Chapter-3 Provisions Relating to Bid
11. Process and Stage of Bidding:
(1) In making procurement by bidding, an invitation to bid can be made by the following process:-
(a) Inviting open bids by determining prequalification,
(b) Inviting open bids without determining prequalification.
(2) The open bid may be invited in a single stage or in two stages.
(3) In making invitation to bid on the conditions set forth in Sub-section
(1) of Section 28, it may be made in two stages.
12. Prequalification to be Determined: (1) In order to procure such construction
work as determined by the Public Procurement Monitoring Office from time to
time to be large and complex, or to procure goods of high value such as
industrial plants or with a view to identify qualified bidders, the Public Entity
shall, prior to making invitation to bids, prepare prequalification documents and
publicly invite to proposals for the determination of prequalification.
(2) Where the Public Entity considers appropriate, it may also determine
prequalification for other procurement as well.
(3) The prequalification documents under Sub-section (1) or (2) shall set
forth the qualification criteria required for prequalification and the method for
the preparation of proposal and the manner for the submission of proposal.
(4) The Public Entity shall provide as prescribed the prequalification
documents required to submit proposal as referred to in Sub-section (1) or (2) to
all persons, firms, companies and organizations that request for such document.
(5) The selection of the qualified applicant shall be made on the basis of
the qualification criteria set forth in Sub-section (3). The Public Entity shall
openly publish a list of the applicants so selected and send the same to all
applicants.
(6) If any applicant whose prequalification proposal is rejected, requests
for the information of the reasons for the rejection of his or her proposal, within
thirty days of the notice being given pursuant to Sub-section (5), the concerned
Public Entity shall have to provide such information to him or her.
(7) Other provisions relating to the terms and conditions of
prequalification and determination thereof shall be as prescribed.
13. Bidding Documents to be Prepared: (1) Prior to invitation to bid, the Public
Entity shall have to prepare the bidding documents.
(2) The bidding documents under Sub-section (1) shall contain the
following matters:-
(a) The nature of procurement, time required for procurement and
technical specifications thereof,
(b) Where bids are invited without carrying out prequalification,
the criteria for qualification of bidders, as referred to in
Section 10,
(c) Where there is provision of site visit, information relating
thereto,
(d) If any bid conference has to be held prior to submission of bid,
information relating to such conference,
(e) Instructions for preparing and submitting bids, the place for
the submission of bids, the deadline for the submission of
bids and the place, date and time for the opening of bids,
(f) Component of price, the currency or currencies in which the
bid price may be stated, the currency and the source and date
of the related exchange rate to be used for comparison of bids,
(g) The criteria and methodology for the evaluation of bids and
the selection of bidder,
(h) The preferences to be given, if any, for domestic goods and
local construction entrepreneurs, provision relating thereto,
(i) Where any goods or construction works are to be procured by
making separate lots and packages, such lots and packages and
the manner of evaluation thereof,
(j) Where alternatives to the technical specifications are also
invited, the manner of evaluation of such alternatives,
(k) Where a bid can be submitted even only for a portion of the
goods, construction works or services to be procured, a
description of such portion or portions,
(l) The validity period of bid,
(m) The amount, type, acceptable form and validity period of
security to be furnished for bid, performance or other
necessary matters,
(n) Where a bid security is required, provision that the period of
that security shall exceed by thirty days to the validity period
of bid,
(o) The terms and conditions of the procurement contract under
Section 52 and the modality of coming for the entry into force
of that contract,
(p) Information that bids shall not be processed in the event of
conflict of interest or information relating to legal action for
fraud or corruption,
(q) Provision that any bidder may make an application, for
review, against any error or decision made by the Public
Entity in carrying out bid proceedings,
(r) Provision that the documents proving technical capacity and
financial proposal (bid price) have to be submitted in one
envelope, and
(s) Such other matters determined by the Public Procurement
Monitoring Office as to be involved in the prequalification
documents or bidding documents.
(3) The Public Entity shall make available the bidding documents upon
collection of the charges as prescribed to any person, firm, organization or
company that requests for the bidding documents in accordance with the notice
for invitation to bids, and where prequalification is required to participate in the
procurement proceedings, to those persons, firms, organizations or companies
that have been pre-qualified and request for such documents.
14. Invitation to Bids: (1) A notice for invitation to bids or prequalification
proposals shall have to be published in a daily newspaper of national circulation
and, in the case of an international bid; it may also be published in any
international communication media.
