PROCUREMENT WORKSHOP National Hydrology Project CIVIL WORKS Guwahati Nov 16-18

PROCUREMENT WORKSHOP

National Hydrology Project

CIVIL WORKSCIVIL WORKS

Guwahati Nov 16-18

PROCUREMENT THRESHOLDSPROCUREMENT THRESHOLDS

ICBICB NCBNCB ShoppingShopping Force Force AccountAccount

Works, Supply & Installation

> 40 Million USD

100,000 to <=40 Million

Up to USD 100,000Carried out through a QUALIFIED local contractor after inviting a min of 3 quotations in response to a written invitation by providing min 15 days

As per guidelines 3.8 with prior agreement of the Bank

PRIOR REVIEW PROCUREMENT PRIOR REVIEW PROCUREMENT THRESHOLDSTHRESHOLDS

Prior Prior ReviewReviewThresholdThreshold

Prior Prior Review Review by CPMU by CPMU at CWCat CWC

RemarksRemarks

Works, Supply & Installation

>= US$ 5,000,000

US$ 200,000 <= contracts < US $ 500,000

In addition first contract respective of the value for both ICB and NCB for Works and Supply & Installation will be subject to Prior Review by the Bank for each implementing agency

Force Account

All contracts irrespective of value

As per guidelines 3.8 with prior agreement of the Bank

TYPES OF BIDDING DOCUMENTS FOR WORKS

- Civil Works costing more than US $ 100,000 (NCB) -- W-2;

- Request for Quotations ? Shopping-- W-5;

- Procurement of Works (ICB) ;

- Pre-Qualification Document for Procurement of Works

FEATURES OF BANK’S MODEL PROCUREMENT DOCUMENTS

• sharing of risks between the parties of the contract;sharing of risks between the parties of the contract;

• incorporation of suitable qualification criteria;incorporation of suitable qualification criteria;

• incorporation of precise and fair evaluation incorporation of precise and fair evaluation

criteria;criteria;

• incorporation of non-discriminatory/broad incorporation of non-discriminatory/broad

technical technical specification;specification;

GENERAL REQUIREMENTS

Bidding documents should pre disclose the bid evaluation criteria and the manner in which they will be applied for the purpose of determining the lowest evaluated bid

Bidding documents should be made available for sale till a day prior to the last date of receipt of bids, to all those who intend to participate in the bidding, for a minimum period of 30 days [either by mail or in person]. It should range from 30 to 90 days depending on the magnitude and complexity of the work.

The time for the bid opening should be the same as that for deadline for receipt of bids, or promptly thereafter [to allow only sufficient time to take the bids to the place announced for public bid opening]


Bidders should be permitted to deposit their bids on any day during the bidding period. Receipt of bids should not be restricted to few days or last day only. Bidders could submit their bids either by post or in person. Bids should be received only at one place and should be kept in safe custody till the stipulated time of opening. If electronic submission is permitted, the detailed procedures for that should be specified in the document).

Last date of receipt of Bids and opening of Bids should be the next day, following the close of sale of Bidding Documents. If that day happens to be a holiday, the last date of receipt and opening of bids shall be the next working day. The time of bid opening should be the same as for the deadline for receipt of bids or promptly thereafter (15 to 30 minutes later to allow sufficient time to take the bids to the place announced for public bid opening). All bids received should be opened in the presence of bidder’s representatives who choose to attend and shall sign a register evidencing their attendance


Envelopes marked “WITHDRAWAL” shall be opened first, and the name of the bidder shall be read out. Bids for which an acceptable notice of withdrawal has been submitted shall not be opened. Subsequently, all envelopes marked “MODIFICATION” shall be opened and the submissions therein read out in appropriate detail.

