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The Court of Appeal ordered that a tender be re-issued following the information required for a tenderer to quote was not sufficient. This was held in a judgement delivered by the Court of Appeal in IOT Malta Limited -v- Kunsill Lokali, Valletta, CVA Technology Company Limited on 29 April 2019.

The appeal was lodged by the IOT Malta Limited, following a decision delivered by the Public Contracts Review Board. IOT had originally objected to the Valletta Local Council’s decision to put aside the company’s bid to set up a parking management system in Valletta. The contract was awarded to CVA Technology Company Limited.

The Local Council had issued a tender for the Design, Development, Supply, Installation and Testing for a Parking Management System Including Parking Availability Sensors for Valletta as part of Civitas Destinations Project.

The tender document included a number of conditions including that the solution proposed must be interoperable with the Valletta Travel Information System (VaTIS) app, designed to aggregate and disseminate travel information. Companies which were interested in the tender asked for more information on the details required for the app. The Council replied that the “information will be provided after award of contract.” There were three tenderers, CVA, IOT and another one. On 24 March 2018 the Council asked IOT for more clarifications on its tender and this was replied on 2 April 2018. On 10 September 2018, the Council informed IOT that CVA was given the contract.

The reason behind this was that the Evaluation Committee was not aware of the costs to integrate VoTIS and the Committee was “not in a position to establish/derive to a fixed value at evaluation stage, prior awarding the contract ….” CVA was not the cheapest but IOT was. IOT challenged this decision before the Review Board asking it to revoke the Council’s decision. The Review Board gave its decision on 1 November 2018 wherein it did not agree that there was a change of goal posts, as claimed by IOT, since VoTIS application should have been part of the technical requirements and it was clearly described, but IOT did not clearly indicate the application in the original submissions. The clarifications given before the submission of the tender dealt with technical specifications and the bill of quantities. The Board held this did not amount to new or additional specifications.

With regard to the reason for the rejection of IOT’s tender, the Board agreed with the Valletta Local Council that the bid was incomplete as the costs to have the service integrated with the VaTIS is unknown. The company failed to make adequate clarifications of its bid.

The Court of Appeal was asked to review this decision. Before handling the appeal, the Court of Appeal had to deal with the request by the Valletta Local Council to remove the documents IOT presented in the appeal and which were not presented before the Review Board. In the list of documents presented with the application for the appeal, a number of documents were specifically mentioned, while others were merely described as “various documents” presented before the Review Board. The Court pointed out that each document should be described in the note listing the documents, but the Council failed to pin point which of the documents it was objecting to and therefore, these cannot be removed from the acts of the case.

As the first ground of appeal, the company argued that how the tender was issued breached the principle of equal treatment. CVA has an advantage because it already operates the system. This point was ignored by the Board, although it was raised. IOT held that although CVA had a right to tender, the Council should have given a better explanation of what is required. The Court of Appeal held that the tender document the system offers should be interoperatable with the VaTIS app, but who is not familiar with the current architecture of the system, will not have sufficient information to make the system proposed compatible. When clarifications were sought, the tenders were informed that the system needed to generate an xml file every few seconds, which would be available online.

CVA argued that this information was sufficient for all the tenderers. However, the clarification also said that the information “will be provided after the award of contract”. Therefore, the tenderers, apart from CVA (who provided the service already), could not establish if this had an effect on the price. This meant that CVA was the only tenderer with sufficient information to be able to make a bid. Therefore, the Court of Appeal revoked the Review Board’s decision and ordered that there be a fresh tender, with all the necessary information available to all tenderers.

Avv. Malcolm Mifsud


Mifsud & Mifsud Advocates

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