Section 2: Bid Submission Procedures

These procedures include, but not limited to, the following:

  Project Site Visit Procedures

This paragraph includes all details and arrangements relating to the field visits made to the project site. These visits are arranged with each potential partner separately according to a specific timetable, where the site is visited and the bidder can enquire any matter. The visit may include holding a meeting with the management members and staff if the project is in place and the PPP is aiming at development, renovation, preparation, maintenance, rehabilitation and/or operation. A proper time shall be allocated for these filed visits, noting that those visits are optional and therefore some potential partners may opt to not make them.

  Procedures of Virtual Data Room entry and communication with the project committee.

The Virtual Data Room contains all data and documents relating to the project. The bidders depend on these data and documents to carry out their due diligence study and prepare their bids. The Project Committee and work team shall collect this information from various sources, including the studies carried out by the consultancy team, in order to provide a complete scope as much as possible to bidders about the project and its components and to facilitate the bid preparation and awarding. Although the Project Committee makes its best endeavors to provide correct information, it does not guarantee that the documents and data available in Virtual Data Room are correct and the bidders shall verify their accuracy and correctness. Accordingly, this paragraph of the bidding requirements document shall indicate that there are no guarantees for the correctness of information listed in the Virtual Data Room and that they are merely outcomes of the investigation procedures taken by the Project Committee with the assistance of the work team and the consultancy team. It is very important for the bidders to fully verify the information accuracy before submitting their bids, as the failure to achieve any of the assumptions may delay the financial closure and threatens the entire awarding process.

This paragraph also includes the procedural rules relating to the Virtual Data Room, including the way of accessing the information, the time limits and any fees for Virtual Data Room use (if any), as well as any document required to be signed by the bidders, including Non-Disclosure Agreement.

As the Virtual Data Room is also considered a mean of communication between the bidders and the project committee, this paragraph details the way of communicating with the Project Committee to ask questions and the method to be followed by the Project Committee to provide the bidders with clarifications, answers, timetable and deadlines for this process.

This paragraph also identifies the maximum deadlines to receive the bidders' observations and inquiries regarding the PPP contract or any other documents suggested by the project committee.

  Conditions and Method of Submitting Bids and Required Documents

This paragraph of bidding requirements document includes the procedural details as well as the terms and conditions relating submitting bids. The requirements are identified in terms of the submission place and deadline (date and time). The paragraph also contains the method of submission, including but not limited to:

•  Number of printed copies and any electronic copies may be required.

•  Bid validity period as identified by the project committee.

•  Details related to number of envelops to be submitted and how they are marked.

•  Initial guarantees and securities in terms of their conditions, values and periods.

This paragraph lists in detail the information and obligations required from the bidders as well as the documents to be submitted and their details. The paragraph shall be drafted very clearly in a manner that would raise the bids quality.

This paragraph identifies the rules to be followed if any modification occurs in the structure of the company alliance qualified by the project committee. Such modification is considered a common matter, where any member may withdraw from the alliance during the bid preparation. Thus, the paragraph identifies the procedures and rules to be followed in such case, which would enable the alliance to maintain the strength and eligibility that were the main factor of its qualification and allowing it to move to the bid preparation phase. For example, the Project Committee may request the alliance to suggest a member instead of withdrawing member during a specific deadline, and then reassess the alliance based on the same criteria approved during the prequalification.

■  Technical and Financial bid Models

•  This paragraph of bidding requirements document identifies the formal models of technical and financial bids, which are issued by the Project Committee and bidders adopt thereof to submit their bids.

•  Technical bid Model

The technical bid model developed by the Project Committee in cooperation with the work team aims at clarifying the submitted solution at three levels: technical level, legal level and financial level.

•  Technical Solution Model

The Project Committee requests under this model all information and details relating to the technical solution that the bidders chose to adopt, including the developed designs, the approved method to submit the outcomes, the operation methodology, the plans of meeting the required performance criteria, the expected service quality and its development throughout the contract period, the measures to be adopted for ensuring the services continuity and quality, the suggested maintenance periods (including any replacement of assets), the suggested management team and its structure, the anticipated number of the company staff and their regulation, safety plans, and the plans followed to comply with the follow up and reporting requirements.

This information is clarified in tables, some of which are empty and shall filled by the bidders. This model contains also the draft of Level of Service Agreement for all service elements. The form and content of the Level of Service Agreement differ from one project to another, but in all cases, it forms an integral part of the technical solution and the PPP contract to be signed later.

•  Legal Solution Model

This model aims at providing the Project Committee with all details relating to the private partner/suggested project company, in the event of winning the contract. Under this model, the Project Committee requests information about the project company structure, the incorporation agreements to be adopted as well as information about the alliance members and their respective undertakings. The model contains also enquiries aims at ensuring compliance with applicable laws and regulations, including, but not limited to, the environmental legislations.

•  Financial Solution Model

This form is very important, as it constitutes the cornerstone of the financial bid. The Project Committee aims, through this model, at standardizing the method of information provision in order to facilitate the comparison between the submitted models with each other as well as the comparison between the submitted models and the financial model prepared by the Project Committee in the project study and design phase. The financial solution model differs depending on the projects. Therefore, we will provide below the outlines of this form content, which shall be reviewed and updated according to the nature and specificity of each project.

