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US$ 34,300LC
Dec 31, 2006
C345
Rs 3.45 mIB
Dec 30, 2006
D378
US$ 39,000BG
Dec 30, 2006
E355
Rs. 3.25 i-n
BGDec 30, 2006
F353
3.53 (Only a photo copy of a
BG, submitted with bid; the
original received 2 days laterDec 30, 2006
ens-tc. - )
FT n m en nnn
U,3,D -tZ-,OVVLk -
ucc -) I , /-VVO
H330
Rs. 3.3 mBGDec. 2, 2006
I348
Rs. 3.5 rnBG
Dec 29, 2006
[Note: The official exchange rate on Sep 2, 2006 was 99.0 and on December 2, 2006was 100.0; 345199 = 3.484848; ; 3781199 = 3.818182; 423/99= 4.2727271
Which of the above bid securities you consider as acceptable?
BS 7
An
in
9
The TEC recommendation is that the 2nd lowest, "Bidder A ", be
awarded since the bidder which submitted the lowest quotation did not
submit the Bid Security.
Can the bid "B" be accepted due to following reasons?
1. The price difference between the lowest quotation and the
2nd lowest is Rs.2,330,437.50, for printing of Booklets,which is a substantial.
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eragency invited quotations from 7 bidders on National
respect of Printing, Supply and Delivery of Bookletsbidding period of 7 days, there were only 3 responses
as follows:
Bidder Price
Shopping basis
(18,750 Nos).
and bid prices
as requested in the
TheLetter
A 5,455,312B 3,124,875C 5,462,859
lowest bidder "B"'s did not submit a Bid Securityof Invitation.
. subsequently sent a letter stating that, he could not send the
Bank Guarantee and ready to do so now.
3. The delivery period is 21 days which is considered as a very
short period
TECHNICAL COMPLIANCETC 1
A supplier submitted a bid on a piece of equipment which he said fully
met the bid specifications and attached a catalogue sheet to his bidsubmission. There was a discrepancy between the specifications detailed
in the offer and the specifications printed on the catalogue sheet; those onthe latter did not meet the requirements laid out in the bid specifications
whereas those stated in the bid complied. The PE disqualified the bid
(which was the lowest price) on the grounds that the specifications were
not met as evidenced by the catalogue sheet. The bidder argued that his
did comply as lie had undertaken in his offer specifically to supply
according to the technical specifications in the bid document and the
catalogue sheet was only a reference material. Therefore, he said heshould be awarded the contract as the lowest evaluated bid.
What should the Purchaser do?
TC Z
An implementation agency called for bids for a container crane with a
minimum lifting capacity of 40.6 metric tons. A bidder quoted his price
i iuf we standard container crane tie manufactures, which has an
operating capacity of 40 metric tons. The executing agency decided to
disqualify the bidder because it did not meet the minimum specified
lifting capacity.
Is the bid substantially responsive and acceptable?
TC 3
For a transmission line project, a PE invited bids for 100 km of aluminum
core steel reinforced conductors.The bid specification stipulated,
among other things, that the aluminum should be a minimum of 95%
purity. When the bids were evaluated, the PE proposed award to the
second lowest evaluatedbidder on the argument that he offered
conductors with 97% purity, and the additional cost was more than
balanced by the reduced losses in conduction. The bidding documents
merely specified the minimum threshold for purity.
10
to deduct the value of these features from B's price. This deduction
made B's bid lower than A's and the PE recommended that the contract
be awarded to B.
is this the correct treatment of the bid?
TC 5
A project included the procurement of 4wheel drive vehicles to be
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How will you address this issue?
TC 4
The bidding documents for some process equipment included a capacity
and performance specifications. During the evaluation process, the PE
found that the two lowest responsive bids (from Firms A and B) met all
the technical requirement but that the second lowest bidder (Firm B)had included some features which the PE considered non-essential and
over and above those called for in the specification. The PE proceeded
Type 4 wheel drive
Fuel Diesel
Engine 175HP at 4500 RMP
Wheel Base 21 feet 6 inches
Suspension Heavy Duty
Fuel Tank 70 liters
Ground Clearance 15 cms.
Transmission Standard Shift
Eight bids were received with the required bid security and required
documents. The PE, as a result of bid evaluation, rejected all but the
highest bid on the basis that the, failed to comply with one or more of
the technical specifications listed above.
Question:
a) Do these specifications meet the concept of good equipment
specs?
b) What should the bidders have done when they received the
bidding documents?
c) If you had received a query from the bidders, what would youhave done?
d) If you had to r1pnr thic hid wcu!d yc~u 4Z:vz scn', ' ,Lc
no objection to issue the bid documents?
TC 6
In an agricultural project in Latin America, the PE invited bids for a plant
for producingsugar cane juice from sugar cane. In the detailed
specifications, it was stated that the cane should be crushed using steel
rollers powered by an A.C. electric motor operating at 220 volts SO
cycles; there should be three stages of rollers. The first stage with
rollers diameter of 200 cm rotating at 5 rpm and the second stage with
rollers of 100 cm rotating at 25 rpm and the final stage with rollers of 10
cm diameter rotating at 100 rpm.