(2) The notice as referred to in Sub-section (1) shall be placed in the
website of the concerned entity or that of the Public Procurement Monitoring
Office, in the case of a central level Public Entity, and in the case of a district
level Public Entity, such notice may be placed in the website of that body or
that of the Public Procurement Monitoring Office.
(3) A notice on invitation to bid or prequalification proposal shall
contain the following matters:-
(a) The name and address of the Public Entity inviting bid,
(b) The nature of and time limit for procurement work and the
place of delivery of the goods to be supplied, the services to be
delivered and the construction work to be performed,
(c) If bid security is required, the amount and validity period
thereof,
(d) Where bid security is required, the amount and validity period
of the bid,
(e) The place, manner of obtaining the bidding documents or
prequalification documents, and the fees charged therefor,
(f) The place, manner, the deadline for the submission or
forwarding of the bidding documents or prequalification
documents,
(g) The place, date and time for the opening of bids, and matter
that the bidders or their authorized agents shall be invited to
attend the opening of bid, and
(h) Other matters as prescribed.
(4) In publishing a notice under Sub-section (1), for invitation of national
level bidding or prequalification proposals, a period of at least thirty days shall
be given and at least forty five days shall be given in the case of a notice on
invitation that of international level bidding or prequalification proposals.
(5) While stating the place from which the bidding documents or
prequalification documents can be obtained pursuant to clause (e) of Sub-
section (3), provision shall have to be made for obtaining such documents from
two or more than two public entities.
(6) While stating the place for submitting or forwarding the bidding
documents or prequalification documents pursuant to clause (f) of Sub-section
(3), provision shall be made that such documents shall be submitted or
forwarded to only one Public Entity.
(7) Where any Public Entity, bidder or proponent requests for security
for submitting or forwarding the bid or prequalification proposal pursuant to
Sub-section (6), the concerned District Administration Office shall mandatorily
make security arrangements immediately.
(8) In making procurement through an international level bidding, the
Public Entity may give domestic preference to the Nepalese entrepreneurs and
businesspersons as prescribed, and where domestic preference is to be so given,
that matter shall be set forth in the notice on invitation to bid and the bidding
documents.
Provided that, in the case of procurement of construction work,
preference may be given pursuant to Sub-section (1) of Section 12 of the
Construction Entrepreneur Act, 1958.
(9) A foreign bidder, while submitting bid, shall have to state whether
he/she has appointed any agent in the State of Nepal or not.
(10) Where an agent is appointed pursuant to Sub-section (9), the details
as prescribed in relation to the agent shall also be set forth in the bid.
(11) Notwithstanding anything contained elsewhere in this Section,
where a foreign bidder enters into joint venture with a domestic construction
entrepreneur, in the case of procurement of public construction work,
preference may be given to such a foreign bidder.
15. International Level Bidding: (1) While making invitation to bid pursuant to
this Act, an international level bid shall be invited in any of the following
conditions:-
(a) Where the goods or construction works as requisitioned by a
Public Entity are not available under competitive price from
more than one construction entrepreneur or supplier within the
State of Nepal,
(b) Where no bid was submitted in response to invitation to
national level bidding for the procurement of goods,
construction works or other services, and the same has to be
procured from abroad,
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(c) Where under an agreement entered into with a donor party,
foreign goods or construction works have to be procured from
foreign assistance source,
(d) Where the Public Entity has certified that the goods or
construction works, being of complex and special nature, have
to be procured through an international level bidding.
(2) A notice on invitation to international bidding as referred to in this
Section shall be published in English language; and all bidding or
prequalification documents shall have to be made available in the English
language.
(3) The notice referred to in Sub-section (2) shall have to be placed in
the website referred to in Sub-section (2) of Section 14.
16. Clarification as to Unclear Matter on Bidding or Prequalification
Documents:(1) Where any bidder, being unclear about any matter set forth in
the bidding documents or the prequalification documents, requests, within the
time period set out in such documents, for a clarification, the Public Entity shall
have to communicate the information of such matter to all bidders prior to the
deadline for the submission of bids or prequalification proposals.
(2) Where the Public Entity makes any alteration/modification in the
information under Sub-section (1) and the bidding documents or
prequalification documents, it shall have to communicate information relating
to such alteration/modification to all bidders that have participated in the
procurement proceedings within a reasonable time so as to enable them to take
such alteration/modification into account in submitting their bids or preparing
their proposals for prequalification.
(3) Where it is necessary to provide additional time to bidders for the act
under Sub-section (2), the Public Entity may extend the deadline for the
submission of bids or prequalification proposals.
