B-153828, MAR. 8, 1965

B-153828, MAR. 8, 1965

TO THE HONORABLE LAWSON B. KNOTT, JR., ACTING ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO LETTER DATED JANUARY 21, 1965, FROM THE ASSISTANT GENERAL COUNSEL, REGULATIONS AND GENERAL LAW DIVISION, REQUESTING OUR COMMENTS ON A PROPOSED REVISION OF THE FEDERAL PROCUREMENT REGULATIONS (FPR) WITH RESPECT TO THE MATTER OF DEALING WITH UNSOLICITED SAMPLES, DESCRIPTIVE LITERATURE, AND REFERENCE TO BRAND NAMES. SECTIONS 1-2.202-4 (G) AND 1-2.202-5 (F) OF THE PRESENT REGULATIONS, WHICH CONCERN UNSOLICITED SAMPLES AND UNSOLICITED DESCRIPTIVE LITERATURE, PROVIDE RESPECTIVELY AS FOLLOWS:

"UNSOLICITED SAMPLES. IF BID SAMPLES ARE NOT REQUIRED BY THE INVITATION FOR BIDS, BUT SAMPLES ARE FURNISHED WITH A BID, THEY WILL NOT BE CONSIDERED AS QUALIFYING THE BID, AND WILL BE DISREGARDED, UNLESS IT IS CLEAR FROM THE BID OR ACCOMPANYING PAPERS THAT IT WAS THE BIDDER'S INTENTION SO TO QUALIFY THE BID.

"UNSOLICITED DESCRIPTIVE LITERATURE. IF THE FURNISHING OF DESCRIPTIVE LITERATURE IS NOT REQUIRED BY THE INVITATION FOR BIDS, BUT SUCH LITERATURE IS FURNISHED WITH A BID, IT WILL NOT BE CONSIDERED AS QUALIFYING THE BID, AND WILL BE DISREGARDED, UNLESS IT IS CLEAR FROM THE BID OR ACCOMPANYING PAPERS THAT IT WAS THE BIDDER'S INTENTION SO TO QUALIFY THE BID.'

THESE REGULATIONS IN EFFECT DECLARE A PRESUMPTION THAT, IN THE ABSENCE OF CLEAR INTRINSIC EVIDENCE TO THE CONTRARY, UNSOLICITED SAMPLES AND DESCRIPTIVE LITERATURE ARE SUBMITTED ONLY FOR THE PURPOSE OF SUPPLYING GENERAL BACKGROUND INFORMATION AND ARE NOT INTENDED TO QUALIFY A BID.

IN THE DISCUSSION SUBMITTED WITH YOUR PROPOSAL, REFERENCE IS MADE TO PROBLEMS ENCOUNTERED IN YOUR AGENCY. IT IS STATED THEREIN THAT THE NECESSITY OF DETERMINING IN ADVANCE WHETHER THE PARTICULAR ITEMS BID UPON COMPLY WITH THE CITED SPECIFICATIONS IS ONEROUS, TIME CONSUMING, AND UNFAIR TO OTHER BIDDERS WHO HAVE EITHER TAKEN PAINS TO INSURE THAT THEIR ITEMS COMPLY WITH SPECIFICATIONS OR ARE WILLING TO ASSUME THE RISKS OF NONCOMPLIANCE. AS WE READ THE EXISTING REGULATIONS THE NECESSITY FOR SUCH ADVANCE DETERMINATIONS IS ELIMINATED AND CONFORMITY TO SPECIFICATIONS IS FOR DETERMINATION ONLY UPON FINAL INSPECTION. UNDER THE EXISTING REGULATIONS IT IS ALSO STATED THAT THERE IS A SUBSTANTIAL AND UNDESIRABLE RISK OF AWARDING CONTRACTS TO BIDDERS WHO ARE UNWILLING OR UNABLE TO COMPLY WITH SPECIFICATIONS, THEREBY INCREASING THE LIKELIHOOD OF POSSIBLE TERMINATION ACTIONS AND DELAYS IN OBTAINING NEEDED SUPPLIES.

IN ORDER TO OBVIATE THESE DIFFICULTIES YOU PROPOSE TO REVISE THE FEDERAL PROCUREMENT REGULATIONS AS FOLLOWS:

"1. DELETE SEC. 1-2.202-4 (G).

"2. DELETE SEC. 1-2.202-5 (F).

"3. ADD A NEW SECTION AS FOLLOWS:

"SEC. 1-2.202-6 UNSOLICITED BRAND NAME REFERENCES, SAMPLES AND DESCRIPTIVE LITERATURE.

"WHERE PROCUREMENT IS EFFECTED UNDER SPECIFICATIONS OR PURCHASE DESCRIPTIONS (OTHER THAN "BRAND NAME OR EQUAL") AND THE GOVERNMENT DOES NOT SPECIFICALLY REQUEST BID SAMPLES, DESCRIPTIVE LITERATURE OR REFERENCES TO BRAND NAMES, BIDS WHICH ARE ACCOMPANIED BY ANY OF THE ABOVE WILL BE REJECTED UNLESS IT IS CLEAR FROM THE BID OR ACCOMPANYING PAPERS THAT THE BRAND NAME REFERENCE, SAMPLE OR LITERATURE IS NOT INTENDED TO QUALIFY THE BID AND THAT THE BIDDER PROPOSES TO FURNISH ITEMS FULLY IN ACCORDANCE WITH THE SPECIFICATIONS OR PURCHASE DESCRIPTIONS.'

