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A bid is a bidder’s response to a solicitation by a contracting authority requesting offers to provide specific works or goods or services.
A General Procurement Notice (GPN) is published by the Bank and the Borrower, in the United Nations Development Business Journal (UNDB), upon the approval of each Loan or Grant, by the Bank’s Board of Directors. Subsequently, for all bids where International Competitive Bidding (ICB) is being used, Specific Procurement Notices (SPN) are published in the UNDB and in the respective national press in the Borrower’s country. GPNs and SPNs are also published in the Bank’s AfDB Business Bulletin, which is published monthly, by the Procurement Unit, and is also available on the Website.
The Bank maintains the DACON database for Consultants; however, no such database is maintained for Contractors and Suppliers. On the other hand, the Bank has a system of keeping records of all contracts awarded to all contractors, suppliers and consultants for different projects financed by the Bank.
No. Contractors or Suppliers from member countries are not required to register with the Bank in order to participate in procurement under the projects financed by the Bank. For large or complex projects, pre-qualification procedures may be used which as advertised in the UNDB.
When a firm learns, from the GPN or SPN or QOS or the AfDB Business Bulletin or the Bank’s Website, that procurement opportunities under the Bank’s financing, have become available, and it is interested to participate, it should firstly express its interest by writing to the Borrower. It should then request the bidding documents as soon as they are available. Interested bidders should ensure that they send the Borrower the appropriate fee specified to purchase the bidding documents. Interested bidders may also have a local representative to purchase the documents for them, while Embassies may also sometimes purchase documents on behalf of firms. In all cases bidders should ensure that it is their name that appears on all documents. After a firm receives the bidding documents, it should carefully examine the provisions and requirements in the Instructions to Bidders (ITB) to decide whether it could submit a competitive responsive bid. The bidder should be certain that it understands both the commercial and technical requirements and it should follow them strictly, in bid preparation. No assumptions should be made in respect of bidding terms and conditions. Any questions or doubts should be clarified with the Client/ Purchaser before the bidder completes the preparation of its bid. If a firm has decided to bid, it must follow precisely the procedure in the ITB and submit its bid by the specified date and time, and at the specified place, as spelled out in the bidding documents.
Under the Bank Group’s funding, the name and address of the implementing agency of the Borrower is given in the Bank’s Quarterly Operational Summary (QOS), the GPN, the SPN and also in the Bank’s AfDB Business Bulletin, all of which are available on the Bank’s Website.
Firms will normally see the GPN in the UNDB, and they are advised to follow-up the procurement processing in the UNDB until they see the SPN of interest to them, appear. The GPN will specify when SPNs will be issued. In general however, the firm should contact the Borrower as soon as it learns that the bidding documents are being or have been issued and request or buy them immediately, as the case may be. If the firm does not have enough time to prepare its bid, after receiving the bidding documents, it has the right to request a postponement in the bid closing date to allow time to prepare its bid. If the Borrower fails to respond, or does not agree to the proposed postponement, the firm should immediately notify the Bank, usually the concerned Project Officer (Task Manager) or the Head of the Procurement Unit.
It is for each firm to identify their potential competitors or partners. Firms may search in the AfDB Business Bulletin or at the Bank’s Website for information on contract awards in order to identify the firms that have successfully completed contracts financed by the Bank Group.
In order to become a pre-qualified bidder, a firm must respond to a specific SPN and submit a completed Pre-qualification Questionnaire. There is no renewal of the pre-qualification status required by the Bank because the pre-qualification exercise is undertaken, on a case-by-case basis, for each major and or complex contract, and all interested firms can submit their pre-qualification data for consideration specifically for that contract. Pre-qualified bidders are expected to update their pre-qualification data during bidding.
No. Implementing agencies in member countries cannot force the bidder to use a local partner. Bidders are free either not to choose or to choose their own partner(s) as long as the partner firm is from a member country of the Bank.
Emphatically No. The bidder cannot correct any mistakes in its Bid after bid submission. It is against the laws of good procurement practice. Only clear and unequivocal arithmetical errors can be corrected, by the Borrower/ Executing Agency, when a bid has been opened, as required by the bidding documents. Altering any other elements of any bid is not permitted either by the Borrower or the bidders.
Bidders should raise questions and issues with the Borrower/ Executing Agency in writing. Copies of this communication can also be sent to the Bank. If the Borrower/ Executing Agency does not respond promptly, the firm can contact the concerned Operational Departmental Head or the Project Officer/Task Manager.
The Bank requires pre- qualification for large or complex contracts or turnkey contracts to ensure that invitations to bids are confined only to firms capable of undertaking the work. In some cases pre-qualification is used for suppliers of specialized equipment where quality and performance is of primary importance. Invitations to pre-qualify are advertised internationally through the UNDB, so that prospective bidders can obtain documents and submit their responses. All the bidders who qualified during the pre-qualification process shall participate in the bidding. Pre- qualification of bidders is mandatory only for all large or complex or turnkey contracts that would be procured through the ICB process. The GPN and SPN will clearly specify where pre-qualification is required.
