B-141357, JANUARY 19, 1960, 39 COMP. GEN. 531

B-141357: Jan 19, 1960

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IT IS ESSENTIAL THAT IT BE KNOWN. WHETHER DOMESTIC OR FOREIGN GOODS ARE OFFERED. REJECTION OF THE BID AS NONRESPONSIVE AND REJECTION OF THE BIDDER'S REQUEST TO CURE A MATERIAL DEFECT ARE PROPER ADMINISTRATIVE ACTIONS. 1960: FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE AWARD OF A CONTRACT TO ANY BIDDER OTHER THAN YOURSELF UNDER AN INVITATION DATED NOVEMBER 10. UPON LEARNING THAT IT WAS CONTEMPLATED TO MAKE AWARD TO ANOTHER BIDDER AT $134 PER TON FOR DOMESTIC NEWSPRINT PAPER BECAUSE A 6 PERCENT DIFFERENTIAL WOULD HAVE TO BE ADDED TO YOUR BID IN VIEW OF THE FOREIGN PRODUCT TENDERED. PROVIDED ON ITS FACE AS FOLLOWS: "IF YOU ARE A DEALER AND QUOTATION IS IN EXCESS OF $10. THE INVITATION PLACED ALL BIDDERS ON NOTICE THAT PRODUCTS OF DOMESTIC MANUFACTURE MUST BE FURNISHED UNLESS IT WAS DETERMINED BY THE GOVERNMENT THAT THE BID OR OFFERED PRICE OF THE MATERIALS OF DOMESTIC ORIGIN WAS UNREASONABLE.

B-141357, JANUARY 19, 1960, 39 COMP. GEN. 531

CONTRACTS - BUY AMERICAN ACT - FAILURE TO FURNISH SOMETHING REQUIRED - SOURCE OF MANUFACTURE IN THE EVALUATION OF BIDS UNDER AN INVITATION WHICH INCORPORATED THE BUY AMERICAN ACT RESTRICTIONS, 41 U.S.C. 10A, AND SPECIFICALLY REQUIRED BIDDERS TO NAME A SOURCE OF MANUFACTURE, IT IS ESSENTIAL THAT IT BE KNOWN, UPON OPENING, WHETHER DOMESTIC OR FOREIGN GOODS ARE OFFERED; HENCE, TO PERMIT A LOW BIDDER--- WHO DID NOT INDICATE IN THE BID THE MANUFACTURER'S NAME AND WHO AT BID OPENING FURNISHED A FOREIGN MANUFACTURER'S NAME--- TO SUBSTITUTE A DOMESTIC MANUFACTURER, UPON ADVICE THAT THE 6 PERCENT DIFFERENTIAL REQUIRED TO BE ADDED TO FOREIGN BIDS WOULD RESULT IN HIS DISPLACEMENT AS LOW BIDDER, WOULD BE PREJUDICIAL TO OTHER BIDDERS AND DETRIMENTAL TO THE COMPETITIVE BID PROCEDURES BY PERMITTING THE BIDDER TO CONTROL HIS RELATIVE STANDING AFTER DISCLOSURE OF BID PRICES; THEREFORE, REJECTION OF THE BID AS NONRESPONSIVE AND REJECTION OF THE BIDDER'S REQUEST TO CURE A MATERIAL DEFECT ARE PROPER ADMINISTRATIVE ACTIONS.

TO THE BOSTON PAPER BOARD COMPANY, JANUARY 19, 1960:

FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE AWARD OF A CONTRACT TO ANY BIDDER OTHER THAN YOURSELF UNDER AN INVITATION DATED NOVEMBER 10, 1959, FOR THE FURNISHING OF A QUANTITY OF NEWSPRINT PAPER.

UPON THE OPENING OF BIDS ON NOVEMBER 25, 1959, IT APPEARED THAT YOU HAD SUBMITTED THE LOWEST BID IN THE AMOUNT OF $134 PER TON, LESS A CASH DISCOUNT OF ONE-HALF OF 1 PERCENT FOR PAYMENT WITHIN 20 DAYS. HOWEVER, IN SUBMITTING YOUR BID, YOU FAILED TO FURNISH THE NAME AND ADDRESS OF THE MANUFACTURER YOU PROPOSED TO UTILIZE. AT THE REQUEST OF THE CONTRACTING OFFICER SUBSEQUENT TO BID OPENING, YOU ADVISED BY SIGNED STATEMENT DATED NOVEMBER 27, 1959, THAT THE ST. LAWRENCE PAPER COMPANY, THREE RIVERS, QUEBEC, CANADA, WOULD MANUFACTURE THE NEWSPRINT PAPER. UPON LEARNING THAT IT WAS CONTEMPLATED TO MAKE AWARD TO ANOTHER BIDDER AT $134 PER TON FOR DOMESTIC NEWSPRINT PAPER BECAUSE A 6 PERCENT DIFFERENTIAL WOULD HAVE TO BE ADDED TO YOUR BID IN VIEW OF THE FOREIGN PRODUCT TENDERED--- WITH THE RESULT THAT YOUR BID NO LONGER WOULD BE FOR ACCEPTANCE--- YOU ADVISED THE CONTRACTING OFFICER ON NOVEMBER 30 THAT THE SHIPPING POINT FOR THE NEWSPRINT YOU PROPOSED TO FURNISH WOULD BE THE GREAT NORTHERN PAPER COMPANY, MILLINOCKET, MAINE.

