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What Is a Compensation Fee in Procurement (Hyvitysmaksu, Finland)?
This is a Finnish procurement term. A financial remedy the Market Court can order in favour of a bidder who would have had a genuine chance of winning had the procurement been run correctly.
When can the Market Court order a compensation fee?
When the procurement was run unlawfully and the appellant would have had a realistic chance of winning the contract had the error not occurred. It is typically used when the contract has already been signed and cannot be undone.
How is the amount decided?
The court weighs the nature of the breach, the value of the contract and the costs the bidder incurred. It is compensation for a lost opportunity rather than full damages for lost profit.
Can you claim damages instead?
Yes. Damages are claimed separately in the general courts, and the threshold of proof there is higher. The compensation fee is the lighter route available within the procurement appeal itself.
