[Protest of Navy IFB Cancellation]

B-218015: Apr 12, 1985

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A firm protested the Navy's cancellation of an invitation for bids (IFB). The IFB was cancelled because the Navy determined that the protester's bid price was unreasonably high and a previous supplier was not solicited. The protester contended that: (1) it was awarded a contract before the cancellation; (2) its price was fair and reasonable when compared to prices the Navy paid in previous procurements and the government's initial estimate; and (3) the Navy's failure to solicit the previous supplier should not have been a basis for cancellation. GAO found that the protester was not awarded a contract under the IFB, it was merely notified that a contract number had been assigned. GAO questioned the Navy's acceptance of a previous supplier's quoted price, since procurement history suggested that it was very low. Furthermore, GAO did not believe that the Navy had a basis for rejecting the protester's bid as unreasonably high, since it was consistent with procurement history and a government estimate. The failure of a previous supplier to enter the competition does not prevent award and require resolicitation so long as the agency has made a significant effort to obtain competition, a reasonable price was obtained, and there was no deliberate attempt to exclude the previous supplier from competition. Therefore, GAO recommended that the Navy reevaluate the reasonableness of the protester's bid price, reinstate the IFB, and award the contract to the protester if reevaluation shows that its price is reasonable. Accordingly, the protest was sustained.