That obligation is a duty owed to an economic operator.

Textual Amendments

Duty owed to GPA economic operatorsE+W+N.I.

45B.(1)  Subject to paragraphs (2) and (3), the duty owed to an economic operator in accordance with regulation 45A is a duty owed also to a GPA economic operator.

(2) The duty is not owed in relation to—

(a)a Part B services contract; or

(b)a contract for research and development services specified in category 8 of Part A of Schedule 3.

(3) References to an “economic operator” in this Part, except in regulation 45A or in relation to the duty owed in accordance with that regulation, also include a GPA economic operator.

(4) In this regulation—

GPA economic operator” means a person from a GPA State who sought, who seeks, or would have wished, to be the person to whom the contract is awarded;

GPA State” means any country, other than a relevant State, which at the relevant time is a signatory to the GPA and has agreed with the [F3European Union] that the GPA shall apply to a contract of the type to be awarded; and

relevant time” means—

(a)

if the utility selects economic operators to tender for or to negotiate the contract in accordance with a qualification system established in accordance with regulation 25, the date on which the selection commences;

(b)

if the utility satisfies the requirement that there be a call for competition by indicating the intention to award the contract in a periodic indicative notice in accordance with regulation 16(2)(a)(i), the date on which the notice is sent to the Official Journal; or

(c)

in any other case, the date on which the utility sent a contract notice or design contest notice to the Official Journal or would have done so if the requirement that there be a call for competition applied and the utility decided to satisfy that requirement by sending such a notice.

Textual Amendments

Enforcement of duties through the CourtE+W+N.I.

45C.(1)  A breach of the duty owed in accordance with regulation 45A or 45B is actionable by any economic operator which, in consequence, suffers, or risks suffering, loss or damage.

(2) Proceedings for that purpose must be started in the High Court, and regulations 45D to 45P apply to such proceedings.

General time limits for starting proceedingsE+W+N.I.

45D.(1)  This regulation limits the time within which proceedings may be started where the proceedings do not seek a declaration of ineffectiveness.

[F4(2) Subject to paragraphs (3) to (5), such proceedings must be started within 30 days beginning with the date when the economic operator first knew or ought to have known that grounds for starting the proceedings had arisen.]

(3) Paragraph (2) does not require proceedings to be started before the end of any of the following periods—

(a)where the proceedings relate to a decision which is sent to the economic operator by facsimile or electronic means, 10 days beginning with—

(i)the day after the date on which the decision is sent, if the decision is accompanied by a summary of the reasons for the decision;

(ii)if the decision is not so accompanied, the day after the date on which the economic operator is informed of a summary of those reasons;

(b)where the proceedings relate to a decision which is sent to the economic operator by other means, whichever of the following periods ends first—

[F5(i)15 days beginning with the day after the day on which the decision is sent, if the decision is accompanied by a summary of the reasons for the decision;]

(ii)10 days beginning with—

(aa)the day after the date on which the decision is received, if the decision is accompanied by a summary of the reasons for the decision; or

(bb)if the decision is not so accompanied, the day after the date on which the economic operator is informed of a summary of those reasons;

(c)where sub-paragraphs (a) and (b) do not apply but the decision is published, 10 days beginning with the day on which the decision is published.

[F6(4) Subject to paragraph (5), the Court may extend the time limit imposed by paragraph (2) (but not any of the limits imposed by regulation 45E) where the Court considers that there is a good reason for doing so.

(5) The Court must not exercise its power under paragraph (4) so as to permit proceedings to be started more than 3 months after the date when the economic operator first knew or ought to have known that grounds for starting the proceedings had arisen.

(6) For the purposes of this regulation, proceedings are to be regarded as started when the claim form is issued.]

Special time limits for seeking a declaration of ineffectivenessE+W+N.I.

45E.(1)  This regulation limits the time within which proceedings may be started where the proceedings seek a declaration of ineffectiveness.

(2) Such proceedings must be started—

(a)where paragraph (3) or (5) applies, within 30 days beginning with the relevant date mentioned in that paragraph;

(b)[F7in any event ], within 6 months beginning with the day after the date on which the contract was entered into.

(3) This paragraph applies where a relevant contract award notice has been published in the Official Journal, in which case the relevant date is the day after the date on which the notice was published.

(4) For that purpose, a contract award notice is relevant if, and only if—

(a)the contract was awarded without prior publication of a contract notice; and

(b)the contract award notice includes justification of the decision of the utility to award the contract without prior publication of a contract notice.

