On 24 November 2010, the Cabinet Office published a consultation document (the "Consultation Document") setting out various options for changing the time limits for bringing proceedings relating to breaches of the public procurement rules. The Cabinet Office is seeking views on which of the options would be preferable, as well as suggestions on how to assess the impact of the various options.
The current rules are found in the Public Contracts Regulations 2006 and the Utilities Contracts Regulations 2006. They state that proceedings should be brought 'promptly and in any event within three months from the date when grounds for the bringing of proceedings first arose, unless the Court considers that there is a good reason for extending the period'. A subsequent amendment to the definition of 'promptly' states that proceedings need not be brought before the expiry of the 10/15 day 'standstill' period contained in the regulations which implemented the EU Remedies Directive (Directive 2007/66).
However, in the Uniplex judgment (Case C-406/408) of 28 January 2010, the European Court of Justice (the "ECJ") held that the current UK limitation rules do not comply with EU law. The ECJ found that:
- the limitation period should not start to run until the date on which the claimant knew, or ought to have known, of the alleged breach of the procurement rules; and
- the requirement to bring proceedings 'promptly' is incompatible with EU law. This is because it leaves the court with the discretion to dismiss an application even where the three month time limit has not yet expired, and renders the limitation rules imprecise and uncertain.
The Cabinet Office is now acting to reform the limitation rules following the Uniplex judgment. The Consultation Document outlines three possible options to reform the rules:
- implementing a shorter time period of 10/15 days from the date of knowledge of the infringement. The court would have no discretion to extend this time limit;
- implementing a longer time period, possibly of 30 days, from the date of knowledge of the infringement. Again, the court would have no discretion to extend this time limit; or
- implementing a time period of 10/15 days from the date of knowledge of the infringement, but with discretion to extend for a period up to three months.
Notably the Cabinet Office has rejected a suggestion that the limitation period be amended to allow a period of three months from the date of knowledge on the basis that such a period is "unduly favourable to the claimant". In relation to the first two options, the Cabinet Office is seeking views as to how the 'date of knowledge' should be defined.
The Cabinet Office is seeking responses to the Consultation Document by 19 January 2011. It will then publish a summary of the results before laying the amending regulations before Parliament.
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