B-168810, MAY 22, 1970

B-168810, MAY 22, 1970

CONTRACTS--SPECIFICATIONS--QUALIFIED PRODUCTS--LISTING--REMOVAL NOTICE WHEN ALL INTERESTED PARTIES WERE NOTIFIED THAT SPECIFICATIONS WERE BEING AMENDED, THAT AMENDMENT WOULD AFFECT CONTROL UNIT REQUIREMENTS, THAT NO CONTROL UNITS WERE APPROVED FOR QPL LISTING AND THAT REQUALIFICATION OF CONTROL UNIT TURN SIGNAL SAMPLES WOULD BE NECESSARY, CONTRACTOR WHOSE CONTROL UNIT UNDER AMENDED SPECIFICATIONS FAILED TO QUALIFY IS DENIED PROTEST TO NECESSITY FOR SPECIFICATION CHANGE AND TO REMOVAL OF ITS UNIT FROM QPL SINCE NOTICES, BOTH WRITTEN AND ORAL, FULLY MET NOTICE REQUIREMENTS AND ACTION OF PROCURING ACTIVITY IN REJECTING BIDDERS PROPOSAL USING ORIGINAL CONTROL UNIT WAS PROPER. CONTRACTS-- SPECIFICATIONS--QUALIFIED PRODUCTS--PURPOSE WHEN IT IS IMPRACTICAL TO PROCURE PRODUCTS SOLELY ON ACCEPTANCE TESTS WITHOUT UNDULY DELAYING DELIVERY AND TO DETERMINE AVAILABILITY OF PRODUCTS IN SUCH CASES, QUALIFICATION OF SPECIFIC PRODUCTS IS REQUIRED PRIOR TO BID OPENING OR AWARD OF NEGOTIATED CONTRACTS AND GAO HAS RECOGNIZED USE OF SUCH SYSTEM EVEN THOUGH ADMINISTRATION OF QUALIFIED PRODUCTS LIST SYSTEM MAY RESULT IN RESTRICTING COMPETITION. BIDDER'S PROTEST TO NECESSITY FOR AMENDMENT OF SPECIFICATIONS, REMOVAL OF PRODUCT FROM QPL AND REQUALIFICATION IS DENIED SINCE DRAFTING SPECIFICATIONS AND CHANGES THERETO ARE RESPONSIBILITIES OF PROCURING AGENCY WHOSE ACTION GAO WILL NOT QUESTION. SEE COMP. GEN. DECS. CITED. CONTRACTS--SPECIFICATIONS-- QUALIFIED PRODUCTS--JUSTIFICATION FOR USE REQUIREMENT WHERE COST OF REPETITIVE PREPRODUCTION TESTING WOULD BE EXCESSIVE AND WHERE INTEREST OF GOVERNMENT REQUIRES ASSURANCE PRIOR TO AWARD THAT PRODUCT IS SATISFACTORY FOR INTENDED USE, EVEN THOUGH COMPETITION MAY BE RESTRICTED, USE OF QUALIFIED PRODUCTS SYSTEM IS JUSTIFIED. WHEN PROCURING AGENCY AMENDED SPECIFICATIONS OF CONTROL UNIT, COMPONENT OF TURN SIGNAL KIT, WHICH NECESSITATED RESCISSION OF QUALIFIED PRODUCTS LIST FOR UNITS, PREVIOUS APPROVED SUPPLIER WHOSE CONTROL UNIT FAILED TO MEET QUALIFICATIONS TESTING UNDER AMENDED SPECIFICATIONS IS DENIED PROTEST TO AWARD SINCE GOVERNMENT SHOULD NOT BE REQUIRED TO PURCHASE FROM UNQUALIFIED SOURCES. SEE COMP. GEN. DECS. CITED.

