物料供應及採購規例
STORES AND PROCUREMENT
REGULATIONS
香 港 特 別 行 政 區
政 府 規 例 ( 卷 四 )
REGULATIONS OF THE
GOVERNMENT OF THE HONG KONG
SPECIAL ADMINISTRATIVE
REGION
VOLUME 4
STORES AND PROCUREMENT REGULATIONS
TABLE OF CONTENTS
Introduction (1-16)
C h a p t e r I —
Authority, Policy and Responsibility (100-160)
Authority for Making Stores and Procurement Regulations 100
(SPRs) ..........................................................................................
Applicability ................................................................................ 105
Procurement Policy and Principles .............................................. 106-109
Responsibilities of Public Officers .............................................. 110-115
Authority and Responsibilities of the Tender Boards/ 116
Committees and Consultants Selection Boards/ Committees
Authority and Responsibilities of the Director of Government 120
Logistics .......................................................................................
Authority and Responsibilities of Controlling Officers .............. 125-135
Handling of Complaints ............................................................... 160
Chapter IA —
Avoiding and Managing Conflict of Interest in
Government Procurement (180-198)
General and Applicability ............................................................ 180
Avoiding and Managing Conflicts with Private Interests ........... 185-188
Avoiding and Managing Conflicts that may arise from the 190-198
Different Roles of Consulting Firms/Contractors ........................
Chapter II —
Procurement of Stores, Services and Revenue Contracts
(200-298)
General ......................................................................................... 200-217
Types of Procurement Procedures ............................................... 220-222
Procurement of Stores through the Government Logistics 235
Department ..................................................................................
Procurement of Stores by Departments ....................................... 245-265
Procurement of Services by Departments .................................... 280-290
Procurement of Revenue Contracts by Departments ................... 295
Quotation Negotiations ................................................................ 296
Cancellation of Quotation Exercise ............................................. 297
Exceptional Authorisation ........................................................... 298
Chapter III —
Tender Procedures (300-390)
Scope and Coverage .................................................................... 300
Classification of Information ....................................................... 305
Tender Boards and Other Approving Authorities ....................... 310
Types of Tendering ...................................................................... 315-330
Direct Engagement ...................................................................... 331-333
Funding ........................................................................................ 337-338
Tender Notices and Tendering Period ......................................... 340
Tender Documents ....................................................................... 345
Access to Tender Information ..................................................... 346-349
Tender Specifications .................................................................. 350
Tenders in Foreign Currencies ..................................................... 355
Tender Deposits/ Bonds ............................................................... 360
Contract Deposits/Performance Bonds ........................................ 361-362
Retention Moneys ........................................................................ 363
Receipt and Clarification of Tenders ........................................... 365
Evaluation of Tenders .................................................................. 370
Tender Reports ............................................................................. 375
Cancellation of a Tender Exercise or Concluding a Service 380
Level Agreement with a Trading Fund Department ....................
Tender Negotiations ..................................................................... 385
Acceptance of Tenders and Awards of Contracts ........................ 390
Chapter IV —
Consultants Selection Procedures (400-470)
Applicability, Scope and Coverage ............................................. 400-405
Approving Authority ................................................................... 410-416
Classification of Information ....................................................... 420
Consultants Selection Boards and Committees ........................... 425-427
The Central Consultants Selection Board Procedures ................. 430-460
Remuneration of Consultants ...................................................... 465
Cancellation of a Consultants Selection Exercise ...................... 470
Chapter V —
Contract Administration (500-541)
Applicability ................................................................................ 500
Execution of Contracts ................................................................ 505-510
Contract Payments ....................................................................... 515
Variations to Contracts ................................................................ 520
Contract Negotiations .................................................................. 525
Disposal of Contract Documents ................................................. 530
Monitoring of Performance of Contractors and Consultants ....... 535-541
Chapter VI —
Stores Records (600-680)
General ......................................................................................... 600-605
Ledgers ........................................................................................ 610-635
Vouchers and Forms .................................................................... 650-675
Registers ...................................................................................... 680
Chapter VII —
Accounting for Stores (700-775)
Classification of Stores ................................................................ 700-710
Accounting for General Inventory Items ..................................... 715-730
Accounting for Special Inventory Items ...................................... 735-760
Accounting for Non-Inventory Items .......................................... 765-775
Chapter VIII —
Management of Stores (800-896)
General ......................................................................................... 800-810
Receipt of Stores .......................................................................... 815-835
Issue of GLD Unallocated Stores ................................................ 845
Issue of Departmental Stores ....................................................... 850-870
Return of Stores ........................................................................... 875-880
Safe Custody of Stores ................................................................. 885
Handover of Stores ...................................................................... 890-895
Security of Stores ......................................................................... 896
Chapter IX —
Collection and Delivery of Stores from Suppliers Outside
Hong Kong (900-965)
General ......................................................................................... 900-905
Handling of Consigned Goods Received by the Director of 915
Government Logistics ..................................................................
Receipt of Stores .......................................................................... 920
Inspection of Stores Received ..................................................... 925-930
Claims .......................................................................................... 935-965
Chapter X —
Stock Verification and Write-off (1000-1085)
Stock Verification ........................................................................ 1000-1025
Procedures for Dealing with Discrepancies ................................. 1030-1065
Authority for Write-off of Lost/Deficient Stores ......................... 1070
Replacement of Stores ................................................................. 1075
Surcharge ..................................................................................... 1080-1085
Chapter XI —
Disposal of Surplus Stores (1100-1155)
Scope ............................................................................................ 1100
Departmental Disposal Authority ................................................ 1105-1108
Disposal Procedures ..................................................................... 1110
Disposal of Unserviceable Stores Items ...................................... 1115-1126
Disposal of Serviceable Stores Items .......................................... 1130-1151
Proper Accounting for Stores ...................................................... 1155
Chapter XII —
Disposal of Dangerous or Confiscated Goods (1200-1235)
Disposal of Materials in a Dangerous Condition ......................... 1200
Disposal of Confiscated Goods ................................................... 1205-1235
Appendices
Glossary
INTRODUCTION
VALIDITY OF GOVERNMENT REGULATIONS, CIRCULARS AND CIRCULAR
MEMORANDA
1.
Government Regulations regulate matters relating to the conduct of
Government business, the terms of appointment and conditions of service for Government
servants, financial business and accounting operations, the management and procurement of
Government stores and services, the security of Government records, and other miscellaneous
matters. They do not provide for necessary and self-evident exceptions.
2.
Save for Financial and Accounting Regulations and Stores and Procurement
Regulations which are made under the provisions of the Public Finance Ordinance (Cap. 2),
Government Regulations are Regulations made by or with the authority of the Chief
Executive. The sole authority for their interpretation and application is the Chief Executive,
or those to whom he has delegated such authority.
3.
Government Regulations apply to all government servants, except in so far
as —
(a)
a contrary intention appears in Government Regulations; or
(b)
an alternative provision is made for particular government servants in a piece
of legislation which applies in the Hong Kong Special Administrative Region;
or
(c)
a Government Regulation is inconsistent with the terms of a piece of
legislation which applies in the Hong Kong Special Administrative Region
which apply to particular government servants; or
(d)
a particular government servant is excluded by the terms of his employment
from the operation of a Government Regulation.
4.
Government Regulations are divided into 7 volumes as shown below. The
following public officers have been authorised to amend, supplement, apply, interpret and
make exceptions to the Regulations in each Volume as shown —
Volume
Name Authority
1
General Regulations
Director of Administration
2
Civil Service Regulations
Secretary for the Civil Service
3 (Part 1)
Financial and Accounting
Financial Secretary/Secretary for
Regulations
Financial Services and the Treasury
(Part 2)
Standing Accounting Instructions
Director of Accounting Services
4
Stores and Procurement Regulations
Financial
Secretary/Secretary
for
Financial Services and the
Treasury/Permanent Secretary for
Financial Services and the Treasury
(Treasury)#
5
Security Regulations
Secretary for Security
6
Accommodation Regulations
Secretary for Financial Services and
the Treasury
7
External Service Regulations
Secretary
for
the
Civil
Service/Permanent Secretary for
Commerce and Economic
Development (Commerce, Industry
and Tourism) and Permanent Secretary
for Constitutional and Mainland
Affairs*
# The Permanent Secretary for Financial Services and the Treasury (Treasury) is
authorised to apply, interpret and make exceptions to the Stores and Procurement
Regulations and related Financial Circulars.
* The Permanent Secretary for Commerce and Economic Development (Commerce,
Industry and Tourism) or Permanent Secretary for Constitutional and Mainland
Affairs is authorised to apply, interpret and make exceptions, where expressly stated,
to the External Service Regulations in respect of staff posted to offices outside Hong
Kong maintained by the Government of the Hong Kong Special Administrative
Region.
5.
Government Regulations may be supplemented by Circulars and Circular
Memoranda and the instructions contained therein are of equal application and force to the
Regulations. These Circulars and Circular Memoranda and their issuing authority are
described below —
General Regulations
General
Circulars
and
Director of Administration
Circular Memoranda
Civil Service Regulations
Civil
Service
Bureau
Secretary for the Civil
Circulars and Circular Service
Memoranda
Financial and Accounting Financial Circulars and
Secretary
for
Financial
Regulations
Financial Services and the
Services and the Treasury
Treasury Bureau Circular
Memoranda
Standing Accounting
Accounting
Circulars
and
Director of Accounting
Instructions
Circular Memoranda
Services
Stores and Procurement
Financial Circulars and
Secretary
for
Financial
Regulations
Financial Services and the
Services and the Treasury
Treasury Bureau Circular
Memoranda
Government
Logistics
Director of Government
Department Circulars and
Logistics
Circular Memoranda
Security Regulations
Security
Circulars
and
Secretary for Security
Circular Memoranda
Accommodation
Accommodation
Circulars
Government Property
Regulations
and Circular Memoranda
Administrator
External Service
External Service Regulations
Secretary for the Civil
Regulations
Circulars and Circular Service
Memoranda
6.
Each set of Circulars is issued in a single numbered series with a new series for
each calendar year. Circulars are reviewed annually and the first Circular of each calendar
year indicates which of the previous Circulars remain in force. Circular Memoranda may be
numbered as for Circulars and are subject to regular review by the concerned issuing
authorities.
RESPONSIBILITY FOR KNOWLEDGE OF GOVERNMENT REGULATIONS,
CIRCULARS AND CIRCULAR MEMORANDA
10.
It is the duty of all Government servants other than staff on daily rates of pay
to be thoroughly acquainted with all Government Regulations, Circulars and Circular
Memoranda on Conduct and Discipline, and such other Government Regulations, Circulars
and Circular Memoranda as appertain to their duties.
11.
Where a Government servant disobeys or neglects or fails to observe the terms
of Government Regulations, Circulars or Circular Memoranda on Conduct and Discipline
appertaining to his/her duties, disciplinary proceedings may be taken against him/her and
he/she may be held pecuniarily responsible for any financial loss to Government resulting
from each disobedience, neglect or failure.
DISTRIBUTION OF GOVERNMENT REGULATIONS, CIRCULARS AND
CIRCULAR MEMORANDA
12.
It is the responsibility of a Head of Department to see that all his/her staff
(other than on daily rates of pay) are provided with, or have made available to them,
Government Regulations, Circulars and Circular Memoranda on Conduct and Discipline and
such other Government Regulations, Circulars and Circular Memoranda as appertain to their
duties.
13.
Government Regulations, Circulars and Circular Memoranda on Conduct and
Discipline are available in a separate edition, of which there is a Chinese version. All
Government servants (other than staff on daily rates of pay) shall on first appointment to the
service be provided with, or have made available to them a copy of the Government
Regulations, Circulars and Circular Memoranda on Conduct and Discipline either in English
or Chinese as appropriate.
14.
Copies of Government Regulations, Circulars and Circular Memoranda (other
than the separate editions on Conduct and Discipline) are not to be regarded as the property of
individuals but as part of the equipment of the office for which the copy is provided. It is the
duty of Heads of Departments to ensure that copies of Government Regulations, Circulars and
Circular Memoranda are not retained by officers when transferred to another office.
16.
All Civil Service Bureau Circulars, Financial Circulars and General Circulars
are categorised, on the basis of their respective contents, into one of the following scales of
distribution —
Scale A — to be brought to the attention of all staff.
Scale B — to be brought to the attention of a particular group or groups of officers
because of matters such as conditions of service, salaries and entitlements,
rules and regulations applicable to them as individuals.
Scale C — to be brought to the attention of officers who, because of the functions of their
posts, are required to take action on, or to be informed of, the circular.
Scale D — to be brought to the attention of officers who keep a copy of a particular set of
Government Regulations and those, who because of the functions of their
posts, are required to take action on, or to be informed of, the circular.
There is no fixed scale for distribution of Circular Memoranda. The normal distribution is
usually Directors of Bureaux, Permanent Secretaries and Heads of Departments, with a copy
to the Judiciary Administrator. However, any of the above scales may be used, if necessary.
CHAPTER I
AUTHORITY, POLICY AND RESPONSIBILITY
AUTHORITY FOR MAKING STORES AND PROCUREMENT REGULATIONS
(SPRs)
100.
These Regulations are made by the Financial Secretary/Secretary for Financial
Services and the Treasury (SFST) under section 11(1) of the Public Finance Ordinance
(Cap. 2), and should be read in conjunction with that Ordinance.
APPLICABILITY
105.
The SPRs apply to all public officers except in so far as they are inconsistent
with any enactment. They may be supplemented by Financial Circulars (FCs) and Financial
Services and the Treasury Bureau Circular Memoranda (FSTBCM) which are of equal
application and force as these Regulations.
PROCUREMENT POLICY AND PRINCIPLES
106.
The policy of government procurement is to obtain stores and services at the
best value for money in a publicly accountable manner to support Government’s programmes
and activities.
107.
To make the best use of public resources and be accountable to the public,
bureaux and departments (referred to as “departments” hereafter) should aim to achieve the
best value for money in procurement. “Value for money” does not simply mean buying at the
lowest price. “Value for money” should be assessed in terms of economy, effectiveness and
efficiency, taking into account the total costs involved (measured on a whole-life costing
basis) and the overall value to be created or brought about through the procurement. In other
words, “value for money” means the optimal use of resources to achieve the best outcome.
Controlling Officers (COs) should ensure that public funds are well spent in terms of the total
positive value to be created or brought about by the procurement. The positive values may
include (but are not limited to) social, environmental, economic and/or other positive values
that serve the interest of the public. When conducting procurements, COs should fully take
into account the consideration of whether the procurement is more costly than necessary.
They should be satisfied that the procurements are genuinely required and fully justified on
legitimate and defensible grounds, for example, meeting essential operational needs and/or
achieving better value for money for the procurements.
108.
Procurement decisions are subject to review by the relevant authorities. For
procurements covered by the Agreement on Government Procurement of the World Trade
Organization (WTO GPA), they are also subject to review by the Review Body on Bid
Challenges. COs are accountable to the public for the purchasing decisions of their
departments, and should ensure that the decisions are properly justified and documented.
109.
The policy of government procurement is underpinned by the following
principles –
(a) Open and fair competition
(i)
Competition is a reliable safeguard against bidders overcharging and holding
Government to ransom. By encouraging participation through open and fair
competition, the Government will be better able to obtain responsive and
competitive bids that ensure value for money.
(ii)
As a norm, open bidding should be adopted as far as practicable. Single/restricted
tendering or direct engagement of suppliers/service providers/consultants should
be the exception and must be properly justified to the satisfaction of the relevant
approving authority.
(iii)
All bidders should be treated on an equal footing. There should be no
discrimination on the basis of the country of origin of the goods or service
providers. Requirements, tender specifications and marking schemes (where
applicable) should be drawn up in an objective manner, providing a level playing
field for all to compete on an equal footing.
(iv)
For procurements with limited competition in past exercises, departments should
explore measures to enhance competition and satisfy themselves that the tendering
or consultants selection strategy to attract new bidders and innovative proposals is
effective.
(b) Transparency
To uphold public accountability and fairness of the procurement process, government
procurement should be conducted in a transparent manner. In a procurement exercise,
potential bidders should be given the same information. Departments should make
available tender notices for all open tenders and invitations for admission to
suppliers/service providers’ lists on their webpages. Tender documents or consultancy
briefs should be clear, concise and easy to understand to avoid complicating and adding
to the cost of the bidding process.
(c) Pro-innovation
Innovation is conducive to securing value for money in the long run. Departments should
encourage and be receptive to new ideas from suppliers / service providers, and allow
room for assessing innovative proposals in the procurement process. Outcome-based
requirements should be adopted as far as possible. Over-specification and over-
prescription in product requirements or mode of service delivery should be avoided. For
the procurement of stores, services (excluding works contracts and consultancy) and
revenue contracts, “innovation” includes –
(i) technology related innovation, meaning the use of new technology or innovative
application of existing technology in the supply of stores or services; and
(ii)
ideas or suggestions with no technology content which are not conventionally
adopted or readily envisaged by departments that may create positive value to the
Government or the public. These may include ideas or suggestions that are
conducive to the delivery of public services (e.g. resulting in a cleaner
environment in a street cleansing service contract), contribute to defined policy
objectives of the Government (e.g. contribution to environmental protection in a
facility management service contract, or employment of persons with disability in
a vehicle maintenance service contract), or better serve the needs of endusers (e.g.
meeting user-centric requirements, which are generated from design thinking
process as per the guidelines provided by the Commerce and Economic
Development Bureau / Efficiency Office (EffO) from time to time.).
(d) Integrity
To uphold the integrity of government procurement, procurement decisions should be
made in an impartial manner and public funds spent in an accountable way.
RESPONSIBILITIES OF PUBLIC OFFICERS
110. (a)
No public officer will be relieved of any portion of his responsibility if he
deputes to his subordinates the performance of duties for which he has overall
responsibility. Any public officer contravening any of these Regulations, FCs
or FSTBCM may be subject to disciplinary proceedings.
(b)
Any person who is or was employed as a public officer may be liable to be
surcharged in the circumstances detailed in section 32 of the Public Finance
Ordinance. COs who become aware of any of these circumstances shall
investigate the matter fully and, as soon as practicable, shall forward a detailed
report to the Permanent Secretary for Financial Services and the Treasury
(Treasury) (PS(Tsy)) with copies to the Secretary for the Civil Service,
Director of Accounting Services (DAS) and Director of Audit (D of A).
115.
