At this stage, the prequalified bidders are requested to submit their proposals. This is a very crucial stage for complex PPP projects and may require substantial time. Before issuing this request notice, it is important to refine the project appraisal, if needed, and also to reconsider the assumptions made.
In the first step, bidders are invited to submit tender proposals for the PPP project. At this stage, the interested bidders are asked to supply the conceptual design, a rough estimate of cost, a business plan with performance forecast, the financing plan and the desired share of risks, rewards, costs, etc. The tendering agency may also require other information concerning the bidder's partnership proposal, past performance data, information on technical and managerial capacity and financial status.
At this stage, the implementing agency may consider to provide more detailed information about the project and the contract to the bidders. This may include: the level and amount of service to be provided, output-/input-based performance specifications, draft contract to be signed, timetable and the process for all clarifications that the intending bidders may ask for and other relevant documents.
In order to undertake due diligence the bidders require sufficient information about the project and terms of the contracts. To make this viable, the implementing agency may provide the following information to the bidders:
• Technical conditions of the project site;
• The projected usage/demand for services;
• Relevant legal, technical, financial information;
• Level and amount of service to be delivered;
• Output standards/specifications;
• Auxiliary tasks that may also be needed to be undertaken;
• Safety/security standards;
• Terms of the indicative contract including service specifications, standard specifications, payment mechanism and penalty regime, and legal/regulatory requirements;
• Bid formalities, bid evaluation criteria and their relative weights;
• Whether any first round evaluation would be done;
• Contents of the tender proposal with specified requirements to be met; and
• Other relevant requirements.
The draft contract document should include all critical elements and clearly specify all such items which, among others, include the following:
• Risk allocations and responsibilities of each party;
• Financial terms (including revenue sharing, if any);
• Performance standards, target dates, deliverables;
• Options for terminating the contract;
• Contract management procedures and mechanisms; and
• Dispute resolution approach and mechanisms.