17. Deadline for Submission of Bids or Prequalification Proposals: The Public
Entity shall have to so set the deadline for the submission of bids or
prequalification proposals as not to be less than the period set forth in Sub-
section (4) of Section 14 and as to allow sufficient time for bidders to prepare
or submit such bids or proposals.
18. Method of Submission of Bids: (1) A bid shall have to be submitted in the
specified form, duly signed by the bidder himself /herself or his /her authorized
agent, in a sealed envelope by the bidder himself /herself or through his or her
authorized agent or by post or courier at such place and within the last date and
time as specified for the submission of bids.
(2) Bids received after the deadline under Sub-section (1) shall not be
processed and such bid shall be returned unopened to the concerned bidder.
19. Withdrawal and Modification of Bid: (1) A bidder may, prior to expiry of the
deadline for the submission of bids, make a sealed application for modification
to or withdrawal of bid that a bidder has once submitted.
(2) Other provisions relating to the withdrawal or modification of bid
shall be as prescribed.
20. Validity Period of Bid: (1) The validity period of a bid shall be as specified in
the bidding documents.
(2) The period as referred to in Sub-section (1) shall commence from the
deadline for the submission of bids.
(3) Notwithstanding anything contained in Sub-section (1), the Public
Entity may, if so required to extend the validity period of bids after the opening
of bids, extend the validity period of bids as required assigning the reasons for
the same.
(4) In extending the validity period of bid pursuant to Sub-section (3),
consent of the concerned bidder shall have to be obtained.
(5) A bidder who agrees to extend the validity period of his/her/its bid
pursuant to Sub-section (4) shall correspondingly extend the validity period of
bid security.
(6) The bid security of the bidder not providing consent pursuant to Sub-
section (4) shall be returned.
21. Bid Security: (1) A bidder shall provide as prescribed bid security along with
the bid.
(2) The security furnished pursuant to Sub-section (1) shall be forfeited
in the following conditions:-
(a) If the bidder requests for modification or withdrawal of bid
during the validity period of bid, after the deadline for the
submission of bids,
(b) If the bidder refuses to accept the correction of arithmetical
errors found in the bid,
(c) If the selected bidder fails to sign the procurement contract in
accordance with the terms and conditions set forth in the
bidding documents,
(d) Where the bidder fails to furnish the performance security as
set forth in the bidding documents within the time for signing
the procurement contract,
(e) If the bidder has changed the bid price or substantive matter of
the bid while providing any information in response to
clarification sought by the Public Entity pursuant to Sub-
section (4) of Section 23 in the course of examination of bids.
(f) If any act contrary to conduct as referred to in Section 62 is
committed.
(3) After the conclusion of a procurement contract under Section 52, the
Public Entity shall return the bid security of the bidder who has signed the
procurement contract and the bid security of those bidders whose bid security is
not liable to forfeiture pursuant to Sub-section (2).
22. Opening of Bids: The Public Entity shall have to open bids as prescribed at the
time and place specified in the bidding documents on the same day immediately
after expiry of the deadline for the submission of bids.
23. Examination of Bids: (1) The Public Entity shall have to submit to the
evaluation committee the bids opened pursuant to Section 22.
(2) The committee shall, prior to evaluating the bids submitted pursuant
to Sub-section (1), examine the bids in order to ascertain the following matters:-
(a) Whether documents establishing that the bidder is qualified
under law to submit the bid are submitted or not,
(b) Whether the bid is complete in accordance with the
instructions to bidders set forth in the bidding documents or
not and whether it is signed by the bidder or by the bidder’s
authorized agent or not,
(c) Where a bid security is required to be submitted along with the
bid, whether a bid security of such type, period and amount as
set forth in the bidding documents is accompanied with the bid
or not,
(d) Whether the bid is substantially responsive to the technical
specifications set forth in the bidding documents and the terms
and conditions of procurement contract attached with the
bidding documents or not.
(3) In examining the completeness of bids pursuant to clause (b) of Sub-
section (2), the following matters shall be examined:-
(a) Whether a power of attorney for the authorized agent or local
agent of the bidder is submitted or not,
(b) Where a joint venture agreement is necessary, whether such
agreement is submitted or not,
(c) Whether documents establishing the eligibility of the bidder
and of goods mentioned by the bidder are submitted or not,
(d) Whether necessary document relating to the qualifications of
the bidder is submitted or not,
(e) Where the bidding documents require the submission of a rate
analysis, whether such rate analysis is submitted or not,
(f) Other matters as prescribed.
