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tity should be treated as a new pro- the invitation for bids or limit his liacurement.

bility to the Government so as to give (b) Invitations for bids may be can him an advantage over other bidders. celed after opening but prior to award. For example, bids shall be rejected in and all bids rejected, where such which the bidder: action is consistent with § 1-2.404-1(a) (1) Attempts to protect himself and the contracting officer determines against future changes in conditions in writing that cancellation is in the such as increased costs, if total price best interest of the Government for to the Government cannot be deterreasons such as the following:

mined for bid evaluation. (1) Inadequate, ambiguous, or other (2) Fails to state a price and, in lieu wise deficient specifications were cited thereof, states that price shall be in the invitation for bids.

"price in effect at time of delivery." (2) The supplies or services are no (3) States a price but qualifies such longer required.

price as being subject to "price in (3) The invitation for bids did not effect at time of delivery." provide for consideration of all factors (4) Where not authorized by the inof cost to the Government, such as vitation, conditions or qualifies his bid cost of transporting Government-fur- by stipulating that the bid is to be connished property to bidders' plants. sidered only if, prior to date of award,

(4) Bids received indicate that the bidder receives (or does not receive) needs of the Government can be satis- award under a separate procurement. fied by a less expensive article differ (5) Limits rights of Government ing from that on which the bids were under any contract clause. However, a invited.

low bidder may be requested to delete (5) All otherwise acceptable bids re objectionable conditions from his bid ceived are at unreasonable prices. (See if these conditions do not go to the § 1-3.214 concerning authority to nego substance, as distinguished from the tiate in such situations.)

form of the bid. A condition goes to (6) The bids were not independently the substance of a bid where it affects arrived at in open competition, were price, quantity, quality, or delivery of collusive, or were submitted in bad the items offered. faith. (See § 1-3.214 concerning au- (c) Any bid may be rejected if the thority to negotiate in such situations contracting officer determines in writand Subpart 1-1.9 for reports to be ing that it is unreasonable as to price. made to the Department of Justice.) (d) Bids received from any person or

(7) The bids received did not provide concern debarred or ineligible shall be competition which was adequate to rejected if the period of debarment or insure reasonable prices.

ineligibility has not expired (see Sub(c) Should administrative difficulties part 1-1.6). be encountered after bid opening (e) Low bids received from firms dewhich may delay award beyond bid termined to be not responsible, pursuders' acceptance periods, the several ant to Subpart 1-1.12, shall be rejected lowest bidders should be requested, (but if a bidder is a small business conbefore expiration of their bids, to cern, see Subpart 1-1.7 with respect to extend the bid acceptance period (with certificates of competency), ., consent of sureties, if any) in order to (f) Where a bid guarantee is reavoid the need for readvertisement. quired and a bidder falls to furnish it

in accordance with the requirements $ 1-2.404-2 Rejection of individual bids. of the invitation for bids, the old shall

(a) Any bid which fails to conform to be rejected except as otherwise prothe essential requirements of the invi- vided in § 1-10.103-4. tation for bids, such as specifications, (g) The originals of all rejected bids, delivery schedule, or permissible alter and any written findings with respect nates thereto, shall be rejected as non- to such rejections, shall be preserved responsive.

with the papers relating to the pro(b) Ordinarily, a bid shall be rejected curement. where the bidder imposes conditions (h) After submitting a bid, if a which would modify requirements of bidder transfers all of his assets or that part of his assets related to the $ 1-2.405 Minor informalities or irregular. bid during the period between the bid i ties in bids. opening and the award, the transferee

A minor informality or irregularity may not take over the bid. According

is one which is merely a matter of ly, the contracting officer shall reject

form and not of substance or pertains the bid (see Comptroller General deci

to some immaterial or inconsequential sion B-171959, September 3, 1971).

defect or variation of a bid from the [29 FR 10141, July 24, 1964, as amended at exact requirement of the invitation for 32 FR 2626, Feb. 8, 1967; 36 FR 17421, Aug. bids, the correction or waiver of which 31, 1971; 38 FR 32808, Nov. 28, 1973)

would not be prejudicial to other bid

ders. The defect or variation in the bid $ 1-2.404-3 Notice to bidders of rejection is immaterial and inconsequential of all bids.

