Helsinki tram tender exclusion is being challenged by Škoda Transtech. Parts of a recent Finnish Market Court decision removed the company from the procurement process for new trams intended for the city. This is reported by the railway transport news portal Railway Supply.

Helsinki tram tender exclusion: Škoda appeals
Photo: Škoda Group

According to Škoda Group, the ruling involved what the company views as an incorrect assessment of the technical section of its bid. Škoda Transtech has appealed to the Supreme Administrative Court of Finland. It has also requested an interim measure. The measure is intended to keep the contract from being signed or executed before the Supreme Administrative Court reaches a final decision.

Petr Novotný, CEO of Škoda Group, said:
The Market Court assessed the technical part of Škoda Transtech’s bid in a purely formalistic manner, effectively turning our proactive and cooperative approach towards the contracting authority against us as alleged material change of the bid and thereby concluded on its non-compliance with the technical requirements of the tender.

Helsinki tram tender exclusion and the technical bid dispute

The tender covered the supply of 183 trams for Helsinki. It was launched by the Helsinki Metropolitan Area Transport company. Škoda Transtech said the dispute reached the Market Court after the contracting authority decided to exclude the company from the tender. According to Škoda Transtech, the authority also disseminated unsubstantiated allegations about it.

Škoda Transtech maintains that the technical solution it proposed is fully compliant with the tender requirements. The company argues that the Market Court relied on a formalistic reading of the technical part of its bid. It says the decision did not reflect the substance of the offer or the actual technical parameters of the proposed solution.

Petr Novotný added:
This decision deeply concerns us, and we consider it a dangerous precedent. If technically sound and functional solutions can be excluded on the basis of an ambiguous and formalistic interpretation of details and any explanation provided can be considered as material change of the bid, the very fairness of public procurement in Europe is at risk – and ultimately it is the travelling public who will pay the price. The decision disregards the quality of the offered technical solution and what will be the impact on the travellers.

We disagree with such an approach and will vigorously defend ourselves against it.

The company also said it firmly rejects any suggestion that its technical proposal could involve safety concerns or risks. Škoda Transtech argues that such claims are supported neither by the bid nor by the technical parameters. It says they damage the wider reputation of Škoda products.

Škoda Transtech seeks interim measure in Finland

Zdeněk Sváta, Chairman of the Board of Directors of Škoda Transtech and COO of Škoda Group, said:
We are disappointed. We submitted a competitive bid and a solution that would have represented a significant technological advancement in the operation and safety of tram transport in Helsinki.

Our goal was to succeed in a fair and transparent procurement process. We appealed the Market Court’s decision and, at the same time, requested an interim measure to prevent the contract from being awarded until a final decision is made.

Škoda Transtech said it was surprised that what it called irregularities and ambiguities in the tender procedure were overlooked. Meanwhile, the company said the Market Court focused on technical details.

The company claims that the contracting authority’s handling of the procurement raises serious questions about the overall fairness of the process. In addition, it pointed to material changes to evaluation criteria during different stages of the procedure. According to Škoda Transtech, those changes were neither sufficiently reviewed nor taken into account by the Market Court.

Sváta added:
By altering the evaluation criteria just before the final phase of the procurement process the contracting authority de facto redesigned the procurement. Despite such surprising turn, the contracting authority refused to extend the deadline for submission of the final bid.

After submission of the final bids, instead of real evaluation, it rather focused on finding arguments why and how to exclude the domestic participant offering trams manufactured in Finland and used every formalistic marginal detail for such purpose. If this is not against procurement laws is what we want to find out in the appeal proceeding before the Supreme Administrative Court.

Stadler offer and budget approval

Škoda Transtech has also referred to the contracting authority’s selection of Stadler’s offer. The company said this selection is conditional on approval by the city councils of Helsinki and Vantaa. The approval would increase the budget allocated to the procurement. According to Škoda Transtech, this would suggest that Stadler’s price is above the allocated budget. It would also suggest that the price is higher than Škoda Transtech’s own offer.

Škoda Transtech says it will seek a full review of the case before the Supreme Administrative Court of Finland. It has also requested that the signing and execution of the contract be suspended until a final decision is reached.

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