TO VEDDER, PRICE, KAUFMAN, KAMMHOLZ & MCGUINESS:

REFERENCE IS MADE TO YOUR LETTERS OF FEBRUARY 4 AND MARCH 3, 1970, AND TO PRIOR CORRESPONDENCE FROM NARTRON CORPORATION, PROTESTING THE AWARD UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAE07-70-R-0243 TO SWISS CONTROLS & RESEARCH (SWISS) BY THE ARMY TANK-AUTOMOTIVE COMMAND (USATACOM) AT WARREN, MICHIGAN.

THE RFP WAS ISSUED ON SEPTEMBER 8, 1969, FOR 6,864 SOLID STATE TURN SIGNAL KITS IN ACCORDANCE WITH MILITARY DRAWING A5703317 AS MODIFIED BY ENGINEERING EVALUATION REPORT 5703317 DATED MAY 4, 1968, REVISION "A," FEBRUARY 11, 1968. IT IS REPORTED THAT THE TURN SIGNAL KIT WAS A SOLE SOURCE ITEM PRIOR TO THE AWARD UNDER THIS RFP, AND THAT SWISS WAS THE SOLE SUPPLIER FOR THE TWO MAJOR COMPONENTS OF THE KIT, THE FLASHER, AND THE CONTROL UNIT. THE QUANTITY OF KITS WAS INCREASED BY 10,395 UNITS TO 17,259 UNITS BY AMENDMENT NO. 1 DATED SEPTEMBER 18, 1969, AND THE REFERENCED ENGINEERING EVALUATION REPORT WAS UPDATED BY LISTING THE FLASHER UNIT OF THE KIT AS A QUALIFIED PRODUCTS LIST (QPL) ITEM IN ACCORDANCE WITH QPL-62069-1 DATED JULY 31, 1969. FIVE QUALIFIED SOURCES WERE LISTED ON THIS QPL FOR THE FLASHER UNIT, INCLUDING NARTRON. THE CONTROL UNIT OF THE KIT REMAINED A SWISS SOLE-SOURCE CONTROL ITEM. AMENDMENT NO. 2 DATED OCTOBER 22, 1969, EXTENDED THE CLOSING DATE OF THE RFP FROM OCTOBER 3 TO OCTOBER 30, 1969, AND INCREASED THE QUANTITY BY 92 UNITS TO 17,351 UNITS.

IN NOVEMBER 1969, THE SPARTON MANUFACTURING COMPANY (SPARTON) WAS INCLUDED AS AN ADDITIONAL QUALIFIED SOURCE FOR THE CONTROL UNIT. MEMORANDUM ISSUED BY USATACOM AT THAT TIME STATED THAT NARTRON'S CONTROL UNIT HAD FAILED TO PASS THE QPL TEST REQUIREMENT. AMENDMENT NO. 3 WAS ISSUED ON DECEMBER 2, 1969, TO DESIGNATE THE CONTROL UNIT AS A QPL ITEM WITH SWISS AND SPARTON AS THE APPROVED SOURCES. THIS AMENDMENT ALSO INCREASED THE QUANTITY OF KITS TO 22,333 UNITS AND EXTENDED THE CLOSING DATE OF THE RFP TO DECEMBER 11, 1969.

