Case C 54/21 Antea Polska S.A. – Confidentiality of the tender: to disclose or not to disclose?

Facts

  1. The contracting authority launched a tender procedure. One of the unsuccessful tenderers brought an action before the national court seeking the annulment of the award decision, a fresh examination of the tenders, and disclosure of certain information.
  2. The referring court asked the ECJ about the tender information confidentiality limits.

Findings of the Court

  1. The ECJ clarified on substance the confidentiality limits and some important related procedural aspects.
  2. The general rule on confidentiality enshrined in Article 21(1) of Directive 2014/24 is that the contracting authority is not allowed to disclose information forwarded to it by economic operators which they have designated as confidential, including, but not limited to, technical or trade secrets and the confidential aspects of tenders, unless otherwise provided in the national law.
  3. Under the Polish Law on public procurement the non-disclosed information from the tender are only trade secrets. This in contrast with Article 21 of Directive 2014/24, which protects a much broader sphere of confidential tender information (para 55). Consequently, under the Polish law all other information which is not trade secret can be made public (‘publish more rule’) (para 51).
  4. Thus, there is a friction between the Polish law, which is prone to publish more, and the EU law, which is prone to publish less.
  5. The ECJ gives the example of Articles 50 and 55 of Directive 2014/24, were the information from the award notice or from the reply to a request for information may be withhold ‘where its release would impede law enforcement, would otherwise be contrary to the public interest or would prejudice the legitimate commercial interests of an economic operator or might prejudice fair competition’ (‘publish more exceptions’) (paras 60, 61).
  6. The Court retained that the Polish ‘publish more rule’ is liable to infringe Articles 50 and 55 of Directive 2014/24 when the situation justifies using the ‘publish more exceptions’ (para 62).
  7. Further, the Court argues that a rule by which only trade secrets are treated as confidential is compatible with Article 21 of Directive 2014/24. However, such a rule must be accompanied by the ‘publish more exceptions’ (para 63).
  8. The ECJ explained that the practice where contracting authorities accepts by default requests from tenderers to classify as trade secrets any information that they do not wish to disclose undermines the principle of transparency, confidentiality and effective judicial protection (para 64).
  9. The Court repeated the Klaipėdos C‑927/19 finding that the contracting authority cannot be bound by an economic operator’s mere claim that the information submitted is confidential but must require justification (para 65).
  10. The question on what should be disclosed from the tender is ultimately decided by the contracting authority.
  11. For example the ECJ found that past experience in general should not be treated as confidential and that the essential content of the information must be provided except for certain contracts for sensitive products or services which may exceptionally justify a refusal of disclosure based on the ‘publish more exceptions’ (paras 74-76).
  12. The disclosure of the identity of the entities relied upon is subject to a case-by-case assessment taking into account an open list of circumstances (i) the contract subject matter (ii) the interest of the tenderer and the entities relied upon, (iii) commitments negotiated in confidence, etc (para 78).
  13. The disclosure of design of the planned projects and the description of the manner of performance of the contract is forbidden if protected by intellectual property rights, in particular copyright (para 81).
  14. In any case, the last two can have a commercial value disclosure of which can distort competition (para 78, 79 and 83).
  15. The Court clarified that effective judicial protection implies that where the contracting authority has refused access to wrongly classified confidential information, national courts must annul that refusal (para 102). In addition, if no other procedural remedy is envisaged by the national legislation, the domestic court must either annul that award decision or find that the applicant may bring a fresh action against the award decision (para 107).
  16. In this respect, the ECJ recalled that in line with Uniplex case (C‑406/08, EU:C:2010:45, paragraph 32) the period for challenging an award decision starts to run when the applicant knew, or ought to have known, of the alleged infringement (para 106).

Remarks

  1. The above case-law demonstrates that the rules on confidentiality and access to the successful tender need a serious revamp.
  2. First, the approach that confidential information pursuant to Article 21(1) of Directive 2014/24 is an open list given the phrase ‘(…) including, but not limited to (…)’ is flawed. It gives the impression that there are no limits in qualifying the tender information as confidential. The ‘publish more exceptions’ from Articles 50(4) and 55(3) of Directive 2014/24 must be the boundary setters mentioned expressly in a future revamped article 21.
  3. Despite the long list of ‘publish more exceptions’ from Articles 50(4) and 55(3) of Directive 2014/24, the Varec case (C-450/06 EU:C:2008:91, para 35) confirms that the holy grail confidential information is the one that is capable of distorting competition. This refers to the ongoing and future procurement procedures and not only. Although highly difficult to materialize, there is an urgent need for an EU level guidance on confidentiality in public procurement.
  4. Needless to say, the GDPR rules refrain the public buyer in disclosing them. These should be expressly included in the ‘publish more exceptions’.
  5. In addition, in line with ECJ findings in para 81 of the Judgment, intellectual property rights should also be included in the ‘publish more exceptions’.
  6. Second, the current wording of Article 21(1) of Directive 2014/24 by which economic operators decide what is confidential is in direct clash with what the ECJ mentioned in the above case (para 65). This unfortunate wording must be changed, otherwise it gives a wrong impression to policy makers that the ultimate decision of what is confidential rests upon the economic operator and not the contracting authority. The future provision should provide for a system of incentives to push tenderers to earmark in good faith confidential information and to help the contracting authority distinguish the real commercial interest information and thus, relax the latter’s administrative burden.
  7. Thirdly, the caveat ‘unless otherwise provided … in the national law’ from Article 21(1) of Directive 2014/24 must be expressly limited. The above case shows that such a rule must have its boundaries, i.e. a national regime which does not guarantee (i) undistorted competition (ii) right to good administration, (iii) effective judicial protection is incompatible with EU law.
  8. Fourthly, Contracting Authorities should be very mindful and aware that taking into account the Vanbreda (C-35/15 P(R) – ECLI:EU:C:2015:275, paras 48, 49 and 54) and the above case that the standstill and challenging period starts to run only when the applicant has sufficient information to bring an action. This must be incorporated into the revamped Article 21 of Directive 2014/24. This is a serious sanction for information stingy contracting authorities.
  9. Lastly, the breach of the disclosure obligation by the contracting authority should come with consequences for the latter and with remedies for the aggrieved tenderer to restore the contractual opportunity.
  10. The aggrieved tenderer cannot challenge what he does not know. At the same time, the Directive 2014/24 via Article 55(2) is misleading innocent readers creating the impression that an admissible aggrieved tender can only have access upon request to the characteristics and relative advantages of the successful tenderer and not the tender of the latter as such. The above case shows that this is not true and the legislator did not want to encourage unsuccessful tenderers to start requesting access to the winning tender. This was done intentionally to shield public buyers’ limited resources that would have had to enforce in practice the ‘publish more exceptions’ in exponentially more cases.