In accordance with the Bank’s procurement rules, there are no special preferences and firms from all member countries of the Bank are eligible to participate and compete for contracts. Under ICB, in order to encourage the development of regional firms, the Bank encourages its Borrowers to apply, if they choose, either domestic or regional preference margins. The Maximum domestic preference margin that may be applied by the Borrower is 15% (of CIF) for goods and 10% for works while those for regional preference are 10% (of CIF) for goods and 7.5% for works. However, this must be approved by the Bank’s Board of Directors and must be clearly stipulated in the bidding documents. Where they are applicable, these margins are applied only during evaluation.
No. Pre-qualification questionnaires received after the specified date and time are generally not entertained for evaluation.
Information concerning the bidder’s relevant experience, financial position, technical staff and network of after-sales-service, if needed, shall be required in the bidding documents, for contracts for which pre-qualification has not been specified. This information shall be considered during the initial examination of bids and the bid of any bidder who does not satisfactorily meet these requirements shall not be considered for further evaluation. In any case, the Borrower shall always ensure that the bidder whose bid has been evaluated as the lowest evaluated cost bid, has the technical and financial capability to perform the contract satisfactorily. The criteria to be met shall be set out in the bidding documents and the bid of any bidder, who does not meet these requirements, shall be rejected.
No, procurement does not take place before the Bank approves a loan, except in the exceptional circumstances of the application of Advance Procurement Action (APA) in the case of Goods and Works or Advance Action for the Acquisition of Consultancy Services (AAA), where it is clearly shown that early contracting by the Borrower, will be a favorable and important factor in the timely completion of the project. In such a case, the Borrower may be authorized to issue the invitation to bid (SPN) or to pre-qualify, to issue a letter of intent to the selected contractor, but without signing the ensuing contract before the approval of the loan. The SPN would state that the Borrower has applied for a Bank loan and intends to use the proceeds to finance the contract. The Bank’s approval of the APA or AAA, will not in any way commit the Bank to approve the loan. The limitations, safeguards and the Bank’s approval process are outlined in the Bank’s Rules.
The ICB procedure, in its main steps, for goods and civil works are similar, however, the evaluation criteria differ. In the case of civil works, for example, with Bills of Quantities and or Unit Rates, the price and sometimes the completion period, may be the key considerations. On the other hand, in the case of the purchase of goods, for example, equipment, technical factors such as capacity, maintainability, and fuel efficiency, costs of spare parts and after sales service may be considered in addition to price.
If only one bid is received, the Bank would expect the Borrower to contact the other potential bidders who bought the bidding documents in order to determine why they did not submit bids. Perhaps the conditions or requirements may have been too restrictive or unclear, causing the bidders to conclude that participation was too risky. In such a case, the bidding would be cancelled and the bidding documents revised. The process would begin again using the revised documents.
If however, it is determined that the bidding documents are not restrictive, that all the bidding requirements and procedures were fairly executed, that the bid is technically and commercially responsive, and that the prices quoted in the bid are reasonable, then the Bank would have no objection to the Borrower awarding the contract to the single bidder. Furthermore, if several bids are received, but only one is fully responsive and the quoted prices are reasonable, the Bank would have no objection to awarding the contract to that bidder.
Yes. Bidders are free to send copies of their communications on outstanding issues and questions with the Borrower, to the Bank, or to write to the Bank directly. Communications received from bidders after bid opening will be examined by the Bank in consultation with the Borrower and the Bank’s review of the procurement process will not be completed until the communication is fully examined and considered. However, bidders are also informed that the period from bid opening to contract award is a confidential period and it is essential that the perception of improper interference should be avoided.
The Borrower prepares the bidding documents based upon the Bank’s Standard Bidding Documents (SBDs). The Bank requires that the Borrower’s bidding documents must contain the instructions to bidders, a detailed description of the goods or works to be procured, the evaluation criteria and the conditions of the proposed contract. To assist in the preparation of bidding documents, the Bank has developed Standard Bidding Documents (SBDs) that should be used by Borrowers, on a mandatory basis; and, by using these SBDs, the preparation process can be accelerated. All suppliers and contractors should become familiar with these SBDs.
Bidders should make a request for the bidding documents through a written letter to the Borrower’s Executing Agency for the project. Bidding documents must be made available to everyone who is eligible and who requests them and pays the requisite Borrower’s fees. The Bank monitors the procurement process to ensure that its guidelines are followed. Under the prior review process, Bank staff review the bidding documents, including the sample contract, before they are issued. The Bank further reviews the Borrower’s evaluation of bids and the proposal for contract award, as well as the negotiated draft contract to ensure it corresponds with the bid.
