SRCL Ltd (“SRCL”) (now Stericycle) challenged NHS England’s decision to award to another bidder a contract for clinical waste services. Bidders were invited to submit bids by way of an e-auction designed to drive prices down through more effective competition. SRCL (the main incumbent) were unsuccessful and brought a challenge alleging that both the winning and second placed bids were ‘abnormally low’.
The court ruled: If a contracting authority considers a bid to be abnormally low it may reject it but it must first permit the bidder an opportunity to justify the price. A court will only intervene in the decision if there has been a clear error. In this case, the contracting authority did not know or suspect that the tenders were abnormally low: it was highly relevant that there was 1% price difference between the first and second placed bidders.
In2 the bargain 