Upon evaluation, a bid found not complying with the conditions/requirements in the bid documents shall be rejected outright by the PBAC.
Grounds for Rejection of Bids
1. Late Bids - Under no circumstances shall late bids, either in the circular proposal or in the daily requests for prices, be opened because bids submitted after the scheduled time for their filing should be rejected.
2. Excessive Price Offered - Notwithstanding the fact that the bid of one responsible bidder complies with all the specifications and conditions of the proposal and is the lowest obtained in the bidding, the PBAC may nevertheless reject the same if it appears that the price offered is excessive.
3. Irresponsible Bids - If the bidders are not responsible men, as those having records for habitual default or failure in other contracts with the government, or if they do not count with sufficient capital to undertake the work, the right to reject may be freely exercised.
4. Bids from parent and subsidiary firms - Bids should not be received from two corporations, one of which is owned or controlled by the other and the business is done for the benefit of such other corporate identities, the two being retained merely for trade purposes.
5. Multiple Bids - No bidder should be permitted the advantage of multiple or double bidding. However, where a bidder offers different prices for different quantities of the same article of the proposal for bids, there could be no violation of the prohibition regarding multiple bidding. The same is true in the case of bids for the same item, but of different prices and periods of delivery.
6. Qualified Offers - Bids which are qualified as to render indefinite the contract price to be paid should be rejected for uncertainty of price.
Any condition in the bid which is escalatory in nature or such as to be affecting the price and/or terms of delivery of the goods offered will not be entertained, and the government may in such event exercise the right to either reject the offer, or to accept without the objectionable clause therein.
7. Contingent Bids - Contingent bids such as those "Subject to prior sales", "subject to confirmation by our supplier," or any other such conditions which make the offer entirely contingent, giving the Government no time to consider and accept or to reject the proposal, may not be considered; if considered at all, such conditions will be entirely disregarded, and the bidder will be bound by his offer as if no such contingent conditions were written in his tender.
8. Failure to state source of manufacture of goods - Bidders are required to state the country of origin of the goods to be furnished and, if the articles bid on are foreign, to specifically state whether they are of U.S., English, Japanese, Chinese, or European make, as the case may be. Failure to comply with this requirement may constitute a sufficient cause for the rejection of the bid.
9. Collusive Bids - If the PBAC is convinced that some or all bids received in response to an invitation thereof are the result of collusion on the part of bidders and if his conviction is supported by evidence so clear and convincing as to lead a man of ordinary judgment and prudence to the same conclusion, it would be the PBAC's duty to reject all of the bids.
Identical bids received for the same item are prima facie evidence of a collusive action and may therefore be rightfully rejected.
10. Non-complying Bid - A bid opened which offers conditions other than those specified in the advertisement, such as in the quantity, quality or manner of rendering the service, or supplying the materials or supplies being bidded, or the time of performance under the resulting contract, etc., will likewise be ineligible for an award, but the proposal will be noted in the abstract with a memorandum why the said proposal has been disqualified for an award.
11. Unsealed or Oral Bids - It is a general requirement that bids shall be in sealed envelopes only. Bids by telegram, telephone, radiogram, or open bids shall not be accepted. They are invalid.
12. Foreign Bid in certain cases - Under our law, no foreign
bid shall be allowed for the construction of land, air, and seacoast defenses,
arsenals, barrels, depots, hangars, landing fields, quarters, hospitals,
and all other buildings and structures required for the national defense
of the Philippines.
11.1 National Government/Government-Owned and/or -Controlled
Corporations
11.1.1 Applicable Laws, Rules and Regulations
a. conformity of the proposal with the specifications called for in the Invitation to Bid and the price quoted shall be the main considerations in the evaluation of bids;
b. price quoted, considering the Flag Law, Commonwealth Act 138, as amended, and other laws and policies pertinent to procurement;
c. when time is of the essence, the bidder who offers to deliver within the period stipulated in the invitation to bid shall be awarded the contract, provided that the price is not unreasonably higher than the lowest price offered;
d. all other things being equal, the bidder shall be preferred, in order to obtain uniformity in quality, tensile, strength, color shade, etc.; and
e. reliability of bidders as supplier or contractor.