(4) The Public Entity may, in the course of examining the bids pursuant
to this Section, ask bidders for necessary information.
(5) The concerned bidder shall have to provide the information sought by
the Public Entity pursuant to Sub-section (4) to the Public Entity, and in
providing such information, no change or alteration in the bid price or other
substance of the bid shall be allowed.
(6) In examining bids invited after determination of prequalification,
examination of the qualification of bidder shall be made to ascertain whether or
not it conforms to the prequalification or not.
(7) While examining the qualification pursuant to Sub-section (6), if the
qualification of a bidder is found to be substantially lower than what was at the
prequalification stage, the bid of such a bidder shall be rejected.
(8) If any arithmetical error is found in a bid in examining bids pursuant
to this Section, the Public Entity may correct such an error, and where, in
making such correction, there exists a discrepancy between unit rate and total
amount, the unit rate shall prevail, and the total amount shall be corrected as per
the same rate.
(9) Where there is a discrepancy between figures and words in a bid
submitted by a bidder, the amount in words shall prevail.
(10) Where any error is corrected pursuant to Sub-section (8) or (9),
information of such correction shall be communicated to the concerned bidder.
24. Non–procession of Bids: Bids having following noncompliance shall not be
processed:
(a) Where it is not sealed,
(b) Where it is not submitted within the time frame,
(c) The bids withdrawn pursuant to Section 19,
(d) If it is not in accordance with Sub-section (2) of Section 23,
(e) The bids submitted by mutual collusion pursuant to Sub-section (6)
of Section 26,
(f) The bids cancelled pursuant to Sub-section (7) of Section 23.
25. Evaluation of Bids: (1) All submitted bids other than those separated for non-
procession pursuant to Section 24, shall be included for evaluation.
(2) Where a bid is found containing minor deviations in the matters such
as the technical specifications, descriptions and characteristics etc. so as not to
reject the bid, the value of such deviations shall be quantified, to the extent
possible, and included in the evaluation of bids pursuant to Sub-section (1).
(3) Where the value of minor deviations under Sub-section (2) exceeds
fifteen percent of the bid price of the bidder, such a bid shall be deemed to be
substantially non-responsive; and shall be excluded from evaluation.
Explanation: For the purposes of this Section, the words “minor
deviations” mean such deviations that do not materially depart from the matters
such as the technical specifications and descriptions as set forth in the bidding
documents.
(4) Where invitation to bid has been made after determination of
prequalification, the bids submitted by the bidder other than the pre-qualified
bidders shall be excluded from evaluation under Sub-section (1).
(5) Bid shall be evaluated in accordance with the criteria and
methodology set forth in the bidding documents; and in carrying out such
evaluation, the bid with the lowest bid price shall be determined by making
comparison of the evaluated price of every bid with the evaluated price of the
other bids.
(6) The qualifications of the bidder of the bid having the lowest bid
price under Sub-section (4) shall be verified in order to ascertain whether it
conforms to the qualification criteria set forth in the bidding documents or not.
(7) Where on examination, the qualification of the bidder of the bid
having the lowest bid price pursuant to Sub-section (4) is in conformity with the
qualification evaluation criteria set forth in the bidding documents under Sub-
section (5), such bid shall be the lowest evaluated substantively responsive bid.
Where, on examination, the qualification of such bidder is found not to be in
conformity with the qualification as evaluation criteria set forth in the bidding
documents, such bid shall be excluded from evaluation; and the qualification of
the next bidder having the next lowest bid price shall be examined on the same
grounds respectively.
(8) The evaluation committee shall prepare an evaluation report stating,
inter alia, the criteria and methodology of evaluation of the lowest evaluated
substantially responsive bid pursuant to Sub-section (6) and submit the report to
the Public Entity.
26. Rejection of Bids or Cancellation of Procurement Proceedings: (1) The
Public Entity may, in the following circumstances, reject all bids or cancel the
procurement proceedings:-
(a) If none of the bids are substantially responsive pursuant to
clause (d) of Sub-section (2) of Section 23,
(b) If the bid price of the lowest evaluated substantially
responsive bid is substantially above the cost estimate, or
(c) If requisitioned goods, construction works, consultancy
services or other services are no longer required.
(2) Notwithstanding anything contained in Sub-section (1), no bid shall
be rejected or re-bidding shall be invited only for the reason that only a few
bids are or only one bid is substantively responsive.
(3) The Public Entity shall have to communicate to all the bidders a
notice along with the reason for the rejection of bids or cancellation of the
procurement proceedings pursuant to Sub-section (1).
