Alstom Transport v Eurostar International Ltd & Anor

On an application for an interim injunction in a regulated procurement, the court applies the American Cyanamid principles, while taking account of the statutory and public interest in transparent, equal and non-discriminatory competition.

A procurement may proceed on hypothetical assumptions about future regulatory change if bidders are treated equally and the specification is sufficiently clear to permit fair bids and evaluation. Criteria, weightings and material evaluation methodologies must generally be disclosed in advance where they could affect tender preparation or assessment. Serious arguable breaches do not by themselves justify an injunction. The court must assess the adequacy of damages, the balance of uncompensatable disadvantage, the public interest and the claimant’s realistic prospect of obtaining substantive relief.

ALSTOM, a bidder for Eurostar’s proposed purchase of new high-speed trains, sought an interim injunction preventing Eurostar from contracting with Siemens. It alleged breaches of the Utilities Contracts Regulations 2006, including uncertainty caused by pending safety-rule changes concerning distributed power systems and the late disclosure of criteria, weightings and evaluation methodology.

ALSTOM also relied on Eurostar’s preliminary agreement with Siemens. The application arose after Eurostar notified ALSTOM that Siemens had won the procurement and during the statutory standstill period. The central questions were whether there was a serious issue to be tried, whether damages were adequate, and where the balance of convenience or injustice lay.

1. Application dismissed. ALSTOM established serious issues to be tried concerning some alleged breaches of the Utilities Contracts Regulations 2006, but the balance of convenience did not favour interim relief.
2. The court applied the three-stage approach in American Cyanamid v Ethicon [1975] A.C. 396: serious question to be tried, adequacy of damages, and, if necessary, the balance of convenience. The court must avoid conducting a mini-trial. The public interest may, and should, be considered in procurement cases.
3. It was arguable that the unresolved safety rules made the specification insufficiently precise under regulation 12(7), or rendered the process insufficiently transparent or equal under regulation 4(3) and regulation 30. A utility may procure on hypothetical assumptions about future regulatory change, provided bidders are placed in an equal position and the specification permits fair evaluation.
4. It was also seriously arguable that Eurostar should have disclosed its NPV-based financial evaluation, its five-point banding system, and the allocation of a material scoring advantage to the lowest bidder. The five-point system appeared inconsistent with the disclosed 100-point system. The complaint that confidence-based scoring was undisclosed was weaker, and the technical evaluation complaint could not be resolved without the evaluation documents.
5. The preliminary agreement was not obviously outside the Regulations, but no relief was sought in respect of it and no finding on that issue was necessary.
6. Damages would not adequately compensate ALSTOM for the loss of a prestigious contract and associated reputational and market benefits. Nor would damages adequately compensate Eurostar for the likely delay and disruption to its entire business programme. The balance nevertheless favoured Eurostar. ALSTOM had only a small prospect of showing that the alleged breaches would have changed the result, particularly given the substantial scoring gap and evidence that Siemens had treated the procurement as a higher priority.
7. The public interest also favoured refusal of the injunction because delay would harm Eurostar’s competitive position and postpone improved competition for Tunnel rail services. The tendering process should not be frozen. ALSTOM’s application was dismissed.