A Cyprus tender challenge now costs a guarantee

Until November 2025 a tenderer who thought a Cyprus public contract had been awarded wrongly could ask the Tender Review Authority to stop the award without putting anything at risk beyond the filing fee. That is no longer the case. Law 189(I)/2025, published in Official Gazette No. 5060 on 7 November 2025, made an interim measure conditional on a personal guarantee, and raised the threshold at which the review regime applies to works contracts.

Two routes, and the choice is made at the start

Section 19(1) of the Review Procedures in the Field of Public Contracts Law, 104(I)/2010, gives a right of recourse to the Tender Review Authority to any interested person who has or had an interest in being awarded a particular contract and who has suffered or may suffer loss from an act or decision of the contracting authority preceding the conclusion of the contract, where that act or decision is alleged to breach any provision of the applicable law.

Section 19(2) preserves the alternative: the person may instead bring a recourse to the Administrative Court under Article 146 of the Constitution. The two are alternatives at the outset, and the choice has consequences for timing, for the standstill and now for the guarantee.

The deadlines

Section 21(1) fixes the time for a recourse to the Authority:

• fifteen calendar days from the day after the date the decision was sent to the interested tenderers or candidates, where facsimile or electronic means were used to send it
• where other means of communication were used, either fifteen calendar days from the day after it was sent, or ten calendar days from the day after the decision was received

Section 21(4) deals separately with the complaint that is about the tender itself rather than the award. Where the act or decision is contained in the notice, the tender documents or any other document relating to the tender procedure, and refers to technical, economic and financial specifications, and is not subject to specific notification, the recourse is brought within ten calendar days of the date of publication. A tenderer that waits for the award before objecting to a specification is out of time on that ground.

Section 21(2)(a) defines who is still in. Interested tenderers are those not yet definitively excluded, and an exclusion is definitive once it has been notified and has been held lawful by the Administrative Court under Article 146, or once the time for such a recourse has expired unused.

Section 21(3) tells the contracting authority what its notification must carry: a summary of the relevant reasons for the decision, and a clear statement of the precise standstill period that applies under section 22. A notification that omits the standstill statement is itself a ground under section 27(b)(iv), once the contract has been signed.

The standstill

Section 22(1) provides that the period for bringing a recourse under section 21(1), and the two working days provided for in section 24(1), prevent the conclusion of the contract. Section 22(2) extends that period, where a recourse is brought, until the date of the Authority's decision on interim measures. Section 23 lists the derogations.

So the contract cannot be signed while the clock in section 21 is running, and once a recourse is filed it cannot be signed until the Authority has ruled on interim measures. Everything after that depends on whether interim measures are granted, which is where the 2025 amendment operates.

The guarantee, from 7 November 2025

Section 24(1A), inserted by section 3 of Law 189(I)/2025, works in stages.

The declaration. A tenderer seeking an interim measure must file, together with the recourse form asking for it, a declaration that it will provide a personal guarantee if the measure is granted. The proviso is blunt: if the declaration is not filed, the request for the interim measure is rejected.

The guarantee. Where the contracting authority objects to the interim measure and the Authority nonetheless decides to grant it, the Authority calls on the tenderer to lodge, within five working days of the decision, a personal guarantee in favour of the contracting authority, in an amount of one per cent of the estimated value of the contract, with a maximum of €50,000. Where the estimated value is not specified, the amount is €10,000.

The default. The tenderer must attend within five working days and lodge the guarantee in the form the Authority prescribes. If the five working days pass without it, the interim measure is cancelled, the contracting authority is not prevented from proceeding with the award or with the execution of its act or decision, and the tenderer is subject to no other consequence.

The outcome. If the contracting authority's act or decision is upheld, the guarantee becomes payable. If it is not paid on first demand, that is professional misconduct on the part of the issuer of the guarantee, who is excluded from participation in future public tenders until it complies with its obligations. If the Authority annuls the act or decision under section 25, or the recourse is withdrawn, the guarantee is returned within ten working days of the decision.

