Para 5.4 — GOODS_MANUAL

5.5. Bid Invitation Process- Risks and Mitigations

Risk Mitigation 1. Exceptions to an open tender process are abused, leading to single-source processes. Rigorously follow the conditions under which open tendering can be dispensed with. 2. When short-lists are used, the process of preparation of short-lists may be nontransparent, and all eligible firms may not be included, and some ineligible firms may get included. Registration of bidders/contractors: All major procuring Departments must keep a list of registered bidders for use in restricted tendering. Publicise even restricted bids on your website. Bidders for LTE/ SLTE may be transparently selected with the approval of CA. 3. 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 be very stringent nor very lax in restricting/facilitating the entry of bidders. These criteria should be Lay down criteria when PQB tendering is warranted. Also, model PQC criteria for diverse types of procurements should be laid down.

2. As far as the bidders who have participated in a tender (participating bidders), for transparency, a comparative summary of Technical (compliance details) and of Financials bids (including QCBS calculations, wherever applicable) should also be accessible to them, but not necessarily to the public at large, unless sought and if permissible under the RTI act.

3. Bidders may have genuine concerns about techno-commercial and operational trade secrets if their full technical and financial bids are accessible to their competitors or the public at large. This concern may get aggravated in complicated EPC/ PPP/ Consultancy procurements. Technical/ financial bids should not be made accessible to the public at large, and a call needs to be taken based on the sensitivity of details in the bids to restrict access of even participating bidders to full technical/ financial bids of their competitors. The decision of procuring Entity to share or not share the full technical bids with other participating bidders should be clearly brought out in the Tender Documents.

4. However, a clause may be added to the tender documents reserving the right of the Procuring Entity and the eProcurement portal to provide access to bidders’ technical/ financial bids to other participating bidders, in addition to the comparative summary of Technical and financial bids of all participating bidders.

5.4. Transparency and Protecting Third-Party Rights of Bidders 1. Objectives of transparency in eProcurement are amply served if data relating to the Tender and Award of Contract are accessible to the public.

Manual for Procurement of Goods, Second Edition, 2024

Risk Mitigation clear, unambiguous, exhaustive, and yet specific. Also, there should be fair competition. 4. Invitation to tender (an open bid) is not well publicised or gives insufficient time, thereby restricting the number of bidders that participate. Publicity and adequate time for bid submission must be ensured. Higher-level approval should be obtained for a shorter bid submission period. 5. Evaluation criteria are not set from the beginning or are not objective or not clearly stated in the tender documents, thereby making them prone to being abused. Objective, relevant and clearly stated evaluation criteria must be specified in the tender document.

1. To safeguard against a bidder’s withdrawing or altering its/ his bid during the bid validity period in the case of advertised (OTE and GTE tenders) or special limited tender enquiry Bid Security (also known as Earnest Money Deposit (EMD)) is to be obtained from the bidders along with their bids95. The amount of bid security should ordinarily range between two (2) to five (5) per cent of the estimated value of the goods to be procured. The amount of bid security, rounded off to the nearest thousands of Rupees, as determined by the Procuring Entity, is to be indicated in the tender documents. Bid security may be obtained in the form of insurance surety bonds96, account payee demand draft, banker's cheque, or bank guarantee (including e-bank guarantee) 97 from any of the commercial banks or payment online in an acceptable form. In case the bid security is more than a threshold (Rupees five lakh) and in case of foreign bidders in GTE tenders, it may be in the form of a bank guarantee (in equivalent Foreign Exchange amount, in case of GTE) issued/ confirmed from any of the commercial banks in India in an acceptable form. The bid security is normally to remain valid for a period of 45(forty-five) days beyond the final bid validity period.

2. In place of a Bid security, Procuring Entities, after seeking approval from the competent authority, may consider asking Bidders to submit a Bid securing declaration (BSD), accepting that if they withdraw or modify their Bids during the period of validity or if they are awarded the contract and they fail to submit performance security, or to sign the contract, before the deadline defined in the tender documents, it shall be considered as a violation of Code on Integrity and they shall be suspended for the time period specified in the BSD from being eligible to submit Bids/Proposals for contracts with the procuring entity.

3. In appropriate cases, Submission of the bid security may be exempted with the Competent Authority’s (CA’s) approval, especially in the case of indigenisation/development tenders, limited tenders, and procurements directly from the manufacturer or authorised agents, bidders that are currently registered, and will also continue to remain registered during the bid validity period with the concerned Ministry/ Department/ Procuring Entity. Micro and Small Enterprises (MSEs) as defined in the MSE Procurement Policy issued by the Department of Micro, Small and Medium Enterprises (MSME) and registered Startups as recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) (please refer to para 1.11.2-4-a)) are exempt from payment of EMD. In case the bidder falls into these categories, the bidder should furnish a certified copy of its valid registration details. Except for MSEs, this exemption is valid for the trade group and monetary value of registration only.

Chapter 6: Forms of Securities, Prices, Payment Terms and Price Variations 6.1. Forms of Security 6.1.1 Bid Security (Rule 170 of GFR 2017)

Chapter 6: Forms of Securities, Prices, Payment Terms and Price Variations 4. A bidder’s bid security shall be forfeited if the bidder withdraws or amends its bid or impairs or derogates from the tender in any respect within the period of validity of the tender or if the successful bidder fails to furnish the required performance security or to sign the contract within the specified period. 5. Bid securities of the unsuccessful bidders should be returned to them as soon as possible after the expiry of the final bid validity period and, at the latest, by the 30th day after the award of the contract. Bid security should be refunded to the successful bidder upon receipt of performance security. However, in the case of two-packet or two-stage tendering, Bid securities of unsuccessful bidders during the first stage, i.e., technical evaluation, etc., should be returned within 30 days of declaration of the result of the first stage, i.e., technical evaluation, etc.98