The International Competitive bidding process is the best way to provide a big platform to all the contractors. The ICB works under the guidelines of the World Bank. The clients should advertise the bid first, then only they can proceed with further procedure. The World Bank advised borrowers to select the lowest-paid bid.
What do you mean by ICB?
ICB stands for International Competitive Bidding. It is the procurement process required for bidding financed by the World Bank. It provides a large choice to the clients to select the most appropriate contractor. Moreover, it offers a wide platform to all the bidders across the globe.
Price of International Competitive Bidding
ICB procurement procedures are normally done with estimated plan preparation. Currently, the pricing range of ICB is a minimum of $3 million to a maximum of $404 million for work contracts and $1 million to $10million for supplying goods.
The ICB threshold also represents the nature of National Competitive Bidding (NCB) and is usually mentioned in the request for proposal document. Everything depends on the World Bank. The World Bank will ask you to go over the cheapest and best bid for the tender.
Procedure types of ICB
There are two bidding procedures of ICB - single stage one envelope and two envelope procedures are default procedures. The procedure selection completely depends on the complexity of the project. The procedure of ICB should be followed as per the World Bank issued guidelines.
The single envelope procedure is generally recommended for ADB procedure. All procedure types don't suit all the contract types. A tender of goods might use the four bidding procedures but the other procurement process will go for a single-stage or two envelopes.
The second procedure is quite famous in Asian countries and might fulfil their National procurement rules and regulations. For the construction of plants single or two-stage procedure might be used. But for complex power plants, processing plants a different well-designed procedure is used for bidding.
It is not a different ICB bidding procedure. However, it is part of the International Competitive bidding procedure where the contractors are invited to submit their bid for a specific tender. Generally, Prequalification is used for the construction of complex plants.
The second condition of using the prequalification procedure, when a large number of contractors are participating in one project. The screening of project requirements will filter and find the most suitable bidders for the project.
ADB has made a guide on the standard procurement prequalification procedure to prepare the documents for the screening and bidding process. Things to be considered while using the prequalification procedure for bidding of complex projects:
- ● EA should consider all the criteria and requirements while using the prequalification procedure.
- ● EA should inform all the participant bidders about the project and its results.
Prequalification is not for everyone. It is for those contractors who fulfil all the requirements of the bid. The prequalification words are used for bidding within 6 months or a year.
Factors Affecting International Competitive Bidding
Advertisement of the Bid
Proper advertising is the primary factor of successful ICB. It helps the client to circulate accurate information about the project to all the potential bidders.
Advertisement can be done on both offline and online portals. Clients can publish the advertisement in local and international newspapers or can post it on their project webpage.
Usually, the procedure of advertisement for ICB procurement is 6 weeks and allows bidders to prepare for the bid. Bidders need to submit the required documents before the deadline to win the project.
Usage of Standard Documents
The client should prepare all the Standard Bidding Documents as per guidelines. Check all the documents required for ICB before publishing the bid. Your proposal should follow all the guidelines to find potential bidders across the globe.
All the documents should be under the World Bank guidelines. You need to refer to the Standard Bidding Documents of the World Bank.
Preference to Domestic Bidders
Clients prefer domestic bidders over international contractors. The preference is done under the domestic preference scheme. Moreover, the margin of preference is applied during bidders’ evaluation.
The domestic preference scheme offers a margin to the domestic manufacturers and contractors. The preference is not applicable to all kinds of projects. It should be followed under few guidelines of the respective country.
How does International Competitive Bidding (ICB) Work?
The world bank has all the details of required documents for ICB. The objective of the World Bank-funded project is to offer healthy competition to all the bidders across the world. The fund borrowed country has a certain freedom to choose the potential bid. However, the World Bank expects from a project to choose the lowest price competitive bid.
Requirements for Conducting ICB
You need to follow the guidelines issued by the World Bank for ICB. Check out the requirements to be followed:
- ● Invite bidders through publishing bids in national and international newspapers or journals. The bid should be English and one regional language of the country.
- ● Besides this, publishing of bids in United Nations Department Business (UNDB), dg Market online, and website of the project is recommended
- ● The sale of the bid only starts after the advertisement publication.
- ● The bidding period should be 45 to 90 days from the date of advertisement printing.
- ● The preference to the domestic bidders is allowed but along with international bidders.
- ● The rest of the procedure will be almost the same as the open tendering procedure.
Advantages of ICB
- ● ICB increases the competitiveness among the bidders which results in getting the best deal for both parties (client and contractor).
- ● It offers a fair chance to potential bidders and avoids corruption.
- ● Borrowers can get the potential bidder at low price.
- ● It increases effective competition and helps the most suitable and promising bidders in winning Government tenders.
- ● Many small and medium companies get a chance in ICB participation.
- ● It provides good exposure to all the local and international contractors.