Two points follow for anyone advising a tenderer. The exposure is now quantifiable at the outset, which makes the decision to challenge a commercial one rather than a procedural reflex. And the sanction for non-payment falls on the bank or other issuer, not only on the tenderer, which is why the issuer will want to understand the merits before it signs.

The threshold moved too

Section 2 of Law 189(I)/2025 replaced, in section 3(d) of the principal Law, the figure of €500,000 with €1,000,000. That paragraph is the one that brings public works contracts under Part V of Law 73(I)/2016, works contracts under Part V of Law 140(I)/2016 and works and services concessions under Part V of Law 11(I)/2017 within the review regime by reference to a domestic figure rather than a European threshold. Works contracts in that band between €500,000 and €1,000,000 are now outside it.

The timetable once a recourse is filed

Section 24(1) requires the Authority, within two working days of the recourse being registered, to notify the contracting authority and to require it (a) where an interim measure is sought, to appear within two working days of that notification to state its views on suspending the award procedure, the execution of the act or decision, or the signature of the contract, with the tenderer or its representative also invited; and (b) to file a written report, with any material it considers necessary, within ten working days.

Section 24(2) tells the Authority how to decide on interim measures: it weighs the probable consequences for all interests likely to be harmed, and the public interest, and may refuse the measure where in its judgment the negative consequences outweigh the benefits. A refusal does not prejudice the tenderer's other claims.

Section 24(3) requires the decision on interim measures within five working days of the notification of the recourse to the contracting authority. Section 24(4) requires the Authority to fix a short date for the hearing.

Section 25(1) requires the decision on the recourse itself as quickly as possible, and in any event no later than forty five calendar days after the hearing is completed.

What the Authority can decide

Section 25(2) gives three outcomes: confirm the act or decision; annul it, if it breaches any provision of the applicable law; or annul or order the amendment of any term in the notice, the tender documents or any other document relating to the tender procedure that refers to technical, economic and financial specifications, before the applications to participate or the tenders are submitted, for breach of any provision of the applicable law.

Section 25(3) is the limit that makes timing decisive. Except where section 27 applies, if the Authority annuls an act or decision after the contract has been concluded, the contract is not affected.

After the contract: ineffectiveness

Section 26(1) requires a recourse asking for a concluded contract to be declared ineffective, on either of the section 27 grounds, to be brought before thirty calendar days have passed from the day after the contracting authority published the award notice with a justification for awarding without prior publication, or informed the interested tenderers of the conclusion of the contract with a summary of the relevant reasons. Section 26(2) applies where subsection (1) does not: the recourse is then brought before six months have passed from the day after the contract was concluded.

Section 27 sets the grounds. The Authority declares a concluded contract ineffective if it finds that the contract:

• (a) was awarded without prior publication of a contract notice in the Official Journal of the European Union, or for contracts under section 3(d) in the Official Gazette of the Republic, where that was not permitted by the procurement legislation; or
• (b) was concluded while a section 19 recourse against the award decision was pending and before the section 24 time for the Authority to decide on interim measures had run; or while interim measures suspending the award or the signature were in force; or in breach of section 22; or without, or before, informing the interested tenderers as section 21(3)(a) requires

For the section 27(b) grounds there is a double condition: the breach must have affected the applicant's chances of being awarded the contract, and it must be combined with a breach of the procurement legislation.

Section 28(1) lets the Authority decline to declare the contract ineffective where overriding reasons of general interest require its effects to be maintained. The provisos matter more than the rule. Economic interests directly linked to the contract are not an overriding reason, and the section names them: the cost of delay in performance, the cost of running a new procedure, the cost of changing the operator performing the contract, and the cost of the legal obligations arising from ineffectiveness. Economic interests are an overriding reason only where, in exceptional circumstances, ineffectiveness would lead to disproportionate consequences. Under section 28(2) every such decision taken in a calendar year is notified to the European Commission through the Public Procurement Directorate.

