B-168629(2), SEP. 2, 1970

B-168629(2): Sep 2, 1970

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OR ONE WHICH PROVIDE THAT TECHNICAL PROPOSALS BE ACCEPTED ONLY FROM CONTRACTORS WHO HAVE MANUFACTURED AND CAN DEMONSTRATE AT AN OPERATING AIR FIELD A SOLID STATE CONVENTIONAL INSTRUMENT LANDING SYSTEM. INCORPORATED: REFERENCE IS MADE TO YOUR LETTERS OF JUNE 30. THE ABOVE-REFERENCED SOLICITATION WAS ISSUED ON APRIL 29. THE FOLLOWING BIDS WERE RECORDED AT THE BID OPENING HELD ON JUNE 26. WE SHALL DISCUSS THE FIVE BASES OF YOUR PROTEST IN THE ORDER IN WHICH THEY ARE PRESENTED IN YOUR LETTERS OF JUNE 30 AND JULY 20. TEXAS INSTRUMENTS' BID WAS TRANSMITTED BY A COVER LETTER DATED JUNE 22. GP70-1 DATED 2 JANUARY 1970 (B) AMENDMENT NO. 1 TO REFERENCE (A) DATED 27 FEBRUARY 1970 (C) AMENDMENT NO. 2 TO REFERENCE (A) DATED 5 MARCH 1970 ENCLOSURE (1) SUBJECT SOLICITATION AND OFFER (2 COPIES) (2) AMENDMENT NO. 1 TO SUBJECT SOLICITATION (2 COPIES) (3) AMENDMENT NO. 2 TO SUBJECT SOLICITATION (2 COPIES) (4) AMENDMENT NO. 3 TO SUBJECT SOLICITATION (2 COPIES) "GENTLEMEN TEXAS INSTRUMENTS IS PLEASED TO SUBMIT THE OFFER CONTAINED IN ENCLOSURES (1) THROUGH (4) TO PERFORM THE PROGRAM DESCRIBED BY THE SUBJECT SOLICITATION AND BY REFERENCES (A) THROUGH (C).

B-168629(2), SEP. 2, 1970

BID PROTEST -- TECHNICAL QUALIFICATION CLAUSE DENIAL OF PROTEST AGAINST AWARD TO AMERICAN STANDARD, INCORPORATED BY AERONAUTICAL SYSTEMS DIVISION, WRIGHT PATTERSON, AFB., BASED ON TEXAS INSTRUMENT PRIME CONTRACTOR TECHNICAL PROPOSAL. RECOMMEND THE BIDDERS TECHNICAL QUALIFICATION CLAUSE BE MADE MORE SPECIFIC AND CLEAR, WHERE BIDDING FOR A PROCUREMENT MAY BE OF A "TEAM ARRANGEMENT" WHEN BEING CONSIDERED IN THE EVALUATION OF TECHNICAL PROPOSALS, OR ONE WHICH PROVIDE THAT TECHNICAL PROPOSALS BE ACCEPTED ONLY FROM CONTRACTORS WHO HAVE MANUFACTURED AND CAN DEMONSTRATE AT AN OPERATING AIR FIELD A SOLID STATE CONVENTIONAL INSTRUMENT LANDING SYSTEM. SUCH CLAUSES MAY BE SATISFIED BY VARYING CONTRACTOR RELATIONSHIPS DESCRIBED AND RECOGNIZED BY ASPR 4-117.

TO AMERICAN-STANDARD, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTERS OF JUNE 30, JULY 20 AND AUGUST 13, 1970, WITH ENCLOSURES, AND LETTERS DATED JULY 22 AND JULY 29, 1970, WITH ENCLOSURES, FROM MR. AUSTIN G. ROE, GROUP COUNSEL, PROTESTING AGAINST THE AWARD TO ANYONE OTHER THAN YOURSELF OF A CONTRACT UNDER INVITATION FOR BIDS NO. 33657-70-B-0166 (IFB-0166), ISSUED BY AERONAUTICAL SYSTEMS DIVISION, WRIGHT-PATTERSON AIR FORCE BASE, OHIO.