THE PROCUREMENT HISTORY OF THIS ITEM REVEALS THAT APPROVAL FOR APPLICATION OF QPL PROCEDURES WAS REQUESTED OF THE ARMY MATERIEL COMMAND (AMC) BY USATACOM LETTER OF OCTOBER 12, 1967, TO INCLUDE THE QUALIFICATION REQUIREMENT IN MILITARY SPECIFICATION MIL-C-62069 COVERING SOLID STATE TURN SIGNAL KITS. THE JUSTIFICATION FOR THE REQUESTED QPL APPROVAL WAS BASED ON THE FACT THAT THE COST OF REPETITIVE PREPRODUCTION TESTING WOULD BE EXCESSIVE. SINCE IT WAS EXPECTED THAT THE KITS WOULD CONSTITUTE A MAJOR PROCUREMENT ITEM INVOLVING LARGE QUANTITIES, IT WAS FELT THAT SUBSTANTIAL SAVINGS IN TIME AND MONEY WOULD RESULT FROM INCORPORATION OF QPL IN THE SPECIFICATION. IT WAS DETERMINED BY THE ENGINEERING REQUIREMENTS BRANCH OF USATACOM THAT THE INTEREST OF THE GOVERNMENT REQUIRED ASSURANCE, PRIOR TO AWARD, THAT THE PRODUCT WOULD BE SATISFACTORY FOR ITS INTENDED USE SINCE DIRECTIONAL CONTROL SIGNAL LIGHTS REPRESENT A CRITICAL COMPONENT ON TACTICAL AND NONTACTICAL VEHICLES. IT WAS CONSIDERED THAT PRIOR QUALIFICATION, COUPLED WITH ADEQUATE ACCEPTANCE AND PERIODIC CONTROL TESTING, WOULD PROVIDE ASSURANCE THAT KITS OF THE REQUIRED QUALITY WOULD BE FURNISHED. QPL REQUIREMENTS FOR THE FLASHER AND CONTROL UNIT WERE GRANTED BY AMC SUBJECT TO THE PROVISIONS OF PARAGRAPH 1- 1107 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR).

NARTRON SOUGHT QPL APPROVAL OF ITS FLASHER COMPONENT OF THE KIT FROM USATACOM, AND ON DECEMBER 19, 1968, NARTRON WAS ADVISED THAT THE FLASHER UNIT HAD SUCCESSFULLY MET ALL THE QPL REQUIREMENTS AND THAT ITS FLASHER UNIT WOULD APPEAR ON THE NEXT QPL FOR THAT ITEM. THEREAFTER, NARTRON SUBMITTED SAMPLES OF A CONTROL UNIT TO USATACOM FOR TESTING. ON JUNE 11, 1969, NARTRON WAS INFORMED THAT THE SAMPLES SUCCESSFULLY MET ALL THE REQUIREMENTS OF MIL-C-62069A AND IT WAS FURTHER INFORMED THAT ITS CONTROL UNIT WOULD APPEAR ON THE NEXT QPL PUBLISHED FOR THESE ITEMS.

ON MAY 15, 1969, SPARTON WAS INFORMED BY USATACOM THAT ITS FLASHER AND CONTROL UNITS WERE APPROVED AND WOULD BE PLACED ON THE NEXT QPL. BEFORE EITHER NARTRON'S OR SPARTON'S CONTROL UNITS WERE PLACED ON THE QPL, IT WAS DECIDED BY USATACOM'S ENGINEERS THAT A CHANGE IN SPECIFICATIONS REGARDING THE CONTROL UNIT WAS NECESSARY.

ON AUGUST 7, 1969, NARTRON WAS INFORMED BY LETTER THAT ITS FLASHER UNIT WAS PLACED ON THE QPL AS OF JULY 31, 1969, BUT THAT NO CONTROL UNITS WERE APPROVED FOR QUALIFICATION LISTING BECAUSE MILITARY SPECIFICATION MIL-C- 62069 WAS BEING AMENDED. SWISS AND SPARTON WERE SIMILARLY NOTIFIED BY LETTER THE SAME DAY. ALL OFFERORS WERE NOTIFIED OF THE CHANGES BEING MADE IN MIL-C-62069 AND WERE INFORMED THAT NEW SAMPLES MUST BE APPROVED BY DECEMBER 1, 1969. NARTRON, SPARTON, AND SWISS SUBMITTED CONTROL UNIT SAMPLES FOR QPL TESTING UNDER THE NEW SPECIFICATIONS BY OCTOBER 1, 1969.