The bidder’s names, bid prices including any alternative Bid Price or deviations, discounts, bid modification and withdrawals and the presence or absence of the requisite bid security and such other details as considered appropriate by the Purchaser shall be announced during opening of bids in the meeting. All cuttings and/or over-writings observed in the Bid Form and Price Schedules should be authenticated by the officers of the Bid Opening Committee by encircling and initialing the cuttings/over-writings. The minutes of the bid opening should be prepared in the specified format.


No bid shall be rejected at bid opening, except for late bids, which shall be returned unopened to the bidder.

Bids and modifications that are not opened and read out at bid opening shall not be considered further for evaluation, irrespective of the circumstances.

Withdrawn bids will be returned unopened to the bidders.

from the date of publication of IFB indate the documents

Minimum Bidding Period

are made ready for

For NCB – 30 days press/UNDB, or, the

For ICB – 6 weeks sale, whichever is

later

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BID SECURITY

a) 1 to 3 % for Works depending of estimated costb) Bid Security has to be in one of the acceptable forms

(including Bank guarantees) and should be valid for 28 /45 days beyond the bid validity period.

c) In lieu of Bid Security, a Bid Securing declaration can be prescribed in which bidders sign a declaration that if they withdraw/modify the bid during the bid validity or refuse to sign the agreement, the bidders can be suspended for a specified period.

d) Bid security of a Joint Venture must be in the name of all the partners in the Joint Venture submitting the bid.

e) No exemption of Bid Security or Security Deposit or Bid Securing Declaration should be permitted to any bidder or class of bidders.

f) Any bid not secured in accordance with the requirements of the bidding document will be rejected as non-responsive.

Land acquisition and engineering investigations for the work should be completed and based on these, bill of quantities and specifications should be properly checked. Schedule of quantities for each slice and package should be incorporated separately in the bidding document.

Liquidated damages not exceeding 0.05% per day (for civil works) of the value of the delayed works, subject to a maximum of 10% of the contract value are normally to be specified for delays in completion of works.

PRICE ADJUSTMENT

Bidding documents shall state either that (i) bid prices will be fixed or (ii) that price adjustments will be made to reflect any changes (upwards or downwards) in major cost components of the contract such as labour, equipment, materials and fuel.

Price adjustment clause should invariably be provided when the stipulated period of completion of works or supply of goods is more than 18 months. The total percentage of Labor, Materials and POL components should equal 100, if “R” in the formula represents

The value of work done. In such cases a bid submitted with a fixed price quotation will not be rejected, but the price adjustment would be treated as zero.

Where the stipulated period of completion of works or supply of goods is less than 18 months, normally prices quoted by the bidder shall be fixed during the bidder’s performance of the contract and not subject to variation on any account. In such cases, a bid submitted with an adjustable price quotation will be treated as non-responsive and rejected.

INTERNATIONAL COMPETITIVE BIDDING

REQUIREMENT - ICB

Publication of Invitation for Bid [IFB] in the United Nations Development Business [UNDB] 0n line –(Minimum period required 7-10 days)

Transmission of IFB to those who have expressed interest in response to the General Procurement Notice

Publication of IFB in national newspapers having wide circulation in all regions of the country

Use of Bank's Standard Bidding Documents. Sale of bidding documents to start only after

publication of IFB in UNDB and national newspapers.

Bidding period 6-12 weeks from the date of start of sale of bidding documents

STEPS - ICB Notification/advertising

Issue of bidding document

Pre Bid Meeting (if Required)

Submission of bid Public opening of bids

Evaluation

Selection of lowest evaluated responsive bid - based

on post-qualification

Contract award

Performance Security

Publication of award in Development Business and web and debriefing of aggrieved bidders

NATIONAL COMPETITIVE BIDDING

NATIONAL COMPETITIVE BIDDING National Competitive Bidding (NCB) is the competitive bidding

procedure normally used for public procurement in the country of the Borrower

To be acceptable for use in Bank-financed procurement, these

procedures shall be reviewed and modified as necessary to assure economy, efficiency, transparency, and broad consistency with the provisions included in Section I of the Bank Guidelines.

