“C4RC instead brings this case for non-commercial reasons in the public interest. These include: (a) Public (judicial) recognition that GCC breached the law, ultimately signing a revised contract unlawfully that cost it some£140 -£160m more than the competitive result signed in 2013. As a public letter signed by Councillors and others in January 2019 and sent to GCC puts it, GCC consistently wrongly and publicly represented the contract cost was£500m right up until disclosure in December 2018. (b) The issue of secrecy is particularly at issue at this stage of the case as your Lordship will have to decide (preliminary Issue I) whether, as we submit, C4RC did not and could not have known of the breach of law until GCC released material on20 December 2018 , nearly 6 years after the early 2013 contract and nearly 3 years after the February 2016 contract. The Court need only address what was known or could have been known by C4RC, but as the Judge will no doubt appreciate it is the Claimant’s belief and stated position that there was deliberate concealment of important facts. (c) It is a matter of important principle that GCC obtains the best value for money available on behalf of taxpayers and this is only possible by compliance with the procurement rules. (d) Finally, and importantly, if ultimately a breach of procurement law is found at final trial, there will be a solid basis for the UK Government/GCC to find that the overpayment to UBB is unlawful State aid. Any overpayment to date will be recoverable from UBB (GCC may immediately have£10 ’s of millions to spend on public services) and any future overpayment will not be payable.” (a) Public (judicial) recognition that GCC breached the law, ultimately signing a revised contract unlawfully that cost it some£140 -£160m more than the competitive result signed in 2013. As a public letter signed by Councillors and others in January 2019 and sent to GCC puts it, GCC consistently wrongly and publicly represented the contract cost was£500m right up until disclosure in December 2018. (b) The issue of secrecy is particularly at issue at this stage of the case as your Lordship will have to decide (preliminary Issue I) whether, as we submit, C4RC did not and could not have known of the breach of law until GCC released material on20 December 2018 , nearly 6 years after the early 2013 contract and nearly 3 years after the February 2016 contract. The Court need only address what was known or could have been known by C4RC, but as the Judge will no doubt appreciate it is the Claimant’s belief and stated position that there was deliberate concealment of important facts. (c) It is a matter of important principle that GCC obtains the best value for money available on behalf of taxpayers and this is only possible by compliance with the procurement rules. (d) Finally, and importantly, if ultimately a breach of procurement law is found at final trial, there will be a solid basis for the UK Government/GCC to find that the overpayment to UBB is unlawful State aid. Any overpayment to date will be recoverable from UBB (GCC may immediately have£10 ’s of millions to spend on public services) and any future overpayment will not be payable.”
“Comparison: Incinerator to R4C Recycling Plant”
“[t]he County Council’s planned solution is to build a huge “mass-burn” incinerator into which everything in our black bags will be thrown with no sorting or pre-treatment, costing the taxpayer an estimated£600 million over 30 years, creating greenhouse gases and risk of widespread pollution, and destroying valuable materials forever. With regulations heading towards recycling, recovery and climate protection, this wasteful project may soon be heavily taxed and/or unusable.”
“25 year contract thought to be£100 + pt,£500M contract (now estimated£595M )”
“Enforcement of duties through the Court (1) A breach of the duty owed in accordance with regulation 89 or 90 is actionable by any economic operator which, in consequence, suffers, or risks suffering, loss or damage.”
“Member States shall ensure that the review procedures are available, under detailed rules which member states may establish, at least to a person having or having had an interest in obtaining a particular contract and who has been or risks being harmed by an alleged infringement.”
“The type of proportionate requirement that the [Council] may lawfully have chosen is open to conjecture, but would need to be directly linked to having sufficient access to finance [sic] to undertake the services (based on its own solution, not on the costs of an EfW plant – this is far more capital intensive) and (likely) indemnity insurance to cover any risk.”
“…does not (really cannot) counter with an alternative “shadow PQQ” but submits that under any putative tender process GCC would have undertaken market testing first and if approached with an open mind, and as is becoming increasingly accepted (in particular in the competitive dialogue procedure), have kept the selection criteria relatively light, and incorporate aspects of deliverability (which may entail aspects of financial viability) in the later stages of the process.” and “Certainly GCC must be able to be comfortable as to financial and economic issues 89. criteria should be set at levels which permit a number of alternative solutions to proceed past the first threshold test and into the more detailed elaboration of a Competitive Dialogue procedure described [in the Regulations]”
“For consortium/group submissions where supported by an appropriate guarantee then the consolidated turnover across the entities will be assessed.” and “GCC reserves the right to reject PQ Applications, and not assess the PQQ further (if any Applicant and, in the case of Consortia, if any Party fails to meet the Minimum Standards as identified in this PQP Section [x] and in the PQQ; otherwise, the assessment of the PQ Application continues.”