(4) Where any bidder requests, within thirty days of the communication
of notice pursuant to Sub-section (3), for grounds for the rejection of all bids or
rejection of the procurement proceedings, the Public Entity shall have to
communicate such information to that bidder.
(5) In making re-invitation to bid because of non-submission of any bid
in response to an invitation to bid or cancellation of all bids or cancellation of
the bid proceedings pursuant to Sub-section (1), the modification shall also be
carry out in the bidding documents, technical specifications, cost estimate and
terms and conditions of procurement contract as per necessity by reviewing the
reasons for such rejection of bids or cancellation of the bid proceedings
(6) Notwithstanding anything contained elsewhere in this Section, if is
proved that the bidder has submitted bid by collusion among the bidders, such
bid shall be rejected.
27. Acceptance of Bid and Procurement Contract: (1) The Public Entity shall
select for acceptance only the lowest evaluated substantially responsive bid in
accordance with Section 25.
(2) Within seven days of the selection of the bid pursuant to Sub-section
(1), the Public Entity shall serve a notice of the intent of acceptance of his or
her bid to the concerned bidder. Information regarding the name, address of the
bidder whose bid has been so selected and the price of the bid shall also be
communicated to the other bidders.
(3) If no bidder makes an application pursuant to Section 47 within a
period of seven days of providing the notice under Sub-section (2), the bid of
the bidder selected pursuant to Sub-section (1) shall be accepted and a notice
shall be communicated to the bidder to furnish the performance security to
conclude the procurement contract within fifteen days.
(4) The concerned bidder shall have to furnish the performance security
and sign the procurement contract under Section 52 within the period set forth
in Sub-section (3).
(5) If the bidder fails to furnish the performance security and sign the
procurement contract within the period under Sub-section (3), the bid security
of that bidder shall be forfeited, and the bid of the other immediately next
lowest evaluated substantially responsive bidder shall be accepted and the
procurement contract concluded.
(6) If even the bidder under Sub-section (5) fails to furnish the
performance security and sign the procurement contract, the bid of the other
immediately next lowest evaluated substantially responsive bidder,
respectively, shall be accepted, and a notice shall be served to that bidder for
concluding the procurement contract pursuant to this Section.
(7) If, within thirty days of the communication of the notice as referred
to in Sub-section (2), any bidder whose bid has been rejected requests for
grounds for the rejection of its bid, the Public Entity shall have to communicate
such information to that bidder.
28. Two-Stage Bidding: (1) Two-stage biding may be invited in the following
conditions:-
(a) When it is not feasible to define fully the technical aspects of
the goods or construction works or services to be procured or
the terms and conditions of the procurement contract at the
time of the invitation to bid, or
(b) Because of the complex nature of the goods or construction
works or services to be procured, if it is necessary for the
Public Entity to discuss with the bidders about how to resolve
the problems related to various technical aspects or the
procurement contract and about such technical aspects and
conditions of contract and benefits accruing there from.
(2) While inviting the first stage bid pursuant to this Section, the bidding
documents shall state the purpose of procurement, expected performance, broad
specifications and other broad features and the qualification of bidders, and
state that bidder shall not be required to quote the price in his/her bid and shall
submit only technical proposal and comments on the terms and conditions of
the proposed procurement contract.
(3) The Public Entity may hold discussions with any or all bidders in
relation to the bids submitted in response to the invitation to bid made pursuant
to Sub-section (2).
(4) The Public Entity may, also taking into account the discussions held
in pursuance to Sub-section (3), do the following in relation to the bids
submitted pursuant to Sub-section (2):
(a) Canceling a proposal relating to a bid that fails to meet the
basic requirements required to be met in relation to
procurement or fails to make minimum performance or fails to
complete the work within the specified period or that cannot
be modified to meet such requirements or to make such
performance or to complete the work within the specified
period or due to any other weakness,
(b) Modifying or improving the technical specifications,
evaluation criteria and terms and conditions of the
procurement contract in order to increase competition,
(c) Determining the evaluation system in order to determine the
appropriateness of various options submitted by the bidders.
(5) After the completion of the acts as referred to in Sub-section (4), the
Public Entity shall make invitation to second stage bid. In making such
invitation to bid, the bidders whose bids have not been cancelled pursuant to the
said Sub-section shall be invited to submit bid along with price in accordance
with revised bidding documents.
(6) The second-stage bidding proceedings to be carried out pursuant to
Sub-section (5) shall be carried out pursuant to the provisions contained in this
Chapter except for those provided for in this Section.