THE INVITATION INCORPORATED BY REFERENCE CONTRACT TERMS NO. 1, DATED JULY 1, 1943, AS REVISED MAY 1, 1959, AND ALL CONDITIONS AND STIPULATIONS OF THE PAPER PROPOSAL DATED SEPTEMBER 21, 1959, PROVIDED SUCH CONDITIONS AND STIPULATIONS DID NOT CONFLICT WITH THE REQUIREMENTS OF THE INVITATION. CONTRACT TERMS NO. 1 AND THE PAPER PROPOSAL CONTAIN WALSH-HEALEY PUBLIC CONTRACTS ACT, 41 U.S.C. 35, PROVISIONS CONCERNING CONDITIONS OF EMPLOYMENT AND THE BUY AMERICAN ACT, 41 U.S.C. 10A, RESTRICTIONS, INCLUDING THE POLICIES AND PROCEDURES SET FORTH IN EXECUTIVE ORDER NO. 10582, DATED DECEMBER 17, 1954, IMPLEMENTING THE BUY AMERICAN ACT. SPECIFICALLY, THE INVITATION PROVIDED THAT: " G.P.O. FORM NO. 142, BID AND ACCEPTANCE, REQUIRES THE BIDDER TO SUBMIT INFORMATION AS TO SOURCE OF SUPPLY * * *.' THE BID AND ACCEPTANCE, FORM NO. 142, PROVIDED ON ITS FACE AS FOLLOWS: "IF YOU ARE A DEALER AND QUOTATION IS IN EXCESS OF $10,000, SUBMIT NAME AND ADDRESS OF MANUFACTURER.' THE INVITATION PLACED ALL BIDDERS ON NOTICE THAT PRODUCTS OF DOMESTIC MANUFACTURE MUST BE FURNISHED UNLESS IT WAS DETERMINED BY THE GOVERNMENT THAT THE BID OR OFFERED PRICE OF THE MATERIALS OF DOMESTIC ORIGIN WAS UNREASONABLE. IN THE EVALUATION OF BIDS UNDER THE INVITATION, IT WAS ESSENTIAL, THEREFORE, THAT IT BE KNOWN, UPON OPENING, WHETHER DOMESTIC OR FOREIGN NEWSPRINT WAS OFFERED IN ORDER THAT THERE MIGHT BE APPLIED THE PERCENTAGE DIFFERENTIAL PROVIDED FOR IN EXECUTIVE ORDER NO. 10582 TO DETERMINE THE REASONABLENESS OF BIDS OFFERING DOMESTIC NEWSPRINT AS OPPOSED TO BIDS OFFERING FOREIGN NEWSPRINT.

TO PERMIT A BIDDER AFTER BIDS ARE PUBLICLY OPENED AND PRICES DISCLOSED TO OBTAIN AND NAME A SOURCE OF MANUFACTURE IN SITUATIONS SUCH AS INVOLVED IN THIS CASE IS MANIFESTLY UNFAIR TO OTHER BIDDERS WHO SUBMITTED BIDS UPON THE BASIS OF A NAMED SOURCE OF MANUFACTURE. IT GIVES TO A BIDDER WHO WITHHELD OR FAILED TO FURNISH THE NAME OF HIS SOURCE OF MANUFACTURE UNTIL AFTER BIDS ARE OPENED AND PRICES DISCLOSED A DISTINCT ADVANTAGE OVER OTHER BIDDERS IN THAT HE CAN SELECT EITHER A DOMESTIC OR FOREIGN SOURCE DEPENDING UPON THE RANGE OF BID PRICES DISCLOSED, WITH THE RESULT THAT THE BIDDER CAN CONTROL HIS RELATIVE STANDING AMONG THE BIDDERS, AS WAS DONE BY YOU IN THIS CASE. THIS, WE THINK, WOULD BE PREJUDICIAL TO THE OPEN AND COMPETITIVE CHARACTER OF THE ADVERTISING PROCEDURES AND WOULD PERMIT BIDDERS THE WIDEST LATITUDE IN SELECTING THE MOST ADVANTAGEOUS SOURCE OF MANUFACTURE TO THE DETRIMENT OF THOSE BIDDERS WHO INITIALLY COMPLIED WITH THE INVITATION REQUIREMENT.

UNDER THE CIRCUMSTANCES, WE MUST CONCLUDE THAT THE INVITATION REQUIREMENT HERE INVOLVED IS A MATERIAL PROVISION GOING TO THE SUBSTANCE OF THE BIDS THEREUNDER, AND, THEREFORE, THAT YOUR BID AS SUBMITTED WAS NOT RESPONSIVE TO THE INVITATION AND SHOULD BE REJECTED FOR NONCOMPLIANCE WITH THE REQUIREMENTS OF THE INVITATION. NEITHER MAY THE DEFECT IN YOUR BID BE CURED AFTER OPENING BY FURNISHING THE NAME OF A SOURCE OR SOURCES OF MANUFACTURE. SEE CITY OF CHICAGO V. MOHR, 74 N.E. 1056; 17 COMP. GEN. 554.

ACCORDINGLY, YOU ARE ADVISED THAT YOUR BID MAY NOT BE CONSIDERED FOR AWARD UNDER THE INSTANT INVITATION.