Guide on Bid Evaluation

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• Publisher: Asian Development Bank
• Year: 2010
• Print ISBN: 9789290921448
• eBook ISBN: 9789290922254
• Edition: 1
• Topic: Business
• Subtopic: Operations
• Index: Business

This guide is intended to provide guidance to borrowers on bid evaluation procedures and how to prepare a bid evaluation report to be submitted to the Asian Development Bank, in connection with the procurement of contracts financed in whole or in part from proceeds of its loans.

PART 1

BID EVALUATION PROCEDURE AND REPORTING

Section 1. General

A.INTRODUCTION

1.1Procurement under projects financed by the Asian Development Bank, hereinafter referred to as “the ADB” or “ADB”, must be carried out in accordance with the general principles, practices and procedures laid down in the Procurement Guidelines, hereinafter referred to as “the Guidelines”. The policies applicable to procurement which have been incorporated in the Guidelines are derived from the provisions in The Agreement Establishing the Asian Development Bank (“the Charter”). The basic principles relating to procurement that are stipulated in the Charter are:

(i)¹the proceeds of any loan shall be used only for procurement in member countries of goods and services produced in member countries; and

(ii)²the ADB shall ensure that the proceeds of any loan made by the ADB are used only for the purpose for which it was approved, with due attention given to considerations of economy and efficiency.

1.2All procurement for ADB-financed projects must conform to the above basic principles set forth in the Charter and the Guidelines. Further, the ADB, being a public international, multilateral development finance institution, has an obligation to provide adequate, fair and equal opportunity to supply goods, services and works under ADB-financed projects to interested bidders from all its member countries. If any of these basic principles are not followed in the procurement process, including bid evaluation and contract award, the ADB may refuse to finance that particular procurement and cancel the corresponding portion of the loan.

1.3Bidding documents approved for ADB-financed procurement should include the provisions necessary to satisfy the ADB’s principles, practices and procedures. Evaluation of bids must be consistent with the terms and conditions stipulated in the bidding documents. Fair, accurate and transparent evaluation of bids is one of the most important aspects of procurement. Also, the ADB must be satisfied that its objectives of economy, efficiency and fairness among bidders have been met.

B.PURPOSE OF BID EVALUATION

1.4The main purpose of bid evaluation is to determine the lowest evaluated substantially responsive bid among the bids submitted on or before the bid closing date and time specified in the bidding documents. The lowest evaluated substantially responsive bid may or may not necessarily be the lowest priced bid. In order to determine accurately the lowest evaluated substantially responsive bid in accordance with the terms and conditions of the bidding documents, a logical systematic evaluation procedure designed to cover all aspects of the evaluation process should be followed.

C.PRINCIPLES IN BID EVALUATION³

1.5There are certain principles and practices of the ADB in bid evaluation that must be clearly understood and observed in the bid evaluation process.

(a)Confidentiality of Procedures

After the public opening of bids, no information relating to the examination, clarification and evaluation of bids, and recommendations concerning awards, shall be communicated to any person not officially concerned with these procedures until the announcement of the award of the contract to the successful bidder has been made.

(b)Clarifications and Alterations of Bids

No bidder will be permitted to alter its bid after the bids have been opened. Only clarifications, which do not change the substance or price of the bid may be requested or accepted by the Executing Agency. The request for clarifications and the response by the bidder shall be in writing or by acceptable electronic means (such as facsimile or documents sent through e-mail). Any response to an inquiry of the Executing Agency which leads to a change in the bid price shall be considered as an alteration and shall not be considered in the bid evaluation. The records of all clarifications sought and received must be kept by the Executing Agency.

(c)Rejection of Bids

All valid bids received shall be evaluated in accordance with the terms and conditions of the bidding documents, and only those bids which do not substantially meet the specifications on the bidding requirements may be rejected.

