Protest Involving Requirements Contract

B-202152: Jun 12, 1981

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A firm protested the award of a requirements contract by the Federal Supply Service for adjustable wrenches. The protester argued that the price of its Japanese manufactured wrenches, which were subject to an import duty, should have been evaluated without reference to that duty as the Korean manufactured wrenches offered by the awardee were not subject to such a duty. The protester stated that, since its net price excluding the duty was low and since the duty went to the Government, its bid represented the lowest overall cost to the Government. The solicitation called for bids on various types of wrenches and provided that award would be made on an item-by-item basis to the low responsive offerors. In addition, the solicitation incorporated a standard form which provided that the contract would be awarded to the responsible offeror whose offer conformed to the solicitation and would be most advantageous to the Government. The exact basis upon which bids will be evaluated and award made, including any Government costs to be added or deducted, must be stated in the invitation. If any factor other than bid price is to be considered in determining the low bidder, the invitation must advise all bidders of such factor so that all bidders are on an equal footing in submitting bids. Nowhere in the invitation was it indicated that import duties were to be separately considered in the evaluations of bids offering the lowest price. Thus, GAO held that the awardee's and the protester's bids were properly evaluated. In addition, the protester complained that the exemption of the awardee's product from import duty created an unfair competitive situation in Government procurement not comtemplated by the Trade Act of 1974. There is nothing in the Act which indicates that its exemptions are not to apply in Government procurements. Accordingly, the protest was denied.