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IT IS OUR VIEW THAT THIS REQUIREMENT WILL DISCOURAGE THE FILING OF MERITLESS PROTESTS AND COVER AT LEAST PART OF THE GOVERNMENT'S COST OF HANDLING SUCH PROTESTS THAT ARE DISMISSED OR DENIED. IT IS NOT CLEAR FROM YOUR LETTER WHETHER YOU ARE SUGGESTING THAT THE BOND REQUIREMENT BE APPLICABLE ONLY TO PROTESTS FILED WITH THE CONTRACTING AGENCY OR TO PROTESTS FILED WITH OUR OFFICE AS WELL. WE DO NOT THINK IT IS A GOOD IDEA. IS UNTIMELY. OR IS OTHERWISE NOT FOR OUR CONSIDERATION. MANY PROTESTS FILED WITH OUR OFFICE ARE DISMISSED. IN MOST OF THESE CASES WE ARE ABLE TO DISMISS THE PROTEST WITHOUT THE NEED FOR AN AGENCY RESPONSE AT ALL. WE THINK THAT WE CAN AND ARE ELIMINATING MOST UNFOUNDED PROTESTS AT A MINIMUM COST TO THE GOVERNMENT.

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B-208159, SEP 25, 1985, OFFICE OF GENERAL COUNSEL

PRECIS-UNAVAILABLE

MR. DAVID L. HOFF: POST OFFICE BOX 606 AIRWAY HEIGHTS, WASHINGTON 99001-0606

BY LETTER DATED AUGUST 22, 1985, YOU SUGGESTED THAT THE PROCUREMENT REGULATIONS BE AMENDED TO REQUIRE THAT A $500 BOND ACCOMPANY EVERY BID PROTEST FILED. IT IS OUR VIEW THAT THIS REQUIREMENT WILL DISCOURAGE THE FILING OF MERITLESS PROTESTS AND COVER AT LEAST PART OF THE GOVERNMENT'S COST OF HANDLING SUCH PROTESTS THAT ARE DISMISSED OR DENIED. IT IS NOT CLEAR FROM YOUR LETTER WHETHER YOU ARE SUGGESTING THAT THE BOND REQUIREMENT BE APPLICABLE ONLY TO PROTESTS FILED WITH THE CONTRACTING AGENCY OR TO PROTESTS FILED WITH OUR OFFICE AS WELL. IN ANY EVENT, WE DO NOT THINK IT IS A GOOD IDEA.

THE COMPETITION IN CONTRACTING ACT OF 1984, (CICA), PUB.L. NO. 98-369, TITLE VII, 98 STAT. 1175, ESTABLISHED IN OUR OFFICE AS A BID PROTEST FORUM. CICA AND OUR IMPLEMENTING REGULATIONS ALLOW US TO DISMISS A PROTEST WHEN ON ITS FACE IT DOES NOT STATE A VALID BASIS FOR PROTEST, IS UNTIMELY, OR IS OTHERWISE NOT FOR OUR CONSIDERATION. BID PROTEST REGULATIONS, 4 C.F.R. SEC. 21.2 AND 21.3(F) (1985). OUR REGULATIONS PROVIDE THAT WE MAY DISMISS A PROTEST AT ANY TIME DURING THE PROTEST PROCESS. 4 C.F.R. SEC. 21.3(F). IN FACT, MANY PROTESTS FILED WITH OUR OFFICE ARE DISMISSED, AND IN MOST OF THESE CASES WE ARE ABLE TO DISMISS THE PROTEST WITHOUT THE NEED FOR AN AGENCY RESPONSE AT ALL. THUS, WE THINK THAT WE CAN AND ARE ELIMINATING MOST UNFOUNDED PROTESTS AT A MINIMUM COST TO THE GOVERNMENT.

IN ADDITION, REQUIRING A BOND WOULD HAVE A DISCRIMINATORY IMPACT ON SMALL BUSINESSES. THE SMALL BUSINESS BIDDER WITH A LEGITIMATE PROTEST WOULD BE PRECLUDED FROM VOICING ITS OBJECTION TO A SOLICITATION OR AWARD IF IT IS UNABLE TO MARSHALL THE NECESSARY FUNDS. MOREOVER, A SMALL BUSINESS PERSON WHO IS NOT AN EXPERT IN PROCUREMENT LAW WOULD BE RELUCTANT TO FILE FOR FEAR OF LOSING THE BOND MONEY SHOULD ITS PROTEST BE ULTIMATELY DENIED.

IN OUR VIEW, A BOND REQUIREMENT WOULD SERVE AS A SERIOUS IMPEDIMENT TO SMALL BUSINESSES, DISCOURAGE MANY POTENTIALLY SUCCESSFUL PROTESTS, AND INHIBIT AT LEAST ONE KEY PURPOSE OF OUR BID PROTEST FORUM: TO ENCOURAGE PRIVATE PARTIES TO ENFORCE THE SUBSTANTIVE PROVISIONS OF CICA. CONSEQUENTLY, WE DO NOT PROPOSE TO ADD SUCH A REQUIREMENT TO OUR REGULATIONS.

WITH RESPECT TO PROTESTS FILED AT THE AGENCY LEVEL, THEY ARE NOT GOVERNED BY CICA OR OUR BID PROTEST REGULATIONS, AND THEREFORE OUR APPROVAL IS NOT CONTROLLING WITH RESPECT TO SUCH PROTESTS, ALTHOUGH AS A MATTER OF POLICY, WE WOULD NOT ENCOURAGE THE AGENCIES TO ADOPT A BOND REQUIREMENT.

WE APPRECIATE YOUR INTEREST IN THE PROTEST PROCESS.

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