Standard Bidding Documents (SBDs) are “templates” that Borrowers use to prepare their tender documents to procure goods and or works under competitive bidding funded by the Bank. SBDs are on this Website. The SBDs prepared by the Bank have been developed through broad international experience, and are closely in line with those of other Multilateral Development Banks (MDBs). SBDs are updated from time to time depending on the need. Any suggestions received regarding any clauses of the SBDs would initially be analyzed carefully by the Bank, before any change is effected. The MDBs are currently working together on the use of harmonized common master bidding documents, in order to streamline procurement procedures globally. The AfDB is currently using the harmonized MDBs Master SBD for Goods (ICB), and others are being prepared.
Yes. When the procurement is through ICB, the Borrower in agreement with the Bank, may grant a margin of preference to domestic manufactured goods and to domestic contractors during evaluation of bids in comparison with foreign bids. Similarly, a margin of regional preference may similarly be granted for goods, suppliers and contractors from regional member countries with which the Borrower has entered into economic integration or trade arrangements.
Either of these two preferences is allowed, provided the Borrower clearly indicates such margin of preference, in the bidding documents, in accordance with Bank’s rules. Domestic or regional preference margins are applied separately and cannot be applied together in the one tender.
Yes, alternative bids can be acceptable, but this fact shall be explicitly stated in the bidding documents. In the cases where alternative bids are acceptable, a bidder can submit an alternate bid, along with the original bid, but initially the comparison with other bidders would be based on the original bid. However, if the bidder, which has submitted an alternative bid, happens to be the lowest evaluated cost bidder and is substantially responsive, then the alternate bid can be considered.
All documents required to accompany the bids, shall be explicitly stipulated in the Instructions to Bidders (ITBs) of the Bidding documents. Under such clauses in the ITB, the Borrower may demand certain documents or evidence to establish the legal existence of the bidder, its qualifications and experience (economic, technical and financial capabilities) to carry out the works and to provide the services or supply the goods concerned. Some such information that may be required concerning legal and financial aspects are indicated below:
Bids can be submitted in any working language of the Bank, i.e. English or French. However, the language in which the bid is required to be submitted will be specified in the bidding documents.
Yes. Bids can always be submitted together, by a group of contractors, suppliers or service providers, forming a joint-venture. However, firstly, to qualify as a joint venture partner, any such partner should contribute more than 25% of the total contract amount. A firm contributing less than 25% is not a joint-venture partner but a sub-contractor. Secondly, it is important to note under pre-qualification conditions that firms which have been individually pre- qualified may form a joint-venture and can submit one bid; but, firms which have been pre-qualified together as partners in a joint-venture, are not permitted to submit individual bids.
Under the Bank’s procurement rules, ICB bidding documents shall always state that any eligible bidder may express its bid price in his country’s currency, or at his option, in any currency widely used in international trade, from any eligible member country. Accordingly, if the bid price is denominated in a currency from an eligible country, other than those specified in the bidding documents, the deviation should be treated as minor. The bid currency shall be converted into the currency to be used for comparison of bids following the method specified in the bidding documents.
For bidding purposes, projects financed by the Bank, can be divided into lots or sections based on the magnitude, nature and location of works and / or goods to be procured. It is important that any split in a component of the project should be of such an appropriate size that invites wide spread competition. The lots or sections and the specific conditions for submission and for evaluation and comparison of the bids shall be clearly stated in the bidding document.
Bid security can either be in the form of a bid guarantee or bid bond. While the bid guarantee is usually issued by an authorised commercial bank, the bid bond is normally issued by an insurance company. Bid bonds are generally given and are popular in USA. Bid security (guarantee or bond), is provided by the bidder at the time of submission of his bid, to the Client, as financial security for acceptance of a contract. The Bank does not encourage borrowers to accept bid bonds from insurance companies, as bid security. Similarly, performance security can be either a bank guarantee or performance bond. While the performance guarantee is given by a commercial bank, the performance bond is issued by an insurance company (mainly in the USA). The difference between the two is that in case of the bond the insurance company can cover the total amount of contract at little cost and has the obligation to pay for completion of the contract by another contractor.
Appropriate wording for the guarantees are contained in the SBDs. However, if the security furnished is substantially responsive to the bid documents, but differs in wording without affecting its substance, it may be accepted.
No. There are no costs involved in the submission of bids by bidders, except the cost of purchase of the bid documents. It is to be noted, however, that there will be no reimbursement by the Client, of the costs involved in the preparation of bids by bidders.
The currency into which bid prices are converted for the purpose of bid comparison should be clearly specified in the bid documents. The bid documents should also state the date on which the conversion exchange rate is applied for comparison. If the bid document is however silent on the date of conversion, the date of bid opening will be used for conversion.
The determination of the “Lowest evaluated cost bidder” will be the criteria for evaluation as stipulated in the bid documents. A broad basic criterion would be:
Other evaluation criteria, such as transportation, spare parts costs and network, performance measures as stated in the bid documents.
Bids are normally valid for between 90 to 120 days. If the evaluation concludes with the determination of the Lowest Evaluated Cost Bidder, the contract should be awarded within the bid validity period. However, if a delay occurs in the evaluation, bidders can be asked for an extension of validity.