The respective responsibilities of the Director of Government Logistics (DGL)
and D of A for checking and reporting any shortcomings in connection with procurement
activities and government stores do not absolve any public officer from his responsibility for
complying, or ensuring compliance, with instructions within the scope of his own duties.
AUTHORITY AND RESPONSIBILITIES OF THE TENDER BOARDS/
COMMITTEES AND CONSULTANTS SELECTION BOARDS/COMMITTEES
116.
The structure for the approval of tenders and consultancies and the key
financial limits for tender boards/ consultants selection boards and COs are summarised
below –
Central Tender Board
All procurement types
No $ limit
Central
Consultants
Engineering
Architectural
Selection
and
and
Board
Associated
Associated
Government
Consultants
Consultants
Logistics
All except
Selection
Selection
Public Works
AACSB and
Board
Department
Board
Tender Board
EACSB
(AACSB)
(EACSB)
Tender Board
consultancies
No $ limit
No $ limit
Stores/
No $ limit
Works & related
services (non‐
services
works)/revenue
≤$200M
≤$60M
Departmental Tender Committee
Departmental Consultants
Stores/services/revenue, except works
Selection Committee
≤$10M
≤ $10M
Where quotations are called,
Where quotations are called ,
the limits are ≤ $7M for works and
the limit is ≤ $3M
≤ $1.4M for other procurement
Note: Details in SPR 220, 310 and 425‐426
AUTHORITY AND RESPONSIBILITIES OF THE DIRECTOR OF GOVERNMENT
LOGISTICS
120. (a)
DGL is responsible for advising departments on implementing good practice
on their management of stores and procurement activities and for conducting
compliance checks on such activities according to prescribed criteria to ensure
compliance with these Regulations and other relevant instructions.
(b)
In the exercise of his duties, DGL shall have access to all records, books,
vouchers, documents and receipts relating to procurement exercises conducted
by and government stores in the possession of any public officer.
(c)
DGL may issue Government Logistics Department (GLD) Circulars and
Circular Memoranda to supplement these Regulations, FCs and FSTBCM
relating to the procurement of stores and services and management of
government stores. With the approval of PS(Tsy), the instructions contained
therein are of equal application and force to these Regulations.
AUTHORITY AND RESPONSIBILITIES OF CONTROLLING OFFICERS
125.
COs are responsible for the procurement of stores, services and revenue
contracts within the financial limits set out in the SPRs, and the management of the stores and
services procured and the contracts awarded. COs shall observe the policy and principles set
out in SPRs 106 – 109 and uphold a culture of compliance with the requirements set out in the
SPRs, regularly remind all the staff concerned about their need to always comply with the
SPRs and closely monitor their compliance.
126. COs may develop departmental instructions as appropriate to guide public officers
in the department in conducting government procurement and stores management, provided
that such instructions comply with SPRs and have been approved by DGL. For works and
works-related consultancy contracts, COs may also develop departmental instructions with
reference to Development Bureau Technical Circular (Works) (DEVB TC(W)). Within the
departmental procurement and stores management system, there should be institutional
safeguards designed with adequate checks and balances as well as clear segregation of roles
and duties. On procurement, COs or designated officers should agree on the segregation of
duties before tenders are invited. COs should ensure that public officers involved in the
procurement exercises are alert to actual, potential and perceived conflict of interest and
sufficient safeguards are in place to avoid or manage such conflict of interest situations in
accordance with Chapter IA.
127.
For procurement covered by WTO GPA, COs shall observe the provisions
therein.
128.
On stores management, COs should ensure the effective and efficient use of
government stores to support Government’s programmes and activities. COs should put in
place the necessary measures to ensure that government stores are properly kept and
accounted for and that regular and surprise inspections are conducted to examine the
adequacy of security arrangements for stores management.
130.
COs should reply promptly to any queries addressed to them by the D of A or
DGL, giving fully the particulars, explanations and information required.
135.
COs should appoint a Departmental Stores Manager (DSM) to assist them in
supervising all procurement and stores management matters within their purview. The DSM
may be assisted by Supplies Grade staff and/or non-Supplies Grade staff. Purchasing and
stores management functions should normally be performed by Supplies Grade staff. COs
should make available sufficient Supplies Grade staff to discharge these functions in an
appropriate manner.
HANDLING OF COMPLAINTS
160. (a)
Contractors, suppliers, firms or organisations may lodge complaints about the
process or result of a procurement exercise to the procuring department, the
relevant tender board/consultants selection board, or the Office of The
Ombudsman. If there is suspected corruption, complaints may be made to the
Independent Commission Against Corruption.
(b) For procurements covered by WTO
GPA, contractors/suppliers/service
providers may also make a challenge against alleged breaches of WTO GPA to
the Review Body on Bid Challenges.
(c)
COs should put in place an effective complaint-handling system in accordance
with SPR and other relevant government regulations/ circulars/ guidelines.
On receipt of a complaint or the referral of a complaint, CO of the procuring
department should personally ensure that the complaint is to be handled in an
impartial and timely manner, and that an early and substantive reply is to be
provided to the complainant direct or through the referral office within ten
working days. An interim reply should be sent to the complainant if a
substantive reply cannot be issued within the above timeframe. All complaints
and the substantive replies should be brought to the attention of the relevant
tender board or consultants selection board.
(d)
If the CO has been personally involved in the procurement exercise and an
apparent conflict of interest may arise, he should refer the complaint to the
relevant tender board or consultants selection board (depending on the value
and the nature of procurement) for consideration after investigation by his
department. The CO or a designated directorate officer should present the
complaint, the outcome of the investigation and recommendations on way
forward to the relevant tender board or consultants selection board. The
relevant tender board or consultants selection board will decide on how the
complaint should be taken forward.
(e)
If the relevant tender board or consultants selection board believes that there is
scope for changing the procurement policy or system, it should make a
recommendation to the PS(Tsy) and for works-related items, the Permanent
Secretary for Development (Works) for consideration.
CHAPTER IA
AVOIDING AND MANAGING CONFLICT OF INTEREST
IN GOVERNMENT PROCUREMENT
GENERAL AND APPLICABILITY
180.
It is the responsibility of all public officers to ensure the integrity and
impartiality of the Government’s procurement process. Conflict of interest situations may
arise in cases where a public officer exercises his authority, influences decisions and actions
or gains access to valuable information, perhaps but not necessarily restricted or confidential.
Conflict of interest may also arise from participation by consulting firms/organisations
(hereinafter referred to as “consulting firms”) or contractors in government procurement. All
public officers involved in procurement must be alert to situations which may lead to actual,
potential or perceived conflict of interest and ensure that sufficient safeguards are in place to
avoid such situations from arising or manage such situations. The principles and guidelines
set out in this Chapter apply to all types of government procurement including revenue
contracts, irrespective of value.
AVOIDING AND MANAGING CONFLICTS WITH PRIVATE INTERESTS
185.
All public officers involved in government procurement, including in particular
the head or chairperson, members and/or secretary of all committees/working groups
responsible for preparing tender documentation (including tender specifications and marking
schemes), tender opening teams, tender assessment panels (TAPs), departmental tender
committees (DTCs), departmental consultants selection committees (DCSCs), tender boards
and consultants selection boards, must —
(a)
avoid conflicts, whether actual, potential or perceived, arising between their
official duties and their private interests. Private interests include the financial
and other interests of the public officer, the public officer’s relatives and close
associates, or persons to whom the public officer is indebted or owes a favour,
as defined in relevant civil service guidelines (including Civil Service Bureau
Circular No. 2/2004 on “Conflict of Interest” or any updated version);
(b)
declare all such conflicts or relevant private interests as soon as the public
officer is aware of them to enable his supervisors, the head or the chairperson
of the relevant tender preparation team, tender opening team, TAP, DTC,
DCSC, tender board or consultants selection board to decide whether the
public officer should continue to be involved in the specific procurement
exercise;
(c)
observe prevailing civil service code and guidelines on how to prevent or deal
with conflict of interest situations; and
(d)
observe prevailing Security Regulations and not make unauthorised disclosure
or take advantage of any tender-related information whether or not for
personal gain.
186.
All public officers involved in preparing tender documentation (including
tender specifications and marking schemes), assessing tenders and conducting negotiations
must declare whether they have any actual, potential or perceived conflict of interest upon
their taking up of the respective responsibilities in procurement matters and as soon as they
become aware of such actual, potential or perceived conflict of interest. Departments must
state in each tender report whether or not the public officers involved in preparing tender
documentation (including tender specifications and marking schemes), assessing tenders and
conducting negotiations have declared their interest and, where conflicts of interest (actual,
potential or perceived) have been identified, what remedial action has been taken. A
specimen declaration and undertaking is at Appendix I(A).
187.
The head or chairperson, members and/or secretary of all tender opening
teams, DTCs, DCSCs, tender boards and consultants selection boards who handle
procurement matters are required to sign an undertaking upon taking up these responsibilities,
and are also required to renew their undertaking at least annually. A specimen undertaking is
at Appendix I(B).
188.
COs of the procuring department must —
(a)
remind all colleagues involved in government procurement, at regular
intervals, to observe strict confidentiality rules with regard to tender-related
information and to declare any private interests as may arise in relation to the
procurement, or in relation to the parties offering the stores, services or
revenue contracts being procured;
(b)
ensure that all declarations are drawn to the attention of the head or the
chairperson of the tender preparation team, tender opening team, TAP, DTC,
DCSC, tender board or consultants selection board as the case may be. If the
public officer making the declaration is the head or the chairperson himself,
his declaration should be drawn to the attention of his supervisor. All such
declarations and actions taken must be recorded and filed properly;
(c)
if a public officer has declared an interest and the supervisor, the head or the
chairperson of the tender preparation team, tender opening team, TAP, DTC,
DCSC, tender board or consultants selection board rules that the public officer
should not continue to handle the specific procurement exercise,
redeploy, if
necessary, other staff to take the place of the public officer who has declared
an interest in the procurement exercise; and
(d)
consider and if appropriate draw up supplementary guidelines to fit the
circumstances of the department on the detection, avoidance and management
of conflicts in government procurement, making reference to the “Government
Procurement of General Goods and Services” published by the Independent
Commission Against Corruption as appropriate.
AVOIDING AND MANAGING CONFLICTS THAT MAY ARISE FROM THE
DIFFERENT ROLES OF CONSULTING FIRMS/CONTRACTORS
190.
Departments
must
be alert to the potential conflict of interest which may arise
from the different roles or assignments a consulting firm or contractor may take up, whether
in relation to the same project for which that consulting firm or contractor was or remains
engaged by the Government in the first place, or other related projects.
191.
It is not possible to list all situations in which potential conflicts of interest
may arise. One typical situation is where a firm/organisation (hereinafter referred to as
“firm”), having acted as Government’s consultant for a project, bids as a contractor or is
involved as a controlling shareholder or subcontractor of the contractor in a subsequent
exercise for the procurement arising out of the consultancy or which was the very subject of
the consultancy.
192.
To ensure that Government receives from consulting firms objective
professional advice which is not tailored or fashioned with regard to promoting that
consulting firm’s or its associate’s products and/or services, and to maintain a level-playing
field in the procedures for government procurement, departments must —
(a)
ascertain as far as practicable, before the award of a consultancy, whether
there is any reason to disqualify a consulting firm which has expressed an
interest in undertaking a government consultancy on grounds of actual,
potential or perceived conflicts of interest;
(b)
oblige the selected consulting firm to report on situations which may give rise
to those conflicts; and
(c)
debar the selected consulting firm and its associate(s) from participating in
any subsequent exercise for the procurement arising out of or which was the
very subject of the consultancy, save for the circumstances specified in
SPR 194.
Departments should consult the Department of Justice (D of J) on the provisions to be
included in consultancy briefs and consultancy agreements to reflect the requirements in
SPR 192(b) and (c) above.
193.
There may be circumstances where a strict ban on future participation in
procurement exercises is not practicable. Departments which are not able to comply with the
principles and guidelines set out in SPR 192 above must approach the relevant consultants
selection board (or tender board if the professional advice is procured through a tender
exercise) for a ruling.
194.
If, for reasons acceptable to the relevant consultants selection board, a
department would not want to debar a firm which has acted as its consultant and/or the
consultant’s associates from participating in exercises for the procurement arising out of or
which was the very subject of the consultancy, the department must —
(a)
review the recommendations of the consultant, including the proposed tender
specifications for the implementation tender, to satisfy itself that the tender
document is and is seen to be objective and unbiased having regard to the role
and recommendations of that consulting firm. The relevant CO should appoint
a review committee comprising public officers who have
not been involved in
the consultancy in question and who can serve as a credible and effective
checking body, and the decisions should be clearly recorded; and
(b)
specify in the tender notices for the implementation tenders that the firm
appointed for the consultancy studies is a potential bidder but that all the
information which was made available to that firm and all the advice which the
firm has provided and which is relevant to the tender will equally be made
available to all potential tenderers upon request.
Under no circumstances may a consulting firm (including its associates) that has advised on
the preparation of the tender document, including tender specifications and marking scheme,
be allowed to bid, participate or be financially involved in that or related tender exercise.
195. (a)
Departments must bear in mind the requirement that all consulting firms must
not only have, but be seen to have, an equal opportunity to participate in any
consultants selection exercise. Where members of a consulting firm participate
with government departments in committees, working groups, boards, etc. in
the course of which the need to engage consulting firms to perform
assignments arises, departments must without any delay —
(i)
require the person concerned to disengage himself immediately from
the committee, working group, board, etc., as the case may be; or
(ii)
request the person concerned to undertake in writing that his consulting
firm will not compete for, participate or be financially involved in the
assignment whether as the main consultant or sub-consultant or
otherwise.
(b)
Departments must not put pressure on prospective consulting firms to employ
particular sub-consultants or be over-enthusiastic in matching sub-consultants
with consulting firms. Information on the availability of specialist
sub-consultants should be provided to all firms in the invitation to submit an
expression of interest (EOI) and/or a tender, if it is considered essential for the
main consultants to have such information.
196.
When a consulting firm submits a bid as a main consultant while concurrently
bidding as a sub-consultant of other competing main consultant(s) in the same consultants
selection exercise or when a consulting firm teams up as a sub-consultant with more than one
bidding main consulting firm, the question of potential or perceived role conflict may arise
unless these different roles are disclosed to all participants, including those bidding as main or
sub-consultants. Departments shall require all consulting firms to disclose their competing
roles, if any, in a consultants selection exercise and to confirm in the consultancy proposal
that no confidential information, confidentiality restrictions or restraints of trade or business
have been contravened in lodging the proposal in which the main consultant and/or sub-
consultant are in common or affiliated with the sub-consultant of another bidder.
Departments should consult D of J as necessary to include a provision in the consultancy brief
and consultancy agreement reflecting the aforesaid requirements.
197.
Under special circumstances, advice may need to be sought from technical
experts outside the Government (paragraph 3 of Appendix III(G)1). To ensure that the
Government receives from outside technical experts objective professional advice which is
not intended to favour any particular consulting firms or contractors, and to maintain a level-
playing field in the procedures for government procurement, departments must —
(a)
ascertain as far as practicable, before the engagement of any outside
technical expert, whether there is any reason to disqualify such expert who
has expressed an interest in undertaking the role of technical expert on
grounds of actual, potential or perceived conflicts of interest; and
(b)
oblige the outside technical expert engaged to report on situations which may
give rise to those conflicts.
Departments may consult the D of J as appropriate on the provisions to be included in the
letter or agreement when engaging outside technical experts to reflect the requirements in
SPR 197(b) above. The outside technical experts should be invited to complete the
declaration/undertaking at Appendix I(C).
198.
If actual, potential or perceived conflict of interest is identified in engaging the
outside technical expert, it should be drawn to the attention of the Chairman of the TAP as
specified in paragraph 5 of Appendix III(G)1. The actions taken should be properly
documented and reported to the DTC, DCSC, tender board or consultants selection board as
appropriate.
CHAPTER II
PROCUREMENT OF STORES, SERVICES
AND REVENUE CONTRACTS
GENERAL
200.
For the purpose of these Regulations —
(a)
government stores refer to all articles purchased or acquired on behalf of
Government, excluding land and buildings;
(b)
services refer to tasks performed by firms for and on behalf of Government,
which include services for construction and engineering works, consultancy
services and other general services;
(c)
where a contract for the supply of stores includes the provision of incidental
services and the value of the services does not exceed that of the stores, the
contract shall be construed as a contract for the supply of stores. Where a
contract for the supply of services includes the provision of stores and the
value of the stores does not exceed that of the services, the contract shall be
construed as a contract for the supply of services; and
(d)
revenue contracts refer to contracts that generate revenue for and on behalf of
Government.
205.
The financial limits set out in these Regulations refer to the total value of
stores or services of a similar nature or total value of revenue which, in normal practice, are
obtained or generated in a single purchase or contract. COs should ensure that public officers
responsible for procurement matters interpret these limits strictly, and that they do not evade
the limits by dividing procurement requirements into instalments or by reducing the usual
duration of contracts. In making procurement, COs should consolidate requirements of stores
and services of similar nature as far as possible to achieve better economies of scale. COs
may be held personally responsible for the amount so expended or revenue so lost if they
allow or order the procurement of stores, services or revenue contracts without proper
authority.
206.
Where the purchase is for replacement stores or equipment, trade-in option
should be considered as far as practicable. Apart from the monetary return, the opportunity
can be taken to use the contractors’ resources to dispose of the stores which would otherwise
have to be arranged separately by the concerned department at a cost to the Government.
When determining the value of purchases, departments should only count the value of the new
stores instead of the net value after deducting the value of the trade-in items.
210.
The procurement of specific stores is subject to endorsement by the appropriate
authority. These endorsement authorities and the respective procurement agents, where
applicable, are listed at Appendix II.
216.
While procurement should normally be conducted at departmental
headquarters, COs can authorise any procurement of their own departments to be conducted in
branches/divisions/sub-offices, as appropriate.
217.
There must be clear segregation of roles and responsibilities in the
procurement process. As far as possible, the users of the stores and services to be procured
and the public officers who initiate procurement of revenue contracts should not be the
approving authority for inviting bids, or approving the acceptance of offer, where applicable.
Furthermore, the public officer who approves and/or selects the suppliers/service
providers/potential bidders for inviting bids shall not be the public officer authorising the
acceptance of the offer for that procurement.
TYPES OF PROCUREMENT PROCEDURES
220.