THE USATACOM LABORATORY PROGRESS REPORT OF OCTOBER 24, 1969, INDICATED THAT THE NARTRON CONTROL UNIT FAILED TO MEET THE BASIC DIMENSIONAL REQUIREMENTS OF MIL-C-62069/1B. THE PROGRESS REPORT OF OCTOBER 31, 1969, INDICATED THAT THE NARTRON CONTROL UNIT COMPLETED THE HIGH AND LOW TEMPERATURE TESTS BUT FAILED THE STRENGTH TEST. THE CONTROL UNITS OF SWISS AND SPARTON SUCCESSFULLY COMPLETED THE STRENGTH TEST. NARTRON WAS INFORMED OF ITS UNIT'S FAILURE AND THAT SUCH FAILURE WOULD NECESSITATE COMPLETE RETESTING. NARTRON RESUBMITTED THREE MODIFIED CONTROL UNITS FOR RETESTING ON NOVEMBER 10, 1969, BUT THESE UNITS FAILED THE ACTUATION TEST. IT WAS NOTED THAT THE DEFECTIVE NARTRON UNITS WERE CAUSING DAMAGE TO THE ENDURANCE TESTING EQUIPMENT, AND A DECISION WAS MADE TO DISCONTINUE TESTING OF NARTRON'S CONTROL UNIT AND IT WAS SO INFORMED. NARTRON THEN REQUESTED PERMISSION TO MODIFY THE TWO SAMPLES STILL UNDERGOING RETESTING. THEREAFTER, USATACOM CONSENTED TO RETEST THE MODIFIED CONTROL UNIT SAMPLES. THE PROGRESS REPORT OF NOVEMBER 24, 1969, INDICATED THAT THESE NARTRON SAMPLE CONTROL UNITS FAILED THE ENDURANCE TEST AGAIN AND TESTING WAS AGAIN SUSPENDED AND NARTRON WAS SO NOTIFIED. THE SPARTON AND SWISS SAMPLES HAD, AT THAT TIME, SUCCESSFULLY COMPLETED ALL TESTS WITH THE EXCEPTION OF THE FUNGUS RESISTANCE TEST WHICH WAS STILL IN PROGRESS.

DURING THE PERIOD IN WHICH NARTRON WAS ATTEMPTING TO HAVE ITS CONTROL UNIT PLACED ON THE QPL, IT ASSUMED THAT ALL FUTURE PROCUREMENTS WOULD BE HELD IN ABEYANCE UNTIL A NEW QPL FOR CONTROL UNITS WAS ISSUED. REMINDED THE USATACOM OFFICIALS THAT BOTH ITS FLASHER UNIT AND CONTROL UNIT HAD BEEN QUALIFIED UNDER MIL-C-62069. USATACOM REPLIED TO THIS STATEMENT ON AUGUST 26, 1969, ADVISING THAT IT WAS NOT ITS INTENTION TO HOLD ALL PROCUREMENTS OF THE CONTROL UNITS IN ABEYANCE UNTIL PUBLICATION OF A NEW QPL FOR THAT ITEM. NARTRON WAS ADVISED THAT MINIMUM ESSENTIAL NEEDS WOULD BE FILLED BEFORE A NEW QPL WAS PUBLISHED IF EMERGENCY REQUIREMENTS AROSE. SEE ASPR 1-1107.1. NARTRON WAS FURTHER INFORMED THAT USATACOM'S LETTER OF JUNE 11, 1969 (ADVISING NARTRON OF ITS QUALIFICATION) WAS RESCINDED BECAUSE NO PROCUREMENT UTILIZING MIL-C-62069A WAS AUTHORIZED AT THAT TIME.

ON JANUARY 6, 1970, USATACOM WAS ADVISED THAT THE TURN SIGNAL KIT WAS IN A CRITICAL BACKORDER POSITION AND IT WAS DETERMINED TO TAKE IMMEDIATE STEPS TO AWARD A CONTRACT FOR THE URGENTLY NEEDED KITS. IT WAS ALSO DETERMINED THAT NARTRON'S PROPOSAL WOULD NOT BE CONSIDERED FOR AWARD BECAUSE THE COMPANY BASED ITS DECEMBER 11, 1969, PROPOSAL ON SUPPLYING ITS OWN CONTROL UNIT AS APPROVED BY USATACOM LETTER DATED JUNE 11, 1969. SINCE THIS APPROVAL HAD BEEN RESCINDED BY USATACOM LETTER DATED AUGUST 26, 1969, NARTRON'S PROPOSAL WAS CONSIDERED UNACCEPTABLE.