Division of award may be made only in either of the following:
a. in case of tie offers and the supplies are divisible, the award may be divided as equally as practicable unless the interest of the service demands that it should be given to only one dealer; or
b. in case the lowest bidder offers to supply only a limited or partial quantity, the balance may be awarded to other acceptable bidders in the order of advantage of their offers.
Sec. 4.7, IRR, E.O. 302, dated February 26, 1996 - Examination and Evaluation of Bids
4.7.1 Prior to bid evaluation and comparison, bids received shall be examined with respect to, among others, the eligibility requirements, bid securities as to form and amount, responsiveness/compliance with the bidding documents and technical specifications, authority of signatory, or for any material computational errors in preparing the bid. Only bids that are determined to be complete, valid, eligible and substantially responsive and complying shall be considered for evaluation and comparison.
4.7.2 The purpose of bid evaluation is to determine the cost of each bid to the Government in a manner that will permit a comparison of bids on the basis of their evaluated cost. The responsive bid with the lowest evaluated cost, but not necessarily the lowest submitted price, shall be selected for award. The general guidelines to be followed in bid evaluation and comparison are given in Annex G (Appendix "I").
4.7.3 The concerned agency may employ any of the specific evaluation procedures described in Annex H (Appendix"J") in determining the bid's evaluated cost that it deems most appropriate for the requirements of a particular contract. The use of any such procedure shall be duly approved and so indicated in the bidding documents.
4.7.4 Evaluation of bids shall be completed not later than thirty (30) calendar days from the date of opening of bids. The PBACs of all agencies shall prepare and keep on file detailed reports on the evaluation and comparison of bids setting forth the specific reasons on which recommendations are based for the contract award.
4.7.5 The Government reserves the right to reject any or all bids or to declare the bidding a failure if there is reason to suspect an evident collusion among bidders thus resulting in no competition. However, all bids should not be rejected and new bids invited on the same specifications for the purpose of obtaining low prices, except in cases where the lowest evaluated bid exceeds the estimated procurement cost by a very substantial amount. In such a case, a revised less expensive requirement may be substituted to seek a more affordable result.
4.7.6 No information relating to the substance, examination, and evaluation of bids and recommendations concerning awards shall be disclosed to persons outside the PBAC concerned before the announcement of the contract award to the successful bidder. After the award of contract, all unsuccessful bidders shall be informed individually.
Sec. 4.8, IRR, E.O. 302 dated February 26, 1996 - Failure of Bidding
4.8.1 The Government shall declare the bidding a failure and the concerned agency shall conduct a rebidding of the project when no bids are received, or when no bids are found to be substantially responsive and/or complying to the requirements of the bidding documents, particularly in terms of the technical requirements/specifications of the contract.
4.8.2 Should there occur another bidding failure after the conduct of the project's bidding, the agency concerned may enter into a negotiated procurement.
11.2.1 Applicable Laws, Rules and Regulations
In the local government units, awards in the procurement of supplies shall be given to the lowest complying and responsible bid which meets all the terms and conditions of the contract or undertaking.
Sec. 63, Rule 6, Rules and Regulations on Supply and Property Management - Bids Submitted Late
Bids submitted after the time and date of opening of bids shall not be accepted.
Sec. 64, Rule 6, Rules and Regulations on Supply and Property Management - Unsigned Bids
Bids submitted which are not signed shall be totally disregarded and declared as "No Bid".
Sec. 65, Rule 6, Rules and Regulations on Supply and Property Management - Non-Complying Bids
Bids submitted which do not conform to the specifications and descriptions of the supplies or property are non-complying bids and shall be rejected. In no case shall failure to meet the specifications or technical requirements of the supplies or property desired shall be waived.