when its significance as to price, quanWhen it is determined to reject all

tity, quality, or delivery is trivial or

negligible when contrasted with the bids, the contracting officer shall

total cost or scope of the supplies or notify each bidder that all bids have

services being procured. The contractbeen rejected, stating the reason for

ing officer shall either give the bidder such action.

an opportunity to cure any deficiency $ 1-2.404-4 Restrictions on disclosure of

resulting from a minor informality or

irregularity in a bid or waive such defidescriptive literature.

ciency, whichever is to the advantage (a) When a bid is accompanied by of the Government. Examples of descriptive literature (as defined in minor informalities or irregularities $ 1-2.202-5(a)), and the bidder imposes include: a restriction that such literature may (a) Failure of bidder to return the not be publicly disclosed, such restric number of copies of signed bids retion renders the bid nonresponsive if it quired by the invitation for bids. prohibits the disclosure of sufficient (b) Failure to furnish required inforinformation to permit competing bid- mation concerning the number of bidders to know the essential nature and ders' employees. type of the products offered or those

(c) Failure of bidder to sign its bid, elements of the bid which relate to

but only if (1) the unsigned bid is acquantity, price and delivery terms.

companied by other material indicatThe provisions of this paragraph (a)

ing the bidder's intention to be bound do not apply to unsolicited descriptive

by the unsigned bid document, such as literature submitted by a bidder if

the submission of a bid guarantee, or a such literature does not qualify the

letter signed by the bidder with the

bid referring to and clearly identifying bid (see § 1-2.202-5(f)).

the bid itself; or (2) the firm submit(b) Descriptive literature restricted by a bidder against public disclosure

ting a bid has formally adopted or au

thorized, before the date set for openshall not be disclosed in a manner

ing of bids, the execution of docuwhich would contravene the restric

ments by typewritten, printed, or tion without permission of the bidder.

stamped signature and submits evi§ 1-2.404-5

dence of such authorization and the All or none qualifications.

bid carries such a signature. Unless the invitation for bids so pro (d) Failure of a bidder to acknowlvides a bid is not rendered nonrespon- edge receipt of an amendment to an sive by the fact that the bidder speci- invitation for bids, but only if: fies that award will be accepted only (1) The bid received clearly indicates on all, or a specified group, of the that the bidder received the amenditems included in the invitation for ment, such as where the amendment bids. However, bidders shall not be added another item to the invitation permitted to withdraw or modify "all for bids and the bidder submitted a or none" qualifications after bid open bid thereon; or ing since such qualifications are sub- (2) The amendment involves only a stantive and affect the rights of other matter of form or is one which has bidders.

either no effect or merely a trivial or

negligible effect on price, quantity, evidence establishes the existence of a quality, or delivery of the item bid mistake. upon.

(2) However, if the evidence is clear

and convincing both as to the exist§ 1-2.406 Mistakes in bids.

ence of a mistake and as to the bid ac

tually intended, and if the bid, both as § 1-2.406-1 General.

uncorrected and corrected, is the After the opening of bids, contract lowest received, a determination may ing officers shall examine all bids for be made to correct the bid and not mistakes. In cases of apparent mis- permit its withdrawal. takes and in cases where the contract. (3) A determination may be made ing officer has reason to believe that a permitting the bidder to correct his mistake may have been made, he shall bid where the bidder requests permisrequest from the bidder a verification sion to do so and clear and convincing of the bid, calling attention to the sus- evidence establishes both the existpected mistake. If the bidder alleges a ence of a mistake and the bid actually mistake, the matter shall be processed intended. However, if such correction in accordance with this § 1-2.406. Such would result in displacing one or more actions shall be taken prior to award. lower acceptable bids, the determina

tion shall not be made unless the ex§ 1-2.406–2 Apparent clerical mistakes. istence of the mistake and the bid acAny clerical mistake, apparent on

tually intended are ascertainable subthe face of a bid, may be corrected by

stantially from the invitation and bid the contracting officer prior to award,

itself. If the evidence is clear and conif the contracting officer has first ob vincing only as to the mistake, but not tained from the bidder verification of as to the intended bid, a determination the bid actually intended. Examples of permitting the bidder to withdraw his such apparent mistakes are: obvious bid may be made. misplacement of a decimal point; obvi (4) If the evidence does not warrant ously incorrect discounts (for example, a determination under paragraphs (a) 1 percent 10 days, 2 percent 20 days, 5 (1), (2), or (3) of this section, a deterpercent 30 days); obvious reversal of mination may be made that a bidder the price f.o.b. destination and the may neither withdraw nor correct his price f.o.b. origin; and obvious mistake bid. in designation of unit. Correction shall (b) Heads of executive agencies may be reflected in the award document. delegate to a central authority in their

agencies, without power of redelega§ 1-2.406-3 Other mistakes disclosed

tion, authority to make the determinabefore award.