The Financial Secretary has delegated the authority to COs to procure stores,
services and revenue contracts of value not exceeding the financial limits, by way of
quotations or tendering, as stated below —
Financial limits
Procurement type
(up to and including)
Procedures to be followed
(a) (i) Stores
Quotation Limit:
For items within Quotation
Limit -
Quotation procedures
(ii) Services (other $3 million for
in Chapter II of the SPRs.
than those
consultancy services;
Alternatively, if COs prefer
covered by (b) $1.4 million for other (say for greater competition),
below)
items
tender procedures or
consultants selection
(iii) Consultancy
Departmental Limit:
procedures in Chapter III or IV
services
$10 million
of the SPRs.
(general and
works-related
For items beyond Quotation
consultancy)
Limit - Tender procedures or
consultants selection
(iv) Revenue
procedures in Chapter III or
contracts Note 1
IV of the SPRs.
(b) Services
for Quotation Limit:
For items within Quotation
construction and
$7 million
Limit -
Quotation procedures
engineering
in Chapter II of the SPRs.
works Note 2
Departmental Limit:
Alternatively, if COs prefer
$55 million for non-
(say for greater competition),
WTO GPA works
tender procedures in
contracts Note 3 procured Chapter III of the SPRs.
under the simplified
tendering arrangement
For items beyond Quotation
as set out in FC
Limit - Tender procedures in
No. 3/2009 (as may be Chapter III of the SPRs and FC
updated from time to No. 3/2009 if applicable.
time)
Note
1. Sale of goods for disposal of government stores or confiscated goods will be dealt with by
GLD.
2. They only cover those services which fall under Division 51 of the United Nations
Provisional Central Product Classification Code which is accessible at
http://portal.ccgo.hksarg/en/ia/DisplayIAByCat.jsf?cat=3766#3766
3. For classification of works contracts, please refer to DEVB TC(W) No. 5/2012 (as may
be updated from time to time) and guidelines issued by the Development Bureau
(DEVB).
221.
For
procurements
beyond the respective quotation limits specified in SPR 220,
departments shall follow the tender or consultants selection procedures laid down in
Chapter III or Chapter IV respectively, and supplementary instructions, as appropriate.
Departments may choose to follow the tender or consultants selection procedures for
procurement within the respective quotation limits. In such cases, the relevant procedures
(including the use of marking scheme in general) in Chapter III or Chapter IV, will apply.
Procurements adopting the tender or consultants selection procedures shall be subject to the
approval or advice of the relevant tender board/ committee or consultants selection board/
committee.
221A.
Departments may choose to adopt a marking scheme for evaluation of offers
for procurements under the quotation procedures. In such case, departments should observe
the guidelines and the authority for adopting a marking scheme at Appendix III(G). For
works contracts and consultancy services, the marking scheme shall be approved by a
directorate officer before invitation of quotations. For procurement of stores, services
(excluding works contracts and consultancy) and revenue contracts, the use of a marking
scheme which deviates from the Standard Marking Scheme Framework (SMS Framework)
shall be approved by a directorate officer before invitation of quotations. As a general rule,
irrespective of the use of marking schemes, tenderer’s experience should not be set as an
essential requirement in non-works procurement. If it is absolutely necessary, prior approval
must be sought from public officers (normally at directorate level) designated by COs. The
justifications for seeking exception from the general rule and the grounds for approval should
be properly recorded.
222.
Departments may refer to the lists of contractors/suppliers/service providers
maintained by the GLD or maintain their own lists of contractors/ suppliers/service providers
for inviting quotations for the procurement of stores, services and revenue contracts not
exceeding the quotation limits in SPR 220. If departments maintain their own lists, they
should publish their methods and invitations for admission to the lists of
contractors/suppliers/service providers on their webpages.
PROCUREMENT OF STORES THROUGH THE GOVERNMENT LOGISTICS
DEPARTMENT
235. (a)
DGL is the procurement agent for stores with a value beyond the departmental
limit specified in SPR 220(a). Departments shall make their requests to the
DGL for procurement of stores which are neither held in unallocated stock by
the GLD nor covered by a bulk contract arranged by the GLD in accordance
with the arrangements set out in (c)-(f) below.
(b)
For the procurement of stores not exceeding the departmental limit specified in
SPR 220(a), departments may seek assistance from the DGL for preparation of
tender documents and invitation of tenders or as an alternative, conduct their
own tender exercises. Departments choosing to conduct their own tender
exercises have the authority to prepare their tender documents (including
tender specifications and marking schemes), assess tenders received and
approve acceptance of offers.
(c)
For procurement of stores through the DGL, departments should make full use
of GLD’s Procurement and Contract Management System to submit their
procurement requests.
(d)
To obtain competitive offers, departments shall use general specifications
prepared in accordance with the provisions set out in SPR 350. Specifications
having the effect of suiting a particular supplier should not be adopted, unless
exceptionally justified. If necessary, the DGL or departments may refer the
matter to the relevant tender board for consideration.
(e)
Delivery of stores by air, if proposed, should be the exception and needs full
justification.
(f)
If the stores to be procured require the endorsement of an appropriate authority
(such as vehicles, furniture and equipment items in the public works projects,
safes, printing-related equipment, etc.), departments should attach to the
request a copy of the approval from the endorsement authority.
PROCUREMENT OF STORES BY DEPARTMENTS
245.
Departments may procure stores of a value not exceeding the departmental
limit specified in SPR 220(a) direct, rather than through the GLD, if such stores are -
(a) not held in unallocated stock by the GLD; or
(b) not covered by a bulk contract arranged by the GLD.
If notwithstanding (a) and (b) above, departments still want to procure stores direct, they shall
seek the DGL’s prior consent having regard to value for money consideration. Except in the
case of urgent minor purchases under SPR 265, departments shall follow the procedures set
out in SPR 260 or the tender procedures set out in Chapter III when making direct purchases.
246.
Departments may only make repeated purchases of the same items within
12 months if the cumulative value of the purchases does not exceed the quotation limit set out
in SPR 220(a). If departments have to use a particular item regularly in quantities with a
value in excess of the quotation limit, departments shall follow the tender procedures laid
down in Chapter III and supplementary instructions, as appropriate. For purchases outside
Hong Kong on Free on Board terms, the quotation limit includes the Free on Board value of
the stores procured, but excludes the freight, insurance and other incidental charges.
254.
When preparing specifications, departments may make reference to the
Guidelines for Drawing Up Tender Specifications at Appendix III(F), where appropriate.
Authorisation and control
255.
For the purpose of exercising adequate control over direct purchases, COs must
designate a public officer to approve the issue of formal orders. Unless otherwise approved
by the DGL, the public officer should not be lower than the rank of Assistant Supplies
Officer/Executive Officer II or equivalent, who shall report to a more senior ranked DSM
appointed under SPR 135. Before authorising the issue of formal orders, the public officer
must ensure that the procedures set out below are fully complied with. Only in exceptional
circumstances, and subject to the clearance of the DSM, may departments make purchases
before placing formal orders. When this occurs, the public officer handling the purchase must
provide a clear explanation on file for record purpose.
260. (a)
For purchases with a value not exceeding $50,000, with the exception of
those urgent minor purchases made under SPR 265, departments should
normally invite more than one supplier for quotations and accept the lowest
conforming offer or the conforming offer with the highest overall score (if a
marking scheme is used). Departments shall designate public officers of not
lower than the rank of Supplies Supervisor II or equivalent to handle the
selection of suppliers and to contact them for quotations. Public officers
contacting suppliers for quotations shall record on file the particulars such as
the names and contact details of the suppliers contacted and details of the
quotations received for audit purpose. The acceptance of an offer can only be
approved by a public officer of not lower than the rank of Assistant Supplies
Officer/Executive Officer II or equivalent. This public officer shall certify on
file that the prices quoted are reasonable. The purchase shall be made through
purchasing cards unless the CO, or a designated officer not lower than the rank
of Chief Executive Officer or equivalent, has authorised in writing otherwise.
Departments should follow supplementary guidelines issued by the DGL on
the use of purchasing cards for low value purchases.
(b)
For purchases with a value over $50,000 but not exceeding the quotation
limit set out in SPR 220(a), departments must invite at least five written
quotations, save for the circumstances stated under (d) below and follow the
procedures in (d)-(g) below.
(c)
Departments shall forward copies of their purchase orders, together with a
summary return listing out purchases over $50,000 in value, to the DGL at
half-yearly intervals ending 31 March and 30 September respectively. For all
purchases with a value exceeding $500,000, explanations have to be provided
in the returns if the number of written quotations received is less than five
and/or an offer of a higher price or not obtaining the highest score (if a
marking scheme is used) is accepted.
Invitation of quotations
260. (d)
Provided that no less than five written quotations are invited, public officers at
the levels listed in column (A) of the table below are authorised to approve the
issue of invitations and/or selection of suppliers for inviting quotations. For
the purpose of this Chapter, written quotations by electronic mail, facsimile or
post are accepted. In cases where it is not possible to invite no less than five
written quotations, or it is justified to invite less than five written quotations,
such as in the case of purchases from a sole agent or supplier, the approving
authority is listed in column (B) of the table below –
Approving Officer
Value of the
(not lower than the rank of)
Purchase
(A)
(B)
(i)
not
exceeding
Assistant Supplies Officer/ Supplies Officer/
20% of the
Executive Officer II or Executive Officer I or
quotation limit
equivalent
equivalent
set out in
SPR 220(a)
(ii)
not
exceeding
Supplies Officer/
Senior Supplies Officer/
50% of the
Executive Officer I or Senior Executive Officer
quotation limit
equivalent
or equivalent
set out in
SPR 220(a)
(iii)
up to the
Senior Supplies Officer/ Chief Supplies Officer/
quotation limit
Senior Executive Officer Chief Executive Officer
set out in
or equivalent
or equivalent
SPR 220(a)
The approving officer shall record on file the particulars such as the names and
contact details of the suppliers proposed to be contacted, a brief explanatory
note on the decision (in case less than five written quotations are invited) and
the reasons for their selection.
(e)
After the necessary approval under (d) above is obtained, a public officer not
lower than the rank of Assistant Supplies Officer/Executive Officer II or
equivalent shall contact the suppliers for quotations.
(f)
Where written quotations are invited, departments shall ask the suppliers to
return the quotations in sealed envelopes, submit the quotations through
e-Procurement System or other electronic procurement system where
applicable, or by electronic mail/facsimile in cases where the receipt of
quotations by electronic mail/facsimile has been authorised by the approving
officers for the issue of invitations under (d) above, by a specified time. A
quotation opening team comprising two members, with the team leader at a
rank not lower than that of Assistant Supplies Officer/Executive Officer II or
equivalent, will open or vet the quotations received, and where applicable,
date-stamp and initial quotations. All written quotations received should be
properly documented.
Acceptance of offer
260. (g)
Provided that no less than five written quotations are received, public officers
at the levels listed in column (A) of the table below are authorised to approve
the acceptance of the lowest conforming offer or the conforming offer with the
highest overall score (if a marking scheme is used). In cases where (i) less
than five written quotations are received; (ii) less than five written quotations
have been invited in accordance with SPR 260(d); or (iii) a higher conforming
offer or a conforming offer not obtaining the highest overall score (if a
marking scheme is used) is to be accepted under exceptional circumstances
with full justifications, the approving authority is listed in column (B) of the
table below –
Approving Officer
Value of the
(not lower than the rank of)
Purchase
(A)
(B)
(i) not exceeding 20% Supplies Officer/
Senior Supplies Officer/
of the quotation
Executive Officer I or Senior Executive Officer
limit set out in equivalent
or equivalent
SPR 220(a)
(ii) not exceeding 50% Senior Supplies Officer/ Chief Supplies Officer/
of the quotation
Senior Executive Officer Chief Executive Officer
limit set out in or equivalent
or equivalent
SPR 220(a)
(iii) up to the quotation Chief Supplies Officer/ D1 or equivalent
limit set out in Chief Executive Officer
SPR 220(a)
or equivalent
(h)
Except for purchases made through purchasing cards and e-purchases made by
placing e-orders, or as provided in SPR 265, departments shall place order
using Departmental Order for Supply of Stores (GF 219) or a Letter of
Acceptance, as appropriate.
(i)
Departments must certify all stores received against a direct purchase order by
asking the public officer who receives the stores to sign on the invoice issued
by the supplier. Where this is impracticable, the public officer shall sign a
receipt. In either case, the invoice or receipt requires endorsement by a senior
public officer.
Purchases outside Hong Kong
260. (j)
For direct purchases outside Hong Kong, except for purchases made through
purchasing cards and e-purchases made by placing e-orders, departments shall
place orders with the supplier outside Hong Kong by way of a Letter of
Acceptance. Departments should normally arrange collection and local
delivery of the goods directly with the supplier. For specialised stores such as
arms and ammunition, departments may request the DGL to be the consignee
of such goods and arrange collection and local delivery of the consigned
goods. Departments shall handle any claims arising from these direct
purchases outside Hong Kong in accordance with SPR 935-965, with GLD
rendering advice and assistance where necessary.
Urgent minor purchases
265. (a)
Public officers may make minor purchases of stores in cash or through
purchasing cards to meet immediate needs, provided that the total value of the
purchase does not exceed $5,000 each and the authorising officer not lower
than the rank of Assistant Supplies Officer/Executive Officer II or equivalent
is satisfied that such purchases are essential and the rates obtained are
reasonable and certifies this on file. For payments made in cash, the cost of
such purchases will be reimbursed from a departmental imprest account.
When claiming reimbursement, public officers shall use a Claim for
Reimbursement of Expenses (GF 51). For these purchases, departments do not
need to issue covering orders, but shall maintain a copy of GF 51 issued for
audit purpose.
(b)
Public officers not lower than the rank of Assistant Supplies Officer/Executive
Officer II or equivalent may make purchases of stores to meet departmental
needs while on official visits outside Hong Kong, provided that the total value
of the purchase does not exceed $25,000. Public officers making such
purchases shall follow the same reimbursement procedure described in
SPR 265(a).
PROCUREMENT OF SERVICES BY DEPARTMENTS
280. (a)
Departments shall follow the provisions set out in these Regulations for
procurement of services with a value not exceeding the quotation limits stated
in SPR 220(a) or (b) as appropriate. Reference may be made to A General
Guide to Outsourcing prepared by EffO (formerly known as Efficiency Unit)
for guidance. When preparing specifications, departments may make
reference to the Guidelines for Drawing Up Tender Specifications at Appendix
III(F), where appropriate. For service contracts that rely heavily on the
deployment of non-skilled workers, departments should consider setting
requirements in accordance with the relevant FCs.
Authorisation and control
280. (b)
For procuring services with a value not exceeding $50,000, with the
exception of services procured under SPR 290, departments should normally
invite more than one service provider for quotations and accept the lowest
conforming offer or the conforming offer with the highest overall score (if a
marking scheme is used). Departments shall designate public officers of not
lower than the rank of Supplies Supervisor II or equivalent to handle the
selection of service providers and to contact them for quotations. Public
officers contacting service providers for quotations shall record on file the
particulars such as the names and contact details of the service providers
contacted and details of the quotations received for audit purpose. The
acceptance of an offer can only be approved by a public officer of not lower
than the rank of Assistant Supplies Officer/Executive Officer II or equivalent.
This public officer shall certify on file that the rates or amounts quoted are
reasonable. The procurement of services shall be made through purchasing
cards unless the CO, or a designated officer not lower than the rank of Chief
Executive Officer or equivalent, has authorised in writing otherwise.
Departments should follow supplementary guidelines issued by the DGL on
the use of purchasing cards for low value purchases.
(c)
For procuring services with a value exceeding $50,000 but not exceeding
the quotation limits stated in SPR 220(a) or (b) as appropriate,
departments must invite written quotations from not less than five service
providers, save for the circumstances stated under (d) below and follow the
procedures set out in (d)-(g) below.
Invitation of quotations
280. (d)
Provided that no less than five written quotations are invited, public officers at
the levels listed in column (A) of the table below are authorised to approve the
issue of invitations and/or selection of service providers for inviting
quotations. For the purpose of this Chapter, written quotations by electronic
mail, facsimile or post are accepted. In cases where it is not possible to invite
no less than five written quotations, or it is justified to invite less than five
written quotations, such as in the case of purchases from a sole agent or
service provider, the approving authority is listed in column (B) of the table
below –
Approving Officer
Value of the
(not lower than the rank of)
Purchase
(A)
(B)
(i)
not
exceeding
20% of the
quotation limit
set out in
SPR 220(a)
Assistant Supplies Officer/ Supplies Officer/
Executive Officer II or Executive Officer I or
equivalent
equivalent
SPR
220(b)
Assistant
Engineer
or
Engineer or equivalent
equivalent
(ii)
not
exceeding
50% of the
quotation limit
set out in
SPR 220(a)
Supplies
Officer/ Senior Supplies Officer/
Executive Officer I or Senior Executive Officer
equivalent
or equivalent
SPR 220(b)
Engineer or equivalent
Senior Engineer or
equivalent
(iii)
up to the
quotation limit
set out in
SPR
220(a)
Senior Supplies Officer/ Chief Supplies Officer/
(i), (ii) and (iv) Senior Executive Officer Chief Executive Officer or
or equivalent
equivalent
SPR
220(a)
Chief Supplies Officer/ D1 or equivalent
(iii)
Chief Executive Officer
or equivalent
SPR
220(b)
Senior
Engineer
or
Chief Engineer or
equivalent
equivalent
The approving officer shall record on file the particulars such as the names and
contact details of the service providers proposed to be contacted, a brief
explanatory note on the decision (in case less than five written quotations are
invited) and the reasons for their selection.
(e)
After the necessary approval under (d) is obtained, a public officer not lower
than the rank of Assistant Engineer or equivalent (for services for construction
and engineering works) or Assistant Supplies Officer/Executive Officer II or
equivalent (for other services) shall contact the service providers for
quotations.
(f)
Where written quotations are invited, departments shall ask the service
providers to return the quotations in sealed envelopes, or submit the quotations
through e-Procurement System or other electronic procurement system where
applicable, or by electronic mail/facsimile in cases where the receipt of
quotations by electronic mail/facsimile has been authorised by the approving
officers for the issue of invitation under (d) above, by a specific time. A
quotation opening team comprising two members, with the team leader at a
rank not lower than that of Assistant Engineer or equivalent (for services for
construction and engineering works) or Assistant Supplies Officer/Executive
Officer II or equivalent (for other services), will open or vet the quotations
received, and where applicable, date-stamp and initial the quotations. All
written quotations received should be properly documented.