Four bids were received. In the evaluation, the PE rejected the lowest
bid from Australia and proposed award to the second lowest bid from
Brazil. The Australian bidder protested claiming that he had offered a
well proven machine widely used all over Asia. Bank queried the PE who
11
BID COMPARISIONBC 1
1. The five bids for construction of the hospital, clinic and powerhousewere after technical evaluation:
US$
Foreign Company 1 1,820,000
Foreign Company 2 1,890,000
Local/Foreign 3 1,970,000
Foreign Company 4 2,247,000
Foreign Company 5 2,647,000
2. The Government's estimate for the work was US$1,200,000. The
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ecause use on y wo s ages o s ee ro ers ns ea o ree an wdifferent diameters and speed, and hence, failed to comply with the bid
specification. Moreover, the PE had no prior experience with such a
machine.
Question: How do you analyse ?
low bid is therefore 50% higher than had been expected. At least
three alternatives are open to the Government as to what should bedone in this case:
(a) Reject all bids and call for new bids;
(b) Award the contract to the low bidder but cut down the work
called for in the contract, to somewhere nearer US $1,200,000;or
(c) Reject all bids and enter into negotiations with the low bidder
or a few low bidders to find out why they have come in so high
and try to alleviate that problem.
3. Keeping in mind (i) the time delay and additional cost in going out
for new bids, (ii) the technical difficulties in "redesigning" the
project so an award could be made on a slimmed down basis, (iii)
the lack of competition in awarding the contract according to the
"new" design, and (iv) the possibilities for unfair pressure on
bidders, and the potential for lack of competition in a negotiation
situation:
(a) Which of the three courses set out above would you follow,
and why?
(b) If you chose (a) above what steps would you take to
expedite the new bidding? and
(c) If you chose course (c) above which company or companies
would you invite to enter into negotiations, and why?
BC 2:The biddin documents re uire that the bid should be valid for a eriod
12
B
26 MNone
26 M
C24 M
5 9/o discount if awarded
within 90 days22.8 M
D27 M
10 % discount with a
modification letter
submitted along with the
bid.24.3 M
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Discountof 90 days from the deadline for submission of bids. Five bids have been
received by the Agency. Some of the bidders offered discounts in
different manner as follows.
Name
OriginalBid Price
Condition
Bid price if Discount is
considered
A25 M
6 % discount if awardedwithin 60 days
23.5 M
E25.8 M
12% discount with a letter,
registered on the day
before the submission of
bid but Purchaser receive
one day after bid close22.7 M
Agency processed the evaluation expeditiously within 30 days of bid9 1
opening and determined the bidder E at a contract price of 22.7 M as the
lowest responsive after taking into account the discount of 12 % along
with the discounts offered by other bidders.
a) Is the decision of the Agency Correct?
b) Which of the above bids that you consider as substantial
responsive?
c) What is your recommendation for the award of contract?
BC 3:
LoadingThe bid documents for water pipe and fittings containedalternate
f...-Ccncrctc ai-id st&z::P;Ytf, '1111JUJIfir, the requirements
for internal and external coating. Six bids were received, of which the
three lowest were close, varying from (local currency units) 5.3 million of5.6 million, as follows:
Bidder No.1(steel pipe) 5.3 million
Bidder No.2(steel pipe) 5.5 million
Bidder No.3(Concrete pipe) 5.6 million
During evaluation, the Executing Agency decided that cathodic
protection should be provided if steel pipe were selected.
It, therefore, adjusted the bids for steel pipe by adding to the bid price
13
After adjustment of the bid prices quoted by bidders Nos.1 and 2 for
steel pipes, Bid No.3 became the lowest evaluated bid. The Executing
Agency, accordingly, proposed award of the contract to Bidder NO 3.
Questions:
Do you agree with the evaluation of bids by the Executing Agency?
If not, which bidder should be awarded the contract?
Assuming that cathodic protection of steel pipe was needed, how
should the Executing Agency proceed to procure it?
POST QUALLIFICCATIONPOQ 1:
The PIU using NCB method issued standard BD for works for patching
potholes and repairs for an urban road with an estimated value of about
$200,000. Evaluation of bids was to be based on a post qualification
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documents neither required cathodic protection to be included in the
prices quoted for steel pipe nor stated that it would be used as a factor
in the evaluation of bids.
The Executing Agency based its decision on the statement in the bid
documentsthat "to determine the lowest responsive bid, operation and
maintenance
costs will also be considered".
process of the bids using the standard criteria provided in the Bank BD
for small works. By bid closing date, five bids were received and the
lowest priced bid was lacking data on audited financial statements. You
are the chairman of the evaluation committee.
Should this bidder be recommended for award of the contract
POO.2:
On an NCB procurement, for the procurement of civil works for the
reinforcement of river embankments, estimated to cost US$3.3 million,
the Employer received a complaint from a bidder, ANDERSON, that it
had submitted the lowest-priced bid but that the TEC had rejected itsbid incorrectly.
