B-169165, APR. 17, 1970

B-169165, APR. 17, 1970

BIDS--MULTIPLE PROPRIETY AWARD OF CONTRACT TO LOW BIDDER IS AFFIRMED NOTWITHSTANDING FACT THAT ANOTHER BID WAS SUBMITTED BY FIRM AFFILIATED WITH LOW BIDDER, AS MERE FACT OF AFFILIATION DOES NOT RENDER BIDS RECEIVED FROM AFFILIATED COMPANIES ILLEGAL OR NONRESPONSIVE; AND RECORD PRESENTS NO EVIDENCE THAT EITHER COMPANY'S BID WAS NOT SUBMITTED STRICTLY ON BASIS COMPETITIVE TO ALL OTHER BIDDERS, NOR IS THERE ANY OTHER BASIS FOR FINDING OF IMPROPER OR ILLEGAL BIDDING. SEE COMP. GEN. DECS. CITED.

TO WHITE PLAINS ELECTRICAL SUPPLY CO; INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 24, 1970, PROTESTING THE AWARD OF A CONTRACT TO WESTINGHOUSE ELECTRIC SUPPLY CO. SPOKANE, WASHINGTON, UNDER BUREAU OF RECLAMATION SOLICITATION FOR BIDS NO. 100- 1536, ISSUED BY THAT BUREAU AT BOISE, IDAHO.

THE SOLICITATION WAS FOR THE PROCUREMENT OF CABLE INTENDED FOR THE GRAND COULEE THIRD POWERPLANT, COLUMBIA BASIN PROJECT, WASHINGTON. YOUR PROTEST CONCERNS THE FACT THAT TWO AFFILIATES OF THE WESTINGHOUSE ELECTRIC CORPORATION SUBMITTED BIDS AND THAT THE BUREAU OF RECLAMATION PROPOSES TO AWARD A CONTRACT IN THE AMOUNT OF $8,700 TO THE LOWEST ACCEPTABLE BIDDER, WESTINGHOUSE ELECTRIC SUPPLY CO; SPOKANE, WASHINGTON. YOUR COMPANY WAS SECOND LOW BIDDER, HAVING SUBMITTED A BID OF $9,135, LESS DISCOUNT AND ALLOWANCES. ANOTHER BID BY A FIRM OF THE SAME NAME AS THE LOW BIDDER, WESTINGHOUSE ELECTRIC SUPPLY CO. OF BOISE, IDAHO, WAS SUBMITTED IN THE AMOUNT OF $15,585. IT IS INDICATED THAT BOTH FIRMS ARE INCORPORATED IN THE STATE OF PENNSYLVANIA AND THAT THE PARENT COMPANY IS WESTINGHOUSE ELECTRIC CORPORATION.

IN YOUR LETTER OF FEBRUARY 24, 1970, TO THIS OFFICE, YOU STATE THAT "THE SAME COMPANY IN THE NAME OF WESTINGHOUSE ELECTRIC SUPPLY CO. HAS SUBMITTED ANOTHER BID, WHICH IS A HIGHER BID." YOU STATE FURTHER THAT "WE FEEL THAT TO ALLOW THIS COMPANY PLURAL BIDS, UNDER THE CIRCUMSTANCES, IS HIGHLY PREJUDICIAL TO OURSELVES, THE SECOND LOW BIDDER, AND HIGHLY DESTRUCTIVE OF THE INTEGRITY OF THE BID SYSTEM. WE, AS THE SECOND LOW BIDDER SHOULD THUS RECEIVE THE AWARD." IN YOUR LETTER OF FEBRUARY 26, 1970, TO THE BUREAU OF RECLAMATION, BOISE, IDAHO, YOU STATE THAT:

"* * * WE NOTE THAT WHERE A CORPORATION AND ITS WHOLLY OWNED SUBSIDIARY SUBMITTED BIDS ON THE SAME SUPPLIES, THE COMPTROLLER GENERAL HAS ADVISED THAT 'NO BIDDER SHOULD BE PERMITTED THE ADVANTAGE OF DOUBLE BIDDING HEREAFTER'.

"THIS WAS TAKEN FROM DECISION 14, COMPTROLLER GENERAL 168 (1934)." IT IS THE POSITION OF THE BUREAU OF RECLAMATION THAT IT HAS BEEN COMMON PRACTICE IN THE PAST TO RECEIVE BIDS FROM AFFILIATES OF A FIRM LOCATED IN DIFFERENT LOCATIONS AND THAT THERE IS NO LEGAL OBJECTION TO THE SUBMISSION OF SEPARATE BIDS BY AFFILIATED CONCERNS.