NCB may be the most appropriate method of procurement where foreign bidders are not expected to be interested because (a) of the size and value of the contract, (b) works are scattered geographically or spread over time, (c) works are labor intensive, or (d) the goods, works, and non-consulting services are available locally at prices below the international market.


NCB procedures may also be used where the advantages of ICB are clearly outweighed by the administrative or financial burden involved.

The text of advertisement (even short) shall be published in a

national newspaper of wide circulation in the National Language or in the official gazette, provided that it is of wide circulation, or on a widely used website or electronic portal with free national and international access.

The Borrower may publish a shorter version of the advertisement text, including the minimum relevant information, in the national press provided that the full text is simultaneously published in the official gazette or on a widely used website or electronic portal with free national and international access.


Notification shall be given to prospective bidders in sufficient time to enable them to obtain relevant documents.

Bidding documents may be issued in the National Language.

The currency of the bid and currency of payment should be Indian Rupees with no obligation to convert to any other currency.

In addition, the bidding documents shall provide clear instructions on how bids should be submitted, how prices should be offered, and the place and time for submission of bids.

Adequate response time for the preparation and submission of bids shall be provided. The procedures shall provide for adequate competition in order to ensure reasonable prices, and methods used in the evaluation of bids and the awards of contract shall be objective and made known to all bidders in the bidding documents and not be applied arbitrarily.

The comparison of all bids and the award of contract may be based on the total cost at destination including all taxes and duties.

The procedures shall also include public opening of bids, publication of results of evaluation and of the award of contract as per paragraph 7 of Appendix 1 of the Guidelines.

Borrowers shall have an effective and independent protest mechanism in place allowing bidders to protest and have their protests handled in a timely manner.

If foreign firms wish to participate in NCB they shall be allowed to do so on the prevailing NCB terms and conditions that apply to national bidders.

All bids received should be opened and read out at the time of bid opening

No bid should be rejected at bid opening, except for late bids, which shall be returned un-opened to the bidder

Minutes of bid opening must be prepared and one copy forwarded to the Bank for information

NCB PROVISIONS…The Bank and GOI have agreed in 1998-1999 the following conditions for procurement following NCB in Bank financed projects:

The model bidding documents for NCB agreed with government of India Task Force [ and as amended from time to time], shall only be used for bidding.

Invitations to bid shall be advertised in at least onewidely circulated national daily newspaper, at least 30days prior to the deadline for the submission of bids.

No special preference will be accorded to any bidder when competing with foreign bidders, state-owned enterprises,small- scale enterprises or enterprises from any given State, etc.

Two or three envelopes system of bidding shall not be acceptable.

Except with the prior concurrence of the Bank /Association, there shall be no negotiation of price withthe bidders, even with the lowest bidder.

Extension of bid validity [with respect to contracts subject to Bank Prior Review] shall not be allowed without the prior concurrence of the Bank/Association [1] for the first request for extension if it is longer than eight [four] weeks; and [2] for all subsequent requests for

extension irrespective of the period (such concurrence will be considered by Bank only in cases of Force Majeur and circumstances beyond the control of

Purchaser/Employer.

Re-bidding shall not be carried out [with respect to contracts subject to Bank Prior Review] without theprior concurrence of the Bank/Association. System of rejecting bids outside a pre-determined margin or “bracket” of prices shall not be used.