Acceptance of offer
280. (g)
Provided that no less than five written quotations are received, public officers
at the levels listed in column (A) of the table below are authorised to approve
the acceptance of the lowest conforming offer or the conforming offer with the
highest overall score (if a marking scheme is used). In cases where (i) less
than five written quotations are received; (ii) less than five written quotations
have been invited in accordance with SPR 280(d); or (iii) a higher conforming
offer or a conforming offer not obtaining the highest overall score (if a
marking scheme is used) is to be accepted under exceptional circumstances
with full justifications, the approving authority is listed in column (B) of the
table below —
Approving Officer
Value of the
(not lower than the rank of)
Purchase
(A)
(B)
(i)
not
exceeding
20% of the
quotation limit
set out in
SPR
220(a)
Supplies
Officer/
Senior Supplies Officer/
Executive Officer I or Senior Executive Officer
equivalent
or equivalent
SPR 220(b)
Engineer or equivalent
Senior Engineer or
equivalent
(ii)
not
exceeding
50% of the
quotation limit
set out in
SPR 220(a)
Senior Supplies Officer/ Chief Supplies Officer/
Senior Executive Officer Chief Executive Officer or
or equivalent
equivalent
SPR
220(b)
Senior
Engineer
or
Chief Engineer or
equivalent
equivalent
(iii)
up to the
quotation limit
set out in
SPR
220(a)
Chief Supplies Officer/ D1 or equivalent
(i), (ii) and (iv) Chief Executive Officer or
equivalent
SPR
220(a)
D1 or equivalent
D2 or equivalent
(iii)
SPR
220(b) Chief Engineer or
Government Engineer or
equivalent
equivalent
(h)
Except for procurement of services made through purchasing cards and
e-purchases made by placing e-orders or as provided in SPR 290, departments
shall use Departmental Order for Provision of Services (GF 220) or a Letter of
Acceptance, as appropriate, for ordering services.
Urgent minor purchases
290. (a)
Public officers may make minor purchases of services in cash or through
purchasing cards to meet immediate needs, provided that the value of services
does not exceed $5,000 and the authorising officer not lower than the rank of
Assistant Engineer or equivalent (for services for construction and
engineering works) or Assistant Supplies Officer/Executive Officer II or
equivalent (for other services) is satisfied that such purchases are essential and
the rates obtained are reasonable and certifies this on file. For payments made
in cash, the cost of such purchases will be reimbursed from a departmental
imprest account. When claiming reimbursement, public officers shall use a
Claim for Reimbursement of Expenses (GF 51). For these purchases,
departments do not need to issue covering orders, but shall maintain a copy of
the GF 51 issued for audit purpose.
(b)
Public officers not lower than the rank of Assistant Supplies Officer/Executive
Officer II or equivalent may make purchases of services to meet departmental
needs while on official visits outside Hong Kong, provided that the total value
of the purchase does not exceed $25,000. Public officers making such
purchases shall follow the same reimbursement procedure described in
SPR 290(a).
PROCUREMENT OF REVENUE CONTRACTS BY DEPARTMENTS
295. (a)
Departments shall follow the provisions set out in these Regulations for
procurement of revenue contracts with a value not exceeding the quotation
limit stated in SPR 220(a). When preparing specifications, departments may
make reference to the Guidelines for Drawing Up Tender Specifications at
Appendix III(F), where appropriate.
Authorisation and control
295. (b)
For procuring revenue contracts with a value not exceeding $50,000,
departments should normally invite more than one potential bidder for
quotations, and accept the highest conforming offer or the conforming offer
with the highest overall score (if a marking scheme is used). Departments
shall designate public officers of not lower than the rank of Supplies
Supervisor II or equivalent to handle the selection of potential bidders and to
contact them for quotations. Public officers contacting potential bidders for
quotations shall record on file the particulars such as the names and contact
details of the potential bidders contacted and details of the quotations received
for audit purpose. The acceptance of an offer can only be approved by a
public officer of not lower than the rank of Assistant Supplies
Officer/Executive Officer II or equivalent. This public officer shall certify on
file that the rates or amounts quoted are reasonable.
(c)
For procuring revenue contracts with a value exceeding $50,000 but not
exceeding the quotation limit stated in SPR 220(a), departments should
invite written quotations from not less than five potential bidders. For the
purpose of this Chapter, written quotations by electronic mail, facsimile or
post are accepted. Departments shall follow the same procedures for the
procurement of services (excluding services for construction and engineering
works) as laid down in this Chapter.
QUOTATION NEGOTIATIONS
296.
Where it would be in the Government’s interest to negotiate with a bidder or
bidders in a quotation exercise, such negotiations should be conducted in a non-discriminatory
manner. The approving officers specified in SPR 260(g) or SPR 280(g) may approve the
initiation of the quotation negotiations if it is justified to do so. The acceptance of the
negotiated outcome should be approved by public officers at least one rank higher than the
officers approving the initiation of negotiation. Some guidelines on preparing for and
conducting negotiations are provided at Appendix III(J) for general reference. They are not
intended to be comprehensive.
CANCELLATION OF QUOTATION EXERCISE
297.
The approving officers specified in SPR 260(g) or SPR 280(g) may approve
the cancellation of the quotation exercise if it is justified to do so. The reasons for
cancellation (such as no conforming offer received, the contract sum of recommended offer
exceeds the quotation limit, or other reasons on grounds of public interest) should be recorded
for audit purpose. Approval for cancellation of a quotation exercise is not required when no
offer is received after the close of quotation invitation.
EXCEPTIONAL AUTHORISATION
298.
In very exceptional cases, PS(Tsy) may authorise departments to make
purchase of stores not in accordance with the requirements in this Chapter. For purchases of
stores not in accordance with SPR 245-265, departments shall submit the requests through the
DGL, who will forward them with his recommendations to PS(Tsy).
CHAPTER III
TENDER PROCEDURES
SCOPE AND COVERAGE
300. (a)
The tender procedures set out in these Regulations shall be followed for
procurement and disposal of stores, services, construction/engineering works
and other items as well as for revenue contracts, with the exception of the
following for which separate procedures shall apply —
(i)
procurement of stores, services and revenue contracts not exceeding the
quotation limits specified in SPR 220. Quotation procedures are
applicable;
(ii) franchises, concessions, leases, licences, tenancies and other items
procured and disposed of by public auction or method laid down by
statute, Government Regulations, or administrative procedure agreed by
the PS(Tsy);
(iii) private treaty grants, exchanges, extensions and short-term tenancies of
land under the approved “Abbreviated Tender System”;
(iv) procurement of consultancy services through quotation and consultants
selection procedures in Chapters II and IV respectively;
(v) direct engagement of contractors/suppliers/service providers without
recourse to tender procedures specified in SPR 331-333;
(vi) briefing out of legal work by the Secretary for Justice; and
(vii) employment of individual persons.
(b)
Where procurements are covered by WTO GPA and hence are subject to
additional requirements, these are separately specified. Departments shall
comply with the requirements of WTO GPA and related circulars/guidelines
(as may be updated from time to time) which can be viewed at
http://portal.ccgo.hksarg/en/ia/DisplayIAByCat.jsf?cat=3766#3766
In
estimating the value of a procurement for the purpose of ascertaining whether
it is a procurement covered by WTO GPA, departments shall include the
estimated maximum total value of the procurement over its entire duration,
whether awarded to one or more contractors/suppliers/service providers, taking
into account all forms of remuneration.
CLASSIFICATION OF INFORMATION
305.
Information relating to tenders and contracts should be handled in the
following manner —
(a)
All communications regarding tenders, from the time tender documents are
prepared until a decision is made on the acceptance or otherwise of the
tenders, must be classified as RESTRICTED (TENDER). Correspondence on
prequalification and single/restricted tendering should also be classified as
RESTRICTED (TENDER).
(b)
Contract documents and communications regarding contracts do not usually
have a security classification. RESTRICTED will be an adequate
classification for sensitive information relating to contract disputes, litigation,
claims, etc. Information should only be classified as CONFIDENTIAL if its
disclosure would be prejudicial to the interest of the Government of the Hong
Kong Special Administrative Region (HKSAR).
(c)
COs and Chairmen of Tender Boards shall appoint public officers to open and
handle classified correspondence relating to tenders and contracts on a
need-to-know basis. Detailed instructions on the procedures for handling such
correspondence shall be made in accordance with the provisions of the
Security Regulations.
TENDER BOARDS AND OTHER APPROVING AUTHORITIES
310. (a)
The Financial Secretary/SFST appoints the Central Tender Board (CTB), and
has authorised PS(Tsy) to appoint subsidiary tender boards and COs to appoint
DTCs each comprising not less than three persons to consider and decide on
the acceptance of tenders or to advise on the acceptance of tenders up to the
approved financial limits. The relationship amongst CTB, subsidiary tender
boards and DTCs is provided in SPR 116.
(b)
The CTB advises the PS(Tsy) on the acceptance of all tenders exceeding the
financial limits of subsidiary tender boards. The CTB also advises or decides
on matters concerning tenders, contracts and subsidiary tender boards
generally in accordance with its terms of reference. In the case of serious
disagreement among members of the CTB on the award of a contract, the
Chairman, in his discretion, may refer the matter to the Financial
Secretary/SFST for advice.
(c)
In seeking advice or approval of the CTB (concerning, for example, tender
reports, the use of a marking scheme for works contracts, deviation from the
SMS Framework for the procurement of stores, services (excluding works
contracts) and revenue contracts, or the conduct of prequalification exercise
and the list of prequalified tenderers), departments shall send seven copies of
the submission and the original copy to the Secretary, CTB. Submissions to
the CTB must be signed or endorsed by the respective CO or his representative
at directorate level. The CO concerned or his representative at directorate
level may be requested or may himself request to attend CTB’s meeting to
present his recommendations or to answer any queries that the CTB may have
(see also SPR 375).
(d)
There are currently two subsidiary tender boards, viz. the GLD Tender Board
and the Public Works Tender Board. If there is a division of opinion on a
contract award between members of a subsidiary tender board, the Chairman
of the concerned subsidiary tender board should refer the matter to the CTB
for advice. Subsidiary tender boards shall submit to the CTB at the end of the
month concerned details of all contract awards where the lowest conforming
offer (highest in the case of revenue contract), or the tender of the highest
overall scorer in case a marking scheme is used in tender evaluation, has not
been accepted and the reasons for making such awards.
(e)
Up-to-date information on the membership and terms of reference of the CTB
and subsidiary tender boards is published in the Civil and Miscellaneous Lists
of the Government of the HKSAR, which can be viewed at the website
<http://www.info.gov.hk/cml/eng/cbc/c23.htm>.
(f)
COs shall establish in their departments a DTC consisting of not less than
three persons and chaired by a directorate officer not lower than D2 rank who
shall be at least one rank higher than the chairman of the TAP set up for that
particular tender exercise to consider or decide on the acceptance of tenders
for procurements within the financial limits specified in SPR 116.
(g)
If there is a division of opinion on a contract award between members of a
DTC, the Chairman of the concerned DTC may refer the matter to his CO for
ruling. DTCs shall submit to the relevant tender board at the end of the month
concerned details of all contract awards where the lowest conforming offer
(highest in the case of revenue contract), or the tender of the highest overall
scorer in case a marking scheme is used in tender evaluation, has not been
accepted and the reasons for making such awards.
(h)
COs are delegated the authority to personally approve —
(i)
the award of all works contracts not exceeding $30 million each and not
subject to WTO GPA; and
(ii)
the award of works contracts above $30 million but not exceeding
$55 million each and not subject to WTO GPA provided they are
awarded to the lowest conforming bidder or the highest overall scorer.
TYPES OF TENDERING
315.
Departments should normally adopt open tendering for invitation of tenders.
Under special circumstances and where approval from the concerned authorities have been
obtained, departments may invite tenders in any of the alternative ways, namely selective
tendering, single/ restricted tendering or prequalified tendering as provided for in
SPR 320-330 below.
Open tendering
316.
All interested contractors/suppliers/service providers are free to submit their
tenders. Procedures and requirements on publications of tender notice for open tendering are
set out in SPR 340.
Selective tendering
320. (a)
Selective tendering is adopted when contractors/suppliers/service providers on
the relevant approved lists of contractors/suppliers/service providers are
invited to submit tenders.
(b)
It is a two-step, open bidding process which departments may establish lists of
qualified contractors/suppliers/service providers for particular services or
articles, where there is a frequent need to invite tenders for such services or
articles but not all contractors/suppliers/service providers in the market are
capable of providing the required services or articles. Normally, admission to
the lists is accepted at any time and any contractor/supplier/service provider
may submit an application. A contractor/supplier/service provider who has
submitted a request for participation in a tender exercise but is not yet on the
approved lists shall not be excluded from consideration on the grounds that
there is insufficient time to examine the application for admission to the
approved lists, unless, in exceptional cases, due to the complexity of the
procurement, the department is not able to complete the examination of the
application within the time-period allowed for submission of tenders. Notices
of tender invitations should be published in the Government Gazette, on the
Internet, and/or sent by letter to all contractors/suppliers/service providers on
the relevant approved lists of qualified contractors/suppliers/service providers
established for the purpose of selective tendering. For procurements covered
by WTO GPA, in addition to SPR 340(c), departments shall notify and provide
the notice of tender invitation to the contractors/suppliers/service providers on
the relevant approved lists of qualified contractors/ suppliers/service providers
that will be invited to tender. Detailed procedures and requirements on
publication of notices of tender invitations are set out in SPR 340.
(c)
Except for the authority delegated for works contracts in (d) below, the
PS(Tsy) is the approving authority for the establishment of lists of qualified
contractors/suppliers/service providers for selective tendering. When applying
to establish such lists, departments shall set out the justifications and provide
information on the source of prospective applicants, qualification criteria,
assessment panel and method of assessment. The qualification criteria and
method of assessment shall not discriminate among foreign
contractors/suppliers/service providers or between domestic and foreign
contractors/suppliers/service providers. For procurements covered by
WTO GPA, the qualification criteria shall be limited to those which are
essential to ensure that the contractors/suppliers/service providers have the
legal and financial capacities and the commercial and technical abilities to
undertake the relevant procurements. In establishing the qualification criteria,
departments shall not impose the criterion that, in order for a
contractor/supplier/service provider to participate in a procurement, the
contractor/supplier/service provider has previously been awarded one or more
contracts by an entity covered by the WTO GPA, but may require relevant
prior experience where essential to meet the requirements of the procurement.
Departments shall seek the prior approval of the PS(Tsy) before revising the
qualification criteria and method of assessment.
(d)
For works contracts, the approving authority for the establishment of the List
of Approved Contractors for Public Works and the List of Approved Suppliers
of Materials and Specialist Contractors for Public Works and for revising the
qualification criteria and method of assessment of the lists has been delegated
to the Permanent Secretary for Development (Works). Departments shall
follow supplementary procedures set out in relevant DEVB TC(W).
(e)
Departments establishing and maintaining approved lists of qualified
contractors/suppliers/service providers for selective tendering shall publish a
notice inviting interested contractors/suppliers/service providers to apply for
admission to the lists in the home page on the Internet, which shall be posted
continuously during the period of its validity. Such notice shall include,
among other things, a description of the stores or services, or categories
thereof, for which the lists may be used, the period of validity of the lists, the
qualification criteria, the method of application and assessment and the means
for renewal or termination, where applicable. A specimen is at
Appendix III(A). Approved lists shall be reviewed regularly to ensure that
new applications are processed promptly and that contractors/suppliers/service
providers who cease to be qualified are deleted from the lists. In addition, new
applications from contractors/suppliers/service providers for admission to the
approved lists shall be allowed at any time and dealt with expeditiously.
Departments shall promptly inform the contractors/suppliers/service providers
of their decisions and, on request of the contractors/suppliers/service
providers, promptly provide them with a written explanation of the reasons for
their decisions. Updating of the lists according to the approved qualification
criteria does not require further approval from the PS(Tsy).
Single and restricted tendering
325. (a)
For single or restricted tendering (referred to as limited tendering under
WTO GPA for which the conditions for invoking limited tendering are also
specified therein), tenders are invited from only one or a limited number of
contractors/suppliers/service providers. Single or restricted tender procedures
shall only be used in circumstances when open competitive tendering would
not be an effective means of obtaining the requisite stores or services or for
procuring revenue contracts. They shall not be used for the purpose of
avoiding competition among contractors/suppliers/service providers or in a
manner that discriminates against non-local contractors/suppliers/service
providers or protects local contractors/suppliers/service providers. Examples
that may justify the use of single or restricted tendering procedures include —
(i)
insofar as is strictly necessary where, for reasons of extreme urgency
brought about by events unforeseeable by the procuring department, the
stores, services or revenue contracts could not be procured in time using
open tendering or selective tendering;
(ii)
where the requirement is for a work of art, or where for the protection of
patents, copyrights or other exclusive rights, or due to an absence of
competition for technical reasons, the stores, services or revenue
contracts can be supplied or provided only by a particular
contractor/supplier/service provider and no reasonable alternative or
substitute exists;
(iii) where no tenders were submitted or no contractors/suppliers/service
providers requested participation, or no tenders that conform to the
essential requirements of the tender documentation were submitted, or
no contractors/suppliers/service providers satisfied the conditions for
participation, or the tenders submitted have been collusive, provided
that the requirements of the single or restricted tendering do not
substantially differ from the previous requirements of open or selective
tendering;
(iv) where the procurement is for additional deliveries by the original
contractor/supplier/service provider of stores or services that were not
included in the initial procurement, and a change of
contractor/supplier/service provider for such additional stores or
services cannot be made for economic or technical reasons such as
requirements of interchangeability or interoperability with the existing
equipment, software, services or installations procured under the initial
procurement, and that any change would cause significant
inconvenience or substantial duplication of costs for the procuring
department;
(v)
where the procurement is for purchasing a prototype or a first good or
service that is developed at the request of the procuring department(s) in
the course of, and for, a particular contract for research, experiment,
study or original development. Original development of a first good or
service may include limited production or supply in order to incorporate
the results of the field testing and to demonstrate that the good or
service is suitable for production or supply in quantity to acceptable
quality standards, but does not include quantity production or supply to
establish commercial viability or to recover research and development
costs;
(vi) where services are to be provided by utility companies; and
(vii) where lease terms require that work must be executed by a particular
firm.
