Prequalification is a process used to ensure that invitations to tender are extended only to suitably qualified suppliers for certain specific contracts. Such a procedure is usually only deemed necessary for purchases of a complex, high value or specialist nature, where the preparation, evaluation and comparison of bids is much more complicated, costly and time-consuming such as:
• Specialist or highly technical goods and services
• Turnkey, design and build or complex construction contracts
• Custom-designed equipment or industrial plant.
The benefits of prequalification include that it may narrow down the number of bids that the procuring entity needs to evaluate and compare. Prequalification also benefits competent suppliers who may be sometimes reluctant to participate in procurement for high value contracts, where the cost of preparing the bid may be high, if the competitive field is too large, and where there is a risk of having to compete against unrealistic bids, proposals or offers submitted by unqualified or disreputable suppliers.
The Financial (Amendment) (No2) Regulations, 2006, under the authority of The Public Management and Finance Law (2005 Revision), permits prequalification to be used as part of the tender process by Government entities for contracts over 500 Million CFA Franc.
However, because the process restricts competition for government contracts, the use of prequalification needs to be justified and must be approved by the Central Tenders Committee.
The prequalification process assesses the capability of a supplier and any significant third parties or subcontractors against specified evaluation criteria with regards to their:
1. Experience and past performance on similar contracts;
2. Professional and technical capabilities and capacity with respect to personnel, management, equipment and construction or manufacturing facilities;
3. Financial position;
4. Legal position.
The evaluation criteria can also include any other relevant factors such as:
5. Health and Safety record and procedures;
6. Quality Assurance processes and standards;
7. Environmental management.
However, the evaluation criteria must:
• relate to the characteristics that are essential to ensuring the satisfactory execution of the subject contract;
• be precisely stated;
• not inhibit competition nor limit the number of eligible firms to be prequalified; and
• not discriminate based on nationality or any other factor that is not objectively justifiable.
All suppliers who meet the prequalification criteria standards shall be awarded prequalification status and shall receive an invitation to tender for the contract.
Reconfirmation of Prequalification Information
Organisations are fluid, and as a result capability, capacity, legal and financial positions are constantly changing. Consequently, the process of prequalification shall be carried out on an individual contract basis to ensure that the information provided by the supplier is accurate at that time. As a result of this, no register or list of prequalified suppliers will be kept for future projects.
Reconfirmation of prequalification information can be requested at any time during the project to permit the procuring entity to determine whether the qualification information submitted at the time of prequalification remains valid and accurate. Suppliers are responsible for ensuring that any changes to the information submitted at the prequalification stage are communicated to the Central Tenders Committee in writing during the tender process. If changes in information result in the prequalification criteria requirements no longer being achieved, or if the information provided is proven to be inaccurate, either deliberately or otherwise, the Central Tenders Committee may withdraw prequalification status and the supplier will no longer be permitted to participate in the process.