“Where the Applicant is a Consortium, each Party to an Applicant will be assessed against these criteria in order for GCC to obtain confidence in the ability of the Parties to fulfil their obligations under a Contract, on a joint and several basis, should it be successful.” “The weighted score from each section are then added together to derive a combined score for each Applicant, shareholder or consortium member within a Group SPV or Contractual JV respectively. An Applicant must achieve combined score of no less than 5 out of a possible 10 to pass the 2nd stage of the financial assessment.” “In order to establish an overall score for a Group SPV or Contractual JV the scores of each shareholder or consortia member will be averaged.” “As part of its due diligence process, GCC will ask Applicants and Parties to a Consortium, to provide a statement detailing their financial position in full from the date of their latest submitted company accounts, or relevant financial information, to the PQ Application Deadline.” and “The accounts of any Guarantor of a Party or a single Applicant will only be assessed if: • The Applicant, or Party to a Consortium, is relying on a Guarantor in order to prequalify; • Further investigations are triggered as described above during the due diligence process; and • The Applicant or Party as applicable provides satisfactory confirmation from that parent company (or other Guarantor) that it will provide a Parent Company Guarantee.”
“Where necessary, contracting authorities may clarify in the procurement documents how groups of economic operators are to meet the requirements as to economic financial standing or technical ability referred to in regulation 58 provided that this is justified by objective reasons and is proportionate.”
“A Contracting Authority could raise the “preliminary issue” of selection criteria against any Claimant in a direct award case (where by definition there was no PQQ) and the case would be entirely disposed of on the basis of an inability to prove that a (necessarily hypothetical) bid would not have met a (hypothetical) PQQ.”
“Whether in any event Mears suffered a risk of loss of being selected for the ICTD stage of the Procurement.”
“143. Article 1(3) of Directive 89/665 permits the Member States to restrict the right to bring an application in relation to a review procedure for the award of public contracts in two respects: on the one hand, through the requirement that the applicant should have an interest in the relevant public contract and, on the other, through the requirement of existing or imminent harm to the applicant. In this way public interest actions and actions brought by applicants with no prospect of success may be excluded.” 144. However, that must not affect the practical effectiveness of the directive. The restrictions on the entitlement to bring an action must therefore be construed in the light of the twofold aim of the directive: on the one hand, the individual must be afforded an effective legal remedy in connection with the award of public contracts and, on the other, the requisite review of the lawfulness of the decisions by contracting authorities must be facilitated. 145. For, as is apparent from the first and second recitals in its preamble, Directive 89/665 seeks to strengthen the means available at national and Community levels in order to secure the actual application of the Community directives in the sphereof public procurement. To that end the Member States are obliged under Article1(1) of the directive to ensure that unlawful decisions by contracting authoritiescan be reviewed effectively and as swiftly as possible. […] 148. The possibility of harm to the person concerned must be presumed where it isnot manifestly excluded that the applicant would have received the award if the legal infringement alleged had not occurred. Where, as in the present case, the public contract is awarded directly without prior contract notice, it follows from the fact that the person concerned is – allegedly unlawfully – precluded from participating in the award procedure that he may have lost a contract and thus suffered loss. […] 149. Nor may actual proof of standing be required of the person concerned at the stage of an application for review; in the same way, he cannot be required to provide evidence that he would have received the award if the alleged infringement had not taken place. Otherwise access to the review procedure would be renderedimpossible in practice or at any rate excessively difficult. In particular in cases ofdirect awards such as the present case, it would be barely possible for the personconcerned to provide actual proof of standing, since he would have no accurateinformation about the requirements laid down by the contracting authority becauseof the lack of a prior contract notice. [….] 151. On the sixth question I therefore conclude that an application for review under Article 1(3) of Directive 89/665 is admissible if the applicant persuasively asserts an interest in the public contract, the existence of a legal error and the possible harm suffered or about to be suffered. If the contract was awarded without priorpublication of a contract notice, it follows from the fact that the person concernedwas precluded from participating in the award procedure that he may have sufferedharm unless there is a manifest lack of standing on its part.”
“The Claimant is an economic entity (as defined in Regulation 2 of the PCR 2015), the legal form being a registered Community Benefit Society. The Claimant had previously (in 2015-15) taken steps to form a consortium to win a contract for waste disposal from the Defendant (this was ultimately abandoned only once it became clear the UBB contract left no realistic scope for any other provision of services) and it would have used that consortium to bid had a procurement exercise taken place.”
“As regards these issues, it is respectfully suggested that the Defendant wait until disclosure has taken place and the Claimant’s witness evidence has been provided as the (hypothetical but realistic) members/composition of the consortium will be set out and made clear by way of evidence (by witnesses and contemporary documents) as will their financial standing and technical ability and how this would meet any lawful requirements.”
“Our client’s Part 18 request dated21 August 2019 was made in order to identify your client’s consortium bid on the basis that this had not been confirmed in your client’s pleadings, despite references to a consortium having been formed previously which would have been used in this procurement exercise. Our client wanted to ensure that details of your client’s consortium was within the scope of both disclosure and witness evidence so that it would have the opportunity to consider and respond in advance of the hearing in March.”