tions under paragraphs (a) (2), (3), and (a) Heads of executive agencies are (4) this section. The authority to make authorized, in order to minimize delay determinations to permit withdrawal in contract awards, to make the ad of bids as provided in paragraphs (a) ministrative determinations described (1) and (3) of this section may be delebelow in connection with mistakes in gated, without power of redelegation, bids alleged after opening of bids and to any purchasing activity having legal before award. The authority contained counsel available. herein to permit correction of bids is (c) Each proposed determination limited to bids which, as submitted, shall be approved by the agency's are responsive to the invitation for General Counsel, Associate General bids, and may not be used to permit Counsel, an Assistant General Councorrection of bids to make them re- sel, or other comparable legal officer. sponsive. This authority is in addition However, authority to approve deterto that in § 1-2.406-2 or that which minations to allow withdrawal of bids may be otherwise available.

pursuant to paragraphs (a) (1) and (3) (1) A determination may be made of this section may be delegated to the permitting the bidder to withdraw his legal counsel of purchasing activities. bid where the bidder requests permis- (d) Suspected or alleged mistakes sion to do so and clear and convincing shall be processed as follows:

(1) Whenever the contracting officer (B) Specific information as to how suspects that a mistake may have been and when the mistake was alleged; made in a bid, he shall immediately re- (C) A summary of the evidence subquest the bidder to verify the bid. mitted by the bidder; Such request shall inform the bidder (D) In the event only one bid was rewhy the request for verification is ceived, a quotation of a recent conmade-that a mistake is suspected and tract price for the supplies or services the basis for such suspicion; e.g., that involved, or, in the absence of a recent the bid is significantly out of line with comparable contract, the contracting the next low or other bids or with the officer's estimate of a fair price for the Government's estimate. If the time for supplies or services and the basis for acceptance of bids is likely to expire such estimate; before a decision can be made, the (E) Any additional evidence considcontracting officer shall request allered pertinent including copies of all bidders whose bids may become eligi correspondence between the contractble for award to extend the time for ing officer and the bidder concerning acceptance of their bids. If the bidder the alleged mistake; and whose bid is believed erroneous does (F) The course of action with respect not grant such extension of time and a to the bid that the contracting officer decision cannot be reached before ex considers proper on the basis of the piration of the time for acceptance, evidence. even if handled by telegraph or tele (4) When time is of the essence, bephone as provided in subparagraph (4) cause of the expiration of bids or othof this paragraph, the bid shall be con erwise, the contracting officer may sidered as originally submitted.

refer the case by telegraph or tele(2) If the bidder verifies his bid, the phone to the designated authority. Orcontracting officer shall consider it as dinarily, however, contracting officers originally submitted. If the bidder al- will not refer mistake in bid cases to leges a mistake, the contracting officer the designated authority by telegraph shall advise him to support his allega- or telephone, particularly when the tion by statements concerning the al determinations set forth in paragraph leged mistake and by all pertinent evi. (a) (2) and (3) of this section are applidence, such as the bidder's file copy of cable, since actual examination of the the bid, his original worksheets and evidence is generally necessary to deother data used in preparing the bid, termine the proper action to be taken. subcontractors' and suppliers' quota. (5) Where the bidder fails or refuses tions, if any, published price lists, and to furnish evidence in support of a susany other evidence which will serve to pected or alleged mistake, the conestablish the mistake, the manner in tracting officer shall consider the bid which it occurred, and the bid actually as submitted unless the amount of the intended.

