Judge scathingly rejects Alstom tender appeal

Israel Railways train  picture: Eyal Yitzhar

Tel Aviv District Court judge Michal Agmon-Gonnen called Alstom's behavior in its appeal over Israel Railways' electrification tender "unacceptable".

"I believe that the behavior of the petitioners, which includes spying on a business competitor by making false presentations to it in an attempt to extract incriminating information, all in order to have the winner retroactively disqualified, is fundamentally unacceptable and in my view in itself justifies dismissing the petition," Tel Aviv District Court judge Dr. Michal Agmon-Gonnen said yesterday concerning the petition brought by French company Alstom against Israel Railways over the latter's railway electrification tender.

The tender was for part of one of the largest infrastructure projects in Israel's history. It was for electrifying 420 kilometers of existing and planned railway track, and constructing transformer stations and command and control systems.

Last December, Israel Railways announced that Spanish company Semi had won the tender. Semi's bid was some NIS 1 billion below Israel Railways' estimate. Whereas the tender was estimated to be worth NIS 3 billion, Semi's price was NIS 2 billion.

Alstom petitioned the court claiming that Israel Railways had biased the tender in favor of Semi. Alstom even hired the services of business intelligence company Black Cube, which claimed in the court that it had secret recordings of senior Israel Railways managers indicating that the tenders committee's proceedings were flawed.

The judge dismissed the petition, saying, "This petition began thunderously, and was like an episode from a suspense or spy novel, with monitoring and undercover questioning of senior executives on Israel Railways assessment team… in the end, nothing whatsoever was left of the severe claims that were raised."

The judge added, "That being the case, the need arises to examine the limits that should be set for bidders in a tender who seek to attack the declaration of the tender winner."

Israel Railways was represented by Renato Jarach and Dana Jarach Zaharovich of law firm M. Firon & Co.

Published by Globes [online], Israel business news - www.globes-online.com - on April 19, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

Israel Railways train  picture: Eyal Yitzhar
Israel Railways train picture: Eyal Yitzhar
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