Sec. 66, Rule 6, Rules and Regulations on Supply and Property Management - Consideration of Defective Bids
Defective bids defined in Section 4 herein may be considered for the purpose of determining whether it would be advisable to hold a rebidding or to waive the defects. The guidelines outlines hereunder shall be observed.
Whenever the price in a defective bid is lower than that in a non-defective bid by at least ten (10%) per cent, the bidder who offered the non-defective bid shall be asked to reduce his price to that of the defective bid. If he consents, the award shall be made to him at the reduced price.
If the bidder offering the non-defective bid refuses to reduce his offer to that of the defective bid, rebidding may be advertised within forty eighty (48) hours.
If the Committee on Awards believes that rebidding is impractical, the defects may be waived and the award shall be made in favor of the defective bid.
If the defect cannot be waived to meet the needs and requirements of the requisitioner, or there is a conclusive evidence showing that the defective bid was submitted to prejudice the non- defective bid, the award shall be made in favor of the latter without reduction in price.
Sec. 67, Rule 6, Rules and Regulations on Supply and Property Management - Acceptance of Bids
Awards in the procurement of supplies or property shall be given to the lowest complying and responsible bid which meets all the terms and conditions of the contract or undertaking.
The following factors, among others, shall be considered in making the award:
a. conformity with the specifications in the ITB;
b. price quoted, considering the Flag Material Law (CA 138), as amended, whenever applicable, and other laws and policies pertinent to the procurement;
c. when time is of the essence,, the bidder who offers to deliver within the period stipulated in the Invitation to Bid shall be awarded the contract, provided that the price is not unreasonably higher than the lowest price offered;
d. all things being equal, the bidder who offers to supply the whole quantity shall be preferred in order to obtain uniformity in quality, tensile strength, color shade, etc.; and
e. reliability of bidder as a supplier or contractor.
Sec. 69, Rule 6, Rules and Regulations on Supply and Property Management - Division of Award
Division of award may be made only in either of the following instances:
a. in case of tie offers and the supplies are divisible, the award may be divided as equally as practicable unless the interest of the service demands that it should be given to only one dealer; or
b. in case the lowest bidder offers to supply only a limited or partial quantity, the balance may be awarded to other acceptable bidders in the order of advantage of their offer.
Sec. 57, Rule 6, Rules and Regulations on Supply and Property Management - First Failure of Public Bidding
If no bid or only one (1) qualified bid is received on or before the scheduled date of opening of bids, the Committee on Awards may schedule another bidding following the same procedures herein prescribed.
Sec. 58, Rule 6, Rules and Regulations on Supply and Property Management - Second Failure of Public Bidding
If there is a failure of bidding for the second time, the Committee on Awards may recommend the procurement through negotiated purchase in accordance with these rules and regulations.
COA Decision No. 93-3116 - August 25, 1993
Facts: On December 27, 1989, the PSC, thru a public bidding purchase various equipments from Sunrise for the latter prevailed as the lowest bidder. The TSO, however, obtain lower price during its recanvass in the open market. The Auditor, subsequently, disallowed the total amount of P14,143.00. Hence, this appeal.
Held: Disallowance is lifted.
"It should be underscored that the consideration here is the circumstance that the equipment in question were purchase thru public bidding, a mode of procurement which is designed to secure the lowest possible price and obtain the better bargains for the government. In the absence of any irregularities in the bidding procedure, the outcome thereof deserves faith and credence ...there appears no sufficient basis for comparison between TSO price findings and the prices of equipment in question. . .Factors such as the place of canvassing, quality of equipment, the point of origin, etc. are to be considered in determining the reasonableness of price."
Background: Some spare parts were brought thru a public bid ding. The purchase was questioned based on the alleged overpricing.
Decision: No overpricing.
