6.1 2008 Edition

CHAPTER 6

TENDER PROCEDURE

Rev Issue Date Amendment Incorporated

First Issue September 2008 1 14 November 2008 Amendment No. 2/2008 2 16 December 2008 Amendment No. 4/2008 3 30 March 2009 Amendment No. 3/2009 4 20 April 2009 Amendment No. 4/2009 5 19 May 2009 Amendment No. 5/2009 6 29 July 2009 Amendment No. 7/2009 7 24 November 2009 Amendment No. 10/2009 8 1 December 2009 Amendment No. 11/2009 9 18 December 2009 Amendment No. 12/2009 10 18 February 2010 Amendment No. 5/2010 11 20 May 2010 Amendment No. 8/2010

The parts of the PAH shown in blue and boldshould only be updated by Works Branch ofDevelopment Bureau. Amendment No. 3/2009

6.2 2008 Edition

2008 Edition SYNOPSIS

This Chapter sets out the procedures for obtaining and assessing tenders for all capital works contracts which are basically in accordance with Stores and Procurement Regulations (SPR). These procedures also apply to tenders for term and maintenance contracts subject to any modifications set out in Chapter 8 Maintenance and Minor Works and Works for and by Others. In addition, these procedures apply to tenders for design and build contracts, subject to the modifications set out in the Administrative Procedures for Use with the Government of the Hong Kong Special Administrative Region (HKSAR) General Conditions of Contract for Design and Build Contracts, which can be found on the DEVB website (under Publications and Press Releases\Publications\Standard Contract Documents\). The additional procedures for procurement covered by the Agreement on Government Procurement of the World Trade Organization (WTO GPA) are also set out. Tenders for contracts may only be invited after obtaining authority, either by the inclusion of the project in Public Works Programme (PWP) Category (Cat.) A or D, or by approval from the respective Policy Secretaries. The Secretary for Financial Services and the Treasury (SFST) has delegated authorities to all Policy Secretaries to allow tenders for works projects, irrespective of type and value, to be invited before funding is secured subject to the conditions as set out in Financial Circular (FC) No. 2/2009 (Amendment No. 4/2009). However, tender action is normally subject to the availability of funds and of land, and the completion of legal and administrative procedures. Tenders are normally invited from contractors in the appropriate categories and groups of Development Bureau (DEVB) Lists of Approved Contractors for Public Works or Approved Suppliers of Materials and Specialist Contractors for Public Works through notification in the Government of the HKSAR Gazette or through invitations published on the Internet. For occasions where the quality of service or product is a major consideration, a marking scheme in tender evaluation should be adopted. A separate exercise for prequalification of tenderers should only be employed in exceptional situation with sound justifications. Minor services and stores are procured in accordance with SPR. Supply-only tenders are normally handled by the Government Logistics Department. Government tender procedure is not required for Government works entrusted to non-government bodies, such as MTR Corporation Limited (MTRCL), who will themselves be responsible in accordance with their own tender procedure.

6.3 2008 Edition

CONTENTS Page No.

I. ABBREVIATION

6.10

II. GLOSSARY OF TERMS

6.13

1. TENDER PROCEDURE CHECK-LIST 6.14

2. GENERAL 6.20 2.1 METHODS OF CALLING FOR TENDERS 6.20 2.1.1 For Contracts Generally 6.20 2.1.2 For Minor Services and Stores 6.21 2.1.3 For Supply-only Tenders 6.21 2.1.4 For Government Works Entrusted to Outside Bodies 6.21 2.1.5 Use of Marking Schemes in Tender Evaluation 6.21 2.1.6 A Formula Approach to Tender Evaluation 6.23 2.2 TENDER BOARDS 6.23 2.3 DEVB LISTS OF APPROVED CONTRACTORS 6.24 2.4 TIMING FOR TENDER PROCEDURES 6.25

3. PREREQUISITES TO CALLING FOR TENDERS 6.27 3.1 AUTHORITY TO CALL FOR TENDERS 6.27 3.2 AVAILABILITY OF FUNDS 6.27 3.3 AVAILABILITY OF LAND 6.28 3.4 LEGAL AND ADMINISTRATIVE PROCEDURES 6.28 3.5 TENDER DOCUMENTS 6.28 3.6 INTERFACING AND HANDOVER OF LAND 6.29 3.7 CONTRACTS ESTIMATED TO EXCEED 5,000,000

SPECIAL DRAWING RIGHTS 6.29

3.8 LANGUAGES TO BE USED FOR TENDER SUBMISSIONS 6.30 3.9 MINIMUM WAGE REQUIREMENTS 6.30

6.4 2008 Edition Page No.