THIS REVISED REGULATION WOULD CREATE A PRESUMPTION THAT IN THE ABSENCE OF CLEAR INTRINSIC EVIDENCE TO THE CONTRARY UNSOLICITED SAMPLES, DESCRIPTIVE LITERATURE, AND REFERENCES TO BRAND NAMES ARE INTENDED AS QUALIFICATIONS OF BIDS.

YOUR AGENCY RECOGNIZES THAT PROBLEMS WOULD ARISE UNDER THE PROPOSED REVISED PROCEDURE, SUCH AS THE REJECTION OF MORE BIDS THAN UNDER PRESENT PROCEDURES, WITH A CONCOMITANT INCREASE IN THE NUMBER OF PROTESTS FROM REJECTED BIDDERS, AT LEAST IN THE SHORT RUN. IT IS YOUR VIEW THAT WHILE SOME INCREASES IN PROCUREMENT COSTS MAY RESULT FROM THE ADOPTION OF THE REVISION, THESE SHOULD DECREASE AS BIDDERS LEARN OF THE DANGERS OF SUBMITTING UNSOLICITED DESCRIPTIVE LITERATURE, SAMPLES, AND REFERENCES TO BRAND NAMES, AND YOU BELIEVE THAT ANY DISADVANTAGES OF THE PROPOSED PROCEDURES ARE OUTWEIGHED BY THEIR ADVANTAGES.

WE HAVE EXPRESSED THE VIEW THAT THE VOLUNTARY FURNISHING OF LITERATURE WITH A BID WITH NOTHING ELSE TO EVIDENCE THE INTENT TO QUALIFY THE BID OR DEVIATE FROM THE ADVERTISED SPECIFICATION DOES NOT RENDER SUCH A BID NONRESPONSIVE. 39 COMP. GEN. 878; B-136050, JUNE 18, 1958. SUCH A VIEW IS BASED UPON THE ASSUMPTION, CONSISTENT WITH THE PRESENT PROVISIONS OF FPR, THAT UNDER SUCH CIRCUMSTANCES THE BIDDER DID NOT INTEND TO QUALIFY HIS BID OR DEVIATE FROM THE ADVERTISED SPECIFICATION. HOWEVER, IT IS SAID TO BE YOUR EXPERIENCE, AS OUTLINED IN YOUR SUBMISSION, THAT THE INTENT TO QUALIFY A BID IS OFTEN THE SPECIFIC REASON FOR SUBMITTING UNSOLICITED DESCRIPTIVE LITERATURE, SAMPLES, OR REFERENCE TO BRAND NAMES, ALTHOUGH SUCH INTENT IS NOT STATED IN THE BID. FOR THIS REASON, IT APPEARS TO BE YOUR BELIEF THAT ADOPTION OF THE PROPOSED NEW APPROACH WOULD BE A MORE REALISTIC TREATMENT.

WE REALIZE THAT THERE IS NO EASY SOLUTION TO THE PROBLEM INVOLVED, AND THAT THERE ARE DISADVANTAGES INVOLVED IN EITHER COURSE OUTLINED ABOVE. HOWEVER, THE FACT THAT FEW, IF ANY, QUESTIONS UNDER THE EXISTING REGULATIONS HAVE BEEN BROUGHT TO OUR ATTENTION SINCE ITS ADOPTION MAKES US SOMEWHAT DISINCLINED TO FAVOR SO COMPLETE A REVERSAL OF POSITION AS WOULD BE EFFECTED BY THE PROPOSED REGULATION. OUR PRINCIPAL CONCERN IS THE DEFINITE POSSIBILITY THAT THE GOVERNMENT MAY, BY THE REQUIRED REJECTION OF ALL BIDS ACCOMPANIED BY UNSOLICITED SAMPLES OR LITERATURE, BE DEPRIVED OF A NUMBER OF ADVANTAGEOUS BIDS.

INASMUCH AS IT APPEARS THAT THE DIFFICULTIES GIVING RISE TO THE PROPOSED REVISION HAVE BEEN EXPERIENCED PRINCIPALLY IN YOUR FEDERAL SUPPLY SERVICE, IT OCCURS TO US, AND WE THEREFORE SUGGEST, THAT ANY PROPOSED MODIFICATION OF THE EXISTING REGULATIONS AND PROCEDURES BE TRIED OUT BY THAT ACTIVITY BEFORE ANY FINAL DECISION IS REACHED TO AMEND THE FPR.

IN THE EVENT SUCH A TRIAL COURSE SHOULD BE ADOPTED, WE WOULD ALSO SUGGEST THAT FURTHER CONSIDERATION BE GIVEN TO THE POSSIBILITY OF INCLUDING IN INVITATIONS AND BIDS A CLAUSE, IN LINE WITH THE EXISTING REGULATIONS, SPECIFICALLY ADVISING BIDDERS OF THE EFFECT OF UNSOLICITED SAMPLES OR LITERATURE AND PROVIDING A BOX OR SPACE TO BE CHECKED IF SUCH MATERIAL IS INTENDED TO QUALIFY THE BID. IN FACT, WE ARE INCLINED TO BELIEVE THAT SUCH A STATEMENT IN THE BID MIGHT BE DESIRABLE UNDER EITHER THE EXISTING REGULATION OR THE PROPOSED REVISION, AS TENDING TO ELIMINATE OR ..END :