0.5% screening threshold in price investigation passes legality test
A contracting authority may apply a weight threshold during price investigation to select non-negligible items, provided the threshold is carefully established and stays within the bounds of reasonableness.
What happened?
Beliris launched an open procedure for the construction of a green space at the Materialenkaai in Brussels (works, price as sole award criterion, five tenderers). The price investigation followed a two-step approach: first, non-negligible items were selected using arithmetic criteria — including a weight threshold of 0.5% of the average total price — then those items were substantively examined. For two items (lighting masts and suspension system), Beliris concluded the prices did not appear abnormally low without requesting price justification. For two other items (site fencing and soil treatment), it did request justification and accepted it. The second-ranked tenderer challenged the award on three grounds: the screening methodology, the decision not to investigate two items, and the acceptance of the justification for two other items.
Why does this matter?
This judgment provides a rare in-depth overview of what the Council of State expects from the screening phase of price investigation. Where earlier judgments (243,217 and 244,492) struck down screening methods that allowed abnormally low prices to escape detection precisely because they were low, this judgment confirms that a well-calibrated threshold — here lowered from the usual 2% to 0.5%, calculated on the average of all tenders, and supplemented with qualitative criteria — falls within the authority's discretionary margin. It also clarifies that in the general price investigation, the authority need not demonstrate that prices are market-conforming, but only ascertain whether they appear abnormal.
The lesson
The screening phase of price investigation must be carefully designed, but the legislator prescribes no specific method. A weight threshold is permissible provided: (1) it is realistically calibrated for the specific contract (here lowered from 2% to 0.5% due to the large number of items), (2) it is calculated on an objective basis (average total price, not the individual tender), (3) it is supplemented with qualitative criteria (nature of the item, speculation risk, lump-sum character), and (4) the authority reserves the right to examine additional items beyond the established criteria. When accepting price justification, the authority may also consider information not originating from the tenderer (Art. 36 §3 Royal Decree 2017), and a profit margin of 17.8% can cover hypothetical additional costs.
Ask yourself
Do you use a screening threshold in your price investigation? If so, verify that the threshold is calculated on the average of all tenders (not on individual tenders), that you calibrated it based on the number of items and the nature of the contract, and that you consider qualitative factors alongside the arithmetic threshold. Expressly reserve the option to examine additional items beyond the established criteria.
About this database
The Council of State (Raad van State / Conseil d'État) is Belgium's supreme administrative court. In disputes over public procurement — from contract awards to tenderer exclusions — the Council of State is the final arbiter. The rulings in this database are summarised by TenderWolf in plain language, with practical lessons for tenderers and contracting authorities. View all rulings →