Regulation 33 of the Utilities Contracts Regulations 2006 states that is mandatory for a utility “as soon as possible after the decision has been made, [to] inform any economic operator which submitted an offer, which applied to be included amongst the economic operators to be selected to tender for, to negotiate the contract or to be admitted to a dynamic purchasing system, of its decision to abandon or to recommence a contract award procedure in respect of which a contract notice has been published, in relation to: (a) the award of a contract; (b) the conclusion of a framework agreement; or © admittance to a dynamic purchasing system”.
Furthermore, Regulation 33(12) states the following: “A utility which informs an economic operator of its decision in accordance with paragraph 11 shall: (a) include the reasons for the decisions; and (b) provide the decision and reasons in writing if requested by the economic operator”.
Thus, it is legally permissible to cancel a contract, and it must be done “in writing if requested”, but can be done orally. Generally speaking, one would be advised to conduct such activity in the written word.