Section 29(1) gives the contracting authority a safe harbour against the section 27(a) ground: it must show that awarding without prior publication was permitted, must have published in the Official Journal a notice of its intention to conclude the contract carrying the five items the section lists, including the justification, and must not have concluded the contract before ten calendar days from the day after that publication.

Section 30 governs the consequences. Ineffectiveness may be retrospective. Where the Authority decides it is not, ineffectiveness is confined to cancelling the obligations not yet performed at the date of the decision.

Section 31(1) requires the Authority, where it finds a contract was concluded unlawfully on a section 27 ground, whether or not it declares it ineffective, to impose an administrative fine on the contracting authority, a shortening of the contract term, or both. Under section 31(2) it weighs the seriousness of the breach, the conduct of the contracting authority and the extent to which the contract remains in force, and takes account of the requirement that the sanctions be effective, proportionate and dissuasive. The fine is paid within sixty days into the Consolidated Fund, and under section 31(4) is recovered as a civil debt due to the Republic if it is not.

Costs, and the summary dismissal

Section 20(2) requires the recourse to be filed on the Authority's own form with a fee fixed by the Minister of Finance on the Authority's recommendation and published in the Official Gazette. Where the act or decision is annulled, or is withdrawn by the contracting authority with the result that the recourse is dismissed, or where the recourse is withdrawn or dismissed for a reason in section 27(b), the Authority may in its discretion order the whole or part of the fee to be refunded.

Section 20(3) makes each party responsible for its own costs. Section 20(4) lets the Authority order the costs of the proceedings against an applicant whose recourse is dismissed under section 20(5) or confirmed under section 25(2)(a). Section 20(5) allows the Authority to examine summarily and dismiss a recourse it considers unfounded, without calling either the applicant or the contracting authority before it.

Where each further step goes

Section 32 provides that every decision, act or omission of the Tender Review Authority is subject to a recourse to the Administrative Court under Article 146 of the Constitution.

Section 33 is the damages route, and it is a different court. Annulment by the Authority of the act or decision creates a right, where the interested party has suffered loss from it, to claim damages from the contracting authority by action in the Court, and section 2 defines the Court as the Nicosia District Court. Annulment first, damages second, and in a civil action rather than in the administrative jurisdiction.

What a tenderer should settle before filing

• Which route: the Authority under section 19(1), or the Administrative Court under section 19(2)
• Which clock: fifteen or ten days under section 21(1), or ten days from publication under section 21(4) if the complaint is about a specification
• Whether an interim measure is worth one per cent of the contract value, capped at €50,000, and who will issue the guarantee
• Whether the contract has already been signed, since section 25(3) leaves it standing unless a section 27 ground is made out
• Whether the loss, if the award is annulled, is worth a separate action in the Nicosia District Court

We advise contractors, suppliers and consultants on Cyprus public tenders, including procurement strategy, challenges before the Tender Review Authority and the disputes that follow. Write to us at office@kleanthousplatis.com with the names of everyone involved and a short description, and we will reply within one business day.

Questions we are asked

Sources

• Review Procedures in the Field of Public Contracts Law of 2010, 104(I)/2010, consolidated text
• Review Procedures in the Field of Public Contracts (Amending) Law of 2025, 189(I)/2025, Official Gazette No. 5060, 7 November 2025

This article is provided for general information purposes only and does not constitute legal advice.

Klitos Platis

Advocate, Partner

Kleanthous & Platis LLC, Nicosia · Published 23 August 2026

More on this: Construction Lawyers in Cyprus, Before You Sign a Building Contract in Cyprus: Ten Clauses That Protect You, The Legal Structure of a Cyprus Construction Project: Who Contracts With Whom, Key Parties in a Cyprus Construction Contract: Who Is Answerable for What.