Upon reviewing the bid evaluation report prepared by the TEC, the PC
f3ur,d ANDERSON ;idd, indeed, submiiied me iowest-priced bid but
that the TEC had rejected its bid on the grounds that ANDERSON did not
possess the required experience, as defined in the bidding documents,
namely that "bidders should have completed at least two contracts of
similar nature and complexity in the past five years".
In its bid, Anderson provided a list of the following contractsto
demonstrate its past experience:
Name of ContractContract
Year of
Price (m)Completion
Civil Works for the Reinforcement of RiverUS$4.0
2002
Embankments
14
on ANDERSON - BOB's experience in attempting to demonstrate its own
experience. In its letter of complaint, ANDERSON protested that,
because it fully owns ANDERSON - BOB, its experience should be
counted as ANDERSON's experience and that ANDERSON should,
therefore, be awarded the contract.
Question
'
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Civil Works for the Reinforcement of RiverUS$4.5
2003
Embankments
However, ANDERSON's bid indicated that the two contracts cited had, in
fact, been performed by a company, ANDERSON -BOB, which is a
company wholly owned by ANDERSON, although it is a separate legal
entity.
The TEC's bid evaluation report recorded that, because ANDERSON -
BOB is a separate legal entity from ANDERSON. ANDERSON cannot rely
POQ 3:An Agency invited bids for 100 PCs for supply to an education institution.
ProcuremIn respect of post qualification criteria, bidding document required that
ent ofthe bidder shall be original manufacturers and the PC offered shall be a
Computermodel which is mass produced, has been previously supplied, and in use
sin an Asian country, and has a proven experience of at least 24 months.
Five bids were received. In its evaluation PE rejected iected bid K, L and M and
recommended award to P on the grounds that Bid K was not submitted
by a manufacturer, Bid L had not supplied in Asia and Bid M did not fulfill
the minimum proven experience. Bidder M protested that the PC
offered by him was indeed in proven service for 28 months on the date
of evaluation even though it was in proven service for only 23 months
on the date of bid opening.
Bid K LKR 10. 5 m CIP Colombo
Bid L LKR 10.9 m CIP Colombo
Bid M LKR 10.7 m CIP Colombo
Bid N LKR 11.8 m CIP Colombo
Bid P LKR 11.3 m CIP Colombo
To whom you will award the contract?
CONTRACT AWARDCA 1:
A number of responsive bids at reasonable prices from various supplierswere received through ICB. However, the PE found subsequently that he
could buy the item tor which bids were caked from a iocal 1-11111 (wlmm
had not bid) at a price lower than any of the bids received. The PE
proposed to reject all bids and procure this item (without any change inthe specifications) through direct purchase from the local firm.
Is this a good proposal? Is it acceptable under Procurement
Guidelines?
Analyse the case and give your recommendation for future
CA 2:
Government of Ruritania in July 2008, using NCB method issued Bank
standard BD for small works for construction of a Teacher Training
15
CA 3:
During a post audit for procurement for rehabilitation of 10 schools
estimated at Rs 30 m the following was observed:
Three bids received:
Unbalanc
ed Bid
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Center estimated to cost about $150,000. By bid closing date, two bids
were received and the lowest evaluated bidder had submitted a bid that
was 40% less than the Engineer's estimate. You are the chairman of the
evaluation committee. Should this bidder be recommended for award of
the contract?Bid A: Rs 26 m
Bid B: Rs. 27.4 m
Bid C: Rs. 27.5 m
All three bids were substantially responsive.
In the BC)Q for Bid A, the unit price quoted for windows was
substantially lower than the other three bids and the estimated cost of
the Engineer
The TEC was concerned about the low rate and worried about that
Bidder A will not complete the work satisfactorily
The TEC requested the bidder to substantiate the cost of replacing
windows, giving the breakdown of labour and material.
The breakdown rate was higher than that was in the bid
TEC did not want to take a risk and awarded the contract to Bidder B at
Rs. 27.4 m
CONTRACT ADMINISTRATIONCAD 1:
Pursuant to an ICB process, an Agency placed a contract on a supplier in
IncotermGermany for laboratoryequipmentfor delivery CIF Incotermsat
CU'10111'00 FOrL.
Payment was to be made on the basis of a Letter of Credit on presentation
of Clean Bill of Lading, and other documents. Goods were air-freighted
and the bidder submitted the Airway Bill, country of origin certificate,
invoice to the bank, which paid the contract price."The Agency refused
to take delivery [since the equipment was no more required by him] and
sued the bank for refund of the money since the LC did not permit airwaybill.
Question - Is the bank right in having paid ?
CAD 2:
incoterms
Messrs Lemunge & Sons, a Tanzanian construction company, has
ordered from Fibro A/5, a Danish manufacturer of building materials,
10 000 fiber boards of certain dimensions Ex Works Aalborg Denmark
16