2012/9 Sjåtil & Fornæss Kongsvinger AS – The municipality of Kongsvinger

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(Grounds for award of contract – cancellation of tendering procedure)

Decision of the Grand Board regarding the breach of the rules on confidentiality in the Norwegian public procurement regulation § 3-6

Case 2012/9 concerns an open procedure by the municipality of Kongsvinger for framework agreements on the procurement of consultancy services, regarding engineering and construction management. After the contract was awarded, the municipality disclosed the average hourly rates offered in relation to the price criterion, upon the request from a tenderer. At this point, several complaints regarding the tendering procedure had been submitted. The procedure was eventually cancelled due to the use of unlawful award criteria. KOFA found that the contracting authority violated the rules on confidentiality by disclosing the tenderers' hourly rates.

A question before the Complaints Board was also whether the decision to disclose the Complainants average hourly rates, constituted a breach of the rules on confidentiality in the public procurement regulations § 3-6. This question demanded a broad assessment of the rules of confidentiality, including their general reach. For this reason, it was decided to treat the case with five members instead of three (Grand Board).

One of the board members dissented on the question of whether the municipality had released information in breach of the rules of confidentiality. The majority, however, found that disclosing the Complainant's average hourly rate violated the rule on confidentiality. The majority emphasized that the average hourly rate – being an explicit award criteria in the present procedure – constituted a fundamental basis of competition between the tenderers. In addition, the municipality at the time of the disclosure was aware of circumstances that could result in the cancellation of the procedure and thereby a new call for tenders. In this situation, information concerning hourly rates could be utilized to the complainant's disadvantage in subsequent competitions. This also proved to be the case when the contracting authority cancelled the procedure in question, with a view to launch a new call for tenders. Therefore, the information on average hourly rates was considered confidential pursuant to the public procurement regulation § 3-6.

The minority found that the municipality had not acted in breach of the public procurement regulation § 3-6. In the opinion of the minority, information about the hourly rates should not be considered confidential solely because competitors might gain access to the information during a case of appeal, followed by a cancellation of a tendering procedure and a new call for tenders. The main rule, it was argued, was that tenderers are granted access to the total price in other tenders pursuant to the Freedom of Information Act § 23 (3). The provision in § 3-6 of the public procurement regulation should not preclude the tenderers from pursuing this right in a case of appeal, no matter what happens after a preliminary award of contract.