(5) This paragraph applies where the utility has informed the economic operator of—

(a)the conclusion of the contract; and

(b)a summary of the relevant reasons,

in which case the relevant date is the day after the date on which the economic operator was informed of the conclusion or, if later, was informed of a summary of the relevant reasons.

(6) In paragraph (5), “the relevant reasons” means the reasons which the economic operator would have been entitled to receive in response to a request under regulation 33(9).

(7) In this regulation, “contract award notice” means a notice in accordance with regulation 32(1).

[F8(8) For the purposes of this regulation, proceedings are to be regarded as started when the claim form is issued.]

Starting proceedingsE+W+N.I.

45F.[F9(1) Where proceedings are started, the economic operator must serve the claim form on the utility within 7 days after the date of issue.]

(2) Paragraph (3) applies where proceedings are started—

(a)seeking a declaration of ineffectiveness; or

(b)alleging a breach of regulation 33A, 45G or 45H(1)(b) where the contract has not been fully performed.

(3) In those circumstances, the economic operator must, as soon as practicable, send a copy of the claim form to each person, other than the utility, who is a party to the contract in question.

(4) The utility must, as soon as practicable, comply with any request from the economic operator for any information that the economic operator may reasonably require for the purpose of complying with paragraph (3).

(5) In this regulation, “serve” means serve in accordance with rules of court, and for the purposes of this regulation a claim form is deemed to be served on the day on which it is deemed by rules of court to be served.

Contract-making suspended by challenge to award decisionE+W+N.I.

45G.[F10(1) Where—

(a)a claim form is issued in respect of a utility's decision to award the contract;

(b)the utility has become aware that the claim form has been issued and that it relates to that decision; and

(c)the contract has not been entered into,

the utility is required to refrain from entering into the contract.]

(2) The requirement continues until any of the following occurs—

(a)the Court brings the requirement to an end by interim order under regulation 45H(1)(a);

(b)the proceedings at first instance are determined, discontinued or otherwise disposed of and no order has been made continuing the requirement (for example in connection with an appeal or the possibility of an appeal).

F11(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) This regulation does not affect the obligations imposed by regulation 33A.

Interim ordersE+W+N.I.

45H.(1)  In proceedings, the Court may, where relevant, make an interim order—

(a)bringing to an end the requirement imposed by regulation 45G(1);

(b)restoring or modifying that requirement;

(c)suspending the procedure leading to—

(i)the award of the contract; or

(ii)the determination of the design contest,

in relation to which the breach of the duty owed in accordance with regulation 45A or 45B is alleged;

(d)suspending the implementation of any decision or action taken by the utility in the course of following such a procedure.

(2) When deciding whether to make an order under paragraph (1)(a)—

(a)the Court must consider whether, if regulation 45G(1) were not applicable, it would be appropriate to make an interim order requiring the utility to refrain from entering into the contract; and

(b)only if the Court considers that it would not be appropriate to make such an interim order may it make an order under paragraph (1)(a).

(3) If the Court considers that it would not be appropriate to make an interim order of the kind mentioned in paragraph (2)(a) in the absence of undertakings or conditions, it may require or impose such undertakings or conditions in relation to the requirement in regulation 45G(1).

(4) The Court may not make an order under paragraph (1)(a) or (b) or (3) before the end of the standstill period.

(5) This regulation does not prejudice any other powers of the Court.

Remedies where the contract has not been entered intoE+W+N.I.

45I.(1)  This regulation applies where—

(a)the Court is satisfied that a decision or action taken by a utility was in breach of the duty owed in accordance with regulation 45A or 45B; and

(b)the contract has not yet been entered into.

(2) In those circumstances, the Court may do one or more of the following—

(a)order the setting aside of the decision or action concerned;

(b)order the utility to amend any document;

(c)award damages to an economic operator which has suffered loss or damage as a consequence of the breach.

(3) Where the Court is satisfied that an economic operator would have had a real chance of being awarded the contract if that chance had not been affected by the breach mentioned in paragraph (1)(a), the economic operator is entitled to damages amounting to its costs in preparing its tender and in participating in the procedure leading to the award of the contract.

(4) Paragraph (3)—

(a)does not affect a claim by an economic operator that it has suffered other loss or damage or that it is entitled to relief other than damages; and

(b)is without prejudice to the matters on which an economic operator may be required to satisfy the Court in respect of any such other claim.