bid is so far out of line with the (3) Where the bidder furnishes evi- amounts of other bids received or with dence in support of an alleged mis the amount estimated by the agency take, the case shall be referred to the or determined by the contracting offiappropriate authority together with cer to be reasonable, or there are the following data:

other indications of error so clear, as (i) All evidence furnished by the reasonably to justify the conclusion bidder.

that acceptance of the bid would be (ii) A copy of the bid, of the invita unfair to the bidder or to other bona tion for bids, and any specifications or fide bidders, in which case it may be drawings relevant to the alleged mis- rejected. The attempts made to obtain take.

the information required and the (iii) An abstract or record of the bids action taken with respect to the bid received.

shall be fully documented. (iv) A written statement by the con (e) Nothing contained in this $1tracting officer setting forth

2.406-3 shall deprive the Comptroller (A) The expiration date of the bid in General of his statutory right to quesquestion and of the other bids submit- tion the correctness of any administra

tive determination made hereunder


nor deprive any bidder of his right to able bid under the original invitatio have the matter determined by the for bids. Comptroller General should he so re- (c) Determinations under (b) of thi quest. All doubtful cases shall be sub § 1-2.406-4 may be made only on th mitted to the Comptroller General for basis of clear and convincing evidenc advance decision in accordance with that a mistake in bid was made, an agency procedures.

either that the mistake was mutual a (f) Each agency shall maintain rec that the unilateral mistake made b ords of all administrative determina the contractor was so apparent as t tions made in accordance with this § 1 have charged the contracting office 2.406-3, the facts involved, and the with notice of the probability of th action taken in each case. Copies of all mistake. If the evidence does not wai such administrative determinations rant a determination under paragrapl shall be included in the case file. (b)(1) or (b)(2) of this section, a deter Where a contract is awarded, the Gen mination may be made that no chang eral Accounting Office copy of the shall be made in the contract a contract, wherever filed, shall be ac awarded. companied by a signed copy of any re (d) Heads of executive agencies may lated determination.

delegate to one central authority onl

in their agencies, without power of re [29 FR 10141, July 24, 1964, as amended at

delegation, authority to make the de 41 FR 27725, July 6, 1976)

terminations under this § 1-2.406-4. § 1-2.406–4 Disclosure of mistakes after

(e) Each proposed determinatior

shall be approved by the agency's award.

General Counsel, Associate Genera (a) When a mistake in a contractor's

Counsel, and Assistant General Coun bid is not discovered until after the

sel, or other comparable legal officer. award, the mistake may be corrected if Mistakes discine

(f) Mistakes disclosed after award by contract amendment or supplemen- shall be processed as follows: tal agreement if correcting the mis- (1) Whenever a mistake in bid is al take would make the contract more fa

ledged or disclosed after award, the vorable to the Government without contracting officer shall advise the changing the essential requirements of

contractor to support the alleged erroi the contract.

by written statements and by all perti (b) In addition to the cases contem- nent evidence, such as the contractor': plated in (a) of this § 1-2.406-4, heads file copy of the bid, his original work

file copy of the bid his or rective agencies are authorized, sheets and other data used in prepar under the circumstances set forth in ing the bid, subcontractors' and suppli (c) of this 1-2.406-4, to make the ad- ers' quotations (if any), published ministrative determinations described price lists, and any other evidence below in connection with mistakes in which will serve to establish the mis bids alleged or disclosed after award. take, the manner in which it occurred This authority is in addition to that

and the bid actually intended. provided by Pub. L. 85-804 (50 U.S.C. (2) Where the contractor furnishes 1431-1435) (see Part 1-17), or that evidence in support of an alleged mis. which may be otherwise available.

take, the case shall be referred to the (1) A determination may be made to appropriate authority together with rescind a contract where the original the following data: contract price does not exceed $10,000. (i) All evidence furnished by the con

(2) A determination may be made to tractor. reform a contract, irrespective of (ii) A copy of the contract, including amount, (i) to delete the item or items a copy of the bid and any specifica. involved in the mistake where such de- tions or drawings relevant to the alletion does not reduce the contract leged mistake, and any change orders price by more than $10,000, or (ii) to or supplemental agreements thereto. increase the price where such increase (iii) An abstract or record of the bids does not exceed $10,000 and if the con- received. tract price, as corrected, does not (iv) A written statement by the conexceed that of the next lowest accept tracting officer setting forth

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