3.10 DESIGNS AND ALTERNATIVE DESIGNS BY TENDERERS 6.30 3.11 MAXIMUM NUMBER OF CONTRACTS TO BE

UNDERTAKEN BY THE SAME CONTRACTOR

6.31

4. TENDERING 6.32 4.1 NORMAL TENDERING 6.32 4.1.1 Eligible Tenderers 6.32 4.1.2 Tender Invitation 6.36 4.1.3 Issue of Tender Documents 6.39 4.2 SINGLE AND RESTRICTED TENDERING 6.40 4.3 PREQUALIFIED TENDERING 6.42 4.3.1 Conflict of Interest 6.44 4.3.2 Representations at Pre-contract Stage 6.45

5. ACTION DURING TENDER PERIOD 6.47 5.1 PRE-TENDER MEETING 6.47 5.2 TENDER ADDENDA 6.47 5.3 QUERIES FROM TENDERERS 6.49 5.4 SALE OF PLANS OR DRAWINGS TO TENDERERS 6.49 5.5 AMENDMENTS TO TENDER DESIGNS 6.50 5.6 LEGAL VETTING OF SUBSTANTIAL ALTERATION TO

TENDER DOCUMENTS 6.50

5.7 EXTENSION OF TIME FOR TENDERING 6.50 5.8 EXTENSION OF TENDER VALIDITY PERIOD 6.51

6. EXAMINATION OF AND REPORT ON TENDERS 6.53 6.1 CONFIDENTIALITY OF TENDERS 6.53 6.2 OPENING AND LISTING OF TENDERS 6.54 6.3 ASSESSMENT PANEL 6.54

6.5 2008 Edition Page No.

6.4 CONFLICT OF INTEREST 6.54 6.5 EXAMINATION OF ELECTRONIC SUBMISSION OF

TENDER RETURNS ON REMOVABLE MEDIA 6.55

6.6 COMPLIANCE WITH CONDITIONS OF TENDER 6.55 6.7 FOREIGN CURRENCY CONVERSION

6.56

6.8 EXAMINATION OF TENDER PRICES AND RATES 6.57 6.9 PROCEDURE AFTER CORRECTION OF ERRORS AND

EXAMINATION OF RATES 6.57

6.10 TENDER QUALIFICATION 6.57 6.11 DESIGNS AND ALTERNATIVE DESIGNS BY TENDERERS 6.58 6.12 CONTRACTORS ELIGIBILITY TO TENDER 6.58 6.13 EFFECT OF INCIDENCE OF PAYMENTS 6.59 6.14 EVALUATION OF TENDERS 6.59 6.14.1 General 6.59 6.14.2 Methods of Tender Evaluation 6.59 6.14.3 Technical Submissions 6.60 6.14.4 Other Checks to be Carried out on Tenders 6.60 6.14.5 Unified Approach for Rounding Marks in Tender

Evaluation and Prequalification Exercises of Works Contracts (Amendment No. 5/2010)

6.61

6.15 TENDER RECOMMENDATIONS 6.61 6.16 NOT USED (Amendment No. 2/2008) 6.62 6.17 TENDER NEGOTIATIONS 6.62 6.18 TENDER REPORT BY THE ENGINEER DESIGNATE 6.63 6.19 ENDORSEMENT OF TENDER REPORT 6.65 6.20 SUBMISSION OF TENDER REPORTS 6.66 6.21 REJECTION OF TENDER 6.67

7. ACCEPTANCE OF TENDER 6.68

6.6 2008 Edition Page No.