ON JANUARY 13, 1970, CONTRACT NO. DAAE07-70-C-2409 WAS AWARDED TO SWISS WHICH HAD SUBMITTED THE LOWEST ACCEPTABLE PROPOSAL UNDER RFP 0243. AT THE DATE OF AWARD, NARTRON WAS NOT QUALIFIED UNDER THE QPL PROCEDURES.

THE BRIEF SUBMITTED BY YOU CONTAINS SEVERAL ALLEGATIONS OF IMPROPER PROCUREMENT PRACTICES AMONG WHICH IS THE CONTENTION THAT THE CONTRACTING AGENCY'S REJECTION OF NARTRON'S LOW PROPOSAL WAS ILLEGAL BECAUSE IT WAS BASED UPON INSUFFICIENT GROUNDS CONTRARY TO THE LAWS RESPECTING COMPETITIVE BIDDING AND BECAUSE DENIAL OF QPL APPROVAL OF THE NARTRON CONTROL UNIT WAS IN DISREGARD OF LAW RESPECTING COMPETITIVE BIDDING. NARTRON POINTS OUT THAT ITS CONTROL UNIT WAS AN ACCEPTABLE PRODUCT WHICH HAD BEEN DETERMINED BY THE PROCUREMENT AGENCY TO MEET THE ESSENTIAL REQUIREMENTS OF THE SPECIFICATIONS AND THAT ITS CONTROL UNIT SHOULD HAVE BEEN QUALIFIED; THAT THE AMENDMENT OF THE SPECIFICATIONS SHORTLY AFTER QUALIFICATION DOES NOT ALTER THE FACT THAT THE CONTROL UNIT HAD SUCCESSFULLY MET THE ESSENTIAL REQUIREMENTS OF THE SPECIFICATIONS BECAUSE THE NEW SPECIFICATION DID NOT ALTER THE PRIOR SPECIFICATIONS IN ANY ESSENTIAL MANNER; AND THAT THE STRENGTH TEST WAS CLEARLY NONESSENTIAL REQUIREMENT SINCE IT WAS NOT DEEMED ESSENTIAL IN THE PAST. YOUR BRIEF ALSO STATES, GENERALLY, THAT THE INCLUSION OF THE STRENGTH TEST IN THE SPECIFICATIONS REPRESENTED A "NONESSENTIAL MECHANICAL ELEMENT" WHICH WAS AN INCONCLUSIVE MEASURE OF THE FUNCTIONAL ABILITY OF THE CONTROL UNIT AND, AS SUCH, WAS AN ILLEGAL SPECIFICATION REQUIREMENT. YOU ALLEGE FURTHER THAT USATACOM UNREASONABLY REQUIRED AN ENDURANCE RETESTING OF NARTRON'S SAMPLE CONTROL UNIT.

IN SUMMARY, NARTRON ALLEGES THAT AWARD SHOULD HAVE BEEN MADE TO IT EVEN THOUGH IT PROPOSED TO USE ITS OWN CONTROL UNIT WHICH WAS NOT THEN LISTED ON THE QPL AS REQUIRED BY THE RFP.

OUR OFFICE HAS RECOGNIZED THE USE OF A QUALIFIED PRODUCTS SYSTEM AS AN ACCEPTABLE METHOD OF PROCUREMENT IN VIEW OF THE AUTHORITY CONTAINED IN 10 U.S.C. 2305, WHICH VESTS IN THE INDIVIDUAL PROCUREMENT AGENCIES A REASONABLE DEGREE OF DISCRETION TO DETERMINE THE EXTENT OF COMPETITION THAT MAY BE REQUIRED CONSISTENT WITH THE NEEDS OF THE AGENCY. 43 COMP. GEN. 223 (1963); 36 COMP. GEN. 809 (1957). IT IS RECOGNIZED THAT THE ADMINISTRATION OF THE QPL SYSTEM MAY RESULT IN INSTANCES WHERE COMPETITION IS RESTRICTED. THEREFORE, THE NEED FOR QUALIFICATION REQUIREMENTS MUST BE JUSTIFIED. USATACOM'S REQUEST TO HIGHER AUTHORITY FOR APPROVAL TO INCLUDE QUALIFICATION REQUIREMENTS CONCERNING MIL-C 62069 FOR THE TURN SIGNAL SPECIFIED THE FOLLOWING:

"A. THE COST OF REPETITIVE PREPRODUCTION TESTING WOULD BE EXCESSIVE. * *

"B. THE INTEREST OF THE GOVERNMENT REQUIRES ASSURANCE, PRIOR TO AWARD, THAT THE PRODUCT IS SATISFACTORY FOR ITS INTENDED USE. * * *" IN THIS REGARD, SEE ASPR 1-1103. OUR DECISION AT 42 COMP. GEN. 717 (1963) HELD AT PAGE 720:

"* * * WE HAVE RECOGNIZED THAT COMPETITION MAY BE RESTRICTED BY THE GOVERNMENT CONSISTENT WITH ITS NEEDS. SEE 36 COMP. GEN. 809, 815-816, WHERE WE UPHELD THE USE OF A QUALIFIED PRODUCTS SYSTEM; AND 40 COMP. GEN. 35, WHERE WE SUSTAINED THE USE OF THE TWO-STEP PROCUREMENT PROCEDURE. OBVIOUSLY, THE GOVERNMENT SHOULD NOT BE REQUIRED TO PURCHASE FROM UNQUALIFIED SOURCES. 26 COMP. GEN. 676. NOR SHOULD IT HAVE TO PURCHASE WHAT IT DOESN'T NEED OR INCLUDE IN EVALUATION OF A BID ITEMS WHICH WILL NOT IN FACT BE INCLUDED IN A CONTRACT AWARD."

A REASONABLE RESTRICTION UPON COMPETITION DOES NOT IN ITSELF VIOLATE THE RULE OF COMPETITIVE BIDDING THAT ALL BIDDERS SHOULD HAVE AN EQUAL OPPORTUNITY TO BID ON A COMMON BASIS, IF IT CAN BE SHOWN THAT THE RESTRICTION IS NECESSARY TO THE BEST INTEREST OF THE PROCURING AGENCY. COMP. GEN. 456 (1966), AT PAGE 460.

ASPR 1-1101 REFERENCES CHAPTER IV OF THE DEFENSE STANDARDIZATION MANUAL (DSM) 4120.3-M WHICH IS CONCERNED WITH QUALIFIED PRODUCTS AND QUALIFICATION PROCEDURES.

PARAGRAPH 4-101, CHAPTER IV, DSM PROVIDES:

"PURPOSE OF QUALIFICATION. SINCE MANY SPECIFICATIONS ARE BASED ON PERFORMANCE REQUIREMENTS THE POSSIBLE VARIATIONS IN DESIGN AND QUALITY AND THE NATURE OF THE REQUIREMENTS AND TESTS FOR CERTAIN CLASSES OF PRODUCTS ARE SUCH THAT IT IS IMPRACTICAL TO PROCURE PRODUCTS SOLELY ON ACCEPTANCE TESTS WITHOUT UNDULY DELAYING DELIVERY. TO DETERMINE AVAILABILITY OF PRODUCTS IN SUCH CASES, QUALIFICATION OF SPECIFIC PRODUCTS IS REQUIRED PRIOR TO THE OPENING OF BIDS OR THE AWARD OF NEGOTIATED CONTRACTS. TESTING OF A PRODUCT FOR COMPLIANCE WITH THE REQUIREMENTS OF A SPECIFICATION IN ADVANCE OF, AND INDEPENDENT OF ANY SPECIFIC PROCUREMENT ACTION, IS KNOWN AS QUALIFICATION TESTING. THE ENTIRE PROCESS BY WHICH PRODUCTS ARE OBTAINED FROM MANUFACTURERS, EXAMINED AND TESTED, AND THEN IDENTIFIED ON A LIST OF QUALIFIED PRODUCTS IS KNOWN AS QUALIFICATION. THE PURPOSE OF QUALIFICATION IS, PRIOR TO AND INDEPENDENT OF ANY PROCUREMENT ACTION, TO PROVIDE A MEANS OF RELIEVING QUALITY CONFORMANCE INSPECTION OF SOMETIMES LONG, COMPLEX, OR EXPENSIVE TESTS, SOME OF WHICH WOULD OTHERWISE BE REQUIRED AFTER EACH AWARD (SEE 4-105). TO ESTABLISH A QUALIFIED PRODUCTS LIST, A SPECIFICATION MUST EXIST WHICH REQUIRES QUALIFICATION AND SETS FORTH THE QUALIFICATION EXAMINATION AND TESTS."