(d)Extension of Bid Validity Period

The Executing Agency shall make every effort to complete bid evaluation and contract award before the expiration of bid validity. The validity of bids may only be extended in exceptional circumstances, and with the prior approval of ADB. If an extension of bid validity is considered necessary, all those who submitted bids shall be asked to extend the validity of their bids. Bidders who are willing to extend the validity of their bids shall not be permitted to modify the substance or price of their bids. They must, however, be required to extend the validity of their bid securities. The bid securities of bidders who do not extend the validity of their bids shall be returned to them promptly.

(e)Rejection of All Bids

The rejection of all bids is justified when the bids submitted are not substantially responsive or where none of the bids received meet the specifications or where there is evidence of lack of competition. The rejection of all bids and calls for new bids solely for the reason of high prices are not accepted by ADB. Where all bid prices have substantially exceeded the cost estimate, the Borrower may, instead of calling for new bids, and after consultation with ADB, negotiate with the lowest evaluated bidder for a reduction of the bid price. If no satisfactory contract can be concluded, rebidding should be initiated with appropriate modification of the scope of the contract.

(f)Currency of Bid Evaluation

Whether a Bidder quotes in any foreign currency, as in the procurement of goods, or in local currency, as in the procurement of works, for bid evaluation and comparison purposes, all bid prices shall be converted into a single currency, using the selling exchange rates officially prescribed for similar transactions on the date specified in the bidding document. The Executing Agency shall make this conversion using the selling (exchange) rates for those currencies quoted by an official source, such as the central bank.

(g)Provisional Sums for Contingencies

Provisional Sums for Contingencies are budgetary items only, and are not bid competitively. They may be a fixed amount, or a percentage of the bid price as a whole or the bid price of specific schedules of the bill of quantities as specified in the bidding documents. As contingencies are not bid competitively, they must be excluded for evaluation purposes.

(h)Provisional Sums for Dayworks

These are commonly found in contracts where the likely incidence of unforeseen works cannot be covered by definitive descriptions and estimated quantities in the bill of quantities. Dayworks are works carried out as directed by the appropriate authority stipulated in the bidding documents. They are paid for on the basis of the time spent and the resources employed by the contractor comprising workers, materials and equipment at unit rates quoted in the bid. Dayworks shall be included for bid evaluation purposes only if priced competitively. To be priced competitively, the Executing Agency must provide nominal quantities for each item in the daywork schedule and bidders shall quote both unit rates and the products of the nominal quantities and unit rates for each item. The total of the daywork schedule is then included in the bid price for evaluation purposes. If nominal quantities are not specified by the Executing Agency or the unit rates are not priced competitively, dayworks shall be excluded for evaluation purposes.

(i)Other Provisional Sums

Other Provisional Sums are sometimes included by the Executing Agency in schedules of the bill of quantities to cover services to be provided by the bidder that cannot be accurately described or quantified in the bill of quantities. Payment to the bidder is usually made by the Executing Agency against receipts supplied by the bidder for the services supplied, normally with an additional specified percentage for use of the bidder’s funds. As the provisional sums are stipulated in the bill of quantities by the Executing Agency, they are not priced competitively and shall be excluded for evaluation purposes.

D.ADB’S BIDDING PROCEDURES UNDER COMPETITIVE BIDDING

1.6The ADB has adopted four competitive bidding procedures which may be selected by the Executing Agency to suit the nature of the particular procurement: (i) Single-Stage, One-Envelope, (ii) Single-Stage, Two-Envelope, (iii) Two-Stage, Two-Envelope, and (iv) Two-Stage. The use of the Two-Envelope (Single- or Two-Stage), and the Two-Stage bidding procedures are subject to the ADB’s advance approval on a case-to-case basis which will depend on the c...

Table of contents

• Front Cover
• Title Page
• Copyright Page
• Contents
• Preface
• Part I. Bid Evaluation Procedure and Reporting
• Part II. Examples of Bid Evaluation
• Back Cover