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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. 01/2003

The rejection of a tender proposal for the supply, delivery, installation, commissioning, maintenance, training and warranty for a reloadable card operated parking system ("RCOPS") and the provision of other related services 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 Article XIII.4 of the World Trade Organization Agreement on Government Procurement (GPA) in a tender exercise for the supply, delivery, installation, commissioning, maintenance, training and warranty for a reloadable card operated parking system ("RCOPS").

The respondent rejected the complainant's tender because the former claimed that the latter's technical proposal were inferior to the successful tenderer in the aspects including PDR Memory Capacity, PDR Operational Capabilities, Back-end System Capability, CCS system Memory Capacity, Battery and Law Enforcement indication. However, the complainant alleged that the respondent failed to evaluate or properly assess complainant's offer and therefore in breach of the GPA.

A Panel comprising the Deputy Chairman and two members of the Review Body was set up to consider the bid challenge. Having preliminarily examined the case, the Panel recommended the respondent to suspend the tendering procedures until the end of the hearing as a Rapid Interim Measure (RIM). The respondent at first accepted the Panel's recommendation, and yet, due to the outbreak of SARS, the hearing did not commence until early May 2003. As there was a certain urgent to have the 1,000 parking meters and system well tested in order to see what subsequent modifications would be necessary, the respondent requested that the RIM should be then discharged. Having regard the public interest on the issue, the Panel granted a discharge of the RIM.

A five-day hearing was conducted to examine the case. The decision of the Panel is summarized as follows -

  1. The respondent breached the GPA in the subject procurement as the respondent failed to make proper queries to the complainant and therefore the technical assessment of the complainant's offer was flawed. Furthermore, some of the members of the Assessment Panel did not have enough technical knowledge to properly and fully understand the technical materials contained in the tender document. As a result, they wrongly applied the assessment criteria and misinterpreted the technical requirement of the specifications.
  2. Since the Panel is not able to determine if the complainant would have won the Tender if the respondent had fully complied with the GPA, the Panel will not recommend as corrective measures that the Tender awarded to the successful bidder be set aside.
  3. The Panel recommended the respondent should only appoint properly qualified persons to Assessment Panels to assess technical submissions.
  4. The Panel recommended that the determination on the confidentiality of any information provided or to be provided to a Panel be completed before the commencement of the inquiry.
  5. The Panel further recommended to the Government to implement the recommendation made in Case No. 01/2001 concerning the insertion in all tenders covered by the GPA, a clause which enables the procuring entity to suspend implementation of the successful contract for so long as the contract is subject to a review by a Panel set up under the Review Body.