Basis: There appears to be no sufficient basis for comparison between the TSO price findings and the prices of the spare parts so as to arrive at its conclusion of overpricing. Such factors as the place where the canvass was made, the quality of the spare parts, and the point of origin that may bring about higher prices, which the TSO price analysis failed to consider are valid grounds for determining reasonableness of price.
Background: Biological Production Service, acquired from Era Trading 2 units labelling and sealing machines and 400,000 pieces of ampoules. In the course of audit, the Auditor disallowed the purchase of the sealing and labelling machines based on the inspection report of the COA Technical audit Specialist who found that said machine were not brand new and the price of the ampoules delivered were found to be higher than the price as canvassed by the Technical Service Office in the open market. Hence, this appeal.
Decision: Disallowance sustained.
Basis: The Auditor stated that in a public bidding conducted on November 5, 1990, Era Trading who supplied the items purchased in 1988 offered the price of P=2.35/pc. of ampoules with the same specifications as compared to its price of P=5.65/pc. in 1988. Furthermore, she stated that the sealing and labelling machines were now kept in the stockroom because of the stoppage in the production of Oresol, which has been anticipated even before the purchase of said machines. In view of the foregoing and after a circumspect evaluation of the herein facts this Commission cannot find any compelling reason to disturb the subject audit findings with respect to the purchase of the sealing and labelling machines.
Facts: DTI, Central Office conducted a public bidding after due publication. Among the 6 participants, Electroworld quoted the lowest bid of P=45,641.68 per unit. The Regional Offices, however cannot afford the said price and recommended that, instead, computers in Cebu have lower prices compared to Electroworld at P=40,000.00 per unit. Since the Electroworld was not able to cope with the price of Cebu, DTI Central Office ordered that the Regional Offices shall buy their computers at Cebu City.
Based on COA-TSO price findings, the Auditor disallowed the purchases made in Cebu due to overpricing.
Held: Disallowance is lifted.
Basis: 1. There was proper observance in the process of procuring computers by the government agencies as adhered to by the RPG thru the central Procurement Committee.
2. The fact that they procured computers from the lowest bidder is enough to clear them from any disallowance.
3. In determining price reasonableness, we just do not compare prices in Metro Manila with those outside thereof and considered the difference overpricing. The Auditor should have considered adding to the TSO canvassed price of P35,600.00 the 10% allowable price variance under COA Cir. No. 85-55A and the cost of freight and handling etc.. to determine the reasonable purchase price thereof.
Facts: The NKI entered into a contract with, among others, Kalinisan Steam Laundry. The TSO, however, found the contract prices either excessive or undervalued. Hence, on appeal the NKI Exec. Director explained that the prices for the said services were based on sealed canvass and Kalinisan Steam Laundry met all the requirements set by the Awards Committee and quoted the lowest bid.
Held: The request is granted.
It is significant to note that in the pertinent General Conditions of the Invitation to Bid for the provision of Laundry Services, price was not the only basis for the Award of the subject contract. Compliance with technical requirements particularly, physical plant facilities, equipment, etc. were the other factors considered. Besides, and more importantly, Kalinisan Steam Laundry quoted bid price as a whole instead on the per item basis. More over, maintaining two or more laundry contractors would be very impractical and more costly, hence, disadvantageous to the government.
Facts: I In this request, Mrs. Fernandez, herein supplier, contended that the prices of medical products were not only reasonable but were within the ceiling price quoted by the Supply Coordinator Board. In fact, that Auditor recommended for the reduction of the original disallowances.
Held: Request denied.
". . . the stubborn fact remains that these medical supplies were purchased by the agency concerned in 1987 without the benefit of public bidding as mandated by law and existing regulations. x x x On this point, it may not be amiss to stress that public bidding is the policy and medium adhered to in government procurement and construction contracts under existing laws and regulations . . . for arriving at a fair and reasonable price and ensures that overpricing, favoritism and other anomalous practices are eliminated or minimized."