THE ABOVE-REFERENCED SOLICITATION WAS ISSUED ON APRIL 29, 1970, AS THE SECOND STEP OF A TWO-STEP FORMALLY ADVERTISED PROCUREMENT OF AIRCRAFT INSTRUMENT LANDING SYSTEMS (ILS). THE FOLLOWING BIDS WERE RECORDED AT THE BID OPENING HELD ON JUNE 26, 1970:

TEXAS INSTRUMENTS, INC. (TI) $2,656,098

WILCOX DIVISION, AMERICAN-STANDARD

(WILCOX) $5,453,800 UPON EXAMINING THE TI BID, YOU PROTESTED AGAINST AWARD OF THE CONTRACT TO TI, WHICH AWARD HAS BEEN WITHHELD PENDING RESOLUTION OF THE PROTEST BY OUR OFFICE. WE SHALL DISCUSS THE FIVE BASES OF YOUR PROTEST IN THE ORDER IN WHICH THEY ARE PRESENTED IN YOUR LETTERS OF JUNE 30 AND JULY 20, 1970.

TEXAS INSTRUMENTS' BID WAS TRANSMITTED BY A COVER LETTER DATED JUNE 22, 1970, WHICH STATED IN PERTINENT PART:

"SUBJECT SOLICITATION NO. F33657-70-B-0166

REFERENCE (A) TEXAS INSTRUMENTS TECHNICAL

PROPOSAL NO. GP70-1 DATED

2 JANUARY 1970

(B) AMENDMENT NO. 1 TO REFERENCE (A)

DATED 27 FEBRUARY 1970

(C) AMENDMENT NO. 2 TO REFERENCE (A)

DATED 5 MARCH 1970

ENCLOSURE (1) SUBJECT SOLICITATION AND OFFER (2 COPIES)

(2) AMENDMENT NO. 1 TO SUBJECT

SOLICITATION (2 COPIES)

(3) AMENDMENT NO. 2 TO SUBJECT SOLICITATION

(2 COPIES)

(4) AMENDMENT NO. 3 TO SUBJECT SOLICITATION

(2 COPIES)

"GENTLEMEN

TEXAS INSTRUMENTS IS PLEASED TO SUBMIT THE OFFER CONTAINED IN ENCLOSURES (1) THROUGH (4) TO PERFORM THE PROGRAM DESCRIBED BY THE SUBJECT SOLICITATION AND BY REFERENCES (A) THROUGH (C). BOTH OUR TECHNICAL PROPOSAL AND OFFER ARE FULLY RESPONSIVE TO YOUR REQUIREMENTS." YOUR FIRST CONTENTION IS THAT THE ABOVE-QUOTED LETTER RENDERED TI'S BID NONRESPONSIVE IN THAT THE UNDERSCORED WORDS HAD THE EFFECT OF MAKING THAT FIRM'S TECHNICAL PROPOSAL EQUAL TO RATHER THAN SUBORDINATE TO, THE GOVERNMENT SPECIFICATIONS FOR THE PROCUREMENT. ACCEPTANCE OF TI'S BID, YOU MAINTAIN, WOULD PERMIT TI TO DEVIATE IN ITS TECHNICAL PROPOSAL FROM THE REQUIREMENTS OF THE SPECIFICATIONS, WITH THE RESULT THAT EQUIPMENT COULD BE SUPPLIED WHICH DID NOT MEET THE GOVERNMENT'S NEEDS.

ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-503.2(III) PROVIDES THAT SECOND-STEP INVITATIONS FOR BIDS:

"WILL PROMINENTLY STATE THAT THE SUPPLIES OR SERVICES TO BE PROCURED WILL BE IN ACCORDANCE WITH THE SPECIFICATIONS AND THE BIDDER'S TECHNICAL PROPOSAL, AS FINALLY ACCEPTED, UNDER THE REQUEST FOR TECHNICAL PROPOSALS. THIS MAY BE ACCOMPLISHED IN THE SCHEDULE ITEM DESCRIPTION BY A PROVISION SUBSTANTIALLY IN THE FORM OF THE FOLLOWING EXAMPLE.

