A High Court challenge to the awarding of a €650 million contract to replace the Dublin-Belfast Enterprise train service rolling stock could mean the loss of up to €165 million of European Union funding towards the project, a judge was told on Wednesday.
Mr Justice Mark Sanfey admitted an application by Iarnród Éireann-Irish Rail and Northern Ireland Railways Co Ltd, who operate the service, to have a stay on the awarding of the contract lifted to the fast track Commercial Court.
Unsuccessful tenderer, global transportation systems company Construcciones Y Auxiliar De Ferrocarriles (CAF) SA, had brought the challenge last month under EU procurement regulations which mean an automatic stay is placed on the awarding of the contract unless a court decides to lift it.
It is alleged in the Irish Rail’s proceedings that CAF has been added to the UN High Commissioner for Human Rights’ blacklist of firms conducting business in occupied Palestinian territories.
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The contract was awarded to Switzerland-headquartered Stadler Bussnang AG on September 18th.
Peter Smyth, chief mechanical engineer with Irish Rail, said in an affidavit seeking entry of the case to the commercial list, that despite an overall and refurbishment in 2015 of the current locomotives and carriages on the northern line, the fleet is reaching the end of its 30-year design life at the end of 2027. It will then require significant work and investment to ensure continued safe service beyond this date.
Mr Smyth said 3.3 million people live within a 40-mile commute distance from the Dublin-Belfast line and fast and reliable services are vital to the economic life of the island.
The planned investment in the service will see an hourly service between the two cities, doubling the current eight services per day to 16.
It will also mean the replacement of “non-Enterprise sets” of rolling stock which do not have the same feel and kit-out as Enterprise trains. Passengers are also unhappy with them and they are more expensive to operate and inefficient.
The new service will create a capacity to provide four million passenger journeys a year by 2030 with 2.4 million passenger journeys expected to be taken by 2033. It will also achieve higher speeds than the current service which has a maximum speed of 90mph.
Mr Smyth said funding for the project is coming from the Irish Government, the Northern Ireland department of infrastructure and EU funding programmes for the six counties.
Up to €165 million is to come from the EU programmes but this is subject to a condition that there is a December 31st, 2029 end date for the project “after which time any costs not defrayed will be deemed to be ineligible for reimbursement”.
Mr Smyth said it emerged during the tendering competition that none of the bidders will be able to deliver all of the planned eight Enterprise Sets in service by that deadline date but the EU has been asked to approve funding based on the successful tenderer having four sets ready by then.
If the EU funding is not ultimately achieved, it would be for the sponsoring departments here and in Northern Ireland to make up the shortfall, he said.
In her application on Wednesday on behalf of the defendants to have the case admitted to the Commercial Court, Catherine Donnelly SC said there was an urgency to the case because of the possible loss of EU funding and the timeline required by the successful tenderer to fulfil the contract.
Jonathan Newman SC, for CAF, said he was consenting to the case being admitted to the list but was surprised by the case being made about the loss of EU funding when this was at odds with the scoring system in the tender process which gave a 5 per cent mark for on time delivery and where the successful tenderer says he cannot do it until 2031.
He said his client’s case was not confined to manifest errors in the marking of its tender but also the lack of clarity in the competition documents.
Mr Justice Sanfey said it is possible the case could be heard very quickly and he could give directions for an expedited hearing. He adjourned it for two weeks.
