A first look at the courts’ approach to automatic suspension under the Procurement Act 2023

Introduction 

Since the Procurement Act 2023 (the Act) came into force in February 2025, Contracting Authorities and aggrieved bidders will no doubt have been wondering how the Court will approach the new test for applications to lift the automatic suspension under section 102 of the Act. 

The Court has now provided guidance on the new test in the first decision under the Act in ParkingEye Limited v Velindre University NHS Trust and Cardiff and Vale University Health Board [2026] EWHC 1019 (TCC). The case is essential reading for Contracting Authorities and suppliers navigating procurement challenges under the Act or considering the potential consequences of risk-based decisions. 

As our analysis and key takeaways from the judgment show, it's clear that the new test differs significantly to the American Cyanamid test applied in automatic suspension cases under the Public Contracts Regulations 2015 (the PCR 2015), and that "adequacy of damages" is no longer the trump card it once was.

Read on for our key takeaways from the judgment and our reflections on its implications for procurement practitioners. 

The Facts

The procurement concerned car park management services at five NHS hospital sites in Wales. ParkingEye, the incumbent provider, lost the tender to National Parking Control Group Ltd, which was announced as the successful bidder in December 2025. ParkingEye commenced proceedings during an extended standstill period to challenge the decision, triggering the automatic suspension under section 101 of the Act.

Revised assessment summaries and a revised contract award notice were later issued to correct an error in the original documents, after which ParkingEye issued (but did not serve) further proceedings during a second standstill period. In March 2026, Velindre and Cardiff & Vale University Health Board applied to lift the automatic suspension under section 102 of the Act.

The grounds for the underlying claim against Cardiff & Vale University Health Board are numerous and the judgment notes that they span the whole procurement process – from alleged incorrect identification of contracting authorities and estimated contract value in the tender notice, to evaluation issues in later stages of the procurement. However, the decision on 1 May 2026 solely concerned the claim to lift the automatic suspension.

The old and the new 

Under PCR 2015 the test applied by the Courts when considering whether to lift the automatic suspension was the American Cyanamid test, which required the Court to consider: 

• Whether there is a serious issue to be tried;
• If so, would damages be an adequate remedy for the claimant if the suspension was lifted and they succeeded at trial, and is it just in all the circumstances that the claimant should be confined to a remedy of damages;
• If not, would damages be an adequate remedy for the defendant if the suspension remained in place and it succeeded at trial; and 
• Where there is doubt as to the adequacy of damages for either of the parties, which course of action is likely to carry the least risk of injustice? Where does the balance of convenience lie? 

Given the primacy of the adequacy of damages limb of this test, and the laddered approach to considering the limbs, in the vast majority of cases under PCR 2015 the court found damages to be an adequate remedy for the claimant, and therefore an injunction preventing the contracting authority from entering into the contract inappropriate. Consequently, it was often difficult for claimants to maintain the automatic suspension. 

However, for applications to lift the automatic suspension under the Act, section 102(2) provides that the Court must have regard to: 

• the public interest in, among other things:
  • upholding the principle that public contracts should be awarded, and contracts should be modified, in accordance with the law;
  • avoiding delay in the supply of goods, services or works provided for in the contract (for example in respect of defence or security interests or ensuring the continuation of public services);
• the interests of suppliers, including whether damages are an adequate remedy for the claimant; and 
• any other matters that the court considers appropriate. 

Therefore, the new test removes any hierarchy of limbs and limits adequacy of damages to just one of the considerations to bring to the court's attention.  

The Court's interpretation of section 102 (2) 

Following a detailed overview of the relevant law contained in the Act and an explanation of the previous position under PCR 2015, HHJ Keyser provided judicial guidance on the interpretation of section 102(2), with the key points as follows: 

• Interpretation of the Act will be in line with the general principles on statutory interpretation, namely that the courts are required to seek the meaning of the words as intended by Parliament. This means reviewing section 102(2) in the context of the Act as a whole, though "the most important textual context" for its interpretation is section 12 of the Act i.e. the new objectives when conducting a covered procurement.
• The Government's Guidance: Remedies has no statutory authority and cannot be taken to demonstrate the intention of Parliament, but HHJ Keyser did note it was "capable of being of some persuasive authority." Throughout the judgment HHJ Keyser also considered the Government's consultative Green Paper Transforming Public Procurement, the Response to the Consultation and the Explanatory Notes to the Act to assist him with his views on the interpretation of section 102(2). 
• There are now only "two mandatory considerations" when considering lifting the automatic suspension: the public interest and interests of suppliers. 
• There is no guidance on balancing the two mandatory considerations and so the weight to be afforded to each element of the new test will be for the Court to decide on the particular facts of each case. 

Public Interest

HHJ Keyser was of the view that the public interest "will generally tend in favour of keeping the suspension in place, although on the facts of particular cases it may weigh differently."

On the specific public interest examples in the Act, HHJ Keyser considered that they "give a fairly clear indication" of how the public interest is meant to operate as a consideration for the Court. Indeed, in HHJ Keyser's opinion:

• the focus on upholding the principle of lawful awards recognises the public interest that "where the lawfulness of an award of a contract is disputed, the contract should not be awarded until the dispute has been determined;" and
• on the issue of avoiding delay in supply, and the examples provided in section 102(2)(a)(ii) concerning defence or security interests or the continuing provision of public services, the focus is directed to preventing the substantial deprivation of public services. 