FROM THE FACTS PRESENTED, THERE APPEARS NO EVIDENCE OF BAD FAITH OR ABUSE OF DISCRETION ON THE PART OF USATACOM. TO THE CONTRARY, ITS DECISION TO REQUIRE QPL TESTING REMOVED THE TURN SIGNAL KIT FROM ITS SOLE-SOURCE POSITION AND PROMOTED COMPETITION. WITH REGARD TO THAT PART OF THE PROTEST AGAINST THE NECESSITY FOR THE SPECIFICATION CHANGE, IT SHOULD BE RECOGNIZED THAT THE DRAFTING OF SPECIFICATIONS AND CHANGES THERETO ARE RESPONSIBILITIES VESTED SOLELY IN THE PROCUREMENT OFFICE AND OUR OFFICE HAS CONSISTENTLY TAKEN THE POSITION THAT SUCH PROCUREMENT FUNCTION IS NOT SUBJECT TO LEGAL QUESTION IF EXERCISED, AS HERE, WITHIN THE CONTEMPLATION OF LAW AND REGULATION.

WE FIND ADEQUATE BASIS FOR HOLDING THAT THE TESTING REQUIREMENTS, AS APPLIED, WERE BASED UPON A BONA FIDE DETERMINATION OF THE NEEDS OF THE DEPARTMENT OF THE ARMY. CLEARLY, IN THE ORDERLY CONDUCT OF ITS BUSINESS THE GOVERNMENT MAY NOT BE PLACED IN THE POSITION OF HAVING TO SHARE ITS DISCRETIONARY PROCUREMENT RESPONSIBILITIES WITH ONE OF ITS POTENTIAL SUPPLIERS. 45 COMP. GEN. 365 (1965); 34 COMP. GEN. 336 (1955); B-139489, AUGUST 3, 1959; B-150532, MARCH 1, 1963; B-132419, JULY 31, 1957.

YOU PROTEST FURTHER THE REMOVAL OF NARTRON'S UNIT FROM THE QPL. IN THIS REGARD, PARAGRAPH 4.113.1, CHAPTER IV, DSM 4120.3-M PROVIDES, IN PERTINENT PART, AS FOLLOWS:

"REASONS FOR REMOVAL. A PRODUCT MAY BE REMOVED FROM THE LIST FOR REASONS CONSIDERED TO BE SUFFICIENT, AMONG WHICH ARE THE FOLLOWING:

"(A) THE PRODUCT OFFERED UNDER CONTRACT DOES NOT MEET THE REQUIREMENTS OF THE SPECIFICATION.

