Para 4.6 — GOODS_MANUAL

4.6.1 Pre-qualification Bidding (PQB) 1. In situations mentioned above, where the time, effort and money required from the bidder to participate in a tender is high, a two-phase pre-qualification bidding may be considered. Pre-qualification Bids (PQBs) should meet the norms of transparency, fairness, and maintenance of competition. Although there is a separate phase of PQB bidding, it’s not semantically counted as a two-stage bidding. 2. In the first PQB phase, competent, qualified bidders are shortlisted by using a Prequalification Criterion (PQC covering - i) past experience of similar contracts, ii) performance capability and iii) financial strength). No Techno-commercial or Financial details are asked for in the first phase pf PQB. In the second phase, tender documents (Techno-commercial and Financial) are issued as usual through eProcurement/ ePublishing; bids only from shortlisted qualified bidders are evaluated, and others are rejected. 3. Where PQB is not Desirable: Since the two phase PQB system may strain the transparency principle and there is a heightened risk of Anti-competitive practices, two phase PQB should be done only as an exception under specified circumstances. Hence, the procuring entities may lay down restricted powers to approve such modes at sufficiently high levels in SoPP. It should not be a routine/ normal mode of procurement of goods, and qualification criteria as part of a single/ two/ multiple envelopes system should suffice in such situations. PQB bidding as a separate phase is contraindicated in the following circumstances: a) Where procurement is being done through limited tender enquiries; b) Where the requirement is technically and commercially not complex enough that prequalification of the bidder is not crucial for the performance of the contract, for example, Commercial Off The Shelf (COTS) requirements; c) Where the procurement is significantly complex and the time, effort and money required from the bidder to participate in a tender is not significant, clear-cut, fail-pass pre-qualification criteria can be specified in single-stage tendering (instead of twophase tendering) as per para 4.6.2 below.

4.6. Pre-qualification Modes of procurement 1. Where the procurement is significantly complex, and the capability of the source of supply is crucial, for the successful performance of the contract, it may be necessary to ensure that there is competition only among bidders equally capable of performing the contract and incapable bidders don’t queer the pitch by their low quality/ low price bids. In such a situation, a pre-qualification of bidders may be required to shortlist bidders who are equally capable of performing the contract. Evaluation of Techno-commercial and Financial bids is restricted to this shortlist only.

4. Pre-qualification Criteria: PQC should be unrestrictive enough not to leave out even one capable vendor/contractor. Otherwise, it can lead to higher procurement/works/services prices. However, on the other hand, these criteria should be restrictive enough so as not to allow even one incapable vendor/contractor and thus vitiate fair competition for capable vendors/contractors to the detriment of the buyer’s objectives. A misjudgement in either direction may be detrimental. A sample PQC is given in Annexure 12. Due consideration should be given while framing PQC to its effect on the adequacy of competition. PQC should not result in unreasonable exclusion of ‘Class-I local supplier’/ ‘Class-II local supplier’ who would otherwise be eligible beyond what is essential for ensuring the quality or creditworthiness of the supplier. (please refer to para 1.11.3-9). To encourage MSEs, Local Bidders and past successful bidders, a call may be taken as to whether PQC should apply to full quantity/ packages or be proportional to part quantity/package quoted by a bidder. In case the requirement is suddenly multiple times the past procurements, blind adoption of past PQCs (fractions/ percentages) may lead to the disqualification of successful past vendors leading to inadequate competition. PQC should, therefore, be carefully decided for each procurement with the approval of CA for acceptance of the tender. It should be clarified in the PQB documents that bidders have to submit authenticated documents in support of eligibility criteria.

5. Advertisement and Notification: The invitation for the first phase PQB shall be processed (advertised, tender document preparation, publicity, evaluation, and so on) in the same manner as a normal GTE or OTE (as the situation calls for) tender, ensuring the widest possible coverage. The PQC and evaluation criteria should be clearly noted in the PQB documents. The PQB documents should also indicate a complete schedule of requirements for which this PQB is being done, including approximate likely quantities of requirements. A minimum period of 3 weeks (4 weeks in case foreign bidders are also involved) may be allowed for the submission of PQBs. In the case of urgency duly approved by CA, the time limit may be reduced to 10 (ten) days.

6. Evaluation: At least in high-value and critical procurements, the credentials regarding experience and past performance submitted by the successful bidder may be verified as per pre-qualification criteria (PQC), as far as reasonably feasible, from the parties for whom work has been claimed to be done. The procuring entity shall evaluate the qualifications of bidders only in accordance with the PQC specified and shall give due publicity to the particulars of the bidders that are qualified on the relevant portals/ websites.

7. Subsequent Procurement Tender: The pre-qualification shortlist shall be for a single subsequent procurement. In this subsequent procurement, bids are invited from these qualified bidders only, and all other bids may be treated as unsolicited offers, which are normally rejected. This second phase of the procurement process is handled as a normal two-envelope tender. The time gap between the pre-qualification approval and the floating of the linked main procurement tender should normally be less than six months.