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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. 03/2017

The rejection of a tender proposal for the replacement of customs radar monitoring system ("CRMS") for the Government of the Hong Kong Special Administrative Region (HKSARG)

Company A (the complainant) lodged a bid challenge to the Review Body against the Hong Kong Special Administration Region (HKSARG) (the respondent) for breaching Article VIII:2(a), Article X:4 and Article X:11 of the revised World Trade Organization Agreement on Government Procurement (revised GPA) in a tender exercise for the replacement of customs radar monitoring system ("CRMS").

The complainant argued that as the tenderer was required by some technical specifications in the tender to utilise output (in proprietary format) from another system, the requirement precluded suppliers other than the contractor of that other system from this tender. The respondent also required the complainant to obtain written approval by a government department on sharing signal to the CRMS and the complainant had to provide their reply with supporting documents on very short notice.

Moreover, the complainant disagreed with the respondent's claim that the tender was not covered by the revised GPA.

A Panel comprising a 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 signing of the contract with the awarded bidder as a Rapid Interim Measure (RIM). Having considered the written representations of the respondent, the Panel decided not to recommend the respondent to implement RIM, taking into account the status quo that the contract had already taken effect and the balance of convenience was in not suspending the tender contract.

The Panel conducted a one-day hearing to examine the case. The decision of the Panel is summarized as follows -

  1. The Panel was of the view that tender was not covered by the revised GPA, for which the classification of tender work did not fall under the commitment of Hong Kong, China under the revised GPA. The Panel acknowledged that all government procuring entities are bound to conduct a pre-tender valuation before issuing an invitation for tender, and considered that the valuation for the subject tender had been conducted properly and in accordance with the revised GPA.
  2. For the claim of breaching the revised GPA, the Panel considered that, even if tender was covered by the revised GPA, the Panel found no evidence that Articles VIII:2(a), X:4 or X:11 had been breached.
  3. As the Panel could not find any substance that substantiates the alleged breach of any of the aforesaid articles of the revised GPA, the complaint was rejected.