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Para 3.2.3 - Consultancy Consortiums | KartavyaDesk

Consultancy Manual

Original Rule Text

2. Consortium of Consultants: a) In large and complex assignments consultants may associate with each other to form a consortium to complement their respective areas of expertise, to increase the technical responsiveness of their proposal, and make larger pools of experts available or for other reasons. Such an association may be for the long term (independent of any particular assignment) or for a specific assignment. b) Such associations are called Consortium or Joint Ventures (JVs) for the purpose of this Manual. In case of consortium or JVs, all members shall sign the contract and shall be jointly and severally liable for the entire assignment. However, the Procuring Entity only deals with the lead member of consortiums/ JVs for all the purposes. After the short list is finalised, and the Request for Proposal (RfP) is issued, any association in the form of a consortium/ JV or sub consultancy among the short-listed firms shall be permissible in accordance with provisions stated in the RfP. Under such circumstance, one of the shortlisted consultants must become the lead member of the consortium/ JV. c) Bid documents should clearly specify whether consortiums/ JVs are allowed to bid (in case of complex and large assignments, say above certain values (say - Rs. 5 (Rupees five) crore). Maximum number of partners in consortium/ JV shall be limited (say – three). In case consortiums/ JVs are permitted to bid, it should be clarified what qualifications are to be collectively (clubbed together) met by the consortium/ JV partners (say experience of similar consultancy etc) and what each partner has to meet individually and separately (say financial capacity). In case of each member meeting credentials individually, it should also be specified that each partner should meet at least 25% (and the lead partner at least 50%) out of the qualifying limit (say financial capacity/ turnover). d) If consortiums/ JVs are allowed, measures should be taken to ensure that all the consortium/ JV partners are present and deliver services all through the contract period. An Implementation Board with participation of all consortium/ JV partners may be provided for wherein the Project Manager from the procuring entity shall also be allowed audience when required. Meeting of consortium/ JV partners with the project executing authority for quarterly progress review may be made as a criterion linked to achievement of key dates or even payment.

What This Means

Para 3.2.3 of the Manual for Procurement of Consultancy Services deals with how government departments can hire a group of consultancy firms working together, known as a consortium or joint venture (JV). This is useful for large, complex projects where one firm might not have all the necessary expertise. The rule allows departments to benefit from the combined strengths of multiple firms, ensuring a more comprehensive and effective solution. However, it also lays down specific guidelines to ensure accountability and proper management of these collaborations.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

  • •Consortiums/JVs are allowed for large, complex assignments, especially those exceeding a certain value (e.g., Rs. 5 crore).
  • •All members of a consortium/JV are jointly and severally liable for the entire assignment, meaning each firm is responsible for the whole project's success.
  • •The procuring entity (government department) deals only with the lead member of the consortium/JV for all communication and management purposes.
  • •Bid documents must clearly state whether consortiums/JVs are allowed and specify the qualification criteria for the group and individual members.
  • •Measures should be in place to ensure all consortium/JV partners actively participate throughout the contract period, such as an Implementation Board and regular progress reviews.

Practical Example

The Ministry of Urban Development wants to hire a consultant to develop a smart city plan for a large metropolitan area. The project is estimated to cost Rs. 8 crore. Recognizing the need for diverse expertise, the Ministry allows consortiums/JVs to bid. Three firms – 'Urban Solutions,' 'Tech Integrators,' and 'Financial Planners' – form a consortium with Urban Solutions as the lead member. The RFP specifies that the consortium must have a combined 15 years of experience in urban planning and each member must demonstrate a minimum financial turnover of Rs. 1 crore, with the lead member needing at least Rs. 2.5 crore. The consortium wins the bid, and Urban Solutions acts as the primary point of contact for the Ministry, while all three firms are responsible for delivering the project successfully.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

What does 'jointly and severally liable' mean in the context of a consortium?▼
It means that each member of the consortium is responsible for the entire project's success. If one member fails to fulfill their obligations, the procuring entity can hold any or all of the other members liable for the entire damages.
Can a shortlisted firm form a consortium/JV after the RFP is issued?▼
Yes, but only if the RFP explicitly allows it and in accordance with the provisions stated in the RFP. One of the shortlisted consultants must become the lead member.
What happens if a member of a consortium wants to withdraw during the project?▼
The contract should have provisions to address this scenario. Generally, the remaining members are responsible for fulfilling the withdrawing member's obligations. The procuring entity should be consulted and involved in any such changes.
Why is it important to limit the number of partners in a consortium/JV?▼
Limiting the number of partners helps to streamline communication, decision-making, and overall management of the project. Too many partners can lead to confusion and inefficiencies.
What is the purpose of an Implementation Board with participation from all consortium/JV partners?▼
The Implementation Board ensures that all partners are actively involved in the project's execution, fostering collaboration and accountability. It also provides a platform for the procuring entity to monitor progress and address any issues.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Test Your Knowledge

Question 1 of 3

According to Para 3.2.3 of the Manual for Procurement of Consultancy Services, which of the following is TRUE regarding the liability of members in a consortium or Joint Venture (JV)?

Related Rules

Para 8Manual for Procurement of Consultancy Services, 2025 - Para 8 - Chapter 10 - Annexure 18Para 9Manual for Procurement of Consultancy Services, 2025 - Para 9 - Chapter 10 - Annexure 18Para 1.10.2Manual for Procurement of Consultancy Services, 2025 - Para 1.10.2 - Chapter 1Para 1.11Manual for Procurement of Consultancy Services, 2025 - Para 1.11 - Chapter 1Para 1.13Manual for Procurement of Consultancy Services, 2025 - Para 1.13 - Chapter 1

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