NATIONAL COMPETITVE BIDDING (NCB)

Have to strictly follow W-2 documentHave to strictly follow W-2 document

The document just needs tailored as per needs The document just needs tailored as per needs

Estimated cost, Specifications and BOQ to be preparedEstimated cost, Specifications and BOQ to be prepared

Estimated cost should be updated / recent based on market Estimated cost should be updated / recent based on market conditions conditions

W - 2 SECTIONS

Invitations For Bids Instructions to Bidders (Section 1) Forms of BID, Qualification Information and Letter of

Acceptance (Section 2) Conditions of Contract and Special Conditions of COntract

(Section 3) Contract Data (Section 4) Specifications (Section 5) Drawings (Section 6) Bill of Quantities ( Section 7) Formats of Securities (Section 8)

INSTRUCTION TO BIDDERS Customization to be carried out in few clauses / places (List

as per attached)Important provisions:Important provisions: Post Qualification Criteria (Clause 4.5 ) Fill in the years 4.5 A a – Turnover - Not less than 2 times the estimated

annual payments under the contract 4.5 A b – Experience – usually not less than 80% of

estimated value of contract 4.5 A c – Quantity of works Minimum in one year - 80% of

expected peak rate of construction 4.5 A d – Sub contractors qualification – electrical works 4.5 A e – Sub contractors qualification – water supply /

sanitary works

4.5 B a – Requirement of equipment may be indicated 4.5 B c – Credit Lines / Liquid Assets - Equivalent to 3

months cash flow at peak construction period

4.7 – Bid capacity

INSTRUCTION TO BIDDERS

Clause 13.4 – Select Contract if Fixed Price or With Price Adjustment

Clause 16 – Bid Security – Fill in whose name the BD should be

Clause 19.2 a – Fill in the address of office for bid submission

Clause 19.2 b – Fill in bid reference no., and name of contract, and time and date for bid opening

Clause 20.1 – Fill time and date for last date of submission

Clause 34.1 – Fill in information

Clause 36.1 – Fill in details of Adjudicator and appointing authority

SUBCONTRACTINGSUBCONTRACTING

4.3 (j) of ITB of NCB4.3 (j) of ITB of NCB

proposals for subcontracting components of the Works which in proposals for subcontracting components of the Works which in

aggregate aggregate add to more than 20 percent of the Bid Price add to more than 20 percent of the Bid Price

((for each, the qualifications and experience of the identified sub-for each, the qualifications and experience of the identified sub-

contractor in the relevant field should be annexed; no vertical contractor in the relevant field should be annexed; no vertical

splitting of work for sub-contracting is acceptablesplitting of work for sub-contracting is acceptable); and); and

QUALIFICATION CRITERIAQUALIFICATION CRITERIA

Clause 4.5 of ITB of NCBClause 4.5 of ITB of NCB

4.5 A. To qualify for award of the contract, each bidder in its name should have in the last five years

i.e.........................................:*(a) achieved, in at least two financial years, a

minimum annual financial turnover (in all classes of civil engineering construction works only) of Rs........@ (usually not less than two times the estimated annual payments under the contract);

b) satisfactorily completed (not less than 90% of contract value), as a prime contractor, (or as subcontractor duly certified by the employer/main contractor) at least one similar work of value not less than Rs........ @ (usually not less than 80% of estimated value of contract);

* Specify the financial years; they should be those immediately preceding the financial year in which the bids are received.

(c) executed in any one year, the following minimum quantities of work:

- cement concrete (including RCC and PS ...........cum

- earthwork in both excavation and embankment

(combined quantities) ..............cum

- ..................................................cum

- ..................................................cum

(usually 80% of the expected peak rate of construction)

(d) The contractor or his identified sub-contractor should possess required valid electrical license for executing the building electrification works and should have executed similar electrical works totalling Rupees .............@ ** in any one year.

Dam Rehabilitation & Improvement Project

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(e) The contractor or his identified sub-contractor should possess required valid license for executing the water supply/sanitary engineering works and should have executed similar water supply/sanitary engineering works totaling Rupees ................. ** in any one year.

(@) at —————* price level. Financial turnover and cost of completed works of previous years shall be given weightage of 5% per year based on rupee value to bring them to price level*.

the financial year in which bids are received.

