Legal Updates

Attaching a copy of the bank guarantee to a tender bid instead of the original is grounds for disqualification of the bidder

August 9, 2020

The Jerusalem Municipality issued a tender for the maintenance and restoration of bridges, tunnels and road structures in the city, with one of the threshold conditions of the tender being an unconditional bank guarantee for submitting the bid, in accordance with the form guarantee attached to the tender conditions. One of the bidders attached a color photocopy of the guarantee instead of the original guarantee. When the municipality discovered the mistake after about a month, a municipal employee called the bidder and noted it, following which it was clarified that this was a mistake and the original guarantee was sent.
The Supreme Court held that the non-attachment of the original guarantee disqualifies the proposal. The requirement of equality between the participants in the tender requires strict adherence to an original bank guarantee requirement because the actual non-issuance of the guarantee may allow the bidder to cancel the guarantee in the period between submission of the bid and the date of discovery of the missing original guarantee. Therefore, when no original guarantee was attached to the bid in the tender, the bid will be disqualified even if as a result the public accounts will be damaged to some extent.