(b)
Single or restricted tender procedures shall only be initiated with the prior
approval of the following officers –
(i)
COs personally for stores, services (excluding works contracts and
consultancy) and revenue tenders invited by the department within the
departmental limit specified in SPR 220(a). The same requirement also
applies if departments choose to adopt single or restricted tender
procedures for these procurements within the quotation limit;
(ii) DGL or his delegated officers for tenders arranged by GLD (GLD
tenders); and
(iii) PS(Tsy) for tenders other than (i) and (ii) above.
Requests for inviting single or restricted tenders for the supply of stores
exceeding the departmental limit specified in SPR 220(a) other than through a
GLD contract should be routed via the DGL, who will forward them, with his
recommendations, to the PS(Tsy) for approval.
COs should follow relevant guidelines set out in FC No. 2/2019 (as may be
updated from time to time) in deciding whether single or restricted tendering
should be initiated. Requests for single or restricted tendering, irrespective of
value, should be signed or endorsed by a public officer at directorate level.
After obtaining approval for the initiation of single or restricted tenders,
departments shall submit their recommendations to the relevant tender board/
DTC for consideration of the acceptance of tenders in accordance with the
financial limits as set out in SPR 116.
(c)
Departments shall advise tenderers invited to tender under the single or
restricted tender procedures to submit their tenders in the same manner as open
or selective tender procedures. Tenderers shall not be informed that tenders
are being invited on a single or restricted basis. Notices of tender invitation
shall be sent by letter to the tenderers.
(d)
When seeking approval to adopt single or restricted tendering procedures,
departments should —
(i)
describe the background of the case, the stores or services to be
procured or the source of revenue;
(ii)
state the estimated cost or revenue;
(iii) explain why open tenders should not be invited;
(iv) if time constraint is the reason for proposing single or restricted
tendering, explain why the tender exercise could not have been initiated
earlier and why the additional time required for open tendering would
harm the public interest;
(v) if a shortlist of contractors from whom tenders are to be invited is
recommended, explain how the shortlist is drawn up, elaborating
specifically on the criteria used for the shortlisting, and the professional
capability and experience of all the contractors considered, including
those not shortlisted;
(vi) obtain the support from the relevant policy bureau (for cases requiring
approval from PS(Tsy));
(vii) seek and attach the legal advice from D of J or Legal Advisory Division
(Works) of DEVB (LAD(W)/DEVB) on the proposed single/restricted
tendering from the WTO GPA perspective; and
(viii) advise on how it plans to procure the contract in the longer term.
Prequalified tendering
330. (a)
There may be circumstances which require the prequalification of a list of
tenderers that are financially and technically capable of undertaking a
particular project or supplying a particular product. These include projects
which require pre-testing of equipment to determine its suitability; projects of
an extremely complex nature, high value or subject to very rigid completion
programmes; projects which call for a high level of co-ordination, technical
expertise, or a non-standard form of contract, e.g. Build-Operate-Transfer or
specific types of Design-and-Build contracts; and products which are critical
to the user departments.
(b)
PS(Tsy) approves, on the advice of CTB, for the use of prequalified tendering
and the evaluation criteria for prequalifying applications. A request for
approval to conduct prequalification should contain all necessary information
as shown in the format at Appendix III(B).
(c)
Invitations for prequalification shall be published in the Government Gazette.
The invitation may also be published on the Internet, local press and selected
overseas journals for the particular trade/product or any other means deemed
appropriate. Consulates and trade commissions in Hong Kong and known
contractors/suppliers/service providers may be notified of the invitation by
letter, where appropriate. A specimen Gazette notice is shown at
Appendix III(C). For procurements covered by WTO GPA, please refer to
SPR 340(c).
(d)
Applications may be received by the procuring department direct provided
there are proper procedures for the receipt and registration of the applications.
Procuring departments may also require applications to be deposited in the
Government Secretariat Tender Box, in which case, the Secretary, CTB should
be informed in advance and the closing time for submission of applications
must be fixed as noon on a working Friday.
(e)
Having assessed all the applications according to the evaluation criteria
previously endorsed by the CTB, the procuring department should make a
recommendation to the CTB on a list of prequalified applicants from whom
tenders will be invited. The submission (in the format shown at
Appendix III(D)) should contain an analysis of the strengths and weaknesses
of all the applicants and detailed reasons why an applicant should be
prequalified or rejected.
(f)
Notice of tender invitation shall be sent by letter to the prequalified tenderers
and contain information as specified in SPR 340(e) and Appendix III(E),
where applicable.
(g)
Any changes in the material particulars of the prequalified tenderers which
occur between the prequalification and final tendering exercise will require the
endorsement of the CTB. Procuring departments shall advise prospective
applicants in the prequalification document that the Government may permit
changes to the status of a prequalified tenderer at its discretion and may
disqualify a prequalified tenderer at any time prior to acceptance of the tender,
if a prequalified tenderer has ceased to be able to meet the prequalification
requirements.
(h)
Unless with the prior approval of PS(Tsy) who decides on the advice of the
CTB, a prequalification exercise is conducted specifically for a particular
project or product, and the list of prequalified tenderers will normally remain
valid for one year.
DIRECT ENGAGEMENT
331.
Direct engagement of a contractor/supplier/service provider without recourse
to tendering procedures should only be used in circumstances when
open/selective/restricted/single tendering would not be an effective means of obtaining the
requisite stores or services or procuring revenue contracts, supported with very strong
justifications. Where the procurement under a direct engagement is covered by the WTO
GPA, procuring departments should refer to Article XIII of the WTO GPA, and seek legal
advice from D of J or LAD(W)/DEVB if in doubt on the application of the relevant WTO
GPA provisions.
332.
The authority to approve the initiation of direct engagement and acceptance of
offer under direct engagement rests with PS(Tsy). For direct engagement of a
contractor/supplier/service provider for the procurement of stores, services (excluding works
contracts and consultancy) and revenue contracts not exceeding the departmental limit
specified in SPR 220(a), this authority has been delegated to COs personally. Requests for
direct engagement, irrespective of value, should be signed or endorsed by a public officer at
directorate level.
333.
In exercising the delegated authority, the approving authorities should observe
relevant guidelines set out in FC No. 2/2019 (as may be updated from time to time). When
seeking approval to adopt direct engagement, in addition to those listed in SPR 325(d), as no
bidding process is involved, departments should also include the contracting strategy having
regard to the need to protect the Government’s interest and public perception, as well as
negotiation strategy with the baseline position on the cost or revenue, if applicable.
FUNDING
337. (a) For works contracts funded under the Capital Works Reserve Fund, COs shall
adopt parallel tendering, i.e. invite tenders before funding is secured, unless
they consider, upon the conduct of risk assessment, that the benefits of parallel
tendering (in terms of time saving, greater certainty in the Approved Project
Estimate to be sought, etc.) are outweighed by the risks involved (in terms of
abortive tendering work in case the approving authority does not approve the
project concerned or impose conditions not envisaged in the tender, risk of
Government being seen to be pre-empting Finance Committee/ Legislative
Council, etc.). For procurements of estimated value exceeding $30 million,
prior approval from the relevant Directors of Bureaux (or Permanent
Secretaries if authorised by the Directors in writing to do so) is required for
exemption from parallel tendering.
(b)
For other contracts, COs may adopt parallel tendering, i.e. invite tenders before
funding is secured, provided they are satisfied, upon the conduct of a risk
assessment, that the benefits of parallel tendering (in terms of time saving,
greater certainty in the Approved Project Estimate to be sought, etc.) outweigh
the risks involved (in terms of abortive tendering work in case the approving
authority does not approve the project concerned or impose conditions not
envisaged in the tender, risk of Government being seen to be pre-empting
Finance Committee/ Legislative Council, etc). If the estimated value of the
procurement exceeds $30 million, COs shall seek the prior approval of their
Directors of Bureaux (or their Permanent Secretaries if authorised by the
Directors in writing to do so) to adopt parallel tendering.
338.
When parallel tendering is adopted, COs must reflect correctly in such tender
invitations that funding approval has not been obtained and remind tenderers that Government
is not responsible for their costs of preparing the bids. As a general principle, COs should not
award a contract and should not indicate to the successful bidder that Government would
accept its bid unless and until funding for that contract is secured. Conditions for contract
award are set out in FC No. 3/2020 (as may be updated from time to time).
TENDER NOTICES AND TENDERING PERIOD
340. (a)
Departments wishing to publish tender notices in the Government Gazette
(normally published on Friday) shall follow the procedures set out in General
Regulations 103-105, and forward three copies of the draft notice in Chinese
and English by 3:30 p.m. on Tuesday to the Official Languages Division of
Civil Service Bureau, which will forward them to the Assistant Clerk to the
Executive Council after vetting the Chinese translation. Departments should
also send an additional copy of the notice to the DGL not later than 2:30 p.m.
on Tuesday. A specimen Gazette tender notice is at Appendix III(E). Such
notices should generally appear in two consecutive issues of the Government
Gazette but can be published in more than two issues, if the procuring
department deems appropriate.
(b)
Procuring departments may publish tender notices on the Internet, in the local
and/or international press and journals or any other means deemed appropriate
in addition to the Government Gazette. For placement of advertisements in the
press, departments should make arrangements with the Director of Information
Services direct.
(c)
For procurements covered by WTO GPA, procuring departments shall publish
the tender notices and the notices of invitations for prequalification in the
Government Gazette. They should also consider notifying consulates and
trade commissions in Hong Kong of the tender invitations, where appropriate.
(d)
For works contracts not exceeding $55 million and other procurements which
are not subject to WTO GPA, it would suffice to only publish tender notices
on the Internet, as set out in FC No. 3/2009 (as may be updated from time to
time). Publication in the Government Gazette, and/or local and/or
international press and journals is optional.
(e)
Tender invitations shall indicate clearly the name and address and
telephone/fax number/e-mail address of the office from which forms of tender
and further particulars may be obtained and other information necessary to
contact the office and obtain the relevant tender documents, the exact location
of the tender box in which tenders are to be deposited, and the closing date and
time for the receipt of tenders. For procurements covered by WTO GPA,
departments will have to send to any interested tenderer a set of the tender
documents upon receipt of a written request and may charge the tenderer for
the cost of the delivery. Tender notices shall specify whether the intended
procurement is covered by WTO GPA. Tenderers should be advised that late
tenders or misplaced tenders by tenderers will not be accepted. They should
also be informed of the possible extension of tender closing date/time in the
event of tropical cyclone signal No. 8 or above being hoisted, or a black
rainstorm warning signal or “extreme conditions after super typhoons”
announced by the Government being in force, or any possible scenarios of
blockage of public access to the location of a tender box at the original tender
closing date/time.
(f)
Adequate time shall be provided to allow both local tenderers and tenderers
outside Hong Kong to prepare and submit tenders. A minimum of three weeks
is normally required. As an exception, for works contracts not exceeding
$55 million and other procurements which are not subject to WTO GPA, COs
may allow a period of less than three weeks for the preparation and submission
of tenders as set out in FC No. 3/2009 (as may be updated from time to time)
provided that it is commensurate with the complexity of tenders and normally
not less than ten days. For procurements covered by WTO GPA, at least 40
days shall be allowed for receipt of tenders and no less than 25 days for
applications to be prequalified to tender. In the case of extreme urgency,
departments will have to seek the prior approval of the PS(Tsy) for reducing
the period for receipt of tenders. This authority has been delegated to the DGL
or his designated officers in respect of GLD tenders and tenders for the supply
of stores not exceeding the departmental limit specified in SPR 220(a).
(g)
Tenderers must submit the required number of copies of tenders in a sealed
cover. Tenderers should be advised not to give any indication on the cover of
their tenders which may relate them to a particular contractor/supplier/service
provider. Pre-addressed envelopes or labels for the return of tenders should, as
far as possible, be provided to tenderers.
TENDER DOCUMENTS
345. (a)
Departments should normally use the following standard contract forms when
inviting tenders —
(i)
Tender for the Supply of Goods (GF 230).
(ii)
Tender for Services (GF 231).
(iii) Tender for the Purchase of Articles or Materials from the Government
of the HKSAR (GF 232).
(iv) Articles of Agreement and General Conditions of Contract for various
types of works contracts.
(v) Standard Terms and Conditions (Tender for the Supply of Goods,
Tender for the Provision of Services, Tender for Purchase of Articles or
Materials from the Government of the Hong Kong Special
Administrative Region) issued by GLD.
(vi) Standard Terms and Conditions for IT tenders for the design, supply,
implementation and maintenance of IT systems issued by the Office of
the Government Chief Information Officer.
(b)
When using standard contract forms to invite tenders, departments may delete
or amend any clauses appearing on the forms by way of Special Conditions of
Contract but only after consulting D of J or, in the case of works tenders,
LAD(W)/DEVB. In case departments consider that the standard contract
forms are not suitable for use in their tender exercises even if amendments to
the clauses are made, they may design and use their own non-standard contract
forms to meet specific requirements of their contracts. Departments must clear
with the D of J or, in the case of works tenders, LAD(W)/DEVB regarding the
terms and wordings of the non-standard contract forms before they can be used
in tender exercises. Reference may also be made to A General Guide to
Outsourcing prepared by EffO (as may be updated from time to time) for
guidance.
(c)
Departments shall ensure that a complete set of tender documents covering the
following is issued to all tenderers —
(i)
Terms of Tender including the conditions which a tenderer has to
observe when submitting a tender, the tender validity period, the
currency to be used for the contract, the dates for the delivery of goods
or services, any limitation on the means by which tenders may be
submitted, etc. and where the tenders may be submitted by electronic
means, any authentication and encryption requirements or other
requirements related to the submission of information by electronic
means;
(ii) General Conditions of Contract covering the conditions which the
contractor has to comply with in executing the contract;
(iii) Special Conditions of Contract covering any conditions peculiar to the
contract;
(iv) Offer to be Bound or Form of Tender;
(v)
tender specifications (see SPR 350);
(vi) bills of quantities or quantities required of the contract where
applicable; and
(vii) detailed price schedules or schedule of rates where applicable.
For procurements covered by WTO GPA, departments shall include the Note
to Tenderers at Appendix III(E)1 in the tender documents. For procurements
that a trading fund is likely to take part in the bidding exercise, departments
should include the Note to Tenderers and Condition of Tender at
Appendix III(E)2 in the tender documents.
(d)
If a non-works contract has an estimated value exceeding $300 million, the
department must send all the non-standard components of the tender
documents, i.e. bills of quantities, particular specifications, special conditions
of contract, to the D of J for vetting before the tender documents are issued to
potential tenderers. If the vetted documents require substantial amendments
after they have been issued to tenderers, they should be legally vetted again
before the tender addendum is issued or, as the case may be, the contract is
awarded. For a non-works contract with an estimated value not exceeding
$300 million, the CO (or his designated officer(s) at the rank not lower than
Chief Supplies Officer/ Chief Executive Officer or equivalent) may decide if
legal vetting is required for the non-standard components of the tender
documents. If a department considers that the Special Conditions of Contract
previously cleared with D of J pursuant to SPR 345(b) may be used with only
insignificant and immaterial changes for a subsequent contract with an
estimated value not exceeding $300 million, the CO (or his designated
officer(s) at the rank not lower than Chief Supplies Officer/ Chief Executive
Officer or equivalent) may decide if the Special Conditions of Contract with
the said changes need to be legally vetted. For legal vetting of works
contracts, departments should refer to the relevant DEVB TC(W), memo or
guidelines promulgated by DEVB.
(e)
Departments shall promptly make available tender documents to ensure that
potential tenderers have sufficient time to submit responsive tenders and
provide, on request, the tender documents to any potential tenderers. COs may
decide whether to recover the cost of the tender documents from the tenderers.
ACCESS TO TENDER INFORMATION
346.
Departments may receive requests for tender information from time to time.
As a matter of principle, departments must ensure that the disclosure of tender information
will not undermine the integrity of the tendering system, and that the prevailing Code on
Access to Information is observed. Legal advice should be sought if in doubt.
347.
In responding to questions or requests by tenderers, departments should
observe SPR 346 and the following guidelines –
(a)
normally, departments should not disclose the estimated contract value to the
potential tenderers as it may become a guiding factor in the preparation of their
tender proposals, which may be reduced or, of even more concern, expanded
unnecessarily, thus undermining the principles of competition and value for
the money. If, however, the estimated contract value has been disclosed to the
public, departments should, in all fairness, inform all potential tenderers
known to the departments of the estimated contract value;
(b)
to facilitate submission of tenders, departments should respond to questions
from tenderers in a timely manner. Responses to tenderers’ questions should,
as a general rule, be made within ten working days. An interim reply should
be issued if a substantive reply cannot be made within the above timeframe;
(c)
information essential in enabling a tenderer to submit a conforming tender
(e.g. clarifications on the terms, conditions and specifications of tender) should
be provided. For fairness, departments should provide the same information to
all potential tenderers known to the departments (or publish on department’s
website in case of open tender) as soon as possible and in any case before the
closing date for receipt of tenders;
(d)
a tenderer can be advised of any previous record kept of his performance as he
is entitled to know and to make representations against any adverse comments
likely to be reflected in the assessment made to the relevant tender board/DTC;
(e)
an unsuccessful tenderer is entitled to know the reasons why his tender was
unsuccessful. However, departments should ensure that the details provided
do not touch on the tender information provided by another tenderer in
confidence; and
(f)
any information relating to another tenderer could only be provided with the
express agreement of the tenderer in question.
348.
For requests for tender information made by the public, departments may
provide, under the principle of SPR 346,–
(a)
particulars of a contract, the category of tenderers invited to tender for the
contract, and the closing date/time for receipt of tenders; and
(b)
the number of tenders received for a particular contract, the name of the
successful tenderer, the accepted tender sum and the date of the award of the
contract. Information on the winning tender should only be provided after the
contract has been executed with the successful tenderer.
349.
Under no circumstances should a department make available the following
information to either a tenderer or a member of the public –
(a)
minutes of the tender board/ committee recording the deliberations made on a
certain contract; and
(b)
the method statement and plan proposed by the successful tenderer to execute
the contract, the financial position and technical capability of a tenderer and
any information provided in a confidential manner by a tenderer without the
express agreement of the tenderer.
TENDER SPECIFICATIONS
350. (a)
Departments shall ensure that tender specifications which define the
requirements of the contract are drawn up in a manner which meets the
government procurement policy and principles specified in SPR 106-109.
