What Is A Preferred Bidder Agreement

Many governments require bidders to post bid bonds to ensure their commitment to the process and to prevent the winning bidder from withdrawing without a valid reason. For example, the Spanish Public Procurement Law (ES 2011) stipulates that bidders must provide and increase a temporary guarantee to support their proposal in order to fulfill the final guarantee once the contract is awarded. The Philippine BOT Act (PH 2006, section 7.1 clause b(vi)) on regulations requires an offer bond of between one and two percent of the estimated cost of the project. Kerf et al.`s guide to concessions (Kerf et al. 1998, 126) provides further examples and briefly describes the advantages and disadvantages of the requirement for an offer bond. The authors note, for example, that the UK government does not recommend the use of offer obligations for PPP projects as they are costly and should only be sought in exceptional circumstances. Prequalification – the number of bidders “must be maintained at a minimum of three and a maximum of four if possible” For example, in 2004, the European Commission introduced the competitive dialogue procedure for PPP procurement in the European Union. As part of this process, after receiving the first calls for tenders, the government may enter into a dialogue with bidders on all aspects of the tender, contract or proposals before resubmitting a final version of the tender documents and inviting final bids. Further details are provided by the UK Treasury Guidelines on the Competitive Dialogue Procedure (UNITED KINGDOM 2008). In Australia, a similar procedure can be used, called interactive tendering. The Australian National PPP Practitioners` Guide (AU 2015, 70-71) describes the interactive tendering process; Protocols for the process are also included in an annex. Direct negotiations with a single bidder are allowed if only one company qualifies and submits a compliant proposal The main objectives of the procurement strategy, as described above, are both to find the best solution for the project objectives (from a technical and inexpensive point of view) and to select a competent company or consortium for the implementation of this solution. This generally requires a fair, competitive, transparent and efficient procurement process.

However, the best procurement strategy to achieve these goals may depend on the context. For example, the possibility of dialogue with bidders may lead to stronger proposals. However, it can also make the process less transparent – so it may not be the right choice in a country where transparency and minimising the risk of corruption are the most important considerations. This means that the best procurement process may depend on the context of the country, the nature and capacity of the government institutions involved, as well as the characteristics of each project. .

Posted on: October 14, 2021, by : greyson