IN A 1934 DECISION OF OUR OFFICE, 14 COMP. GEN. 168, IT WAS DETERMINED THAT NO BIDDER SHOULD BE PERMITTED THE ADVANTAGE OF DOUBLE BIDDING AND THAT BIDS SUBMITTED BY TWO CORPORATIONS, ONE OF WHICH WAS OWNED AND CONTROLLED BY THE OTHER, SHOULD NOT BE CONSIDERED IN THE MAKING OF A CONTRACT AWARD. THAT DECISION WAS MODIFIED BY DECISION 39 COMP. GEN. 892 (1960) IN WHICH IT WAS HELD THAT THE BIDS OF A CORPORATION AND AN AFFILIATED CONCERN SUBMITTED IN RESPONSE TO THE SAME INVITATION FOR BIDS WERE NOT REQUIRED TO BE REJECTED BECAUSE OF SUCH AFFILIATION. THE SUBJECT OF THE SUBMISSION OF SEPARATE BIDS BY AFFILIATED CONCERNS HAS BEEN CONSIDERED IN SEVERAL SUBSEQUENT DECISIONS OF OUR OFFICE, INCLUDING B- 166291, APRIL 16, 1969, AND IT MAY BE STATED THAT SINCE THE TIME OF RENDERING THE DECISION, 39 COMP. GEN. 892, IT HAS BEEN OUR POSITION THAT THE SUBMISSION OF SEPARATE BIDS BY AFFILIATED CONCERNS IS NOT PROHIBITED BY LAW. B-167725, OCTOBER 3, 1969. THEREFORE, THE MERE FACT OF AFFILIATION WOULD NOT RENDER BIDS RECEIVED FROM COMPANIES WITH THIS RELATIONSHIP ILLEGAL OR NONRESPONSIVE.

IN OUR DECISION AT 39 COMP. GEN. 892, WE TOOK COGNIZANCE OF THE FACT THAT IT IS NOT UNUSUAL FOR MULTIPLE BIDS TO BE SUBMITTED BY AN INDIVIDUAL OR INDIVIDUALS WHO MIGHT HAVE LEGITIMATE REASONS FOR SUBMITTING BIDS OF TWO OR MORE COMPANIES COMMONLY OWNED AND/OR CONTROLLED. SEE, ALSO, B-162187, NOVEMBER 29, 1967, WHEREIN WE HELD:

"IN ANY EVENT, THE PROCURING AGENCY IS GENERALLY REQUIRED TO ACCEPT THE LOWEST RESPONSIVE BID SUBMITTED BY A RESPONSIBLE BIDDER. 10 U.S.C. 2305. THEREFORE, WE MAY CONCLUDE THAT WHERE THE CONSIDERATION OF BIDS SUBMITTED FOR LEGITIMATE BUSINESS REASONS BY AN INDIVIDUAL THROUGH TWO OWNED OR CONTROLLED COMPANIES WILL NOT PREJUDICE THE GOVERNMENT OR AFFORD EITHER COMPANY AN ADVANTAGE NOT ENJOYED BY OTHER BIDDERS, WE WILL TAKE NO EXCEPTION TO THE AWARD OF A CONTRACT TO EITHER COMPANY, PROVIDED THAT THE COMPANY HAS BEEN AFFIRMATIVELY DETERMINED TO BE THE RESPONSIBLE BIDDER WHICH SUBMITTED THE LOW RESPONSIVE BID, AS IN THE PRESENT CASE."

IT IS NOTED THAT THE WESTINGHOUSE ELECTRIC CO. OF SPOKANE SPECIFIED IN ITS BID THAT IT PROPOSED TO FURNISH CONTROL CABLE MANUFACTURED BY ESSEX INTERNATIONAL, INC; MARION, INDIANA, WHEREAS WESTINGHOUSE ELECTRIC SUPPLY CO. OF BOISE, IDAHO, SPECIFIED THAT THE CONTROL CABLE WOULD BE MANUFACTURED BY AMERICAN INSULATED WIRE, BELLMAWR, NEW JERSEY. WE HAVE NO REASON TO BELIEVE OTHER THAN THAT EACH COMPANY'S BID WAS SUBMITTED STRICTLY ON A BASIS COMPETITIVE TO ALL OTHER BIDDERS.

IN SUBMITTING THEIR OFFERS, EACH BIDDER CERTIFIED THAT ITS PRICES HAD BEEN ARRIVED AT INDEPENDENTLY, WITHOUT CONSULTATION, COMMUNICATION, OR AGREEMENT, FOR THE PURPOSE OF RESTRICTING COMPETITION, AS TO ANY MATTER RELATING TO SUCH PRICES, WITH ANY OTHER OFFEROR OR WITH ANY COMPETITOR.

IN VIEW OF THE FOREGOING AND SINCE THE RECORD DOES NOT PRESENT ANY BASIS FOR A FINDING OF IMPROPER OR ILLEGAL BIDDING, YOUR PROTEST IS DENIED.