Material modification doctrine not analogously applicable to Didam-based Allocations

Shell has lost its case against the Dutch State concerning the expansion of Fastned’s electric charging station. Shell initiated proceedings on the grounds that the expansion violated the principle of equal treatment. The preliminary relief judge has now ruled that the expansion does not infringe upon the principle of equality. Moreover, the expansion cannot be qualified as a material amendment, as the doctrine of material amendment is not analogously applicable to public land allocations governed by the Didam judgment.

Facts

The Dutch State ("State") has set out its policy frameworks for granting public-law permission for the construction and operation of facilities at service stations in the so-called Kennisgeving ("Notification"). On 20 December 2011, this Notification was amended. From that moment onwards, it became possible – in addition to traditional core facilities such as fuel stations, roadside restaurants or service stations – to establish an electric charging point at a motorway service area. Where more than one market party expresses interest in developing such a charging point, the default principle is a proportional allocation of the requested charging capacity.

At the motorway service area De Lepelaar – located on the A6 near Lelystad – three market operators submitted an application in 2012 for the development of an electric charging point. A public draw was subsequently held on 27 April 2012, which was won by Fastned (or, more precisely, its legal predecessor). Following this, on 15 July 2015, a permit was granted to Fastned, requiring that at least two fast-charging points remain operational at De Lepelaar. In 2017, the Notification was amended. Since then, the principle has been that only one core charging facility may be established per service area. The Notification was later amended again. The essence of that amendment: parties other than the holder of the core facility – in this case Fastned – are now permitted to apply for an additional permit pursuant to the Public Works (Management) Act (in Dutch: Wet beheer rijkswaterstaatswerken, “Wbr”).

As regards the remaining commercial potential – the conventional petrol station – the Dutch State organised a public auction, which was won by Shell. The current situation at De Lepelaar is therefore as follows: Shell sells conventional motor fuels; Fastned operates a fast-charging station. In May 2022, the Notification was amended once more. It sets out how – and under which conditions – an additional facility may be requested. On 4 October 2023, Fastned was granted an amendment permit to expand its station to a total of eight charging bays. The State published the amendment decision on 6 October 2023. On 25 October 2023, the State subsequently informed market operators of the procedure for allocating additional land for secondary facilities, such as electric charging infrastructure. The essence: a secondary facility can only be established if a number of cumulative conditions are met – including the issuance of a Wbr permit and prior private-law consent from the Dutch State.

The State expressed its intention ("Intention") to expand the De Lepelaar charging station. Market parties could object to the Intention until 3 October 2024. In the Intention, the State expressed its intention to award the project to Fastned, as Fastned is the only bidder that meets the above-mentioned conditions. On 2 October 2024, Shell objected to the Intention, as it believes it can meet the requirements. The State did not go along with this, and Shell subsequently interim relief proceedings.

The ruling

Shell is of the opinion that the State violated the principle of equality. It put forward five claims in this regard:

1. Should the State have held a public selection procedure?

   Shell argued that the State's Intention was wrongly based entirely on the 2012 draw, whereas now it concerns a much larger plot with considerably more loading spaces than permitted at the time. According to Shell, the State should therefore – in view of the Didam judgments – have followed a public selection procedure because Fastned is not the only serious applicant. However, a public selection procedure based on the Didam judgments does not have to be organised if it has been established on objective grounds that only one serious candidate can be considered for the exploitation of the plot of land.

   The preliminary relief judge held that Shell failed to demonstrate that the State’s Intention was incompatible with the 2012 draw. Nor did the judge find it plausible that the Intention would be inconsistent with the Wbr permit granted to Fastned in 2015. The State convincingly argued that the allocation of the core facility in 2012 was not subject to a limitation on the number of charging points to be operated. The Wbr permit – which refers to at least two charging points – does not, either explicitly or implicitly, impose a maximum on the number of charge points allowed under the 2012 draw. Moreover, the preliminary relief judge emphasised that Fastned is the only party currently holding a valid Wbr permit for the location. As such, Fastned qualifies as the sole serious candidate within the meaning of the Didam judgment.

2. Does the criterion that the candidate must have a Wbr licence violate the principle of equality?

   The preliminary relief judge is relatively brief in addressing this claim, holding that the criterion does not infringe the principle of equal treatment. After all, Shell previously had the opportunity to compete for the right to establish an energy charging point as a core facility at De Lepelaar, and also had the possibility to apply for a Wbr permit for an additional facility.

3. Is (by analogy with procurement law) a material modification?

   According to Shell, the planned expansion of the charging station as set out in the Intention must – by analogy – be regarded as a material modification (in Dutch: wezenlijke wijziging) within the meaning of public procurement law. The preliminary relief judge rejects that position, holding that: (i) there is no material modification compared to the 2012 draw, as that draw did not impose any specific limitation on the number of charging points, and (ii) the concept of material modification cannot be applied by analogy to Didam-style tenders.

4. Is there a violation of the level playing field?

   According to Shell, the amendment permit allows Fastned to also open a shop on the plot at a later date. Such a shop limits Shell's scope for competition and operation. The preliminary relief judge emphasised that the amendment permit only covers the operation of charge points by Fastned. Additional facilities will only be granted after another permit application, thus ensuring a level playing field.

5. Was Shell unlawfully moved to withdraw its licence application?

Shell withdrew its permit application because the State had claimed that there was no more room because of Fastned's permit, later it turned out that expansion was possible after all. The preliminary relief judge did not consider this position to be well-founded.

Practical tips

Shell's claims were therefore all dismissed. For operators of charging stations and/or filling stations, but also for parties dealing with Didam tenders, the following is relevant to a greater or lesser extent:

1. For market participants, a proper understanding of the scope of the original permit, and the original manner in which it was licensed, is relevant to whether there has been a breach of the principle of equality;
2. The concept of material modification cannot be applied analogously to Didam tenders.