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SPC Legal Successful for Mazeikiai District Municipal Administration in Appeal of Public Procurement Process

SPC Legal Successful for Mazeikiai District Municipal Administration in Appeal of Public Procurement Process

Lithuania
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SPC Legal, acting on behalf of the Mazeikiai District Municipal Administration, has persuaded the Lithuanian Court of Appeal to dismiss the appeal of companies Eikos Statyba and Genra of a procurement process involving a construction project as unfounded.

According to their complaints, Eikos Statyba and Genra sought to annul Mazeikiai District Municipal Administration’s decision to award a EUR 13 million construction contract for the Mazeikiai Entertainment and Sports Arena.

According to SPC Legal, "Eikos Statyba”argued in its complaint that its tender proposal was wrongly rejected, and that the errors in the cost sheets and statements submitted by the company are of a corrective nature and immaterial therefore are of no relevance to the comparison of the proposals. The total number of such errors recorded in the cost sheets [was] 18. Meanwhile, Genra was convinced that the requirement to provide certificates of quality of materials and equipment at the time of purchase was excessive and restricting the competition and that the tender proposal submitted by the company was potentially evaluated in a more rigorous manner compared to the bids made by other applicants."

However, SPC Legal explains that according to Partner Daiva Lileikiene, "the shortcomings found in the technical part of the tender cannot be justified and must be regarded as serious deficiencies, as otherwise, it would not be possible to ensure equitable comparison of all the tenders submitted, and consequently such tenderer would be given an unjustified advantage over other tender participants."

"If the reservations were made," Lileikiene said, "we would create preconditions for certain errors in the tenders not to be due to the participant's negligence, but to the deliberate intention to offer something other than what the customer intended to acquire."

Finally, according to SPC Legal, "the Court noted that the accurate and exact content of the cost sheet line is essential because the works are to be paid at a fixed rate of work, and therefore the applicant's complaint was dismissed by arguing that the construction company Eikos Statyba had breached its duty to prepare the tender proposal properly and thoroughly and that it must bear the consequences of its actions. The Court also stated that the cost sheets of the tender submitted by Eikos Statyba contained data on materials that were not purchased and that certain materials that were included in the tender proposal had not been evaluated at all and that other works were proposed, and therefore Court reached the conclusion that the shortcomings in the tender that had been identified by the contracting authority are considered as being essential and could not be corrected without involving any substantive changes to the proposal. In response to Genra's complaint, the Court stated unequivocally that the contracting authority had made clear requirements to the key materials and equipment, so it should have been apparent to the tenderer what documents were required and what documents would be considered eligible."

Thus, according to Lileikiene, the tender proposals submitted by Eikos Statyba and Genra were rejected in a lawful and reasonable manner, and thus, it was successfully proved in the court."

SPC Legal also quoted Giedrius Petrulevicius, Advisor to Mayor of the Mazeikiai District Municipality, as celebrating the decision. "This is one of the most important infrastructure projects in Mazeikiai that should create new opportunities for meaningful leisure time both for the city and district residents, so I am glad that the public interest has been defended, and the Court has proved that we have worked accurately and responsibly in the development of this project. After two and a half years of court battles and dispute, I am able to breathe a sigh of relief in terms of this project because there are no disturbances left and the construction work of the arena begins.”

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