(5) This regulation does not prejudice any other powers of the Court.

Remedies where the contract has been entered intoE+W+N.I.

45J.(1)  Paragraph (2) applies if—

(a)the Court is satisfied that a decision or action taken by a utility was in breach of the duty owed in accordance with regulation 45A or 45B; and

(b)the contract has already been entered into.

(2) In those circumstances, the Court—

(a)must, if it is satisfied that any of the grounds for ineffectiveness applies, make a declaration of ineffectiveness in respect of the contract unless regulation 45L requires the Court not to do so;

(b)must, where required by regulation 45N, impose penalties in accordance with that regulation;

(c)may award damages to an economic operator which has suffered loss or damage as a consequence of the breach, regardless of whether the Court also acts as described in sub-paragraphs (a) and (b);

(d)must not order any other remedies.

(3) Paragraph (2)(d) is subject to regulation 45O(3) and (9) (additional relief in respect of specific contracts where a framework agreement is ineffective) and does not prejudice any power of the Court under regulation 45M(3) or 45N(10) (orders which supplement a declaration of ineffectiveness or a contract-shortening order).

(4) Regulation 45I(3) and (4) (entitlement to tendering costs etc. as damages for loss of a real chance of being awarded the contract) apply for the purposes of this paragraph.

Grounds for ineffectivenessE+W+N.I.

45K.(1)  There are three grounds for ineffectiveness.

The first ground

(2) Subject to paragraph (3), the first ground applies where the contract has been awarded without prior publication of a notice in the Official Journal in any case in which these Regulations required the prior publication of such a notice.

(3) The first ground does not apply if all the following apply—

(a)the utility considered the award of the contract without prior publication of such a notice to be permitted by these Regulations;

(b)the utility has had published in the Official Journal a voluntary transparency notice expressing its intention to enter into the contract; and

(c)the contract has not been entered into before the end of a period of at least 10 days beginning with the day after the date on which the voluntary transparency notice was published in the Official Journal.

(4) In paragraph (3), “voluntary transparency notice” means a notice—

(a)which contains the following information—

(i)the name and contact details of the utility;

(ii)a description of the object of the contract;

(iii)a justification of the decision of the utility to award the contract without prior publication of a notice in the Official Journal;

(iv)the name and contact details of the economic operator to be awarded the contract; and

(v)where appropriate, any other information which the utility considers it useful to include; and

(b)which, if Commission Regulation (EC) No 1564/2005 as amended from time to time sets out a form to be used for the purposes of paragraph (3), is in that form.

The second ground

(5) The second ground applies where all the following apply—

(a)the contract has been entered into in breach of any requirement imposed by—

(i)regulation 33A (the standstill period);

(ii)regulation 45G (contract-making suspended by challenge to award); or

(iii)regulation 45H(1)(b) (interim order restoring or modifying a suspension originally imposed by regulation 45G);

(b)there has also been a breach of the duty owed to the economic operator in accordance with regulation 45A or 45B in respect of obligations other than those imposed by regulation 33A (the standstill period) and this Part;

(c)the breach mentioned in sub-paragraph (a) has deprived the economic operator of the possibility of starting proceedings in respect of the breach mentioned in sub-paragraph (b), or pursuing them to a proper conclusion, before the contract was entered into; and

(d)the breach mentioned in sub-paragraph (b) has affected the chances of the economic operator obtaining the contract.

The third ground

(6) Subject to paragraph (7), the third ground applies where all the following apply—

(a)the contract was awarded under a dynamic purchasing system;

(b)the contract was awarded in breach of any requirement imposed by regulation 19(11) to (14) (award of contracts under dynamic purchasing systems); and

(c)the estimated value of the contract [F12is equal to or exceeds ] the relevant threshold for the purposes of regulation 11.

(7) The third ground does not apply if all the following apply—

(a)the utility considered the award of the contract to be in accordance with regulation 19(11) to (14);

(b)the utility has, despite regulation 33(7), voluntarily complied with the requirements set out in regulation 33(1) to (2A); and

(c)the contract has not been entered into before the end of the standstill period.

General interest grounds for not making a declaration of ineffectivenessE+W+N.I.

45L.(1)  Where the Court is satisfied that any of the grounds for ineffectiveness applies, the Court must not make a declaration of ineffectiveness if—

(a)the utility or another party to the proceedings raises an issue under this regulation; and

(b)the Court is satisfied that overriding reasons relating to a general interest require that the effects of the contract should be maintained.