"(E) THE REQUIREMENTS OF A REVISED SPECIFICATION DIFFER SUFFICIENTLY FROM THE PREVIOUS ISSUE THAT EXISTING TEST DATA ARE NO LONGER APPLICABLE FOR DETERMINING COMPLIANCE OF THE PRODUCT WITH THE SPECIFICATION." PARAGRAPH 4-113.3 DSM 4120.3-M PROVIDES:

"NOTICE OF REMOVAL. AFTER DETERMINATION HAS BEEN MADE TO REMOVE A PRODUCT FROM THE LIST, THE MANUFACTURER WILL BE SENT A NOTICE OF REMOVAL AND, BY MEANS OF A REVISION OR AMENDMENT OF THE APPLICABLE LIST, THE PRODUCT WILL BE DELETED THEREFROM WITHOUT DELAY. IF REMOVAL IS FOR REASON 4-113.1 (E), THE APPLICANT WILL BE REQUIRED TO SUBMIT TEST DATA OR EXAMPLES FOR TESTS, AS APPROPRIATE. * * *"

NARTRON WAS ADVISED BY LETTER OF AUGUST 7, 1969, FROM USATACOM, THAT MILITARY SPECIFICATION MIL-C-62069 WAS BEING AMENDED; THAT SAID AMENDMENT WOULD AFFECT THE CONTROL UNIT REQUIREMENTS; AND THAT "NO CONTROL UNITS ARE APPROVED FOR QPL LISTING." BY USATACOM LETTER OF AUGUST 19, 1969, NARTRON WAS ADVISED OF THE REQUIREMENT TO SUBMIT SIX TURN SIGNAL CONTROL UNIT SAMPLES FOR TESTING IN ACCORDANCE WITH REVISED SPECIFICATION MIL-C-62069B (AT). ON AUGUST 26, 1969, NARTRON WAS AGAIN SPECIFICALLY ADVISED THAT THE USATACOM LETTER OF JUNE 11, 1969, (ADVISING NARTRON ITS UNIT QUALIFIED FOR QPL) WAS RESCINDED AND THAT NO PROCUREMENT UTILIZING MIL-C-62069 OF JUNE 27, 1967, WOULD BE EFFECTED. OUR OFFICE HAS RECOGNIZED THAT ONCE A CONTRACTOR IS PLACED ON A QPL IT REMAINS ELIGIBLE TO SUBMIT BIDS OR PROPOSALS WITH RESPECT TO THE ITEM FOR WHICH IT IS QUALIFIED UNTIL (1) IT IS REMOVED FROM THE QPL, OR (2) REQUIRED TO REQUALIFY ITS PRODUCT. 165179, OCTOBER 10, 1969.

IN VIEW OF THE FOREGOING, IT MUST BE CONCLUDED THAT THE NOTICES TO THE NARTRON CORPORATION, BOTH WRITTEN AND ORAL COMMUNICATIONS, FULLY MET THE NOTICE REQUIREMENTS OF DSM 4120.3-M. ALL INTERESTED PARTIES, INCLUDING NARTRON, WERE ADVISED ON AND AFTER AUGUST 7, 1969, THAT REQUALIFICATION OF CONTROL UNIT TURN SIGNAL SAMPLES WOULD BE NECESSARY DUE TO SPECIFICATION CHANGES. A SPECIFIC DATE FOR THE SUBMISSION OF NEW SAMPLES, I.E; OCTOBER 1, 1969, WAS GIVEN AND THE PRECISE ADDRESS WHERE THE SAMPLES WOULD BE SHIPPED FOR TESTING WAS FURNISHED IN WRITING. THE NOTICE FOR QPL APPROVAL AND THE OPPORTUNITY FOR QUALIFICATION WERE EXTENDED TO ALL INTERESTED OFFERORS; HENCE, IT MAY NOT BE SAID THAT ANY PARTICULAR OFFEROR WAS PREJUDICED OR THAT THE PROCUREMENT ACTIVITY ACTED ARBITRARILY OR WITHOUT AUTHORITY.

BASED ON THE RECORD BEFORE US, WE MUST CONCLUDE THAT THE ACTIONS TAKEN BY THE PROCUREMENT ACTIVITY IN THE CIRCUMSTANCES ARE NOT SUBJECT TO QUESTION BY OUR OFFICE.