Judicial review in administrative contracts in Egypt: evidence from administrative court rulings in Government Tenders and Bids Law disputes

ABSTRACT

This paper examines the role of administrative court review in disputes related to Egypt’s Government Tenders and Bids Law. It assesses whether government authorities are more likely to receive a favorable ruling, whether they receive a larger fraction of their claims, and whether administration-initiated claims face a shorter dispute resolution time. I use rulings data from 472 cases to construct variables for dispute characteristics and outcomes. Analysis shows that, compared to contractors, government authorities have higher odds of receiving favorable awards of both the main disputed values and composite claims (including interest or compensation). Plaintiff identity, on the other hand, does not affect the odds of being awarded a compensation or interest claim. Moreover, administrative authorities, on average, receive a larger fraction of their claims and the difference increases for composite claims and when plaintiffs demand interest or compensation when filing. With respect to dispute resolution time, contractor-initiated cases are shorter on average and economy-wide variables and administrative court restructuring affect dispute resolution time in contrast to their negligible effect on expected dispute outcome. The analysis further suggests that plaintiffs are partially successful in applying law principles when claiming interest and compensation to improve dispute outcomes. However, bias in favor of administrative authorities remains, which is likely the outcome of a combination of the discretionary room that the law grants administrative authorities and the discretion that courts have in applying Civil Law principles governing compensation and interest awards.

KEYWORDS:

• Administrative courts
• judicial review
• Egypt

Disclosure statement

No potential conflict of interest was reported by the author.

ORCID

Sahar Tohamy Hassanin http://orcid.org/0000-0002-7951-3006

Notes

1 The government presented in 2017 an amendment to Law 89 for the year 1998 that has been discussed with Parliament's Budget and Planning Committee. The amendment addresses several issues pertaining to enhancing the transparency of the bidding process through obligations of e-publication, a stronger oversight of the Ministry of Finance's General Authority for Government Procurement, government authorities’ pre-planning and acquisition of approval for large procurement commitments, preferential treatment of local products and the possibility to target tenders and bids to local and/or small and medium enterprises. The draft amendment adjusts (up) several monetary ceilings requiring approval when resorting to sole-purchase contracts as well as to required involvement of representatives of the Ministry of Finance in evaluation committees. As of the time of submitting of this paper (July 2018), Parliament has not enacted the new law and thus Law 89/1998 still governs government procurement.

2 For details of Law 89/1998 and its Executive Regulations, see Ministry of Finance (2010).

3 According to this definition of administrative contracts, some public-private contracts belong to private law jurisdiction and private law (regular) courts hear disputes related to such contracts. These typically are contracts not closely related to the operation of a public utility and where the administrative authority does not have exceptional powers in the contract. For example, a dispute related to a government body booking a venue for a conference, or contracting to provide recreational services for employees would fall under private law (and court) jurisdiction.

4 See for example, Gad-Nassar (2004) for an exposition of the development of these concepts and their evolution to characterize the differences in rights and responsibilities of the state and its private partners.