** at least 50% of the estimated value of electrical/water supply works.


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UNBALANCED BIDS

ITB Clause 29.5 of NCB

29.5 If the Bid of the successful Bidder is seriously unbalanced in relation to the Engineer's estimate of the cost of work to be performed under the

contract, the Employer may require the Bidder to produce detailed price analyses for any or all items of the Bill of Quantities, to demonstrate the internal consistency of those prices with the construction methods and schedule proposed. After evaluation of the price analyses, the Employer may require that the amount of the performance security set forth in Clause 34 be increased at the expense of the successful Bidder to a level sufficient to protect the Employer against financial loss in the event of default of the successful Bidder under the Contract.


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KEY PERSONNEL AND EQUIPMENT TO KEY PERSONNEL AND EQUIPMENT TO BE PROVIDED BY CONTRACTORBE PROVIDED BY CONTRACTOR

ITB Clause 4.5(a) and (b) of NCBITB Clause 4.5(a) and (b) of NCB

Clause 9 of G.C.C. of NCBClause 9 of G.C.C. of NCB

CONSTRUCTION METHODOLOGYCONSTRUCTION METHODOLOGY Clause 4.3 (k) of ITB of NCBClause 4.3 (k) of ITB of NCB Clause 27 of G.C.C. of NCBClause 27 of G.C.C. of NCB

ADVANCE PAYMENTADVANCE PAYMENT Clause 51 of G.C.C. of NCBClause 51 of G.C.C. of NCB (Clause 51.2 specified that the contractor (Clause 51.2 specified that the contractor hashas

to demonstrate usage)to demonstrate usage)

CONTRACT – ORDER OF PRECEDENCECONTRACT – ORDER OF PRECEDENCE

Clause 2.3 of G.C.C. of NCBClause 2.3 of G.C.C. of NCB

INSURANCEINSURANCE


COMPENSATION EVENTSCOMPENSATION EVENTS


LIQUIDATED DAMAGESLIQUIDATED DAMAGES


PRICE ADJUSTMENTPRICE ADJUSTMENT Clause 47 of G.C.C. of NCBClause 47 of G.C.C. of NCB

DISPUTE RESOLUTIONDISPUTE RESOLUTION Adjudicator – Clause 25 of G.C.C. of NCB( Adjudicator – Clause 25 of G.C.C. of NCB(

See P3 See P3 for letter of appointment)for letter of appointment)

MANAGEMENT MEETINGSMANAGEMENT MEETINGS Clause 31 of G.C.C. of NCBClause 31 of G.C.C. of NCB

IDENTIFYING DEFECTSIDENTIFYING DEFECTS


VARIATIONSVARIATIONS

Clause 39/40 of G.C.C. of NCBClause 39/40 of G.C.C. of NCB

AS-BUILT DRAWINGSAS-BUILT DRAWINGS Clause 58 of G.C.C. of NCBClause 58 of G.C.C. of NCB

TERMINATION AND FUNDEMENTAL TERMINATION AND FUNDEMENTAL BREACHBREACH

Clause 59 & 60 of G.C.C. of NCBClause 59 & 60 of G.C.C. of NCB

DEFECTS LIABILITYDEFECTS LIABILITY G.C.C. Clause 35 of NCBG.C.C. Clause 35 of NCB

JOINT VENTUREJOINT VENTURE Joint and Several LiabilityJoint and Several Liability

SECTION 2

This section has forms wherein the contractor will fill in information and submit.

Contractors Bid – Fill description of works, Name and Address of Purchaser / Client

Qualification Information – Fill in the years, and the equipment list

7.1 of G.C.C.

The Contractor may subcontract with the approval of the Engineer but may not assign the Contract without the approval of the Employer in writing. Subcontracting does not alter the Contractor's obligations.


