Mandatory requirement for anonymization of bids was interpreted too extensively by the contracting authority
We are monitoring the legal developments in public procurement and now report on the Administrative Court of Appeal in Stockholm's judgment in case no. 1730-24 from August 8, 2024.
The case concerned a procurement of legal services conducted by a municipality in the Stockholm area. The procurement was divided into 16 different legal areas. After the municipality decided to award contracts for legal areas 1 and 5, Supplier A applied for a review, requesting that the procurement be corrected. As the basis for its request, Supplier A argued that the company's bid had been incorrectly disqualified in the procurement due to an alleged failure to meet the mandatory requirement that certain information in the bid be anonymized. Supplier A claimed that the requirements of the procurement had been met and that the municipality's decision not to evaluate the company's bid thus violated the procurement law principles of transparency and equal treatment.
The municipality, on the other hand, argued that the requirements in the procurement document did not violate the fundamental principles of public procurement or any other rule in the Public Procurement Act (LOU), and that the evaluation of the bids had been conducted in accordance with the specified conditions in the procurement document.
The disputed requirement meant that bidders were to "anonymize" their description of work methodology and approach towards the client in the bid. Supplier A had anonymized all information in its description that could directly or indirectly be linked to physical persons. However, the supplier had not removed its own company name from the relevant bid appendix. Supplier A did not dispute that the requirement for anonymization constituted a mandatory requirement in the procurement but objected to the municipality's application of the requirement. The municipality, on its part, claimed that the requirement for anonymization also included the company's name and pointed out that the purpose of the requirement was that the evaluation group should not know which bidders were being evaluated and thus be able to apply personal values in the assessment. The question in the case was thus how extensively this requirement should be interpreted and whether it should include information about the bidder's company name.
The Administrative Court of Appeal initially noted that the procurement document did not specify what was meant by the term "anonymized." The court also compared it with a previous procurement of equivalent services from 2019, where the municipality had made a different interpretation and allowed the bidders' company names to be stated. This strongly suggested that Supplier A had good reasons to interpret the term "anonymized" as not including the company name. The interpretation was also somewhat supported by the fact that 14 out of 18 bidders seemed to have made the same interpretation of the requirement as Supplier A.
Given this, the requirement was not considered to have been formulated clearly, precisely, and unambiguously enough for all reasonably informed and normally diligent bidders to understand its meaning and interpret it in the same way. The municipality had therefore applied the requirement too extensively and rejected Supplier A's bid without sufficient reason. The company had thereby suffered or risked suffering harm, and the court decided that the procurement should be corrected in such a way that A's bid would be evaluated.
The judgment of the Administrative Court of Appeal appears reasonable, especially considering that 14 out of 18 bidders in the procurement interpreted the requirement as allowing the company name to be stated in the relevant appendix. While anonymization of bids can indeed be an effective measure to reduce the risk of subjective assessments in procurements, such a requirement should be formulated more clearly if it is to be applied.