The Procurement Act 2023 and the changes for automatic suspension in practice

The Procurement Act 2023 (PA23) came into force on 24 February 2024. It included, amongst other things, a new test under Section 102 for lifting the automatic suspension.

Much ink has been spent by practitioners in speculating how the Courts will approach this new test and following the case of ParkingEye Limited v (1) Velindre University NHS Trust and (2) Cardiff and Vale University Health Board, we now have some answers.

Case summary: Impacts of the public interest in lawful procurements

The courts have, for the first time, considered the test for lifting an automatic suspension under section 102 of the Procurement Act 2023 (PA23). In ParkingEye Limited v Velindre University NHS Trust (and Others), HHJ Keyser confirmed that the new statutory test departs materially from the American Cyanamid approach and ordered that the automatic suspension in this case be maintained pending trial.

HHJ Keyser held that the statutory framework is “intended to be substantively and not merely formally very different, in both its method and its effect…”

The approach to be taken by the Courts should ensure that proper weight is given to the public interest in lawful procurements, meaning the Courts should not lift suspensions lightly. This represents a significant shift from the former regime, under which the adequacy of damages for the claimant was largely determinative.  

In fact, in this case, the Court accepted that damages would be an adequate remedy for the Claimant (albeit, damages were not being pursued as a remedy) and refused to lift the suspension because the Defendants had failed to demonstrate a sufficiently strong “countervailing public interest”.

Case facts

The claim concerned a challenge by the incumbent supplier to a procurement for car park management services across 59 car parks at five NHS sites in Wales.

In December 2025, the outcome of the procurement was notified to the Claimant, which the Claimant sought to challenge by way of proceedings issued on 19 January 2026. Subsequently, the Defendants identified an error in the original outcome, which resulted in an updated Assessment Summary and Contract Award Notice being issued on 21 January 2026. Again, the Claimant sought to challenge the outcome by way of proceedings issued on 2 February 2026 (the Claims).

The Claims were issued during the respective standstill periods, which triggered the automatic suspension under section 101(1) of the PA23.

The Defendants applied to lift the automatic suspension arguing that damages was an adequate remedy and that the continued suspension would adversely affect the interests of hospital staff, patients and visitors by delaying the provision of services bringing real benefits under the new contract.  

Decision: Why the application was dismissed

HHJ Keyser held that “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”.

The Court held that the ‘new test’ is concerned with the importance of lawful awards themselves, rather than remedies for such unlawful awards, and recognises a public interest in withholding an award of a contract until disputes as to its lawfulness have been determined. Lifting a suspension will generally require, on the facts of the case, compelling evidence of countervailing public interest or an overriding private interest.

HHJ Keyser summarised the statutory test into five key points:

1. Balancing exercise - the court must balance the public interest against the interests of suppliers (including the claimant) and any other relevant matters the court thinks appropriate.
2. Judicial discretion – the weight given to relevant factors is a matter for the Court.
3. Key considerations:
   • (a) Adequacy of damages remains relevant but is less significant than under American Cyanamid.
   • (b) There is a recognised public interest in not awarding a contract while its lawfulness is disputed.
   • (c) The public interest generally concerns continuity of goods or services, not the contracting authority’s preference for its preferred provider or preferred contract terms.
4. Effect on suspension – Although there is no statutory presumption, on the facts of this case, lifting the suspension will usually require either a very strong countervailing public interest or an overriding private interest on the specific facts.
5. Conditions – In striking any balance between interests, the court may impose undertakings or conditions as part of its order.

Comment: A changing approach to automatic suspensions

This judgment marks a clear shift in approach to applications to lift automatic suspensions under PA23.  

For contracting authorities, there is no longer a presumption that the suspension will be lifted on the basis that damages are an adequate remedy for the claimant.  Contracting authorities will need strong evidence of a “countervailing public interest” in favour of lifting the suspension. General assertions about improved services, efficiencies or preferred providers are likely to be insufficient going forward.

For suppliers, they are potentially in a stronger position to oppose an application to lift, refuse consent to lift and prevent contracts from being award prior to any claim being determined.

If the automatic suspension remains in place more readily, what will this mean in practice? Goods and services still need to be provided to the public sector, so contract extensions to incumbent providers could become commonplace.  

If the contracting authority does want to put the new contract in place and avoid the time and cost of a lengthy dispute, during which the automatic suspension would be in place , there could be increased commercial and operational pressures to settle the litigation at an early stage.

This article is part of our Navigating supplier performance series. Visit our hub to discover other insights on effective supplier performance management, with guidance to help you maintain control throughout the contract lifecycle.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at May 2026. Specific advice should be sought for specific cases. For more information see our terms & conditions.