ICDC

Basic Requirements for Eligibility to Tender

The following are the general requirements for potential suppliers to public entities:

• Registration with Attorney General/incorporation certificate;

• Copy of PIN certificate and compliance with VAT (Electronic Tax Register), NSSF and NHIF and valid tax compliance certificates;

• The necessary qualifications, capability, experience, resources, equipment and facilities to provide what is being procured;

• Legal capacity to enter into contract;

• Not insolvent, in receivership , bankrupt or in the process of being wound up and not subject to related legal proceedings;

• Not precluded from contracting by being an employee of the procuring entity or a member of its board or committee or certain relatives of the same; and

• Not having been debarred by the Director-General PPOA from participating in procurement proceedings on account of an offence, breach of contract or other valid reason.

Other requirements may be specified for certain procurements:

• For building works, the potential bidder should be registered in either the Roads or Works Registers maintained by the Ministry of Roads or the Ministry of Public Works;

• Business Permits;

• Energy Regulation Commission registration and classification if the works include electrical installation;

• Evidence of completion of similar works in previous 2 years;

• Provision of bid security of a certain amount (maximum 2% of the contract price); and

• Audited accounts for 3 years.

The Tendering Proccess

a) Prequalification

Prequalification may be necessary for large or complex works or projects. Prequalification is a preliminary stage of the tendering process that is designed to produce a short-list of companies that would be capable of meeting the technical standards of the works or project, without regard to price considerations at this stage.

Prequalification should take into account:

• Experience and past performance on similar contracts;

• Capabilities with respect to construction and manufacturing facilities; and

• Financial position.

Tendering is then confined to companies that have been prequalified.

b) Specifications

Requirements for an item, works or service to be procured will be specified in the tender document. Specifications will normally be based upon Kenyan or international standards.

Specifications form part of the tender documents and are the basis on which the technical evaluation is conducted. It is important that offers should adhere to all mandatory requirements; otherwise the offer may be rejected as non-conforming.

Goods must be supplied or work done in accordance with the specifications. Items which do not meet the specified quality or standards may be rejected by the procuring entity who may withhold payment until items of the required quality are supplied. The time requirements for delivery of goods or performance of services must also be met.

c) Types of tender

Procuring entities may produce standing lists of registered tenderers for supply of their requirements over the coming year. Those on a standing list may be offered an opportunity to tender or submit a quotation for requirements that arise during the year.

Some tender opportunities will be for framework contracts. These are contracts entered over a specified period, typically one to three years, and are used for goods and services that are required on a regular basis, such as office stationery, medical supplies, road maintenance, cleaning, guarding services etc. A framework contract may contain a Service Level Agreement, specifying the minimum standards which will have to be met for delivery of the
services.

Other tender opportunities will be for the one-off supply of an item or service. Some requirements, particularly for high-value items or services, will be obtained through open tendering. All potential bidders, not only those on the standing lists, may compete for open tenders, which are advertised by the procuring entity.

Open competitive bidding can be national or international depending on the goods, works or services being procured. Potential
bidders are allowed a minimum of 21 days to prepare and submit their bids (30 days for international tendering).

Open tendering is the Government of Kenya’s preferred method of procurement. However, alternative procurement procedures may be used in certain circumstances.

These include:

• Restricted tendering, which may be used where suppliers have already been prequalified, where there are time or cost constraints, or where there are only a few known suppliers or the required goods, works or services;

• Direct procurement, which may be used where there is only one person or company that can supply the goods, works or services being procured, where there is no reasonable alternative, or in certain cases of urgent need;

• Request for proposals, which may be used for the procurement of services or a combination of goods and services that are advisory or otherwise of a predominantly intellectual nature, e.g. for consultancy services; and

• Request for quotations and low-value procurement procedures, which may be used for low-value procurements of goods, minor works or services that are readily available.

d) Tender Document

A tender document is a set of documents which may include the following:

• Invitation to Tenders;

• Instruction to Tenderers/Bidders;

• Bid Data Sheet;

• General Conditions of Contract;

• Special Conditions of Contract;

• Schedule of Requirements;

• Technical Specifications;

• Forms-Bid/Tender;

• Forms-Security; and

• Integrity Declaration

Bidding documents are normally in English.

e) Completing Tender Documents

When completing a tender document, a potential bidder should read the Instructions for Bidders, which will contain all the information on how to complete and return the tender document.

Specific requirements of the tender or the bid, for example, where to place attachments or whether an omission would invalidate the bid, will be highlighted in the Bid Data Sheet.

f) Filling Quotation Forms

PPOA has produced a Standard Request for Quotation (RFQ) form for use by procuring entities. Potential bidders should read the instructions carefully.

The RFQ form has in the first part the item descriptions, the unit of measure and the quantity required, which will have been completed by the procuring entity. The bidder will be required to fill in the unit price, any discounts offered, the brand and country of origin of the goods quoted for, and to compute the price for each item, adding tax, shipping and miscellaneous costs to arrive at the total quoted price.

g) Submission of offers

The time and place for submission of offers will be specified in the tender documents. Bidders must submit their offers by the bid deadline: failure to submit your bid on time, even by only a few minutes, will lead to your bid not being considered.

Some tender documents will specify that the technical and financial proposals be submitted in separate inner envelopes within an outer envelope. For these tenders, the technical envelope will be opened first and the technical evaluation carried out before the financial envelope is opened.

If a technical proposal does not meet requirements, the financial envelope will not be opened and will be returned to the bidder.

h) Standard Bidding Documents

PPOA has produced and published a number of Standard Bidding Documents which will be used with suitable modifications for the procurement of different requirements. These are available on the PPOA website: www.ppoa.go.ke.

i) Validity of Bids and Bid Security

Potential bidders are required to submit bids that are valid for a period specified in the bidding documents. Procuring entities have the option to demand bid security which can be a fixed sum or a percentage of the estimated value of the contract. This is specified in the bidding documents and can be up to 2% of the contract price.

Bid securities should be from a reputable bank (local or international), insurance company (approved by PPOA) or in the form of cash or letter of credit, in the amount specified in the bid document. A receipt is attached to the returned tender as proof of payment.

Bid security is only valid if it extends at least thirty days after the expiry of the tender validity period. Bid security is released to unsuccessful tenderers once the contract is awarded to the successful bidder.

j) Payment for documents

Procuring entities may charge a fee not exceeding KShs 5,000 for a set of tender or prequalification documents. This payment covers costs for printing, copying and distribution or for converting documents into electronic format. This fee is normally paid in cash or bankers cheque.

k) Pricing and bid validity

Pricing should be inclusive of all duties, taxes and other levies. Most entities will require that the bid price be valid for up to 120 days after tender opening to cater for the evaluation, post tender negotiations and wider consultations when necessary.

l) Evaluation of tenders

A preliminary evaluation is undertaken by an evaluation committee soon after opening tenders to ascertain that the tender has been submitted in the correct format, has been signed, and that the correct number of copies, tender security, validity and any required samples have been provided.

Any tender that does not meet the requirements is rejected. Tenders are then evaluated more rigorously for technical conformity, followed by the financial evaluation which considers prices read out at tender opening, corrections for arithmetic errors, currency, discounts etc. The lowest priced conforming tender is usually awarded the contract.

However, for some tenders, particularly those based on Requests for Proposals, a marking scheme may be used. Tender documents contain the evaluation criteria by which the tenders will be evaluated. The recommendation for contract award by the evaluation committee will be submitted to the tender committee for approval (procurement committee for lower-value tenders).

The procuring entity has the right to reject all tenders received and to terminate the procurement proceedings at any time without entering into a contract.