HT-2024-000378 - [2025] EWHC 354 (TCC)

This hearing involves three sets of related proceedings which all challenge the conduct by Supply Chain Coordination Limited T/A NHS Supply Chain (“SCCL”) of the same procurement in relation to the provision of a contract for logistics services (“the New Contract”). The Defendant in the three proceedings is SCCL, a company which was established in 2018 to manage the NHS Supply Chain. It is a contracting authority for the purpose of the Public Contracts Regulations 2015 (“the PCR”).

Proceedings HT-2024-000155 were issued by Unipart Group Limited (“Unipart”) (“the First Unipart Proceedings”) on 26 April 2024 which challenged the outcome of the Invitation to Submit Initial Tenders (“ISIT”); proceedings HT-2024-000378 were issued by Unipart (“the Second Unipart Proceedings”) on 11 November 2024, following the award of the contract to GXO Logistics UK Ltd (“GXO”). Proceedings HT-2024-000399 were issued by D.H.L. Supply Chain Limited (“DHL”), another unsuccessful bidder, on 28 November 2024 (“the DHL Proceedings”). A fourth set of proceedings exists in respect of the procurement, brought by Wincanton Holdings Limited, a further unsuccessful bidder (“Wincanton”). Wincanton has no direct role in the applications before the Court to which this judgment relates.

Three separate applications to lift the automatic suspension pursuant to regulation 96(1) of the PCR have been issued by SCCL: one in each set of proceedings. The applications have been heard together. GXO has made submissions as an Interested Party in the Defendant’s applications to lift the automatic suspension presently in place.

The following evidence has been provided by the parties in support of their respective positions taken, supporting or resisting the applications:

The New Contract replaces an existing contract, for which Unipart is the incumbent provider and which was procured in 2017-18 (‘the Existing Contract’). DHL was an unsuccessful bidder in that procurement process, and it sought unsuccessfully to oppose the lifting of the suspension (see DHL Supply Chain Limited v SS for Health and Social Care [2018] EWHC 2213 (TCC)). The Existing Contract expired on 22 February 2024 but is continuing under termination assistance provisions. Its long stop final expiry date is 23 August 2025, which allows for a transition period of 6-7 months. There is an issue as to whether this can be extended further.

SCCL notified the market of the procurement by a prior information notice which was published on 26 February 2022. The subsequent Contract Notice, which formally started the procurement, was published on 28 June 2023. The estimated value in the Contract Notice was £4.4bn plus VAT (excluding termination assistance): the value of the base contract for the 7-year term is around £1.26 billion, and if extended and all additional options are taken by SCCL, its value is about £4.4 billion. It is for an initial term of 84 months, plus a 5-month initial implementation period and a termination assistance period, and can be extended for a further 36 months. In total, therefore, it could last nearly 12 years.

The four tenderers I have identified were successful at the Selection Questionnaire stage, and each were invited to complete the next stage, ISIT. In November and December 2023 bids were evaluated and moderated. Following a review of the moderation, SCCL considered that there were some aspects of the moderation process which were not in accordance with the published criteria, and decided to amend the wording of the scoring criteria for the ISIT and to re-evaluate the bids. Following the re-evaluation in February and March 2024, Wincanton (third-placed) and Unipart (fourth-placed) were excluded. On 28 March 2024 bidders were advised of this outcome. Wincanton and Unipart each brought claims against SCCL in April 2024. No applications to suspend the procurement process were made. SCCL admitted a breach in its Defence to Wincanton’s claim, and invited Wincanton to participate further in the procurement process, which it declined to do. Wincanton’s continuing claim is limited to a claim for damages, which is denied by SCCL.

SCCL proceeded to the negotiation and Invitation to Submit Final Tender (“IFST”) stages. On 5 August 2024, Final Bids were submitted. GXO was announced as the winning bidder on 30 October 2024. Across the four claims, virtually every aspect of the procurement process is challenged. The claims include, variously, allegations of bias; conflicts of interest; “undue influence” by one of the evaluators; manifest errors and undisclosed criteria in the evaluation of the initial tenders; and the failure to exclude an abnormally low tender.

Of particular relevance to the issues before me is DHL’s claim, since adopted by Unipart, that the tender evaluation was irredeemably compromised by the alleged failure of SCCL to identify and remedy the potential for unfairness and unequal treatment of tenderers which, DHL says, was created by the contribution to GXO’s tender of Mr Chris Holmes. DHL alleges that Mr Holmes was employed by SCCL as a senior executive responsible for (amongst other things) logistics transformation until 30 September 2023 and had done extensive work on the logistics transformation aspects of the procurement before he left SCCL’s employment, including meeting potential bidders such as DHL to discuss their logistics operations. When Mr Holmes left, he started to work for GXO. This fact was declared by GXO as part of its submission, but SCCL “misfiled” the declaration. DHL, and now Unipart, contend that SCCL did not take the steps which were required of it by regs. 24 and 41 of the PCR. It is this issue which DHL, with Unipart’s support, contend should be dealt with by the Court by way of expedited Preliminary Issue.