Legal Updates

In the event of a “draw” between bidders the tender committee is obliged to examine all options and duly reason its decisions

August 4, 2022

Two bids in a tender received the same weighted score when the terms and conditions of the tender did not stipulate a "tie-breaker" mechanism. Despite this, the tender committee preferred the cheapest bid without reasoning.

The Court cancelled the decision made by the tender committee and held that the tender committee will hold a renewed hearing before making its duly reasoned decision. An administrative authority is obliged to consider and examine the options before it, on their merits and demerits, and to duly reason its decisions. Here, the tender terms and conditions established a mechanism for scoring the offers, where 80% of the score will be awarded to the price component, while 20% of the score will be according to the quality component, but after weighing the bids, a rare situation of a "draw" occurred between the bidders. The tender did not set rules to resolve such scenario, but the tender committee had several options to choose from: First, to cancel the tender and conduct a new tender that will address such issue; Second, splitting the winnings between the two bidders with their consent; Third, conducting a bidding procedure between the two bidders; Fourth, holding a raffle; and fifth, giving the right to argue the matter to both bidders and choosing one of the two bids. In this case, the tender committee decided not to split the works even though the two bidders had agreed to it, but preferred to enter into contract with only one of the bidders with the cheaper bid, without reasoning it and without considering all the different options. Therefore, there was a flaw in the tender committee's decision and the discussion is to be returned to the committee in order for it to re-examine its decision and duly reason it.