Public (Open) Tender
The owner prepares the service terms and conditions booklet, and lists of works and accessories. These documents need to be prepared with special care. A copy must be kept of the contract and its specifications; financial, administrative, tax, insurance; and succession requirements. Contractual language is standardized on and drafted in English. Translated brochures list the contract’s main requirements and specifications and, in the case of external tenders, they indicate whether, in the event of any disagreement or confusion about the content, Arab, French, Chinese or other texts apply.
Open bidding is advertised in newspapers. This advertisement should make its appearance in a timely manner, disclosing the declaration submitted to tender, the last date for submission, the work required, the value of the primary and final bond, the price of a copy of the tender conditions, whether external tenders must be advertised in the owner country and abroad, and any other data the administration deems necessary for the work.
Usually, from the date of the first announcement of the auction a period of at least thirty days for submission of bids is opened for public tender. If necessary, a licensed competent authority may choose to shorten the period, but to not less than fifteen days. (Except in cases of extreme necessity dictated by the circumstances of the subject of the tender and with the consent of the competent supreme authority, such conditions are not applied to public tenders relating to provision of annual supplies). Except when the body administering the tenders auction requests, in a timely manner, that bidders accept some extension, the duration of a tender’s validity usually runs from the date fixed for the opening of the envelopes at auction until notification of acceptance before the expiry of the tendering submission deadline.
A company planning to enter a bid designates an employee to keep tabs on the chain of custody of its tendering documents from the point at which the documents receive final approval from the relevant department to go forward until the documents are delivered to the office where the tendering auction will convene. This delivery will usually be timed for the afternoon or morning before the bids are scheduled to be opened, but this critical responsibility might also entail having to inform some designated responsible party from the auction-managing authority of imminent delivery of his company’s bid very close to the time officially set for opening the envelopes.
On the day appointed for opening the submitted bids, the chairman of the committee administering the formalities of the auction is tasked with the following:
• verify the integrity of the seals on the bidding documents received;
• establish in the minutes of the meeting the number of envelopes received;
• open the bids sequentially, assigning each opened envelope its uniquely-identifying serial number;
• enumerate the components of the tender;
• read aloud the name of each bidder and title of their tendering document to the audience of bidders or their representatives; and
• announce the amounts of each bid.
Bidders deposit an initial bond of not less than 1 % of the tender value of construction work. Upon acknowledging acceptance of the tender award, a successful bidder deposits a bond equal to 5% of the value of the project’s construction costs. These actions are usually to be concluded over a period not exceeding 10 days, counted from the day following the auction. (For successful bidders from outside the country, the time allowed for submitting this bond is usually not more than twenty days. The authority concerned may extend by not more than 10 days the deadline for the filing of the final deposit.)
Public tenders are particularly favored by government authorities as an instrument for strengthening the general business environment. The public-policy aim is to encourage the development of new contractors on the basis of maintaining an orderly rules-based system complete with internationally-accepted standards from which domestic contractors may raise their overall performance and competitiveness in domestic and foreign markets.