Justifying a low bid and defending rebalancing: the part won with numbers
Nextica Law & Tax puts the numbers behind the legal argument: the technical and economic justification of a bid presumed abnormally low under art. 149 of Law 9/2017, with a breakdown of direct and indirect costs, assigned resources, expected productivity and evidenced compliance with collective-agreement wage costs; and, once performance is under way, the economic rebalancing file and price revision within the framework of Law 2/2015 on de-indexation of the Spanish economy and whatever the tender documents allow.
A low bid is not defended with adjectives. It is defended with a cost breakdown that survives being read under a magnifying glass.
What's included
1. Costing the bid before submitting it
direct cost of the resources, attributable overheads, expected productivity and the wage cost of the applicable collective agreement, line by line.
2. Preparing the low-bid justification in advance, so you can respond within the short period the contracting authority grants without improvising.
3. Drafting the technical and economic justification where the bid is treated as abnormal
savings from the method, technical solutions, evidenced favourable conditions and compliance with employment obligations.
4. Tracking the contract against the bid during performance, to spot the variance while it can still be documented.
5. An economic rebalancing or price revision file where appropriate, with evidence of the extra cost and a quantification that withstands challenge.
6. Controlling works certificates and the collection calendar, which is what decides a public contract's cash flow.
7. Final settlement of the contract, closing off penalties, modifications and outstanding balances.
A LOW BID IS DEFENDED WITH NUMBERS OR NOT AT ALL
The justification stage has a short period set by the contracting authority itself, and what is judged is not whether the bid is low but whether it is viable:
Generic justification
appealing to experience or efficiency without a cost breakdown is rejected. The first thing examined is whether the price covers the applicable collective agreement for the resources offered; if it does not, no other explanation saves it.
art. 149 Law 9/2017Contract won tight and real cost soaring
stopping performance to force a negotiation is the worst way out. The routes are price revision where the tender allows it and rebalancing in the specific cases provided, and both require a formal file and evidence.
Law 2/2015 and Law 9/2017The authority has thirty days to pay from approval of the documents evidencing conformity, and once that passes late-payment interest accrues automatically, with no demand. Most companies never claim it because they do not know they already have it.
art. 198.4 Law 9/2017 and Law 3/2004Frequently asked questions
What must the justification of an abnormally low bid contain?
Everything that explains the price without appealing to goodwill: the savings the manufacturing or service method allows, the technical solutions adopted, any exceptionally favourable conditions available, the originality of the proposal and, above all, compliance with employment, social and environmental obligations. The first thing examined is the wage cost: if the bid does not cover the applicable collective agreement for the resources committed, no other explanation saves it.
Can the prices of a signed contract be raised?
Only through the routes the law and the contract itself provide, and it is worth saying plainly because the alternative —stopping performance to force a negotiation— is the worst of all. The routes are price revision where the tender documents allow it, within the framework of Law 2/2015 on de-indexation of the Spanish economy, and restoration of the economic balance in the specific cases Law 9/2017 recognises. Both require a formal file, evidence of the extra cost and a quantification that withstands challenge.
Content reviewed by
Elena Bosch Prat
Directora · Consultoría Contable y Financiera
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