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Review
Body on Bid Challenges
Hearings
Summary of Case
No. 03/2003
The rejection
of a tender proposal for the supply of 174 000 000 tablets of Nifedipine
sustained-release tablet 20 mg to the Government of Hong Kong Special
Administrative Region (HKSARG)
Company A (the complainant)
lodged a bid challenge to the Review Body against the HKSARG (the respondent)
for breaching Articles III, IV, VI and XII of the World Trade Organization
Agreement on Government Procurement (GPA) in a tender exercise for the
supply of 174 000 000 tablets of Nifedipine sustained-release tablet 20
mg.
The respondent said
that although the price offered by the complainant was the lowest among
the tenderers, its tender proposal was not accepted since the holder of
the Certificate of Registration issued by the Pharmacy and Poisons Board
of Hong Kong as provided by the complainant in its tender proposal was
not the complainant itself. Besides, there were discrepancies between
the drug samples and the information and data of the product specification
submitted by the complainant. Further, the complainant failed to provide
all the required documentary evidence as set out in the Conditions of
Tender.
The complainant, however,
maintained that for pharmaceutical products manufactured outside Hong
Kong, the required submission of marketing authorization issued by the
national control authority of a member country of the International Conference
on Harmonization (ICH), the People's Republic of China or Australia as
set out in the Conditions of Tender created unnecessary obstacles to international
trade. The complainant also considered the requirement a form of discriminatory
treatment regarding the country of origin, hence breaching Articles III
and IV of the GPA. Moreover, the complainant added that the Conditions
of Tender did not require that as far as the pharmaceutical product was
concerned, the tenderer should be the holder of the Certificate of Registration
issued by the Pharmacy and Poisons Board of Hong Kong, and that each tablet
should bear the printed information of its major ingredients. Therefore,
the rejection of the complainant's tender proposal by the respondent on
the above grounds was a breach of Article VI and paragraph 2(g) of Article
XII of the GPA.
A Panel comprising
a Deputy Chairman and two members of the Review Body was set up to consider
the bid challenge. The complainant proposed that the respondent should
suspend the execution of the contract as a Rapid Interim Measure (RIM)
to allow a negotiation between the two parties. Having considered the
written representations of the respondent and the response of the complainant,
the Panel decided not to recommend the respondent to implement RIM on
grounds of public interest.
The Panel conducted
a hearing to examine the case on 15 August 2003. The decision of the Panel
is summarized as follows:
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The Panel considered
the standard of ICH an international standard. The adoption of the
ICH standard was in conformity with paragraph 2(b) of Article VI of
the GPA. Moreover, manufacturers of non-ICH member countries could
apply to any ICH member country for the granting of marketing authorizations.
Thus, the relevant condition of tender was not discriminatory.
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The Panel accepted
the grounds on which the respondent rejected the tender proposal offered
by the complainant.
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In view of the
above reasons, the Panel determined that the tender exercise had not
breached the GPA.
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