RADIO ANTENNA, IN ACCORDANCE WITH EXHIBIT NO. DATED (USE OTHER DESCRIPTION OF SPECIFICATIONS AS APPROPRIATE) AND YOUR TECHNICAL PROPOSAL

(INSERT SPECIFIC IDENTIFICATION OF THE BIDDER'S PROPOSAL INCLUDING ANY REVISION THEREOF AS FINALLY ACCEPTED) INCORPORATED HEREIN BY REFERENCE. NOTHING CONTAINED IN SAID TECHNICAL PROPOSAL SHALL CONSTITUE A WAIVER OF ANY OF THE PROVISIONS OF SAID EXHIBIT (OR SPECIFICATIONS)." IN COMPLIANCE WITH THIS PROVISION, SECTION F, "DESCRIPTION/SPECIFICATIONS", OF IFB -0166 STATED:

"THE SOLID STATE CATEGORY II INSTRUMENT LANDING SYSTEM SHALL BE IN ACCORDANCE WITH ASD EXHIBIT ASNAC-69-12A DATED 4 MARCH 1970, STATEMENT OF WORK FOR SOLID STATE CATEGORY II ILS DATED 27 FEBRUARY 1970 BOTH ATTACHED HERETO AND HEREBY MADE A PART HEREOF AND BIDDER'S TECHNICAL PROPOSAL AS FINALLY ACCEPTED UNDER LETTER REQUEST FOR TECHNICAL PROPOSAL DATED 9 OCTOBER 1969 AND AMENDMENTS 0001 AND 0002 DATED 27 OCTOBER 1969 AND 12 NOVEMBER 1969, RESPECTIVELY, ALL OF WHICH ARE INCORPORATED HEREIN BY REFERENCE. REFERENCES TO ASNAC-69-12A SHALL BE INTERPRETED TO INCLUDE THE CHANGES THERETO MADE IN 3.2 OF SAID STATEMENT OF WORK. EXTRA UNITS OF MARKER BEACON STATIONS REQUIRED FOR EACH SYSTEM IS SET FORTH ELSEWHERE IN THIS CONTRACT. IN EVENT OF CONFLICT AMONG THE ABOVE DOCUMENTS THE ORDER OF PRECEDENT SHALL BE ASNAC-69-12, STATEMENT OF WORK AND BIDDER'S TECHNICAL PROPOSAL." IT IS ADMINISTRATIVELY REPORTED THAT TI'S TECHNICAL PROPOSAL, WHICH WAS FOUND TO BE FULLY COMPLIANT WITH THE SPECIFICATIONS DURING STEP ONE OF THE PROCUREMENT, CONTAINS NO STATEMENT WHICH WOULD ALTER THE ABOVE ORDER OF PRECEDENCE.

IN OUR OPINION, TEXAS INSTRUMENTS' LETTER OF JUNE 22, 1970, DOES NOTHING MORE THAN RECITE THE CONDITIONS FOR SUBMISSION OF BIDS UNDER STEP TWO, AS ESTABLISHED BY ASPR 2-503.2(III) AND SECTION F OF THE INVITATION. WE DO NOT BELIEVE THAT THE LETTER CAN REASONABLY BE CONSTRUED AS A QUALIFICATION OF THE BID. THEREFORE, WE MUST REJECT YOUR FIRST CONTENTION.

YOUR SECOND ARGUMENT IS THAT THE TI BID IS NONRESPONSIVE IN THAT SCHEDULE PAGES CONTAINING OPTION PRICES WERE NOT AUTHENTICATED AS TI BID PAGES AS REQUIRED BY THE SOLICITATION. SECTION C ("INSTRUCTIONS, CONDITIONS AND NOTICES TO OFFERORS") OF IFB -0166 INCLUDED STANDARD FORM 33A, JULY 1966, PARAGRAPH 2.(B) OF WHICH PROVIDES: "THE OFFEROR SHALL SIGN THE SOLICITATION AND PRINT OR TYPE HIS NAME ON THE SCHEDULE AND EACH CONTINUATION SHEET THEREOF ON WHICH HE MAKES AN ENTRY."

SEVERAL PAGES OF THE INVITATION SCHEDULE WERE PREPARED ON STANDARD FORM 36, JULY 1966, WHICH PROVIDES A BLOCK FOR THE INSERTION OF THE BIDDER'S NAME. TI TYPED "TEXAS INSTRUMENTS INCORPORATED" IN ALL SUCH BLOCKS. HOWEVER, PAGES 32, 39, AND 43 THROUGH 46 OF THE SCHEDULE, UPON WHICH CERTAIN OPTION PRICES WERE ENTERED, WERE PREPARED ON PLAIN PAPER WHICH PROVIDED NO BLOCK IN WHICH TO ENTER THE BIDDER'S NAME. TI FAILED TO PLACE ITS NAME ON THESE PAGES, WHILE YOUR FIRM TYPED ITS NAME AT THE TOP OF EACH PAGE.

