EU victory over NHS contractor application

The firm challenged the NHS after it tendered for a supply contract but was turned down in favour of other applicants.

The NHS said the challenge was too late under a three-month time limit for legal claims that tendering rules have been breached.

But the European Court of Justice has now ruled it is wrong to start the clock running as soon as the rejected company has been notified.

Instead, the judges ruled, the time limit for a challenge to public contract decisions only starts when the rejected company has reason to believe the tendering rules have been breached.

"The fact that a candidate or tenderer learns that its application has been rejected does not place it in a position effectively to bring proceedings," said the ruling. "Such information is insufficient to enable the candidate to establish whether there has been any illegality which might form the subject-matter of proceedings."

The judgment said a company could only come to an "informed view" about whether there may have been a breach of tendering rules once it has been given full details of why it failed to win the contract.

Uniplex submitted a tender to the NHS in July 2007 for the supply of surgical equipment. Four months later it was notified that it had not been successful.

The European Court, asked by the High Court to clarify when the clock starts ticking on filing a complaint, said EU rules on public works contracts "requires that the period for bringing proceedings (for infringements of tendering requirements) should start to run from the date on which the claimant knew, or ought to have known, of that infringement".

The decision eases pressure on suppliers who currently feel they have to launch proceedings immediately if they wish to challenge a decision –even before they know whether they have a credible case.