As for the form, the financial model development requires using computer programs. From this point, the Project Committee identifies the programs that may be used and requests to submit the form in two formats; hard copy and soft copy with an explanation of the method of amending the inputs according to the approved scenarios and assumptions.

As for the content, the Project Committee identifies the project commencement date to be approved in the financial models submitted by all bidders as well as the time basis to be approved (monthly, bimonthly or annually) and the discount rate to be used.

The Project Committee requests the details of the financial database approved for the financial model development, which includes the capital expenses, operation and maintenance costs, the expected revenues and tax transactions (if any), which are used in calculating the net current value of revenues.

The approved assumptions are a fundamental pillar to develop these expectations; therefore, the bidder shall detail them.

The project financing structure is the cornerstone in the financial model. So, the bidder shall detail the elements of that structure in terms of type and level of debt financing and share financing, financing plan, schedule of the financing assumptions in which all sources, amounts and uses of financing, terms and conditions, main costs, margins and fees are identified.

The Project Committee may request clarification for any possible contribution by the alliance members in the equities and its percentage. This shall include the details of equities, shareholders' loans, source of money, the financing amount each shareholder committed, and the date of their contributions. The debt financing details shall be identified, including its cost, fees, margin, payment schedule and interest capitalization grounds.

The bidder shall identify risk distribution method upon which the financial model depends, and the bases and costs relating to measures to be taken for hedging risks. It shall also explain the basis of risk pricing.

The Project Committee may request the bidder to calculate some financial rates and proportions and include the same in the financial solution, including internal rate of return, the return on capital, debt-to-equity ratio and debt service coverage proportions. 

•  Financial Bid Model

It should be noted that the financial bid is limited to the price requested by the private partner to provide the required services. This price represents the project cost in the Federal Entity budget. This bid does not include any details in contrary to the financial solution that list in details all financial information and constitutes a part of the technical bid. Under this model, the Project Committee identifies the form to be adopted by bidders in submitting their financial bid, such as the method of scheduling (monthly or annually …..), adopted currency, the foreign exchange rate, value conversion into alphabetical characters, and the approach that the committee will take if the bid value written in letters differs from the value written in figures. In addition, the Project Committee shall identify through this model any documents to be attached to the financial bid and their details. These documents include, but not limited to, the initial insurance and its form (letter of guarantee), the issuing entity (approved bank or any bank working in the state), format and term, provided that it shall be unconditioned and payable; the good performance bond required from the winning bidder and its value; and any other guarantees that may be required by the project committee, such as insurance against delay in the service commence and insurance against maintenance obligations. The bidders shall identify the insurance cost as a separate item from the financial bid.

  Assessment Rules and Methods

This paragraph of bidding requirements document is of a paramount importance in terms of the role it plays in promoting the transparency of selecting the winning bidder. Under this paragraph, the Project Committee identifies the rules it will follow in evaluating the submitted bids.

The bid assessment is based on the joint technical and financial assessment method. There are various patterns of this method, which varies from one project to another. These patterns include something called "Least cost selection with technical hurdle", where the final assessment focuses on the classification of the financial bids of the bidders getting the minimum technical score. The bidders are equal in terms of the technical aspect, and thus the financial bid plays the main role in identifying the winning bidder. Points may be given to bidders if their technical solutions are distinctive, for example in respect of innovation. Such points shall be added to the score given to the financial bids. These points are called "Brownie Points".

The other pattern of the joint technical and financial assessment method is called "Quality and Cost Based Selection". In this pattern, the total points are calculated as the average of the technical bid points and the financial bid points based on the weights allocated to each of them. For example, a weight of 60% may be allocated to the technical points against 40% for financial points or 70% against 30% depending on the importance given by the Project Committee to the technical bid. These two patterns may be integrated together by calculating the total points according to the technical and financial weights for the bids getting the minimum technical score.

In this paragraph of bidding requirements document, the Project Committee identifies the followed assessment method and the relative weights allocated to each of technical and financial bids. The committee may also identify the extent of disclosing the point allocation details. This matter promotes transparency. However, it should be taken into consideration that disclosing the detailed method of point allocation may lead to adapting the bids to meet the assessment criteria, a matter that may result in providing bids do not achieve the best value for the project.

  The Winning Bidder Announcement Procedures

This paragraph identifies the details related to steps followed to announce the winning bidder.

The contract shall be awarded to the bidder providing the best bid according to the Project Committee assessment and the Financial and Economic Committee approval. The project committee shall inform all candidates with the selection process result.

This paragraph details the method to be followed by the Project Committee to announce the winning bidder. This method may be a public session to which bidders are invited, a press conference held for this purpose and/or an announcement posted on the website or any other way the Project Committee deems appropriate.

  Deadlines for Each Phase

This paragraph of bidding requirements document shall be in the form of a schedule explaining the expected date of each entitlement and the specified deadlines, starting from entering the data room till announcing the winning bidder. This schedule may depend on intervals between the entitlements instead of specific dates.