(2) For that purpose, economic interests in the effectiveness of the contract may be considered as overriding reasons only if in exceptional circumstances ineffectiveness would lead to disproportionate consequences.

(3) However, economic interests directly linked to the contract cannot constitute overriding reasons relating to a general interest.

(4) For that purpose, economic interests directly linked to the contract include—

(a)the costs resulting from the delay in the execution of the contract;

(b)the costs resulting from the commencement of a new procurement procedure;

(c)the costs resulting from change of the economic operator performing the contract; and

(d)the costs of legal obligations resulting from the ineffectiveness.

(5) For the purposes of paragraph (1)(b), overriding reasons may be taken to require that the effects of the contract should be maintained even if they do not require the Court to refrain from shortening the duration of the contract by an order under regulation 45N(3)(a).

The consequences of ineffectivenessE+W+N.I.

45M.(1)  Where a declaration of ineffectiveness is made, the contract is to be considered to be prospectively, but not retrospectively, ineffective as from the time when the declaration is made and, accordingly, those obligations under the contract which at that time have yet to be performed are not to be performed.

(2) Paragraph (1) does not prevent the exercise of any power under which the orders or decisions of the Court may be stayed, but at the end of any period during which a declaration of ineffectiveness is stayed, the contract is then to be considered to have been ineffective as from the time when the declaration had been made.

(3) When making a declaration of ineffectiveness, or at any time after doing so, the Court may make any order that it thinks appropriate for addressing—

(a)the implications of paragraph (1) or (2) for the particular circumstances of the case;

(b)any consequential matters arising from the ineffectiveness.

(4) Such an order may, for example, address issues of restitution and compensation as between those parties to the contract who are parties to the proceedings so as to achieve an outcome which the Court considers to be just in all the circumstances.

(5) Paragraph (6) applies where the parties to the contract have, at any time before the declaration of ineffectiveness is made, agreed by contract any provisions for the purpose of regulating their mutual rights and obligations in the event of such a declaration being made.

(6) In those circumstances, the Court must not exercise its power to make an order under paragraph (3) in any way which is inconsistent with those provisions, unless and to the extent that the Court considers that those provisions are incompatible with the requirement in paragraph (1) or (2).

Penalties in addition to, or instead of, ineffectivenessE+W+N.I.

45N.(1)  Where the Court makes a declaration of ineffectiveness, it must also order that the utility pay a civil financial penalty of the amount specified in the order.

(2) Paragraph (3) applies where—

(a)in proceedings for a declaration of ineffectiveness, the Court is satisfied that any of the grounds for ineffectiveness applies but does not make a declaration of ineffectiveness because regulation 45L requires it not to do so; or

(b)in any proceedings, the Court is satisfied that the contract has been entered into in breach of any requirement imposed by regulation 33A, 45G or 45H(1)(b), and does not make a declaration of ineffectiveness (whether because none was sought or because the Court is not satisfied that any of the grounds for ineffectiveness applies).

(3) In those circumstances, the Court must order at least one, and may order both, of the following penalties—

(a)that the duration of the contract be shortened to the extent specified in the order;

(b)that the utility pay a civil financial penalty of the amount specified in the order.

(4) When the Court is considering what order to make under paragraph (1) or (3), the overriding consideration is that the penalties must be effective, proportionate and dissuasive.

(5) In determining the appropriate order, the Court must take account of all the relevant factors, including—

(a)the seriousness of the relevant breach of the duty owed in accordance with regulation 45A or 45B;

(b)the behaviour of the utility;

(c)where the order is to be made under paragraph (3), the extent to which the contract remains in force.

(6) Where more than one economic operator starts proceedings in relation to the same contract, paragraph (4) applies to the totality of penalties imposed in respect of the contract.

Civil financial penalties

[F13(7) Where a contracting authority is ordered by the High Court of England and Wales to pay a civil financial penalty under this regulation—

(a)the Court's order must state that the penalty is payable to the Minister for the Cabinet Office;

(b)the Court must send a copy of the order to the Minister;

(c)the utility must pay the penalty to the Minister; and

(d)the Minister must, on receipt of the penalty, pay it into the Consolidated Fund.]

(8) Where a utility is ordered by the High Court of Northern Ireland to pay a civil financial penalty under this regulation—

(a)the Court's order must state that the penalty is payable to the Department of Finance and Personnel;

(b)the Court must send a copy of the order to the Department;

(c)the utility must pay the penalty to the Department; and

(d)the Department must, when it receives the penalty, pay it into the Consolidated Fund of Northern Ireland.