Tender specifications shall not be prepared, adopted or applied and conformity
assessment procedures shall not be prescribed with the purpose or the effect of
creating unnecessary obstacles to international trade or to competition amongst
the potential tenderers. To encourage competition and minimise entry barriers
(particularly for start-ups and Small and Medium-sized Enterprises (SMEs)),
as a general rule, tenderer’s experience should not be set as an essential
requirement in non-works tenders, irrespective of value. If it is absolutely
necessary, prior approval must be sought from the relevant tender board/DTC
for procurements adopting marking schemes under tendering procedures, or
public officers (normally at directorate level) designated by COs for
procurements not adopting marking schemes under tendering procedures. The
justifications for seeking exception from the general rule and the grounds for
approval should be properly recorded. Where appropriate, tenderer’s
experience may be set as an assessment criterion in the marking scheme as a
desirable feature.
(b)
When inviting tenders under whichever tendering mode, departments shall set
tender specifications in easily comprehensible general terms based on the
functional and performance requirements of the stores or services required,
and not around the technical data of a certain model of the goods or equipment
to be purchased. There shall be no requirement for or reference to a particular
trademark or trade name, patent, copyright, design, type, specific origin,
producer, supplier or service provider, unless there is no other sufficiently
precise or intelligible way of describing the procurement requirements and
words such as “or equivalent” are included in the tender documents. Where
standards are referred to, departments shall use, where practicable,
international standards.
(c) While specifications need to be comprehensive providing sufficient
information for tenderers to formulate their bids, departments should guard
against over-prescribing requirements. Departments are also encouraged to
adopt output- or performance-based, rather than input-based, specifications.
Over-prescription or input-based requirements may perpetuate incumbent
advantage inhibiting competition and leading to over-reliance on a single
contractor. It may discourage the participation of innovative tenderers who are
able to deliver the contractual requirements with alternative methods or fewer
resources than those proposed in the tender document, hence not conducive to
obtaining the best value for money for Government.
(d)
Departments shall set out in tender document all requirements and evaluation
criteria that will be applied in deciding on the suitability of tenders.
(e)
Departments are encouraged to conduct a market research or non-binding EOI
exercise to better understand the goods or services likely to be available in the
market, technological trends, number of potential bidders, etc., in particular for
procurements involving mission-critical or high-value contracts, or contracts
with poor tender response in the past procurement exercise, or the potential for
innovation of the procurement needs to be further assessed, Such information
is useful to ensure proper design of the tender specifications including
essential requirements in order to obtain responsive and competitive tenders.
Some guidelines for drawing up tender specifications are provided for general
reference at Appendix III(F).
(f)
When tenders are called for the execution of a project or the provision of
services on the basis of a schedule of prices or rates, departments shall provide
in the tender document some indication of the estimated quantity, value and
scope of the contract and any other related information in order to obtain
realistic and competitive tenders. Likewise, tender documents for term
contracts should provide details of quantities based on past contracts (if any).
But in both cases, it should be made clear that such figures are quoted only for
the reference of tenderers, and that the Government cannot guarantee that the
requirements under the proposed contract will be comparable.
(g)
For term contracts involving a large number of items and for which it would be
impracticable to state the approximate quantities, the schedule of items shall
be pre-priced, enabling the tenderers to express their offers in terms of a flat
percentage variation. In such cases, tenderers shall be advised of the likely
expenditure under the proposed or previous contract, with the proviso that the
Government does not commit itself to the estimated expenditure under the
proposed contract. When the tenders received are subsequently evaluated, the
same estimates and requirements as those of which tenderers have been
informed in the documents shall be employed in calculating the estimated total
value of each tender.
(h)
To ensure adequate room will be in place in the tender evaluation process to
assess innovative suggestions, departments are encouraged to adopt marking
schemes. Marking schemes should be clear and objective so as to provide a
level playing field for bidders and encourage innovative suggestions. In
formulating marking schemes, departments should bear in mind user-
friendliness and ensure that they are commensurate with the nature, scale and
value of the tender concerned. Departments should follow the Guidelines for
Adopting a Marking Scheme at Appendix III(G) in formulating marking
schemes. For non-works tenders, COs should designate officers (normally at
directorate level) to approve cases not using a marking scheme for tender
evaluation.
(i)
For non-works tenders, departments should formulate marking schemes based
on the SMS Framework promulgated in FC No. 2/2019 (as may be updated
from time to time). The normally allowed range of technical weighting is
50%-70%, and that of the price weighting is 30%-50%. Departments are
required to reserve a minimum percentage of technical marks for assessing
innovative suggestions as per FC No. 2/2019. No prior approval from the
relevant tender board/DTC will be required if marking schemes are formulated
according to the SMS Framework. Any deviation from the SMS Framework,
such as adopting a technical weighting above 70%, or departing from the
permitted range of marks for specified types of assessment criteria, will be
subject to the prior approval from the relevant tender board/DTC before tender
invitation. However, for service contracts that rely heavily on the deployment
of non-skilled workers, no exception will be allowed for adopting a technical
weighting below 50%, or assigning lower than 25 marks (out of a total
technical marks of 100) (i.e. 25% of the total technical marks) for the
assessment criterion on “wages”.
(j)
For works tenders, unless authority has been specifically delegated to
departments or there exists standard marking schemes for individual
procurement set out in relevant DEVB TC(W) and guidelines, the use of a
marking scheme or deviation from the standard marking scheme requires the
prior approval of the relevant tender board. When seeking approval for the use
of a marking scheme or deviation from the standard marking scheme for
individual procurements, departments shall provide a brief description of the
contract/project to be procured, its estimated value, justifications for the use of
the proposed marking scheme or deviation from the standard marking scheme,
the respective weighting for technical and price assessment, the assessment
criteria and their relative weighting with passing mark(s) if any. Departments
shall follow guidelines on the use of standard marking schemes set out in the
relevant DEVB TC(W) and administrative procedures relating to design and
build contracts.
(k)
For tenders for service contracts that rely heavily on the deployment of non-
skilled workers, departments shall observe the guidelines promulgated in FC
No. 2/2019 and FC No. 3/2019.
(l)
Departments should state in the tender documents the use of a marking scheme
in tender evaluation with an outline of the evaluation criteria. In line with the
basic government procurement principle of transparency, departments should
provide information (including descriptions of assessment criteria and their
individual technical marks, passing marks (if any) set for technical assessment,
formula to be used to calculate the technical/price scores, the technical to price
assessment weighting, etc.) in the tender documents to facilitate tenderers’
preparation of competitive and quality tender submissions.
(m)
In case of re-tender, departments should, in the light of the degree of market
competition in the past procurement exercises, review and refine the tender
specifications as well as essential requirements and marking scheme with a
view to encouraging competition.
TENDERS IN FOREIGN CURRENCIES
355. (a)
In general, contract sums for government contracts should be quoted and paid
in Hong Kong dollars. In order to avoid tenderers putting in an unreasonable
amount of allowance in their quotations to cover exchange risks for the
contract period, departments may allow tenderers to quote in foreign
currencies subject to the following conditions —
(i)
the goods or equipment offered are manufactured outside Hong Kong
and form a significant part of the contract or the estimated total value of
the “overseas” element exceeds HK$500,000;
(ii) unless otherwise agreed by the department concerned, the foreign
currency quoted must be the currency of the country supplying the
goods or equipment, and more than one currency may be quoted if items
from more than one foreign country are involved;
(iii) local materials and labour should be priced in Hong Kong dollars,
which generally should include materials manufactured outside Hong
Kong but which require a substantial amount of further processing in
the HKSAR; and
(iv) services provided by personnel based outside Hong Kong and salaried
in a foreign currency may be quoted in that foreign currency.
(b)
Tenders likely to cost HK$10 million or more cannot be quoted in a foreign
currency, other than US dollars, unless with the prior approval of the PS(Tsy),
who must be satisfied that a refusal to allow tenderers to quote in a foreign
currency other than US dollars will significantly reduce the degree of
competition in tendering to the detriment of the public interest.
(c)
For tender comparison purpose, quotations in foreign currencies must be
converted to Hong Kong dollars. The conversion is to be based on the selling
rate of the relevant currency quoted by the Hong Kong Association of Banks
on the tender closing date. Tender boards/DTCs, in considering
recommendations for the award of contracts, will also take into consideration
any significant fluctuations in exchange rates after the tender closing date.
Departments should state in tender reports the converted tendered sums based
on the exchange rates of the tender closing date and the date of tender report
and should indicate whether the ranking of the tendered sums has changed as a
result of these two bases.
TENDER DEPOSITS/ BONDS
360.
A tender deposit/ bond is not normally required. Where a tender deposit/ bond
is required as a pledge of the tenderer’s good faith (as in the case of revenue contracts), the
tender documents shall specify the amount of the deposit/ bond and the methods of payment
(whether by cheque, cashier order, a bond in the form of guarantee arranged by a bank and/or
presentation of original receipts along with the tender) and refund. The amount of tender
deposit/ bond should not be excessive. Tender deposits/ bonds will be refunded to
unsuccessful tenderers without interest.
CONTRACT DEPOSITS/PERFORMANCE BONDS
361.
Successful tenderers may be required to pay a contract deposit (in the form of
cash) or submit a performance bond to the Government within a specified period before
contract signing (rather than at the time of tender submission) as security for the due and
faithful performance of the contract. A performance bond may be in the form of a guarantee
arranged by a bank, insurance company, or the parent company (which has been assessed to
be financially capable) of the tenderer.
362. (a)
For works contracts, departments should follow the guidelines on contract
deposits and performance bonds laid down in the relevant DEVB TC(W).
COs may adopt a flexible and pragmatic approach in considering whether
contract deposit or performance bond or other options of performance
guarantee is needed.
(b)
For non-works contracts, unless otherwise personally approved by the CO,
successful tenderers are required to pay a contract deposit or provide a
performance bond as follows —
Contract value
Contract deposit or
performance bond*
(A)
Stores
contracts
≤ $1.4 million
Not required
> $1.4 million
2%
(B)
Service
contracts
≤ $1.4 million
Not required
> $1.4 million and ≤ $15 million
2%
> $15 million#
2% if passes financial vetting
5% if fails financial vetting
for low risk contracts
6% if fails financial vetting
for high risk contracts
Periodic financial vetting +
closer contract monitoring
needed for high risk and long
duration contracts
(C) Revenue contracts
Not required but departments
may conduct financial vetting
and/or require contract deposit
in individual cases if considered
necessary.
*
Expressed in terms of % of contract value. The stipulated percentage should apply
unless personally approved by the CO.
#
Including contracts for supply of stores which require also the provision of services of
a value exceeding $15 million.
(c)
Requirements on contract deposit or performance bond shall be stipulated in
the tender documents, including the amount required, the payment method and
the rights of the Government to decide whether the guarantor is acceptable and
to refuse the offer from any tenderer which fails to meet the Government’s
requirements.
(d)
Contract deposits shall not be refunded until the contract has been completed
according to the terms of the contract. Likewise, performance bonds must be
maintained in force until the contractor has duly performed all his obligations
under the contract.
RETENTION MONEYS
363.
To protect the interest of the Government, departments may include in the
payment schedule for the contractor a right for the Government to hold back a certain sum as
retention money, which will not be released to the contractor upon completion of the contract
until the Government is fully satisfied, after a period of time, with the goods delivered or the
service provided. The amount of retention money is normally pitched at no more than 5% of
the contract value. For works contracts, departments shall follow guidelines in the relevant
DEVB TC(W).
RECEIPT AND CLARIFICATION OF TENDERS
365. (a)
Tender opening procedures should commence immediately when the deadline
for tender submission is due. Except for tenders for procurements with a value
not exceeding the departmental limit specified in SPR 220(a) received by
departments which have set up their own tender boxes, one copy of the
duplicates of the tenders received will be kept by the relevant tender board
after the tenders have been opened and authenticated by the tender opening
team. The originals and the remaining duplicates of the tenders will be sent to
the procuring department for assessment.
(b)
After receipt of the original tenders from the tender opening team, the
procuring department should check that the tenders contain, inter alia, the
names and addresses of all partners (if the tender is submitted by a partnership)
or offices (if the tender is submitted by an unincorporated body) and the
number of the business registration certificate (or documentary evidence
showing that the tenderer is exempted from business registration under the
Business Registration Ordinance (BRO) (Chapter 310)).
(c)
Where certain tender information is found missing or where a tender contains
some ambiguities, qualifications or counter-proposals, departments should
consider carefully whether to seek the missing information or clarification
from the relevant tenderer. In general, departments shall keep such post-tender
closing contacts with tenderers to the minimum. They shall record clearly and
in full all such contacts. Most importantly, they must ensure that such contacts
will not give a tenderer any advantage or perceived advantage over other
tenderers.
(d)
The opportunities that may be given to tenderers to correct unintentional errors
of form (for instance, clerical errors) shall not be permitted to give rise to any
discriminatory practice.
(e)
Where the provision of certain information is specified as an “essential
requirement” in the tender documents and it is stipulated that non-compliance
with it will render the tender non-conforming, the tender shall be considered as
non-conforming if such information is not submitted. Departments shall not
approach the concerned tenderer for the missing information. For instance,
submission of an execution plan which will be taken into account in the tender
evaluation is by its nature an essential requirement. Hence, it should be so
specified in the tender documents with the stipulation that any non-compliance
of this requirement will render the tender non-conforming. Where submission
of certain information is not specified as an essential requirement but it is
specified in the tender documents that failure to provide such information will
render the tender non-conforming, the tender shall also be considered as non-
conforming if such information is not submitted.
(f)
Where the provision of certain information is not specified as an “essential
requirement” in the tender documents and there is no stipulation that its non-
compliance will render the tender non-conforming, departments may approach
the concerned tenderer for such missing information if it relates to factual
information and there is no room for manipulation by a tenderer by virtue of
late submission of such information. In other cases, departments shall assess a
tender with certain information missing as it is.
(g)
In approaching a tenderer for clarification, departments must not provide any
information that may assist the tenderer to improve his tender to the level of
tenders from other tenderers.
(h)
In case of special circumstances requiring different consideration, departments
shall seek the advice of the D of J or, in the case of works tenders,
LAD(W)/DEVB and/or the relevant tender board or DTC.
(i)
If a clarification or correction results in an adjustment of the tendered sum, the
department shall ask the tenderer to confirm whether he is prepared to abide by
the adjusted tendered sum. If the tenderer refuses to so abide, the department
shall consult the D of J or, in the case of works tenders, LAD(W)/DEVB on
how to deal with the tender. Under no circumstances may a department reject
a tender as a qualified bid (expressly or otherwise) without the approval of the
relevant tender board, except that for works tenders with a value not exceeding
$55 million each which are not subject to WTO GPA and tenders for
procurements with a value not exceeding the departmental limit specified in
SPR 220(a), the authority to reject a tender as a qualified bid has been
transferred to COs and DTCs respectively. For works contracts, departments
shall observe further guidelines on the clarification of tenders and correction of
errors as laid down in relevant DEVB TC(W).
EVALUATION OF TENDERS
370. (a)
Tender evaluation should normally be conducted by a TAP consisting of not
less than two persons. Departments should observe the guidelines on the
establishment and operation of the TAP set out in Appendix III(G)1. For
works tenders, departments should also follow the guidelines laid down in the
relevant DEVB TC(W) currently in force issued by the DEVB.
(b)
The TAP shall examine tenders against the technical specifications, essential
requirements, terms and conditions laid down in the notices of tender
invitations and tender documents to determine whether they are fully
conforming. In recommending a tender for acceptance, the department should
also take into account the following in the evaluation, as appropriate —
(i) technical and financial capability of the tenderers and their past
performance records. For works contracts, the guidelines laid down in
the relevant DEVB TC(W) currently in force issued by the DEVB shall
be followed. For service contracts of a value exceeding $15 million, or
contracts for supply of stores which require also the provision of
services of a value exceeding $15 million, financial vetting shall be
conducted of a tenderer who is being considered for the award of the
contract in order to ensure that the tenderer is financially capable of
fulfilling the contract requirements (see Appendix III(H));
(ii)
timely delivery or completion;
(iii) compatibility with existing or planned purchases;
(iv) after sale support and service including maintenance and spare parts
provision, warranty and/or guarantees;
(v)
running and maintenance costs; and
(vi) fair market prices.
Requirements (ii)-(iv), where applicable, should be included in the tender
specifications. In respect of requirement (v), departments should ask tenderers
to provide an estimate of running and maintenance costs for the equipment or
system supplied to enable a fair price comparison to be made.
(c)
Where a marking scheme is used in the evaluation of tenders, TAPs shall
assess the tenders according to the criteria set out in the tender documents.
Normally, the tender which attains the passing marks (if any) and the highest
overall score under the marking scheme should be recommended. The
methods for evaluating technical and price proposals are set out at
Appendix III(G).
(d)
In normal circumstances, departments shall determine the ranking of the
tenders received according to the original tender prices or the adjusted tender
prices made in accordance with SPR 365(i), or the overall scores they have
attained when a marking scheme is used in tender evaluation. Where price
negotiations are undertaken under SPR 385, departments shall use the
negotiated prices to determine the ranking of the tenders or their price scores.
Departments may only consider other proposals on discounts by a tenderer if
his tender is recommended for acceptance.
(e)
Any negotiation with a tenderer shall be undertaken in accordance with
SPR 385. Such negotiations may also be used to seek resolution of any
qualification or counterproposal put forward by a tenderer and if the
qualification seeks to reduce the tenderer’s risk or to construct payment terms
which are more to his advantage, departments should seek a corresponding
adjustment in the tender price before formally recommending the tender for
acceptance.
(f)
In recommending the acceptance of a tender to a tender board or DTC,
departments shall have value for money in mind. If the tendered sums are very
close or if the contract to be awarded involves payments over a number of
years, e.g. interim payments to the contractor, the department shall compare
the tenders by discounting future payments to obtain the present value. The
present value of the tendered sum should prevail in determining the ranking of
tenders. In assessing the present values of tenders, departments may approach
the Management Accounting Division (MA Division) of Financial Services
and the Treasury Bureau (The Treasury Branch) (FSTB) for advice.
(g)
If none of the tenders received is fully conforming with the technical
specifications, essential requirements, terms and conditions laid down in the
tender documents and/or attains the passing marks (if any) of the marking
scheme, departments shall cancel the tender exercise (see SPR 380(e)) and re-
tender with revised specifications, essential requirements, terms and
conditions, where applicable. If exceptionally departments wish to
recommend a non-conforming tender, they shall state clearly in the tender
report any deviation of the recommended tender from the specifications,
essential requirements, terms and conditions laid down in the tender
documents, the assessment criteria under the marking scheme, and the reasons
for so recommending. As a general practice, departments should clear their
tender recommendations with the D of J, or in the case of works tenders,
LAD(W)/DEVB if they wish to recommend a non-conforming tender. A copy
of the relevant legal advice should be attached to the tender report for relevant
tender board or DTC’s reference.
