B-240590.2, Jan 7, 1991, 70 Comp.Gen. 170

B-240590.2: Jan 7, 1991

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PROCUREMENT - Competitive Negotiation - Competitive advantage - Foreign laws Protest is dismissed where protester complains of its competitive disadvantage in procurement of Embassy guard services resulting from application of Panamanian law since disadvantage is not the result of preference or unfair action by United States government. The solicitation was issued on June 15. Was mailed to 53 prospective contractors including the protester and MIMSA. Which is presently providing the required guard services at the United States Embassy in Panama as essentially a substitute under the protester's current contract. The extended closing date for the receipt of proposals under the solicitation was scheduled for September 7.

B-240590.2, Jan 7, 1991, 70 Comp.Gen. 170

PROCUREMENT - Competitive Negotiation - Competitive advantage - Foreign laws Protest is dismissed where protester complains of its competitive disadvantage in procurement of Embassy guard services resulting from application of Panamanian law since disadvantage is not the result of preference or unfair action by United States government.

Attorneys

DOD Contracts, Inc.:

DOD Contracts, Inc. protests the award of any contract under solicitation No. S-132-FA-151, issued by the Department of State for guard services at the United States Embassy in Panama City, Panama. DOD Contracts contends that it suffers an unfair competitive disadvantage under the solicitation.

We dismiss the protest.

The solicitation was issued on June 15, 1990, and was mailed to 53 prospective contractors including the protester and MIMSA, which is presently providing the required guard services at the United States Embassy in Panama as essentially a substitute under the protester's current contract. The solicitation contemplates the award of a firm, fixed-price contract for 1 year plus 4 option years. The extended closing date for the receipt of proposals under the solicitation was scheduled for September 7. DOD Contracts filed its protest with our Office on September 5.

The solicitation requires bidders to provide their proposed wage rates and requires compliance with any wage standards set by Panamanian law. Bidders were directed to address their questions about any required wage rates to the appropriate Panamanian government authority. Under the solicitation, current Embassy guards are to be offered the right of first refusal for employment under the contract. Article 159 of the Panamanian Labor Code, which all parties agree applies to these services, prohibits any Panamanian licensed employer from reducing the wages of its employees as long as they remain working for that employer, even if the employees agree to any wage reduction. The State Department reports, and the protester agrees, that since MIMSA is the licensed firm currently providing these services, MIMSA, and not DOD Contracts, would be required to pay the current Embassy guards their present wage rates. Other competitors could propose lower wage rates.

DOD Contracts essentially contends that it suffers a competitive disadvantage because it has been unable to acquire a business license from the Panamanian government to perform these services and that it would again have to perform the work through MIMSA as it did under its existing contract. Under such an arrangement, since MIMSA would be legally required to maintain its current employee wages, DOD Contracts contends it would have to bid a higher price than other competitors. DOD Contracts states that the agency previously directed the firm under its existing contract to increase employee wages which it now cannot reduce.

The agency responds that since DOD Contracts is not required to bid in conjunction with MIMSA, the protester's sole complaint is that the Panamanian government has not yet approved the firm's license application.

Generally, certain firms may enjoy a competitive advantage or disadvantage by virtue of their own particular circumstances, and we know of no requirement for equalizing competition by taking into consideration these types of advantages or disadvantages. See ENSEC Service Corp., 55 Comp.Gen. 656 (1976), 76-1 CPD Para. 34. Rather, the test to be applied is whether the competitive advantage or disadvantage experienced by a particular firm would be the result of preference or unfair action by the government. See id. Here, the disadvantage suffered by the protester (if it chooses to use MIMSA) results from Panamanian law and not from preference or unfair action by the government. Further, to the extent the protester's complaint is against its inability to obtain the required Panamanian license for performance without using MIMSA, its protest is a grievance against a third party, the Panamanian government, other than the contracting agency, which is not within the control of the United States government and which also does not form an appropriate basis for a protest to our Office. 4 C.F.R. Sec. 21.3(m) (1990).

Accordingly, we dismiss the protest.