7.1 AUTHORITY TO ACCEPT TENDER 6.68 7.2 CHECKS PRIOR TO ACCEPTING TENDER 6.68 7.2.1 Post Tender Correspondence Prior to the Issue of the

Letter of Acceptance (Amendment No. 2/2008) 6.69

7.3 ACCEPTANCE OF TENDER 6.69 7.4 FEEDBACK AND DEBRIEFING TO UNSUCCESSFUL

TENDERERS 6.70

7.4.1 Notification 6.70 7.4.2 Debriefing 6.70 7.5 DISPOSAL OF UNSUCCESSFUL TENDERS

6.71

7.6 AMENDMENTS AFTER THE ISSUE OF THE LETTER OF ACCEPTANCE

6.71

7.7 REPORTING OF TENDERING PERFORMANCE 6.71

8. ACTION PRIOR TO EXECUTION OF THE ARTICLES OF AGREEMENT

6.73

8.1 PREPARATION OF COPIES OF DOCUMENTS 6.73 8.1.1 Incorporation of Amendments and Post Tender

Correspondence into Formal Contract Documentation (Amendment No. 2/2008)

6.74

8.2 CHECKING OF COPIES OF DOCUMENTS 6.75 8.3 APPROVAL OF BONDSMAN 6.75 8.4 OTHER CHECKS PRIOR TO EXECUTING THE ARTICLES

OF AGREEMENT 6.75

9. EXECUTION OF THE ARTICLES OF AGREEMENT 6.78 9.1 SIGNATORIES 6.78 9.2 SIGNING OF CONTRACT 6.79 9.3 RECEIPT FOR DOCUMENTS FROM CONTRACTOR 6.80 9.4 PUBLICITY FOR SIGNING CONTRACTS OF PUBLIC

INTEREST 6.80

6.7 2008 Edition Page No.

10. DISTRIBUTION OF CONTRACT DOCUMENTS 6.81 11. MISCELLANEOUS 6.82 11.1 NOMINATED SUB-CONTRACT 6.82 11.2 HANDLING OF COMPLAINTS 6.82 11.3 ACCESS TO TENDER INFORMATION 6.82 11.4 NOTICE TO TENDER BOARDS FOR DETAILS OF THE

CONTRACT AWARDED 6.83

11.5 NOTICE TO GOVERNMENT LOGISTICS DEPARTMENT

FOR DETAILS OF THE CONTRACT AWARDED 6.83

11.6 OBLIGATIONS OF DEPARTMENTS 6.83 11.7 CESSATION OF THE USE OF ELECTRONIC DATA 6.84 11.8 CONTRACT RATE DATABASE SYSTEM (Amendment No. 7/2009) 6.84

12. REFERENCES 6.85 APPENDICES APPENDIX 6.1 CALLING FOR TENDERS - SAMPLE ROUTING

SHEET, CHECK-LIST AND ESTIMATES SUMMARY

6.90

APPENDIX 6.2 SAMPLE TENDER NOTICE FOR PUBLISHING

ON THE INTERNET ON THE DEPARTMENTS HOME PAGE

6.95

APPENDIX 6.3 MEMO REQUESTING PUBLICATION OF

GAZATTE NOTICE FOR INVITATION OT TENDER

6.99

APPENDIX 6.4 GAZETTE NOTICE AND CONTENT PAGE

FOR INVITATION TO TENDER 6.102

APPENDIX 6.5 DRAFT PRESS RELEASE FOR GAZETTE

NOTIFICATION 6.110

APPENDIX 6.6 GUIDANCE NOTES FOR PREPARATION OF 6.112

6.8 2008 Edition Page No.

DOCUMENTS FOR GAZETTE NOTIFICATION AND DRAFT PRESS RELEASE

APPENDIX 6.7 SINGLE AND RESTRICTED TENDERING

LETTER OF INVITATION TO TENDER 6.119

APPENDIX 6.8 SAMPLE LETTER FOR TENDER ADDENDUM 6.121 APPENDIX 6.9 THE ENGINEER FOR CONTRACTS 6.124 APPENDIX 6.10 SAMPLE LETTER NOTIFYING TENDERERS

FOR EXTENSION OF TENDER PERIOD 6.125

APPENDIX 6.11 MEMO TO TENDER BOARD FOR

E