IN OUR DECISION B-164615, AUGUST 26, 1968, WE RESPONDED AS FOLLOWS TO THE PRECISE ISSUE WHICH YOU HAVE PRESENTED:

"REGARDING THE FAILURE OF (THE SUCCESSFUL BIDDER) TO PRINT OR TYPE ITS NAME ON THE CONTINUATION SHEETS, IT IS OUR VIEW THAT SUCH FAILURE WAS A MERE INFORMALITY WHICH PROPERLY MAY BE WAIVED UNDER THE PROVISIONS OF ASPR 2-405. THAT SECTION PROVIDES THAT AN IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE INVITATION WHICH HAS NO EFFECT ON PRICE, QUALITY, QUANTITY OR DELIVERY OF THE SUPPLIES BEING PROCURED MAY BE WAIVED WHERE IT IS TO THE ADVANTAGE OF THE GOVERNMENT."

THE THIRD BASIS OF YOUR PROTEST IS THAT TI MADE ITS BID NONRESPONSIVE BY INSERTING THE WORD "NONE" IN THE BUY AMERICAN CERTIFICATE, PARAGRAPH 7 OF STANDARD FORM 33, JULY 1966, WHICH WAS SUBMITTED WITH ITS BID. TEXAS INSTRUMENTS' TECHNICAL PROPOSAL SUBMITTED UNDER STEP ONE OF THIS PROCUREMENT INCLUDED THE SATISFACTORY DEMONSTRATION OF AN EXISTING ILS SYSTEM, LOCATED IN FRANCE AND MANUFACTURED THERE BY ITS FRENCH TEAM MEMBER FOR THIS PROCUREMENT, THOMSON-CSF. THIS LED YOU TO ASSUME, AT THE WRITING OF YOUR LETTER OF JUNE 30, 1970, THAT TI ERRED IN CERTIFYING THAT THE END PRODUCTS TO BE SUPPLIED UNDER THE CONTRACT WERE DOMESTIC SOURCE END PRODUCTS. HOWEVER, TI'S BID UNDER STEP TWO WAS BASED UPON THE DOMESTIC MANUFACTURE OF THE SYSTEM BY TI, UTILIZING THE DESIGN AND TECHNICAL DRAWINGS, EXPERTISE AND KEY PERSONNEL OF ITS TEAM MEMBER, THOMSON-CSF. PREAWARD SURVEY OF TI WAS CONDUCTED BY THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE (DCASO), SAN ANTONIO, WHICH WAS SPECIFICALLY REQUESTED BY THE PROCURING ACTIVITY TO DETERMINE WHETHER TI COMPLIED WITH THE BUY AMERICAN ACT PROVISION OF THE SOLICITATION. THE PREAWARD SURVEY REPORT CONCLUDED THAT THE BUY AMERICAN ACT REQUIREMENTS WOULD BE MET. ON THE BASIS OF THIS INFORMATION IT THEREFORE APPEARS THAT THE END ITEMS TO BE FURNISHED BY TI WOULD CONSTITUTE DOMESTIC PRODUCTS UNDER THE BUY AMERICAN ACT DEFINITION, AND THIS ASPECT OF YOUR PROTEST IS WITHOUT MERIT.

YOU NEXT CONTEND THAT TI'S BID IS NONRESPONSIVE IN THAT TI DOES NOT QUALIFY AS A "MANUFACTURER" OF A DEMONSTRATED TWO-FREQUENCY CATEGORY I ILS SYSTEM. THE INSTANT TWO-STEP PROCUREMENT WAS INITIATED ON OCTOBER 9, 1969, WITH THE ISSUANCE OF A LETTER REQUEST FOR TECHNICAL PROPOSALS WHICH PROVIDED:

"THIS PROCUREMENT WILL BE ACCOMPLISHED IN TWO DISTINCT STEPS: (1) SOLICITATION, SUBMISSION AND EVALUATION OF DETAILED TECHNICAL PROPOSALS WITHOUT PRICING TO DETERMINE ACCEPTABILITY OF THE PRODUCTS OFFERED, AND (2) ISSUANCE OF A FORMAL INVITATION FOR BIDS ONLY TO THOSE FIRMS HAVING ACCEPTABLE TECHNICAL PROPOSALS. BIDDERS WHO CANNOT COMPLY WITH THE ATTACHED BIDDERS QUALIFICATION CLAUSE SHOULD NOT SUBMIT A TECHNICAL PROPOSAL.

