PRE QUALIFICATION

 Submitted by:
 Iris singhania
 Himanshu parchani
 Islavat karthik
INDEX
 WHAT IS PRE QUALIFICATION AND WHY WE
NEED IT
 STAGES OF COMPETS
 ADVANTAGES AND DISADVANTAGES
 WHAT ALL SHOULD BE THERE IN PRE
QUALIFICATION
 PROCEDURE
INTRODUCTION TO PRE-QUALIFICATION

 Prequalification is an assessment of a consultant's or a

contractor's financial, managerial and technical
resources and competence to execute and complete
work required.
 Pre-qualification of contractorsSometimes works are
awarded on the basis of quotations invited from a
group of ‘selected tenderer’ (a group of known reputed
contractors) who are considered suitable for that job.
This method is known as ‘pre-qualification’ and saves a
lot of time.In the advertisement itself it must be
mentioned that only contractors having experience in
the particular work should submit the tender.
Why Prequalification?
 The successful execution of contracts for large buildings,
civil engineering, supply and installation, turnkey, and
design and build projects requires that contracts be
awarded only to firms, or combinations of firms, that
are suitably experienced in the type of work and
construction technology involved, that are financially
and managerially sound, and that can provide all the
equipment required in a timely manner. The assessment
by an implementing agency of the suitability of firms to
carry out a particular contract prior to being invited to
submit a bid is a process called prequalification
The Pre-Qualification process has four
purposes
 1. Identifying potential suppliers (search)
 2. Gathering supplier information (registration)
 3. Supplier capability and risk assessment
(qualification)
 4. Choosing suppliers to tender (selection)
The invitation to prequalify should
contain at least the following:
 the broader context of the project;
 an overview of the project, including the intended allocation
of major risks and envisaged responsibilities of each party;
 a list and summary of the major studies that will be made
available to bidders concerning the project;
 the intended procurement process;
 the qualifications that companies can put forward (e.g.
parent or subsidiary companies’ qualifications);
 the criteria and tests that will be used to evaluate the
prequalification statement (but not necessarily the precise
details to be used in any scoring or ranking since that could
lead to some manipulation by the candidates); and
 a timetable.
Shortlisting

 The purpose of shortlisting is to reduce the number

of bidders to generally between three and five.
 In evaluating the qualification submission, the
Authority will focus on the technical capability,
business capability and financial position of the
potential bidders.
The prequalification submission will
usually be required to describe the
following:
 the business activities of the consortium (e.g. how many
projects of a similar nature, the consortium has
implemented over a specified number of years);
 financial information (e.g. thresholds involving turnover
and net worth);
 legal information about the PPP consortium, including
any relevant litigation involving the companies; and
 the quality of personnel to be involved in the project.
Invitation to tender

 Preparation of the tender documents will usually

have begun during the last steps of the project
preparation phase but to be time-efficient,
finalisation often takes place during the
prequalification period.
Benefits of Prequalification
 the process enables prospective bidders, who may be
insufficiently qualified on their own, to avoid the
expense of bidding. Conversely it is an incentive for
these potential bidders to form a joint venture that may
give them a better chance of success;
 after being prequalified, well-qualified firms will price
their bids with the knowledge that they are competing
against other qualified bidders meeting realistic
minimum competence criteria; the assurance that
inadequately qualified competitors will be excluded
from submitting unrealistic low bids thus encourages
leading contractors to bid
 it helps to expose potential conflicts of interest by
identifying contractors who may have a business
association with consultants to the project;
 it reduces the amount of work and time involved by
Employers in evaluating bids from unqualified
contractors;
 it encourages local firms to form joint ventures with
other local or international firms, thereby benefiting
from their resources and experience;
Disadvantages of Prequalification
 it may increase procurement lead time, although this can be
minimized by good procurement scheduling, e.g., undertaking the
prequalification process while Bidding Documents are being
prepared;
 the Recipient of Financing is required to review all prequalification
applications, whereas postqualification requires the review of the
qualifications of, normally, only one (the lowest evaluated) bidder;
 collusion (and the possibility of price-rigging) is easier among a
limited number of identified bidders, particularly if they are of the
same nationality;
 the element of subjective judgment required by evaluators when
applying the prequalification criteria to a number of Applicants,
and the discretionary rights reserved to the Employer, provide
opportunities for externally influenced deviations from the expected
high standards of ethics and impartiality in prequalifying applicants.
PRE QUALIFICATION PROCESS
 The prequalification process includes four main
phases:
 (i) Advertising,
 (ii) Preparation and Issuing of the Prequalification
Document,
 (iii) Application Preparation and Submission,
 (iv) Application Evaluation, and Prequalification of
Applicants
ADVERTISING
 The Employer shall advertise prequalification in the
project by preparing and publish it any newspaper
or putting onto a notice board
Preparation and Issuing of the
Prequalification Document
 Instructions to Applicants (ITA)
 Pre-Qualification Data Sheet (PDS)
 Qualification Criteria and Requirements
 Application Forms
Application Evaluation and
Prequalification
 The Employer, in observance of best practices, shall:
 Maintain the application evaluation process
confidential;
 Reject any attempts or pressures to bias the
evaluation, including through fraud and corruption;
 Strictly apply the qualification criteria specified in
the Prequalification Document , Qualification
Criteria and Requirement
 The Employer shall specify the “Qualification
Criteria and Requirements” in the table below.
 The four main qualification criteria are:
 1. Eligibility
 2. Historical Contract Non-Performance
 3. Financial Situation
 4. Experience