Newsletter
MAJOR CHANGES TO REGULA-TIONS ON SELECTION COM-MITTEES FOR INFRASTRUC-TURE PARTICIPATION
On 23 December 2005, the Public Construction Commission (PCC) announced amendments to the Regulations for the Organization of the Se-lection Committee and Evaluation for Private Participation in Infrastructure Projects. The amendments are mainly for improving the par-ticipation of outside committee members, re-quiring the arranging authority to provide a working group in all cases, enhancing the im-plementation of selection committees’ opinions, and enabling committees to operate more effi-ciently. The amendments are outlined below:
Committee meetings must be attended by at least seven committee members, at least half of them must be outside members.
The old Regulations already required a selec-tion committee to have between seven (7) and seventeen (17) members, but defined the quorum for resolutions as a proportion of the committee’s total membership, making no distinction between members recruited from inside and outside the arranging authority. Thus the number of members attending a meeting could be less than seven. Although the minimum number of members remains unchanged, in effect the amended Regulations require arranging authorities to set the number at more than seven. They also strengthen the role of outside members.
The arranging authority must set up a working group to assist the selection committee, and must provide review opinions of bids.
The old Regulations provided that for non-complex cases, the arranging authority did not need to set up a working group to assist the selection committee in its work. But in view of the possibility that when working without a working group, a committee may directly select a first-choice bidder after only perfunctory consideration, the PCC has de-leted the provision allowing the omission of the working group. The amended Regulations expressly require the arranging authority to set up a working group to assist the committee, and also require the working group to provide the committee with a review opinion on each bid, for the committee’s reference.
Pre-qualification review is to be carried out by the arranging authority; the selection com-mittee need only conduct substantive review of bids.
The old Regulations required review of bid-ders’ qualification to be carried out by the se-lection committee. But the purpose of pre-qualification review is to ascertain whether bidders meet the qualification re-quirements set out in the invitation to tenders, and does not involve evaluation of the bids’ substantive contents. Also, if documents submitted with a bid do not comply with procedural requirements, it is necessary to set a deadline for the bidder to provide supple-mentary information or clarification. When pre-qualification review is carried out by the selection committee, in such cases the meeting must be adjourned and reconvened at a later date, making the selection process less effi-cient. In view of these considerations, the amended Regulations transfer the task of pre-qualification review to the arranging au-thority.
Subsequent negotiations and finalization of the investment contract are to be based on the results of the selection committee’s overall evaluation.
In the great majority of cases to date, it has been stated in the invitation-to-tender docu-ments that the arranging authority and the private sector to which the contract was awarded would need to amend the investment plan in accordance with the selection com-mittee’s opinion and evaluation results. The amended Regulations now make it an explicit legal requirement that the results of the selec-tion committee’s evaluation should be made the basis for subsequent procedures.
If a project is similar to previous cases or is non-complex in nature, in order to make the selection process more efficient the arranging authority may circulate among the committee members the matters to be reviewed by the committee as well as the review criteria and methods, and obtain the written consent of all the selection committee members. It is then not necessary to convene a meeting of the committee to discuss these matters before the arranging authority makes its official an-nouncement inviting private sectors to par-ticipate in the infrastructure project.