HHJ Keyser did not think that the public interest limb required an assessment of the merits of the case.

Summary of the application of section 102 (2)

HHJ Keyser's analysis concluded with a helpful summary of the interpretation and application of section 102 (2) at paragraph 36 of the judgement:

1. "The test requires the court to balance the public interest and the interests of suppliers, including the claimant, along with any other matters the court thinks appropriate.
2. The weight to be afforded to the several factors is a matter for the court in each particular case.
3. However: (i) the adequacy of damages for the claimant, though still a relevant matter, no longer has the significance it had under the American Cyanamid test; (ii) the new test recognises the public interest that, where the lawfulness of a proposed contract award is in dispute, the contract should not be awarded until the dispute has been resolved; (iii) the public interest in lifting the suspension will generally concern the interest in the continuing provision of goods and services rather than merely the contracting authority’s judgement as to its preferred provider of the goods and services or the detailed terms on which they will be provided.
4. Accordingly, although there is no statutory presumption and in each case the decision where the balance lies must be decided on the facts, the lifting of the suspension will generally require, on the particular facts of the case, the presence of either a very persuasive countervailing public interest or some overriding matter of private interest.
5. In deciding where the balance lies in a particular case, the court will also be mindful of its power to provide for undertakings or conditions in any order that it makes."

Applied to the facts of the case, HHJ Keyser did not consider that there were sufficient reasons (in the public interest or the private interests of third parties) to outweigh the public interest in maintaining the automatic suspension, such that the application to lift was refused. 

How the new test differs from the old American Cyanamid test

HHJ Keyser indicated that the new test is intended to be substantively different from the American Cyanamid test in "both its method and its effect", and his reasoning certainly bears this out:

• Under the American Cyanmid test, a finding that damages would be an adequate remedy for a claimant would be determinative and usually lead to the automatic suspension being lifted, with the result that it was difficult for a claimant to successfully resist an application to lift the stay. However, now adequacy of damages is only one matter to be taken into consideration and other supplier considerations can be brought to the fore (including those of the potential new contractor). HHJ Keyser noted this but believed there were no facts to show that an overriding consideration would be the interests of the new supplier in a prompt award. 
• While the order in which the elements of the new test appear in the Act does not indicate one having greater weight than another, the fact that adequacy of damages is not front and centre in the new test emphasises the departure from the old position. Indeed, owing to the determinative nature of the adequacy of damages point, the public interest was not given true weight in the bulk of cases.

One could argue that the facts of the case did not lend themselves to a detailed consideration of the extent to which matters of public interest might sway a court to lift the automatic suspension. The procurement was for car park management services, and the scope of services was thought to be largely similar to the incumbent. In the judgment, HHJ Keyser appears to focus in on this, noting that there is a means to extend the current contract and have delivery of a largely similar scope of services even where the suspension was maintained. One does wonder if things may have been different if there was no lawful basis for modifying the incumbent contract and/or the services were new or significantly different. 

Another factor, which the judgment doesn’t clearly address, is the fact that the claimant offered an undertaking in the following terms: "Until the final determination of the claims by the court or further order, the claimant undertakes to pay any reasonable damages which the defendants and/or either of them and/or National Parking Control Group Limited directly sustain as a consequence of the maintenance of the suspension and which the court considers that the claimant ought to pay." HHJ Keyser concluded, in refusing to lift the suspension, that it was appropriate to exact an undertaking in damages from the claimant "which ought to be in the form found in the standard orders for interim injunctions" but there is no indication of whether it would have made a difference to the outcome of the decision if the claimant had not been willing to offer such an undertaking. 

Practical implications for Contracting Authorities and bidders

In his concluding remarks, HHJ Keyser made it clear (as in the rest of his judgment) that the public interest and the interest of suppliers is the focus of the new test:

"the statutory suspension and the new test for applications to lift the suspension are clearly intended to ensure that proper weight is given to the public interest in ensuring that public contracts are awarded in accordance with the law and that, accordingly, the courts do not too lightly lift the suspensions." (emphasis added)

It remains to be seen how the interpretation and application of section 102 will develop with further judicial guidance. In ParkingEye the Court has signalled that its starting point is a movement away from simply considering the adequacy of damages and placing instead a strong focus on the public interest in upholding compliance with the Act. 

This decision is unquestionably a success for those who during the development of the Green Paper and the Procurement Bill wanted to see the procurement rules being underpinned by a more effective remedies regime. Under the PCR 2015, the rarity of suspensions being maintained and the hurdles in obtaining damages (due to the need to show a sufficiently serious breach)  left suppliers without effective recourse. But what are the implications? The Green Paper, as HHJ Keyser notes in ParkingEye, also proposed a cap on damages but this never made its way into the final Act – was this a key counterpoint under the proposed new remedies regime which is now missing? Is the new test under the Act going to increase the risk of challenge by providing suppliers with what seems to be a lower bar to maintaining automatic suspension? The Court in this decision seems a lot more supplier-friendly than previous PCR-judgements and such an approach  was by no means evident from either the Green Paper or the resulting legislation. 

The decision reopens the door for suppliers to seek effective and meaningful redress in challenging an unfavourable procurement decision. In doing so, it has turned the challenge landscape on its head: expect more scrutiny and challenge from an emboldened marketplace.