BIDDERS TECHNICAL QUALIFICATION CLAUSE

SOLID STATE INSTRUMENT LANDING SYSTEM

TECHNICAL PROPOSALS WILL BE ACCEPTED ONLY FROM THOSE CONTRACTORS WHO HAVE MANUFACTURED AND CAN DEMONSTRATE AT AN OPERATING AIRFIELD A SOLID STATE CONVENTIONAL INSTRUMENT LANDING SYSTEM. THE SYSTEM MUST BE COMPRISED OF AT LEAST THE FOLLOWING COMPONENTS: A TWO-FREQUENCY (CAPTURE EFFECT), DUAL EQUIPMENT VHF LOCALIZER STATION; A SINGLE FREQUENCY, DUAL EQUIPMENT UHF GLIDESLOPE STATION; AND A VHF MARKER BEACON STATION. THE SYSTEM MUST HAVE SUCCESSFULLY PASSED A FLIGHT CHECK FOR CATEGORY I SIGNAL QUALITY CONDUCTED BY THE FAA OR OTHER INTERNATIONAL CIVIL AVIATION ORGANIZATION RECOGNIZED FLIGHT CHECKING AGENCY. INSPECTION OF SUCH A SYSTEM BY THE GOVERNMENT WILL BE CONDUCTED BY GOVERNMENT ENGINEERS AND TECHNICIANS. THE INSPECTION WILL BE PART OF THE EVALUATION OF TECHNICAL PROPOSALS. FURTHER INFORMATION ON THE ARRANGEMENT FOR SUCH AN INSPECTION IS CONTAINED IN ATTACHMENT NR. 1." WE UPHELD THE PROPRIETY OF THIS PROVISION IN OUR DECISION 49 COMP. GEN. (B-168629, JUNE 19, 1970).

TEXAS INSTRUMENTS ENTERED INTO A TEAM ARRANGEMENT WITH THOMSON-CSF, A FRENCH FIRM, FOR PERFORMANCE OF THE INSTANT PROCUREMENT, WHICH IT DESCRIBED IN DETAIL IN ITS TECHNICAL PROPOSAL. DURING THE EVALUATION OF TECHNICAL PROPOSALS UNDER STEP ONE, THE TI/T-CSF TEAM MET THE REQUIREMENTS OF THE "BIDDERS TECHNICAL QUALIFICATION CLAUSE" BY DEMONSTRATING IN FRANCE AN ILS MANUFACTURED AND INSTALLED THERE BY T CSF. YOUR PROTEST CONCEDES THAT T-CSF "IS A WELL-KNOWN FOREIGN MANUFACTURER OF ILS SYSTEMS, INCLUDING (AS REQUIRED UNDER THE LETTER REQUEST FOR TECHNICAL PROPOSALS) A DUAL- FREQUENCY SYSTEM MEETING AT LEAST CATEGORY I PERFORMANCE." IN CONTRAST, YOU STATE, TI "WAS NOT A MANUFACTURER OF ILS SYSTEMS WHEN THE LRTP WAS ISSUED, WAS NOT A MANUFACTURER OF ILS SYSTEMS WHEN THE IFB WAS ISSUED, AND, AS OF THIS DATE, TI IS NOT A MANUFACTURER OF ILS SYSTEMS."