(9) Where a utility is a non-Crown body—

(a)any payment due under paragraph (7) may be enforced by the [F14Minister for the Cabinet Office] as a judgment debt due to [F15the Minister]; and

(b)any payment due under paragraph (8) may be enforced by the Department of Finance and Personnel as a judgment debt due to it.

Contract shortening

(10) When making an order under paragraph (3)(a), or at any time after doing so, the Court may make any order that it thinks appropriate for addressing the consequences of the shortening of the duration of the contract.

(11) Such an order may, for example, address issues of restitution and compensation as between those parties to the contract who are parties to the proceedings so as to achieve an outcome which the Court considers to be just in all the circumstances.

(12) Paragraph (13) applies where the parties to the contract have, at any time before the order under paragraph 3(a) is made, agreed by contract any provisions for the purpose of regulating their mutual rights and obligations in the event of such an order being made.

(13) In those circumstances, the Court must not exercise its power to make an order under paragraph (10) in any way which is inconsistent with those provisions, unless and to the extent that the Court considers that those provisions are incompatible with the primary order that is being made, or has been made, under paragraph (3)(a).

(14) In paragraph (3)(a), “duration of the contract” refers only to its prospective duration as from the time when the Court makes the order.

Ineffectiveness etc. in relation to specific contracts under a framework agreementE+W+N.I.

45O.(1)  In this regulation, “specific contract” means a contract which—

(a)was awarded under a framework agreement;

(b)was awarded without a call for competition in reliance on regulation 17(1)(i) (framework concluded in accordance with these Regulations); and

(c)was entered into before a declaration of ineffectiveness (if any) was made in respect of the framework agreement.

(2) A specific contract is not to be considered to be ineffective merely because a declaration of ineffectiveness has been made in respect of the framework agreement.

(3) Where a declaration of ineffectiveness has been made in respect of the framework agreement, the Court must, subject to paragraph (5), make a separate declaration of ineffectiveness in respect of each relevant specific contract.

(4) For that purpose, a specific contract is relevant only if a claim for a declaration of ineffectiveness in respect of that specific contract has been made—

(a)within the time limits mentioned in regulation 45E as applicable to the circumstances of the specific contract;

(b)regardless of whether the claim was made at the same time as any claim for a declaration of ineffectiveness in respect of the framework agreement.

(5) Regulation 45L (general interest grounds for not making a declaration of ineffectiveness) applies for the purposes of paragraph (3), insofar as the overriding reasons relate specifically to the circumstances of the specific contract.

(6) This regulation does not prejudice the making of a declaration of ineffectiveness in relation to a specific contract in accordance with other provisions of these Regulations on the basis of the second ground of ineffectiveness set out in regulation 45K(5), where—

(a)the relevant breach of the kind mentioned in regulation 45K(5)(a) is entering into the specific contract in breach of regulation 45G or 45H(1)(b); and

(b)the relevant breach of the kind mentioned in regulation 45K(5)(b) relates specifically to the award of the specific contract and the procedure relating to that award, rather than to the award of the framework agreement and the procedure relating to it.

(7) A declaration of ineffectiveness must not be made in respect of a specific contract otherwise than in accordance with paragraph (3) or on the basis mentioned in paragraph (6).

(8) Where a declaration of ineffectiveness is made in respect of a specific contract in accordance with paragraph (3)—

(a)regulation 45M (the consequences of ineffectiveness) applies;

(b)regulation 45N(1) (requirement to impose a civil financial penalty) does not apply.

(9) Where the Court refrains, by virtue of paragraph (5), from making a declaration of ineffectiveness which would otherwise have been required by paragraph (3), the Court must, subject to paragraph (10), order that the duration of the specific contract be shortened to the extent specified in the order.

(10) The extent by which the duration of the specific contract is to be shortened under paragraph (9) is the maximum extent, if any, which the Court considers to be possible having regard to what is required by the overriding reasons mentioned in paragraph (5).

(11) In paragraphs (9) and (10), “duration of the specific contract” refers only to its prospective duration as from the time when the Court makes the order.

Injunctions against the CrownE+W+N.I.

45P.  In proceedings against the Crown, the Court has power to grant an injunction despite section 21 of the Crown Proceedings Act 1947.]

ConciliationE+W+N.I.

F146.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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