Legal Updates

Past experience which is tainted with fraud is inapplicable as a precondition for participation in a tender

August 19, 2020

One of the prerequisites for participation in a water desalination tender was proof of past experience. A tender participant brought forward a project which was subsequently discovered to have been tainted with fraud.
The Supreme Court held that because the past experience was tainted by fraud and not merely technical failure, it may not be considered "experience" for meeting the tender prerequisites. When there are a few possible interpretations for the tender terms, the one that enables tender offers and enlarges the circle of offerors will be preferred on one that disqualifies such. When it comes to fraud - the compliance with the terms of the tender must be examined from a value-normative aspect. Here, the prerequisites of the tender, as set out in the tender invitation, included a prior experience requirements. The fraud that was exposed as part of the first project prevents the participant from relying on such experience as a "successful" one for the purpose of meeting the tender prerequisites, and because the bidder did not bring forward further experience, it should be disqualified.