Para 4.6.2 - PQB Risk Mitigation | KartavyaDesk

Original Rule Text

Risk Mitigation 1. Pre-qualification criteria: PQB has the potential of getting misused or being applied without considering the restrictive nature of competition. PQC should be relevant to the quality requirements, and neither is very stringent nor very lax in restricting/facilitating the entry of bidders. These criteria should be clear, unambiguous, exhaustive, and yet specific. Also, there should be fair competition. Lay down criteria when prequalification in single-stage or two-stage tendering is warranted. Also, model PQC criteria for diverse types of procurements should be laid down on the lines of Annexure 12. 2. Dangers of Anti-competitive bidding: Since in a two-stage PQB, shortlisted bidders are announced, there is a heightened possibility of these bidders forming a cartel and quoting anti-competitive prices in the second stage of tendering. Two-stage PQB should be done only in appropriately justified situations. Alternatively, a single-stage multiple envelope system may be used for prequalification, in which the chances of anti-competitive behaviour and cycle time are significantly lower. 3. Two-phase PQB is a time-consuming process. 4. Contentious and Disputes: Both the successful and unsuccessful bidders tend to view the PQB process as a means for creating rights/ privileges/ entitlement for them by way of hair-splitting, contentious or viciously legalistic interpretations of PQC In the PQC, a caveat against such tendencies may be included, asserting the right of the procuring agency to interpret the PQC on common usage of terminologies and phrases in public procurement instead of legalistic and hair-splitting judgements

What This Means

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

Key Points

• •PQC should be relevant, clear, unambiguous, and promote fair competition.
• •Two-stage PQB increases the risk of cartel formation and anti-competitive pricing.
• •Single-stage multiple envelope system is a viable alternative to two-stage PQB to reduce anti-competitive behavior and cycle time.
• •Procuring agencies have the right to interpret PQC based on common usage in public procurement, not just legalistic interpretations.
• •PQB should only be used when appropriately justified due to its time-consuming nature.

Practical Example

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

Frequently Asked Questions

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