TENDER REPORTS
375. (a)
Departments shall prepare a tender report containing a clear recommendation
in the standard format as at Appendix III(I). Tender reports for consideration
by the CTB and subsidiary tender boards must be signed or endorsed by the
Head of Department concerned or his representative at directorate level.
Tender reports for consideration by DTCs should be signed by the chairman of
TAP of the procuring department. For submissions to the tender boards, the
originals of the tenders received should be submitted together with the tender
report to the tender board as follows —
(i)
when the ranking of tenders is based on the tendered prices, i.e. no
marking scheme is used in tender evaluation —
if the recommended tender is the lowest (highest for revenue contracts),
only the three lowest (highest) tenders should be submitted. If the
recommended tender is not the lowest (highest for revenue contracts),
the lower (higher) tenders, the recommended tender and the next two
higher (lower) tenders should be submitted; or
(ii) when the ranking of tenders is based on the overall scores, i.e. a
marking scheme is used in tender evaluation —
if the recommended tender is the highest overall scorer, only the tenders
of the three highest overall scorers should be submitted. If the
recommended tender is not the highest overall scorer, the tenders of the
higher scorers, the recommended tender and the tenders of the next two
lower overall scorers should be submitted.
(b)
Departments shall forward sufficient copies of the tender report to the relevant
tender board at least four weeks before the expiry of the validity of the
recommended tender or before the intended commencement date of the
contract to be awarded. If there is a delay in putting forward a submission,
departments must state the reasons in the tender report for not being able to
submit on time. Departments should forward their submissions to the relevant
tender board at least five clear working days prior to a board meeting. Failure
to do so may result in submissions being deferred to a later meeting. For
submission to DTCs, departments should draw up their own departmental
procedures.
(c)
Tender
boards and DTCs should normally meet to deliberate; decisions
reached through circulation of papers should be the exception. Subject
colleagues are to attend meetings of tender boards and DTCs if requested.
(d)
For works contracts to be approved personally by CO in SPR 310(h),
SPR 375(a)-(c) do not apply and COs may devise their own tender report
formats.
CANCELLATION OF A TENDER EXERCISE OR CONCLUDING A SERVICE
LEVEL AGREEMENT WITH A TRADING FUND DEPARTMENT
380. (a)
Unless it is not in the public interest to award a contract, a procuring
department shall award the contract to the tenderer that the department has
determined to be capable of fulfilling the terms of the contract and that, based
solely on the evaluation criteria specified in the notices and tender
documentation, has submitted the most advantageous tender or where price is
the sole criterion, the lowest tender (or highest for revenue contract).
(b) Where a procuring department has invited a tender from
contractors/suppliers/service providers in both the private and public sectors
including department(s) of the Government whose services are funded under
trading funds established pursuant to the Trading Funds Ordinance, Cap. 430
(hereinafter referred to as “the relevant trading fund department”), and where
the relevant tender board or DTC has accepted that the lowest or most
advantageous tender is the one submitted by the relevant trading fund
department, the procuring department shall —
(i)
enter into a service level agreement with the relevant trading fund
department; and
(ii)
promptly inform all tenderers of its decision not to issue a “contract” in
the “public interest” (in line with the requirements set out in
Article XV 5. and Article XVI 1. of WTO GPA, whether or not the
tender is itself subject to the WTO GPA).
(c)
It is not possible to list out definitively and exhaustively all matters that
contribute to “public interest”. Other than the circumstances in (b) above,
matters concerning the integrity, confidentiality, security and safety of the
Government, and the effective use of government resources would be relevant.
Relatively small sums of money saved and/or the retention of government staff
can also be contributing factors that support “public interest”. If in doubt,
legal advice should be sought.
(d)
Approval of cancellation of a tender exercise is not required when no tenders
are received after the close of tender invitation, or in the case of parallel
tendering, if the relevant funding application is not approved by the Finance
Committee of the Legislative Council before expiry of the tender validity or
extended tender validity period (if applicable).
(e)
Other than the circumstances described in items (b) and (d) above, if a
procuring department proposes to cancel a tender exercise once the tenders
have been invited or not to award a contract following a tender evaluation, it
shall seek the prior approval of the relevant tender board or DTC for the
cancellation of the tender exercise following the report format set out at
Appendix
III(I). Departments shall provide detailed justifications for
cancelling a tender exercise and state whether and when a second tender
exercise will be conducted. For works contracts not exceeding $30 million
each and not subject to WTO GPA, COs have delegated authority to
personally approve the cancellation of a tender exercise.
TENDER NEGOTIATIONS
385. (a)
In general, it is the Government’s policy to procure stores, services or revenue
contracts on the basis of competitive tendering, with the contract being
awarded to the tenderer that conforms with the tender specifications and
essential requirements, attains the passing mark(s) if a marking scheme is
adopted, and offers the most advantageous terms to the Government. Where it
would be in the Government’s best interest to negotiate with a tenderer or
tenderers, such negotiations shall be conducted in a non-discriminatory
manner among different tenderers.
(b)
To facilitate negotiations, all notices of tender invitations shall contain a
standard clause stating that the Government reserves the right to negotiate with
any or all tenderer(s) about the terms of the tender.
(c)
PS(Tsy) is the approving authority for tender negotiations and has delegated
this authority to —
(i)
subsidiary tender boards for negotiations on tenders which fall within
their purview;
(ii)
DGL or his designated officers for negotiations on GLD tenders;
(iii) COs or their designated directorate officers not having been involved in
the concerned tender exercises for negotiations on works tenders not
exceeding $55 million each and not subject to WTO GPA; and
(iv) DTCs for negotiations on tenders for procurements not exceeding the
departmental limit specified in SPR 220(a) which fall within their
purview.
(d)
In addition to SPR 385(c), the PS(Tsy) has delegated the authority to COs or
their designated directorate officers not having been involved in the concerned
tender exercises to approve negotiations with potential
contractors/suppliers/service providers for tenders of their own departments in
any of the following circumstances —
(i)
when a single tender within the meaning of SPR 325 has been invited
with the prior approval of the relevant approving authority; or
(ii) when only one tender or very few tenders have been received in
response to an open tender invitation and the procuring department
considers the tenders received may not be sufficiently competitive,
whether in terms of price or other key quality attributes; or
(iii) when the tender price to be recommended is too high (or too low in the
case of a revenue contract) in comparison with the price of similar
procurement in the past or in relation to other market information; or
(iv) when the tender to be recommended contains counter-proposals to the
tender terms which are disadvantageous to the Government but are not
sufficiently substantial or do not cause substantial deviation from the
requirements contained in the tender invitation to render the
recommended tender non-conforming; or
(v)
when two or more tenderers have submitted conforming tenders which
are equal in all aspects in terms of the evaluation criteria set out in the
notice of tender invitation or tender documents and are equally the most
advantageous to the Government.
(e)
Negotiations under items (d)(ii)-(iv) above shall
normally be conducted only
with the
single conforming tenderer or with the conforming tenderer whose
tender has been found to be
clearly the most advantageous to the
Government in terms of the evaluation criteria set out in the notice of tender
invitation or tender documents. Where no single tender is clearly the most
advantageous in terms of the evaluation criteria set out in the notice of tender
invitation or tender document or where the most advantageous tender cannot
be determined until the counter-proposals have been resolved or withdrawn, it
may be necessary to hold negotiations also with the tenderers who have
presented the second or the third lowest (highest for revenue contracts)
conforming tenders. The criteria for selection of tenderers for negotiations
shall be stated in the tender documents. Where such criteria have not been set
forth in the tender documents, the selection of tenderers for negotiations must
be based on objective and reasonable criteria.
(f)
Where negotiations are conducted with more than one tenderer, whether or not
under item (d) above, officers authorised to conduct the negotiations shall
ensure that —
(i)
any elimination of tenderers participating in the negotiations is carried
out in accordance with the evaluation criteria set forth in the notice of
tender invitation or tender documents;
(ii)
should the procuring department introduce any modifications to the
criteria or requirements set out in the notice of tender invitation or
tender documents, the modifications must be transmitted in writing to
participating tenderers in the negotiations and also in adequate time to
allow such tenderers to modify and re-submit amended tenders, as
appropriate; and
(iii) when negotiations are concluded, the remaining participating tenderers
shall be provided with a common deadline to submit any new or revised
tenders.
(g)
For the avoidance of doubt, price may be the subject of negotiations as it is an
essential element in determining the strength and weakness of a tender. Before
negotiations are initiated, however, the procuring department shall take a view
as to whether any reduction of price or increase in revenue that may be
achieved would exceed the cost of undertaking the negotiations, or would
adversely affect the quality of goods or services to be procured.
(h)
The public officers authorised by a CO to conduct negotiations shall be at
directorate level, unless otherwise approved by PS(Tsy). In the case of
contracts awarded by GLD, the DGL shall determine the rank of the
negotiating officers, having regard to the complexity and importance of the
negotiations.
(i)
Public officers authorised to conduct negotiations shall, where necessary, seek
the advice or assistance from the DGL on commercial aspects and the D of J
on legal aspects.
(j)
For a high value or complex tender, negotiations shall be conducted by a team
led by an experienced negotiator. The negotiation team shall consist of the
following, where applicable —
(i)
a member from the GLD for commercial aspects;
(ii)
a member from the D of J for legal aspects;
(iii) a member from the user department for user requirement aspects; and
(iv) a member from the relevant service department for technical aspects e.g.
Office of the Government Chief Information Officer.
(k)
The negotiator and negotiation team shall be authorised in advance to commit
the Government, if necessary, within limits set by the relevant tender board or
DTC, or the concerned CO or the designated directorate officer authorising the
negotiations.
(l)
Proper procedures, including keeping proper records of the negotiations, shall
be established and adhered to. Negotiations may be conducted by exchange of
correspondence and/or meetings. Under no circumstances shall negotiations
be conducted orally by a single negotiator without the presence of another
public officer of an appropriate rank.
(m)
In all cases, only public officers with no real or potential conflict of interest
shall lead or participate in negotiations.
(n)
Some guidelines on preparing for and conducting negotiations are provided at
Appendix III(J) for general reference. They are not intended to be
comprehensive.
ACCEPTANCE OF TENDERS AND AWARD OF CONTRACTS
390. (a)
Unless authority has been specifically delegated to departments or tender
boards, the PS(Tsy) is the approving authority for acceptance of a tender.
Subsidiary tender boards and DTCs are delegated with the authority to accept
tenders under their purview and not exceeding the financial limits of the
respective tender board and DTC. After a decision has been made on the
acceptance of a tender, the relevant tender board secretary will notify the
procuring department by memorandum, copying it to the D of A. Originals
and duplicates of tenders will also be returned to the procuring department.
For contracts awarded by DTCs or COs under delegated authority, the
approving authority will notify the D of A of the acceptance of a tender.
(b)
The procuring department will then send a letter to the successful tenderer
accepting his offer or, as the case may be, inviting him to sign the contract on
a specified date. The department should also notify unsuccessful tenderers of
the outcome of their tenders and the contract award decision promptly, and
include in the letters the reasons why their tenders were unsuccessful. If the
sum of the accepted tender exceeds the approved estimates, the CO concerned
should ensure that it is not accepted before approval for an increase in
commitment or project estimate has been obtained. The letter should be
copied to the secretary of the respective tender board or DTC.
(c)
Departments shall publish a notice of contract award in their home pages on
the Internet and keep a record for all contracts awarded. Departments shall
separately (or additionally) keep a record of each contract awarded under
single or restricted tendering as well as direct engagement of
contractor/supplier/service provider, which shall include the name of the
procuring department, the value and kind of goods or services procured and a
statement indicating the circumstances that justified the use of single/restricted
tendering and direct engagement. For procurements covered by WTO GPA, a
statement indicating the conditions described in the provisions on limited
tendering in WTO GPA that justified the use of limited tendering should also
be included for the purpose of meeting the specific reporting requirements of
WTO GPA.
(d)
Tender boards, DTCs or the approving authority should send to the DGL a list
of all the contracts awarded by them or on their recommendation in a
particular month at least two weeks before the end of the following month for
publication on the Internet.
(e)
Departments should follow the procedures set out in SPR 505-510 in accepting
an offer and executing a contract.
CHAPTER IV
CONSULTANTS SELECTION PROCEDURES
APPLICABILITY, SCOPE AND COVERAGE
400.
Consultants selection procedures should only be used to obtain services from
consulting firms and in circumstances when tender procedures are not applicable, for
example —
(a)
where problem solving is required in areas in which Government does not
have the necessary expertise and qualified staff;
(b)
where the quality of the end product is dependent on the relevant experience,
efficiency, capability, reputation, expertise and proposed method of approach
and methodology of the appointed consultant;
(c)
where the qualities required of the consultant cannot be precisely specified or
quantified; and
(d)
where the quality of service is of paramount importance in the selection and
where selection by competitive tendering on the basis of price is likely to lead
to a lowering of the quality of service.
405.
With the exception of the following for which separate procedures shall apply,
departments should follow the procedures set out in these Regulations for the procurement of
consultancy services —
(a)
procurement of consultancy services of a value not exceeding the quotation
limit specified in SPR 220(a) whereby quotation procedures are applicable;
(b)
employment of individual persons; and
(c)
briefing out of legal work by the Secretary for Justice.
APPROVING AUTHORITY
410.
Unless authority has been specifically delegated to departments and
consultants selection boards, PS(Tsy) is the approving authority for appointment of consulting
firms for the provision of consultancy services. The procuring department is normally
responsible for undertaking the procurement in accordance with these Regulations. Before a
proposal is made to appoint a consultant, the procuring department must obtain policy support
from the relevant Director of Bureau or a public officer authorised by him for the employment
of consultants. The procuring department must confirm that qualified staff for the assignment
are not available in the department or other parts of the Government or within the required
timeframe. The procuring department must obtain the endorsement of the MA Division of
FSTB for the engagement of financial consultancies or non-financial consultancies with
engagement of financial consultants as sub-consultants. For general management
consultancies, the procuring department shall obtain the support of EffO.
416. (a)
For works-related consultancies funded under the Capital Works Reserve
Fund, COs shall adopt parallel tendering, i.e. initiate consultants selection
exercises before funding is secured. The conditions and requirements as laid
down in SPRs 337(a) and 338 equally apply.
(b)
For other consultancies, COs may adopt parallel tendering, i.e. initiate
consultants selection exercises before funding is secured. The conditions and
requirements as laid down in SPRs 337(b) and 338 equally apply.
CLASSIFICATION OF INFORMATION
420.
Information relating to the selection of consultants and consultancy agreements
should be handled in the following manner —
(a)
all communications regarding the selection of consultants, from the time a
short-list or a list of consulting firms for direct invitation of consultancy
proposals is proposed until an agreement is executed, must be classified as
RESTRICTED (CONTRACT);
(b)
consultancy agreements and communications regarding contracts do not
usually have a security classification. RESTRICTED (CONTRACT) will
normally be an adequate classification for sensitive information relating to
contract disputes, litigation, claims, etc. Information should only be classified
as CONFIDENTIAL if its disclosure would be prejudicial to the interest of the
Government of the HKSAR; and
(c)
COs and Chairmen of Consultants Selection Boards shall appoint public
officers to open and handle classified correspondence relating to bids and
contracts on a need-to-know basis. Detailed instructions on the procedures for
handling such correspondence shall be made in accordance with the provisions
of the Security Regulations.
CONSULTANTS SELECTION BOARDS AND COMMITTEES
425. The Financial Secretary/SFST is the authority for the appointment of consultants
selection boards, each consisting of not less than three persons and chaired by a
directorate officer not lower than D2 rank. The Financial Secretary/SFST has
appointed the following -
(a)
Central Consultants Selection Board (CCSB): it advises the PS(Tsy) on the
selection and appointment of all consultants, other than those selected and
appointed by the AACSB, EACSB and DCSCs. Departments shall follow the
procedures set out in SPR 430-470 below on the selection and appointment of
consultants within the purview of CCSB.
(b)
AACSB: it approves the selection and appointment of architectural and
associated consultants for government projects other than those selected and
appointed by DCSCs. Departments shall follow the procedures set out in the
Handbook on Selection, Appointment and Administration of Architectural and
Associated Consultants published by the Architectural Services Department,
and appropriate DEVB TC(W) on the appointment of architectural consultants.
(c)
EACSB: it approves the selection and appointment of engineering and
associated consultants for government projects other than those selected and
appointed by DCSCs. Departments shall follow the procedures set out in the
Handbook on Selection, Appointment and Administration of Engineering and
Associated Consultants published by the EACSB, and appropriate
DEVB TC(W) on the appointment of engineering consultants.
Up-to-date information on the membership and terms of reference of the three
consultants selection boards is published in the Civil and Miscellaneous Lists of the
Government of the HKSAR, which can be viewed at the website
<http://www.info.gov.hk/cml/eng/cbc/c23.htm>.
426. The SFST has delegated the authority to COs to approve the selection and
appointment of consultants for consultancy assignments up to the departmental limit
specified in SPR 220(a). This delegation encompasses the authority to approve the list
of consulting firms for inviting consultancy proposals, consultancy briefs, marking
schemes for assessing consultancy proposals, pre-contract negotiations, appointment
of consultants and cancellation of consultants selection exercises.
COs shall appoint a DCSC in their departments consisting of not less than three
persons to approve the selection and appointment of consultants for these assignments.
The DCSC shall be chaired by a directorate officer not lower than D2 rank, who
should be at least one rank higher than the chairman of the assessment panel set up for
that particular assignment. There should be clear segregation of roles and duties
amongst the DCSC, the assessment panel and other departmental officers handling the
procurement exercise. Unless specified otherwise, departments should follow the
relevant consultants selection procedures stipulated in SPR 430-470 below, the
Handbook on Selection, Appointment and Administration of Architectural and
Associated Consultants, the Handbook on Selection, Appointment and Administration
of Engineering and Associated Consultants, FCs and DEVB TC(W), as appropriate.
COs may also draw up the working procedures for DCSC, provided that these should
adhere to the arrangements for the relevant consultants selection board and should be
fair, transparent and defensible.
427. All marking schemes adopted for assessment of consultancy proposals should be
approved by relevant consultants selection board/DCSC. The technical weighting
should normally be around 60%-70%, unless justified to the satisfaction of the
relevant consultants selection board/DCSC.
