Major Latvian train deal can finally leave the station

The Procurement Monitoring Bureau has turned down a complaint filed by Spanish company Patentes Talgo S.L. (Talgo) about procurement of new electric trains by Latvia's publicly-owned joint-stock company Pasažieru Vilciens (Passenger Train), permitting the Latvian company to sign a previously agreed contract with Czech company Škoda Vagonka (ŠV).

According to the Procurement Monitoring Bureau's decision, Talgo's complaint about the results of the negotiated procedure conducted by Pasažieru Vilciens is unfounded and therefore there is no reason to overturn PV's decision on the procurement results. The bureau has therefore allowed authorized PV to enter into a procurement contract with the winning bidder, Škoda Vagonka.

As previously reported, the contract has been subject to a lengthy legal tussle between the two competing companies.

Four companies originally offered to supply 32 new electric trains for Pasažieru Vilciens - Talgo; a Polish subsidiary of the Swiss company Stadler; Spain's Construcciones y Auxiliar de Ferrocarriles (CAF); and Skoda.

Pasažieru Vilciens initially picked Talgo's bid, which offered to provide the new trains for EUR 225.303 million. However, after ŠV and CAF filed protests, the Procurement Monitoring Bureau banned PV from signing the contract with Talgo. After a review of the bids, PV then decided to sign the contract with ŠV instead, which was asking EUR 241.888 million for the new trains, prompting a fresh challenge from Talgo.

Pasazieru Vilciens reported that the tender’s original winner, Spanish company Talgo, had offered to supply the trains for a lower price but that the maintenance costs offered by Skoda for the trains’ 35-year lifecycle were lower, which meant lower overall costs.

After reviewing a complaint filed by Talgo, the Procurement Monitoring Bureau in March 2019 banned Pasazieru Vilciens from concluding a train supply contract with Skoda and ordered Pasazieru Vilciens to reassess all bids.

Transport Minister Tālis Linkaits described the move as "a step forward for PV procurement".

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