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Trade and Industry Department The Government of the Hong Kong Special Administrative Region
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Review Body on Bid Challenges

Summary of Case No. 01/2005

The rejection of a tender proposal for the supply of digital audio recording and transcription services for the courts of the Hong Kong Special Administrative Region (HKSAR)

Company A (the complainant) lodged a bid challenge to the Review Body against the HKSAR Government (the respondent) for breaching Articles XIII(1)(b), XIII(4)(b) and (c), XVIII(2)(a), (b) and (c) of the World Trade Organization Agreement on Government Procurement (GPA) in a tender exercise for the supply of digital audio recording and transcription services for the courts.

The respondent rejected the complainant’s tender proposal on the ground that the complainant failed to comply with the mandatory requirements specified in the Terms of Tender and the tender was awarded to another company (Company B). The complainant, however, asserted that the respondent was not justifiable in rejecting its tender and in awarding the contract to Company B.

A Panel comprising the Chairman and two members of the Review Body was set up to consider the bid challenge. A one and a half-day hearing was conducted to examine the case.

The major points in the decision of the Panel are summarised as follows-

  • The Panel was of the view that when considering whether the challenge was submitted within the deadline (i.e. within the 30-day period), if the last day was a public or general holiday, it should be excluded from the limitation period. Hence the bid challenge was submitted within the timeframe. 
     
  • The Panel considered that the requirement of providing two full sets of fixed microphones as spares must be met by the tenderer. This requirement was independent of whatever spare microphones that might be used in the Judiciary, and of the Contractor’s obligation to transport spare parts and its rights to use government spare parts. The complainant’s failure to comply with this requirement had entitled the respondent to reject the tender proposal.
     
  • The Panel considered it not reasonable to give only two days to the complainant to clarify simple matters of its tender proposal. However, it did not affect the rejection of the complainant’s tender because of its failure to comply with the requirement of providing spare microphones.
     
  • The Panel considered that all tender proposals had received the same treatment by the tender evaluation team and did not see any unfair or discriminatory treatment by the respondent against the complainant. 
     
  • The Panel considered that the alleged breaches of the contract terms by Company B, if they existed at all, were only minor breaches in post award performance and were matters of contractual liability. There was no evidence showing that Company B was ineligible for the award.

In view of the above reasons, the Panel determined that the challenge was not substantiated and the tender exercise had not breached the GPA.