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Clause 3 of SCC of NCBClause 3 of SCC of NCB

SUB-CONTRACTING (GCC Clause 7)SUB-CONTRACTING (GCC Clause 7)

Please add the following as Clause 7.2:Please add the following as Clause 7.2:

The contractor shall not be required to obtain any consent from the The contractor shall not be required to obtain any consent from the employer for:employer for:

a)a) the sub-contracting of any part of the Works for the sub-contracting of any part of the Works for which the Sub-contractor is named in the which the Sub-contractor is named in the

contract;contract;b)b) the provision of labour; andthe provision of labour; andc)c) the purchase of materials which are in the purchase of materials which are in

accordance with the standards specified in accordance with the standards specified in the Contract.the Contract.Beyond this if the contractor proposes sub-contracting any part of the Beyond this if the contractor proposes sub-contracting any part of the work during execution of works, because of some unforeseen work during execution of works, because of some unforeseen circumstances to enable him to complete the work as per terms of the circumstances to enable him to complete the work as per terms of the contract, the Engineer will consider the following before according contract, the Engineer will consider the following before according approval:approval:

The contractor shall not sub-contract the whole of the Works.The contractor shall not sub-contract the whole of the Works.

The contractor shall not sub-contract any part of the Work without prior consent of the Engineer. Any such consent shall not relieve the contractor from any liability or obligations under the contract and he shall be responsible for the acts, defaults and neglects of any sub-contractor, his agents or workmen as fully as if they were the acts, defaults or neglects of the contractor, his agents or workmen.

The Engineer should satisfy whether (a) the circumstances warrant such sub-contracting; and (b) the sub-contractors so proposed for the Work possess the experience, qualifications and equipment necessary for the job proposed to be entrusted to them in proportion to the quantum of work to be sub-contracted.

If payments are proposed to be made directly to that sub-contractor, this should be subject to specific authorization by the prime contractor so that this arrangement does not alter the contractor's liability or obligations under the contract.


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SUB CONTRACTING

All bidders are expected to indicate clearly in the bid, if they proposed sub-contracting elements of the works amounting to more than 20 percent of the Bid Price. For each such proposal the qualification and the experience of the identified sub-contractor in the relevant field should be furnished alongwith the bid to enable the employer to satisfy himself about their qualifications before agreeing for such sub-contracting and include it in the contract.

In view of the above, normally no additional sub-contracting should arise during execution of the contract. Of course the contractor shall not be required to obtain any consent from the employer for:

The sub-contracting of any part of the Works for which the Sub-contractor is named in the contract;

The provision of labour; and The purchase of materials which are in accordance with the

standards specified in the Contract


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SECTION 3 – SPECIAL CONDITIONS OF CONTRACT

Clause 4 Arbitration – Selection any one of the institution

Indicate the place where the arbitration will take place in d

Section 4 – Contract DataSection 4 – Contract Data

Most important and Critical SectionMost important and Critical Section This section has all the contract conditions which you need This section has all the contract conditions which you need

to fill in based on the type of contract etcto fill in based on the type of contract etc

SHOPPING – W -5 DOCUMENT

Fixed Price Lump Sum Contracts

Quotations invited by writing from at least 3 qualified contractors

FORCE ACCOUNT [FA]Force Account is construction by the use of Borrowers own personnel, materials and equipment where :

Quantities of work involved cannot be defined in advance

Works are small and scattered or in remote locations where mobilization costs for contractors would be unreasonably high

Work must be carried out without disrupting on-going operations

The risk of unavoidable work interruption are better borne by the Borrower than by a contractor

There are emergencies needing prompt attention

To be agreed with the Bank before taking up such activity

4848

BIDDING DOCUMENTS

Contractors of civil works should be made responsible, as far as possible, for all materials (including cement and steel) and equipment without having to rely on departmental supplies. With the exception of explosives if a Borrower insists on supply of certain construction materials, Bank will consider this as reserved procurement and the estimated cost of the materials thus supplied will be excluded from the total project costs to determine the amount Bank will finance.

No filtration in the sale of bidding document. It should be sold to all, whosoever requests for it, and made available by mail as well


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