Combined Bid bond

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Combined Bid bond

Post by itec on Sat Jun 16, 2012 9:47 pm

Hi,

I would like to request for your opinion about what happened during the bidding for hauling trucks on June 14, 2012 as follows:

1)There are 2 different lots that a bidder may participate in.

2)There is an ABC allocation per lot.

3)The requirement for bid bond submission as stated in the 1st and 3rd bid bulletins is:

"ITB Clause 18 Bid Security;
The bidder must give separate bid securities for each
procurement activity/lot it will participate in."

4) 1 bidder submitted a combined surety bond instead of following the requirement as stated above.

5) The BAC initially decided to consider the said surety bond as acceptable since the amount therein is equivalent to the required 5% of the combined ABC's of the 2 lots, only to explain when somebody questioned it that although they will proceed in opening the financial bid of the submitting bidder, they will still have to decide later whether the bid bond complied with their requirement or not.

May I know what shld. be the decision of the BAC on this?

Thank you!

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Re: Combined Bid bond

Post by RDV @ GP3i on Sun Jun 17, 2012 8:29 am

FBA wrote:Hi,

I would like to request for your opinion about what happened during the bidding for hauling trucks on June 14, 2012 as follows:

1)There are 2 different lots that a bidder may participate in.

2)There is an ABC allocation per lot.

3)The requirement for bid bond submission as stated in the 1st and 3rd bid bulletins is:

"ITB Clause 18 Bid Security;
The bidder must give separate bid securities for each
procurement activity/lot it will participate in."

4) 1 bidder submitted a combined surety bond instead of following the requirement as stated above.

5) The BAC initially decided to consider the said surety bond as acceptable since the amount therein is equivalent to the required 5% of the combined ABC's of the 2 lots, only to explain when somebody questioned it that although they will proceed in opening the financial bid of the submitting bidder, they will still have to decide later whether the bid bond complied with their requirement or not.

May I know what shld. be the decision of the BAC on this?

Thank you!

I think what the BAC did was proper. If the combined bid security (which is a surety bond) is sufficient in amount to cover the two (2) lots, then the BAC may consider it as "pass" as far as that requirement is concerned. If the BAC will immediately declare the bid as "fail" (for whatever reason or doubt it has), the procuring entity would have been deprived of the offer of the bidder, as the financial envelope will no longer be opened, more particularly if it happened to be the lowest offered bid (lowest bid as read).

Since the financial envelope was opened and the BAC has the opportunity to evaluate the financial proposal of the bidder, if the calculated price of that bidder happens to be the lowest, then the BAC in the process of post-qualification can validate and ascertain if the combined surety bond is responsive to its requirement, such as determining if the surety bond is specific to the two lots being bidded out, among others. Failing in that, the BAC can still post-disqualify the bidder.
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Re: Combined Bid bond

Post by itec on Sun Jun 17, 2012 8:29 pm


Thank you very much for your early reply!

I am just wondering how will the BAC treats the combined surety bond in case after the postqua. the bidder gets disqualified in 1 of the lots he participated in.




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Re: Combined Bid bond

Post by RDV @ GP3i on Mon Jun 18, 2012 6:56 am

FBA wrote:
Thank you very much for your early reply!

I am just wondering how will the BAC treats the combined surety bond in case after the postqua. the bidder gets disqualified in 1 of the lots he participated in.

If the BAC did not disqualify the bidder for having only one combined surety bond. However, if the bidder has been disqualified for whatever other reasons on one of the lots, the BAC cannot return the surety bond but will have to hold on to it, considering that there is only one surety bond for all of the bonds.

That is the risk that the bidder took for having a combined surety bond.

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Re: Combined Bid bond

Post by itec on Mon Jun 18, 2012 7:43 am

Thanks again RDV and have a wonderful day!

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