IT IS APPARENT FROM THE RECORD THAT YOUR FIRM HAD BEEN ON NOTICE FOR SOME TIME PRIOR TO BID OPENING THAT TEXAS INSTRUMENTS WAS A BIDDER ON THE INSTANT PROCUREMENT. THE SYNOPSIS OF IFB -0166 WHICH APPEARED IN THE MAY 1, 1970, ISSUE OF THE COMMERCE BUSINESS DAILY "SYNOPSIS OF U.S. GOVERNMENT PROPOSED PROCUREMENT, SALES AND CONTRACT AWARDS" IDENTIFIED "TEXAS INSTRUMENTS, INC., 13500 N. CENTRAL EXPRESSWAY, DALLAS, TX" AS ONE OF THE TWO FIRMS WHICH WERE ELIGIBLE TO SUBMIT BIDS UNDER STEP TWO. WE BELIEVE IT WAS COMMON KNOWLEDGE IN THE INDUSTRY THAT TI, IN ITS OWN RIGHT, AND WITHOUT USE OF A TEAM OR SUBCONTRACT ARRANGEMENT, COULD NOT MEET THE BIDDERS TECHNICAL QUALIFICATION CLAUSE REQUIREMENTS. IN VIEW THEREOF WE THINK IT IS SIGNIFICANT THAT TEXAS INSTRUMENTS, RATHER THAN A PARTNERSHIP OR JOINT VENTURE COMPOSED OF TEXAS INSTRUMENTS AND THOMSON-CSF, WAS IDENTIFIED AS A BIDDER ON THE SECOND STEP. ANY OBJECTIONS WHICH YOU MAY HAVE HAD TO TI AS A BIDDER SHOULD HAVE BEEN MADE KNOWN AT THAT TIME, INSTEAD OF AFTER BIDS HAD BEEN OPENED. MOREOVER, YOUR FIRM DOES NOT APPEAR TO HAVE BEEN PREJUDICED, IN THE SUBMITTAL OF ITS BID, BY THE AIR FORCE'S CONCLUSION THAT TI, BY VIRTUE OF ITS TEAM ARRANGEMENT WITH T-CSF, QUALIFIED FOR THE INSTANT PROCUREMENT. IT IS CLEAR THAT WILCOX ITSELF POSSESSED THE CAPABILITY OF MEETING THE "BIDDERS TECHNICAL QUALIFICATION CLAUSE", AND THERE IS NO EVIDENCE OF RECORD THAT WILCOX CONTEMPLATED ENTERING INTO A TEAM ARRANGEMENT WITH ANOTHER FIRM, OR THAT IT BELIEVED IT WAS PRECLUDED FROM DOING SO BY THE QUALIFICATION CLAUSE. UNDER THESE CIRCUMSTANCES, WE SEE NO VALID LEGAL BASIS FOR OBJECTION TO THE AIR FORCE DETERMINATION THAT TI QUALIFIES FOR THE AWARD OF THE CONTRACT.

YOUR FINAL ARGUMENT IS THAT THE TI BID IS NONRESPONSIVE BECAUSE ITS PRICE IS SO LOW AS TO CONSTITUTE A "BUY-IN." YOU HAVE COMPARED TI'S BID PRICE WITH THOMSON-CSF'S CATALOG PRICE FOR SIMILAR UNMODIFIED COMMERCIAL EQUIPMENT, AND WITH YOUR OWN BID PRICE, IN SUPPORT OF THIS CONTENTION. THIS REGARD, THE PROCURING ACTIVITY SPECIFICALLY REQUESTED DCASO, SAN ANTONIO, TO CONFIRM TI'S BID PRICES AT THE PREAWARD SURVEY. THE PREAWARD SURVEY REPORT STATED THAT THE PRICES WERE CONFIRMED, THUS ELIMINATING THE POSSIBILITY OF MISTAKE.

FURTHER, ASPR 1-311(B) PROVIDES:

"TO AVOID OR MINIMIZE THE OPPORTUNITY FOR 'BUYING IN' ON A PROCUREMENT WHICH IS LIKELY TO BE SUCCEEDED BY ONE OR MORE 'FOLLOW ON' PROCUREMENTS, THE GOVERNMENT SHOULD OBTAIN FROM THE CONTRACTOR A BINDING PRICE COMMITMENT COVERING AS MUCH OF THE ENTIRE PROGRAM CONCERNED AS IS PRACTICABLE. SUCH A COMMITMENT MAY BE SECURED THROUGH EMPLOYMENT OF ONE OF THE FOLLOWING PROCUREMENT TECHNIQUES:

(1) MULTI-YEAR PROCUREMENT, WITH A PROVISION IN THE SOLICITATION THAT A PRICE MAY BE SUBMITTED ONLY FOR THE TOTAL MULTI-YEAR QUANTITY (SEE 1- 322.2); OR

(2) PRICED OPTIONS FOR ADDITIONAL QUANTITIES WHICH, TOGETHER WITH THE QUANTITIES BEING FIRMLY CONTRACTED FOR, EQUAL THE ANTICIPATED TOTAL PROGRAM REQUIREMENTS (SEE 1-1504)." BOTH OF THESE TECHNIQUES WERE USED IN IFB -0166, PARAGRAPH 36 OF WHICH STATED:

"THE AWARD CONTEMPLATED BY THIS SOLICITATION WILL BE MADE ON A MULTI YEAR BASIS ONLY AND WILL NOT BE MADE ON A SINGLE YEAR BASIS." FURTHER PARAGRAPH 37 REQUIRED BIDDERS TO SUBMIT PRICES ON OPTIONS FOR ADDITIONAL QUANTITIES FOR PROGRAM YEARS 1970 THROUGH 1972. IT IS ADMINISTRATIVELY REPORTED THAT THE MULTI-YEAR QUANTITIES AND THE OPTION QUANTITIES WILL FULFILL ALL AIR FORCE AND FEDERAL AVIATION ADMINISTRATION REQUIREMENTS FOR A CATEGORY II SOLID-STATE ILS. IN VIEW THEREOF, WE CANNOT CONCLUDE THAT A "BUY-IN" HAS OCCURRED. IN THIS CONNECTION, HOWEVER, IT SHOULD ALSO BE NOTED THAT OUR OFFICE WOULD NOT BE IN A POSITION TO LEGALLY OBJECT TO THE AWARD OF A CONTRACT EVEN IF IT WERE ESTABLISHED THAT TI HAD "BOUGHT INTO" THE PROCUREMENT. AS WE STATED IN OUR DECISION B-169977(1), JULY 23, 1970:

(ASPR 1-311 (A)) FURTHER PROVIDES THAT:

' *** WHERE THERE IS REASON TO BELIEVE THAT "BUYING IN" HAS OCCURRED, CONTRACTING OFFICERS SHALL ASSURE THAT AMOUNTS THEREBY EXCLUDED IN THE DEVELOPMENT OF THE ORIGINAL CONTRACT PRICE ARE NOT RECOVERED IN THE PRICING OF CHANGE ORDERS OR OF FOLLOW-ON PROCUREMENTS SUBJECT TO COST ANALYSIS.'

"SINCE THE PERTINENT REGULATION DOES NOT PROVIDE FOR THE REJECTION OF A BID WHERE 'BUYING IN' IS SUSPECTED, WE HAVE RECOGNIZED IN A NUMBER OF DECISIONS THAT THERE IS NO LEGAL BASIS UPON WHICH 'AN AWARD MAY BE PRECLUDED OR DISTURBED MERELY BECAUSE THE LOW BIDDER SUBMITTED AN UNPROFITABLE PRICE.' B-169465, JUNE 19, 1970, CITING B-150318, MARCH 25, 1963, AND B-149551, AUGUST 16, 1962."

YOUR LETTER OF AUGUST 13, 1970, QUESTIONS WHETHER IT IS CONSISTENT WITH SOUND POLICY TO MAKE AN AWARD TO TI, WHICH WOULD "LOCK OUT" WILCOX FROM THE DOMESTIC MARKET FOR THESE SYSTEMS AND PLACE WILCOX IN A POSITION FROM WHICH IT CANNOT COMPETE WITH THOMSON-CSF IN THE FOREIGN MARKET. YOU ALSO QUESTION WHETHER IT IS SOUND TO TIE THE FUTURE SAFETY OF THE C5A AND C-141 AIRCRAFT TO A PROCUREMENT WHICH WOULD BE SUBJECT TO "THE VICISSITUDES OF THE FOREIGN POLICIES OF THE FRENCH GOVERNMENT, SINCE THE LATTER CAN CONTROL THE TRANSFER OF T-CSF TECHNOLOGY AND KEY PEOPLE TO THE U.S."

AS WE HAVE DISCUSSED ABOVE, THE PARTICIPATION OF THOMSON-CSF IN THIS PROCUREMENT DOES NOT APPEAR TO VIOLATE THE BUY AMERICAN ACT (41 U.S.C. 10A -10D). YOU HAVE NOT DIRECTED OUR ATTENTION TO ANY OTHER STATUTE OR ADMINISTRATIVE REGULATION WHICH PROHIBITS OR EXPRESSES A POLICY UNFAVORABLE TO THE TI/T-CSF TEAM ARRANGEMENT. WHILE YOUR QUESTIONS RAISE ISSUES OF POLICY WHICH MAY BE APPROPRIATE FOR CONSIDERATION BY THE CONGRESS AND THE DEPARTMENT OF DEFENSE, THEY PROVIDE NO BASIS UPON WHICH OUR OFFICE WOULD BE JUSTIFIED IN INTERFERING WITH AN AWARD TO TEXAS INSTRUMENTS.

FOR THE FOREGOING REASONS, YOUR PROTEST IS DENIED.