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Ellex Valiunas Successful for Kaunas City Municipality Before Supreme Court of Lithuania in Procurement Dispute

Ellex Valiunas Successful for Kaunas City Municipality Before Supreme Court of Lithuania in Procurement Dispute

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Ellex Valiunas has persuaded the Supreme Court of Lithuania to rule that the Kaunas City Municipality may continue centralizing food purchases for pre-school education institutions.

According to a summary on the Ellex Valiunas website, in this case, "the applicant [had] questioned whether the municipality had correctly assessed the justification for the abnormally low tenders submitted by two separate suppliers in two public procurements." The value of the two challenged "centralized procurements," that the case revolved around, according to the firm, was EUR 900,000.

According to the firm, "the dispute in the present case arose when a supplier, which later was legally excluded from the tender, decided to initiate a dispute over the eligibility of tenders submitted by other suppliers. Lithuania's Supreme Court noted that even after recognizing the plaintiff's arguments as valid, the plaintiff could no longer return to the tender. Similarly, the applicant could not expect that, if the action was upheld, the tender would be terminated and reopened because, in that case, the other tenderers whose tenders had not been in dispute would be declared the winners. In that context, the SCL ruled that the plaintiff had no legal interest in the case and dismissed the action."

Going forward, Ellex Valiunas suggests, "suppliers and contracting authorities should keep two essential points in mind. First, the exclusion of a supplier from procurement procedures does not in itself lead to the loss of his legal interest: suppliers may continue to initiate disputes over the legality of tendering procedures in the hope of re-tendering or the possibility of an action for damages. Second, a legal interest is lost only if, in the context of a particular situation, the supplier loses even a theoretical opportunity to compete in another purchase (which will not even necessarily be announced)."

According to Ellex Valiunas, "this victory is especially important for Kaunas City Municipality and the people of Kaunas City. Attempts by the municipality to centralize the procurement of food products for pre-school education institutions face significant resistance, which is expressed by initiating unfounded legal disputes against the centralized procurements carried out by the municipality."

The Ellex Valiunas team representing the Kaunas City Municipality was led by Partner Karolis Kacerauskas and included Associate Lawyers Sarunas Neniskis and Aiste Mikociuniene and Lawyer Gabriele Radziute.

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