“to carry on any business for the benefit of the community by the protection and the preservation of the environment for the public benefit by: The promotion of waste reduction, resource re-use reclamation, recycling, use of recycled products, and the use of surplus. Advancing the education of the public about all aspects of waste generation, waste management, waste recycling and the circular economy. The promotion of such other activities and initiatives that contribute to and stimulate the development of a local circular resource economy.” 185.In his oral closing submissions in reply, Mr Sinclair said: “As regards the question of economic operator, C4RC, our position, just to be clear, C4RC was offering services on the market. We do not need to, but we could, if necessary, rely on forming a consortium to do so. C4RC was offering services to Stroud District Council. Therefore, within, if you like, an English black andwhite letter interpretation of economic operator.”
“a community-owned sustainable enterprise with a commitment to delivering long term economic, social and environmental benefits through working with local businesses and communities that will prevent, reduce, reuse and recycle material which would otherwise be thrown away and wasted – thus destroying our valuable resources and doing great harm to the environment through global warming gasses and toxic emissions.”
“It is also very clear that they were going to work with other parties, whether it was in a bid for a Gloucestershire City Council contract, which didn’t exist” - by which he meant the contemplated consortium had not been given an opportunity to tender for the 2016 Contract – “or for any other party, they would work with other parties. And as such a consortium would consist of Community R4C and Revolution R4C and other parties.”
“No further tests would be performed under the PQQ as the organisation has failed the turnover threshold test.”
“You’re applying a valuation process which is not the evaluation process that a PQQ process goes through or a full tender process goes through. They look at the proposal that I put on the table to them and the proposal that I put on the table to them, or we, the consortium, put on the table to them would include aspects that prove that we have a track record of delivering the equipment, delivering it, installing it, running it. We have personnel and skill levels that meet all the requirements in terms of health and safety throughput, guarantees and all the rest. You would deliver that and you would use it, you’d do it using people with the skill set of Paul Winter, who was the CEO of Biocentre at the time, extensive experience delivering£100 million type contracts in the energy waste field. So of course, we had the experience to do this. In terms of technical experience, as the track record shows in terms of the technology in the process, it’s been installed in a number of plants. KMH, who was an active technical partner of ours, were installing plants as we were talking and still do.”
“But the point is that clearly a track record is not something that a company owns, it’s soft intellectual property, it’s something that people and processes and documentation and, you know, process diagrams and certification and data from modelling, the metrics, the model that you run all of this complicated mechanical equipment and ensure that flow rates are correct and all the rest. All of that is deep engineering modelling with experience. It’s built on empirical data - you test what your outputs are and you build that into your future models. All of that is, therefore… All of these plants built into Tony Manser’s models, which were then transferred into ART and then later to BTL. So, these engineering models, which NBHT is based around, come from this track record.”
“This is a financial model for a very different plant to what would have been proposed to the County Council. It operates at much lower margins and operates with a very low price,£20 a tonne for treating waste - the incinerator’s headline price is£190 a tonne. You can understand that that makes it very demanding in terms of how you operate the plant.”
“I am also aware of other members of a possible consortium bid that could have been brought together for a bid in 2015/16. For example, PBS (funding and offtake, biomass boiler), Smiths (operations and CIW waste supply), Veolia (waste supply), Damar/Finning (EPC provider), KMH (mechanical design and installation).”
“Where an economic operator wants to rely on the capacities of other entities, it shall prove to the contracting authority that it will have at its disposal the resources necessary, for example by producing a commitment by those other entities to that effect.”
“It is submitted that, whilst C4RC faces the inherent difficulty of any party dealing with a failure to tender (see AG Kokott in Pressetext) it is likely that a consortium consisting of all or some of the parties described by Mr Jarman and/or Mr Christensen would have bid for the GCC contract in 2015/16 (the degree of likelihood of this need not be separated from the overall question of a substantial as opposed to fanciful chance of meeting lawful selection criteria).”
“(2) Subject to paragraphs (3) to (5), such proceedings must be started within 30 days beginning with the date when the economic operator first knew or ought to have known that grounds for starting the proceedings had arisen.”
“By disclosure on20 December 2018 of previously redacted material, including disclosure for the first time of the changes that had taken place between the First Contract and the Second Contract it became apparent that there were material changes (including to ʻgate feesʼ or payment levels and an increase in up-front payment by the [Council]) such that the total value of the contracts were assessed by the Claimant as being in the order of a change from c.£455m (First contract/contract signed in February 2013) to c.£600m (Second Contract/contract as materially amended and signed in February (sic) 2016). In contrast, the Council had publicly consistently cited a revised value/cost of£500m .”
“He further shows that, at today’s prices, 2017, the total contract cost will be£537.604m ,£87m more than originally claimed.”
“This is not the same thing at all as suggesting there was any basis to bring an action against your client for breach of procurement law.”
“It is abundantly clear that the starting point for any analysis of the process and its results, and specifically of compliance with the procurement rules, must be consideration of the original contract (first) and the nature of the changes to it (including payments made by way of ʻcapital contributionʼ), in this case therefore including the RPP and the E&Y Report and any material information (e.g. models used) to arrive at the conclusions GT has (provisionally) formed.”