THE CENTRAL CONSULTANTS SELECTION BOARD PROCEDURES
430. (a)
CCSB normally adopts a two-stage approval process as follows —
Stage 1 approval : approval for inviting consultancy proposals from the
recommended firms and approval of the consultancy brief and method of
assessing consultancy proposals; and
Stage 2 approval : approval for appointment of the recommended consulting
firm, subject to the fees and other terms set out in the negotiating brief being
resolved satisfactorily, where appropriate.
Key steps are set out in SPR 440-445 below.
(b)
The authority to approve a direct approach to a consulting firm without going
through a competitive selection process rests with the PS(Tsy). This authority
is not delegated to COs irrespective of the value of the consultancy services.
Approval would not normally be granted unless full justification is given to the
satisfaction of the PS(Tsy). In applying for such approval, the procuring
department must justify the case for not conducting a competitive selection
exercise and provide the necessary information including the scope of the
proposed consultancy, the estimated cost and the required expertise of the
recommended consulting firm. After obtaining approval from the PS(Tsy), the
procuring department shall approach the consulting firm direct, assess the
proposal from the single consulting firm and forward a combined Stages 1 and
2 submission to CCSB (for consultancy assignments exceeding the
departmental limit specified in SPR 220(a)) or DCSC (for consultancy
assignments not exceeding the departmental limit specified in SPR 220(a))
seeking approval of the recommendation to appoint the consultant subject to
negotiation of fees and other terms, where appropriate.
(c)
Departments shall forward six copies including the original copy of the
submission in the specified format to the Secretary of CCSB. Departments
should forward their submissions to CCSB at least seven clear working days
prior to a board meeting. Failure to do so may result in submissions being
deferred to a later meeting. At the discretion of the Chairman, CCSB may
exceptionally deal with urgent papers by circulation or additional meetings.
Requests for such exceptional treatment must be fully justified by the CO
concerned.
(d)
Submissions must be signed or endorsed by the respective CO or his
representative at directorate level. He may be requested or may himself
request to attend the CCSB meeting to present the recommendations of the
submission or answer any queries that CCSB may have.
List of consulting firms
435. (a)
Departments may maintain lists of consulting firms for areas of work where
there is a frequent need for consultancy services. For example, the
MA Division of FSTB maintains a list of accounting/financial/actuary firms
and EffO maintains a list of management consulting firms. Departments
wishing to employ financial or management consultants may make reference
to these respective lists for compiling a long list of consulting firms for
short-listing purpose (if EOIs are invited) or for direct invitation of
consultancy proposals (if EOIs are not invited).
(b)
Departments maintaining lists of consulting firms for the above-mentioned
purpose should publish the lists and the method of application for inclusion in
the lists on their webpages. Such information should be kept on their
webpages as long as it remains valid. In addition, new applications from
consulting firms for inclusion in the lists should be allowed at any time and
such applications should be processed expeditiously.
Stage 1 approval
440.
The procuring department should complete the following steps leading to
submission to CCSB for Stage 1 approval —
(a)
compile a long list of consulting firms which should be approached for an EOI
to provide the consultancy services or for direct invitation of consultancy
proposals if EOIs are not invited. Departments may compile this list by
reference to the lists maintained by the relevant departments under SPR 435(a)
or through a general advertisement in the press and/or on the Internet;
(b)
consider inviting EOI or inviting consultancy proposals direct from the long
list if it is considered in the best interest of the Government. Departments
should have regard to the following factors -
(i)
availability of expertise sought – if the expertise sought from the
consultant is widely available, an EOI exercise will help screen out the
less competitive ones and save the consulting firms from having to
incur undue time and resources to prepare the proposals. If the
expertise sought is highly specialised, a direct invitation of consultancy
proposals may be more time- and cost-effective;
(ii)
market reaction – if it is not clear whether the market is keen to offer or
capable of offering the required expertise, or deliver the advice within
the anticipated time frame, an EOI exercise may help ascertain market
interest;
(iii) urgency – if the consultant needs to be on board within a short time
frame, a direct invitation of consultancy proposals may be preferred;
(c)
establish an assessment panel which should normally comprise only
government officials in order to safeguard the integrity of the consultant
selection exercise. It should be chaired by a directorate officer of the
department, with other public officers of the department and representatives of
the relevant policy bureau, resource bureau and the relevant
service/professional departments, e.g. EffO, Office of the Government Chief
Information Officer, Electrical and Mechanical Services Department (EMSD),
as necessary, and endorse the list of consulting firms for direct invitation of
consultancy proposals or determine the short-listing criteria if EOI are invited.
The short-listing criteria should be limited to those which are essential to
ascertaining the consulting firms’ ability to provide the required services.
Guidelines on assessment panel are set out at Appendix III(G)1;
(d)
if short-listing is considered necessary,
invite EOI from the long list of
consulting firms and where appropriate, through advertising in the press and/or
on the Internet. In the invitation, procuring departments should provide the
objective, scope and timing of the consultancy, and expertise/experience of the
consulting firm as well as experience/qualifications of the consulting team
required to undertake the consultancy. Consulting firms should normally be
asked to provide up-to-date information on their experience/expertise and the
experience/qualifications of their proposed team, and should not be asked to
submit consultancy proposals at this stage. Procuring departments should
generally allow no less than two weeks for consulting firms to respond;
(e)
the assessment panel shall
assess the suitability of the consulting firms and
their proposed consulting teams on the basis of the pre-determined
short-listing criteria. All consulting firms meeting the criteria should be
short-listed to ensure competition in the selection process;
(f)
prepare a draft consultancy brief and clear it with the D of J and relevant
departments such as EffO and MA Division of FSTB, if necessary. A
consultancy brief normally covers the objective and scope of the consultancy,
expertise/experience of the consulting firm as well as experience/qualifications
of the consulting team required to undertake the consultancy, duties of the
consulting team, duration and timeframe for the consultancy, information
required for the consultancy proposals (including composition of the
consulting team and proposed approach and method), method of assessing the
consultancy proposals, controls of the consultancy in various aspects
(including the government representative to whom the consulting team will
report, whether and how to deal with change of staff of the consulting team
during the consultancy period, and employment of sub-consultants),
deliverables for each phase of the consultancy, the payment schedule and other
related terms and conditions, and any special features of the consultancy
agreement;
(g)
decide the essential or desirable requirements in terms of for example
experience/qualifications of the consulting team for undertaking the
consultancy, and design the marking scheme for assessment of consultancy
proposals under Stage 2 including, the weighting for technical and fee
assessment for evaluating the cost-effectiveness of consultancy proposals, the
assessment criteria and their relative weighting with passing marks (if any) for
assessing technical proposals and the methodology for scoring fee proposals.
The assessment criteria should generally relate to the information required to
be provided by the consulting firms for evaluation. The technical weighting
should normally be around 60%-70%, unless justified to the satisfaction of
CCSB; and
(h)
make a Stage 1 submission to CCSB seeking approval from the PS(Tsy) for
inviting consultancy proposals from the recommended firms, the consultancy
brief and method of assessing the consultancy proposals. A specimen
submission for Stage 1 approval is at Appendix IV(A).
Stage 2 approval
445.
Upon Stage 1 approval, the procuring department should complete the
following steps leading to submission to CCSB for Stage 2 approval —
(a)
issue the approved consultancy brief to invite consultancy proposals from the
consulting firms. Procuring departments should generally allow no less than
three weeks for the consulting firms to respond. Consulting firms should
submit technical and fee proposals in separate sealed envelopes with the words
“Technical Proposal” or “Fee Proposal” clearly marked on the outside of the
concerned envelope. Procuring departments should require the consulting
firms to submit their fee proposals either on a fixed lump sum or time charge
basis. Where time charge payment is used, consulting firms should be asked
to cap their fee proposals so as to enable a fair cost comparison to be made
(see also SPR 465).
Normally, departments should not disclose the estimated contract value to the
consulting firms as it may become a guiding factor in the preparation of their
proposals which may be reduced or, of even more concern, expanded
unnecessarily thus undermining the principles of competition and value for
money. If, however, the estimated contract value has been disclosed to the
public, procuring departments should, in all fairness, inform all consulting
firms of the estimated contract value;
(b)
invite the consulting firms to a briefing before the closing date for submission
of consultancy proposals, if necessary. In the process leading up to the
submission of consultancy proposals, procuring departments should provide all
consulting firms with the same information to help them prepare their
proposals. After receipt of consultancy proposals and in the course of
evaluation, procuring departments may invite the consulting firms to make a
verbal presentation and to clarify any point in their consultancy proposals.
Normally, the assessment panel should score the consultancy proposals after
the presentation;
(c)
the assessment panel should
complete the technical assessment first
according to the approved marking scheme and assessment criteria. Under no
circumstances should procuring departments alter the marking scheme or
assessment criteria without first obtaining CCSB’s agreement;
(d)
open the fee proposals only after completion of the technical assessment, and
score the fee proposals in accordance with the pre-determined methodology.
Procuring departments should follow the methods for evaluating technical and
fee proposals for tenders given at Appendix III(G) in the evaluation of
consultancy proposals from the consulting firms;
(e)
evaluate the cost-effectiveness of the consultancy proposals by applying the
pre-determined weighting given to the technical and fee assessments.
Normally, procuring departments should recommend the consulting firm with
the highest overall score;
(f)
prepare, where applicable, a negotiating brief listing details of fees, and terms
and conditions of the appointment which need to be resolved with the
recommended firm; and
(g)
make a Stage 2 submission to CCSB seeking approval to appoint the
recommended firm, subject to the fees and other terms set out in the
negotiating brief being satisfactorily resolved, where appropriate. Procuring
departments should also recommend for CCSB’s approval in the Stage 2
submission a fall-back option in the event that agreement cannot be reached
with the recommended firm. A specimen submission for Stage 2 approval is at
Appendix IV(B).
Pre-contract negotiations
455. (a)
Upon notification of Stage 2 approval by the Secretary, CCSB who should
copy the notification memorandum to the D of A, the procuring department
should conduct negotiations with the recommended firm,
where applicable.
Unless authority has been specifically delegated to departments, the PS(Tsy) is
the approving authority for pre-contract negotiations in all procurement of
consultancy services subject to the CCSB procedures. Unless otherwise
approved by the PS(Tsy), the public officer authorised to conduct such
negotiations with the recommended firm should be at directorate level.
Procuring departments should seek advice or assistance from the D of J on
legal aspects or other departments with the relevant expertise such as EffO,
where necessary.
(b)
For a high value or complex contract, departments should consider appointing
a negotiating team led by an experienced public officer. A negotiating team
may consist of the following —
(i)
a member from the D of J for legal aspects;
(ii) a member from the procuring department for user requirement aspects;
and
(iii) a member from the relevant service/professional department for
technical aspects, e.g. EffO and Office of the Government Chief
Information Officer, if necessary.
(c)
The negotiator and the negotiating team should be authorised in advance to
commit Government, if necessary, within limits set out in the negotiating brief.
(d)
In all cases, only public officers with no actual, potential or perceived conflict
of interest shall lead or participate in negotiations. All public officers involved
in conducting negotiations must declare whether they have any actual,
potential or perceived conflict of interest in accordance with SPR 186.
(e)
The procurement of consultancy services is not bound by the WTO GPA.
Nonetheless, public officers authorised to conduct negotiations shall still
observe the principles of fair play and transparency, and may make reference
to the guidelines set out at Appendix III(J).
Acceptance of offers
460.
If all items in the negotiating brief are satisfactorily resolved, procuring
department should
inform the Secretary of CCSB of the outcome and draw up a consultancy
agreement, incorporating the terms agreed with the recommended firm, to be cleared with the
D of J. When the consultancy agreement is ready, the procuring department should notify the
successful consulting firm and invite it to sign the contract on a specified date. Unless
otherwise authorised by the PS(Tsy), the public officer signing the contract on behalf of
Government should be at directorate level. The procedures set out in SPR 505-510 should be
followed in the execution of a contract.
REMUNERATION OF CONSULTANTS
465. (a)
Remuneration for consultants may take the form of time charges, a lump sum
payment by instalments, or a combination of both.
(i)
Time charge payment - this method is suitable for assignments in which
the duration and extent of the consultancy services cannot be
determined in advance, e.g. investigations, economic appraisals and
research. Rates are agreed for professional, technical and supporting
staff, with an element added for overheads and profit. The consultant is
also reimbursed for the use of special equipment and other expenditure
which can be identified directly with the work. When this method is
used, detailed time records of all those engaged on the work must be
maintained, payroll records must be open to inspection or audit by
Government, and receipts and other documents must be provided to
substantiate all reimbursable expenditure. As an added safeguard, a
ceiling is normally placed on the total amount to be paid to the
consultant; and
(ii)
Lump sum payment - this method is used when the scope and duration
of the assignment can be defined clearly and fully. The lump sum
payment is generally computed by estimating the cost of those elements
making up the time charges expected to be incurred.
(b) Before conducting negotiations on fees, where necessary, procuring
departments should ask the consulting firm to provide a detailed cost
breakdown of the consultancy. During such negotiations, procuring
departments should be guided by current market rates and staff costs incurred
by Government on public officers performing comparable duties.
(c)
In general, the contract sums for consultancy agreements should be quoted and
paid in Hong Kong dollars. In order to avoid consulting firms putting in an
unreasonable amount of allowance in their fee proposals to cover exchange
risks for the contract period, procuring departments may allow consulting
firms to quote in foreign currencies for services provided by personnel based
outside Hong Kong and salaried in the quoted currencies. Procuring
departments should follow the procedures set out in SPR 355(b) if they intend
to ask consulting firms to quote in foreign currencies other than US dollars for
contracts likely to cost HK$10 million or more.
(d)
Procuring departments may, upon request by a third party such as the
Legislative Council or the media, disclose the total amount of fees payable to
the successful consulting firms. Procuring departments should consult D of J
for inclusion of a standard provision on the disclosure of fees payable to the
consulting firm in the consultancy brief and the consultancy agreement. For
consultancies remunerated on a time charge basis, departments may make an
estimate on the number of man-days required in order to work out the
estimated total amount for disclosure purpose. Procuring departments should
not
disclose the individual rates of the consulting team engaged at various
levels for the consultancies, as they may reveal the rates that the consulting
firms pay to their staff. Procuring departments should comply with the Code
on Access to Information in handling requests for disclosure of such
information.
CANCELLATION OF A CONSULTANTS SELECTION EXERCISE
470. (a)
If a procuring department decides to cancel a consultants selection exercise
due to reasons such as public interest, lack of conforming bids, or conclusion
of the exercise by entering into a service level agreement with a trading fund
department, it shall seek the prior approval of the relevant consultants
selection board and provide detailed justification for its decision. For
procurement of consultancy services with a value not exceeding the
departmental limit specified in SPR 220(a), the authority for cancelling a
consultants selection exercise has been delegated to DCSCs. After obtaining
the approval, the procuring department should promptly inform bidders of its
decision.
(b)
Approval to cancel a consultants selection exercise is not required when no
consultancy proposals are received after the close of invitation, or in the case
of parallel tendering, if the relevant funding application is not approved by the
Finance Committee of the Legislative Council.
CHAPTER V
CONTRACT ADMINISTRATION
APPLICABILITY
500.
Unless otherwise specified, these Regulations apply to the administration of
contracts for the procurement of stores and services and revenue contracts, irrespective of
whether they were procured through the quotations, tender or consultants selection
procedures.
EXECUTION OF CONTRACTS
Authorised contracting parties
505. (a)
For procurement of stores, services and revenue contracts under the tender or
consultants selection procedures, departments shall conclude contracts with the
selected suppliers, service providers or consultants either by issuing a letter to
accept their offers or by formally signing contracts with them, as appropriate.
Before the said letter is issued or a contract is signed, the procuring department
should obtain a certified true copy of the business registration certificate
concerned from the Commissioner of Inland Revenue or documentary
evidence showing that the tenderer is exempted from business registration
under the BRO. In the case of a limited company, the procuring department
should ask the company to produce a certified true copy of the memorandum
and articles of association and a board resolution to prove due authorisation of
the signatory for the signing of the contract. In case of a partnership, the
procuring department should ask the firm to confirm in writing the authority of
the relevant partner for entering into the contract and dealing with matters
incidental thereto. In case of non-Hong Kong suppliers, service providers or
consultants, procuring departments should consult D of J on measures to be
taken to ensure due execution.
(b)
Where the firm to be awarded the contract is on a list of registered or approved
suppliers, service providers or consulting firms maintained by procuring
departments, the procuring department may already have records indicating
the business registration certificate number, the date of expiry of the certificate
and/or other relevant information of the firms (e.g. exemption from business
registration under the BRO). In such cases and where business registration
certificate is not exempted, verification will only be necessary annually when
the business registration certificate is due for renewal.
(c)
In case of doubt as to whether the company is prohibited by its Memorandum
or Articles of Association to carry on certain business or to exercise certain
powers or whether a person has the authority to sign a contract on behalf of the
company, the procuring department should seek D of J’s advice at the earliest
opportunity. Most contracts are in a standard form, and their general method
of execution will be apparent from the form. Any queries or points of doubt
about execution of contracts should be addressed to the D of J but some
guidance notes are provided at Appendix V(A).
(d) Departments shall report any cases of companies, partnerships or
unincorporated bodies apparently doing business without complying with the
requirements of the Companies Ordinance (Cap. 622) or the Business
Registration Ordinance (Cap. 310) to the Registrar of Companies or the
Commissioner of Inland Revenue, as the case may be.
(e)
Save for SPR 505(f) below, contracts shall be concluded by public officers at
the directorate level signing the relevant documents on behalf of the
Government unless the PS(Tsy) has authorised otherwise. For the avoidance
of doubt, if the substance of that document is to conclude a contract either
immediately or subject to condition(s), it shall be so signed by a directorate
officer.
(f)
For procurement under quotation procedures specified in Chapter II of the
SPRs, contracts may be concluded by public officers designated by COs
signing the relevant documents on behalf of the Government. The designated
officer(s) shall not be lower than the rank of Assistant Supplies Officer/
Executive Officer II or equivalent.
Insurance and personal injury
510. (a)
Where it is required by the terms of the contract, procuring departments shall
ensure that the firm has a valid policy or policies of insurance prior to
executing the contract and ask the firm to submit the policy or policies
required by the contract together with premium receipts. The public officer in
charge of the contract shall examine the validity of such a policy or policies in
administering the contract and be responsible for the safe-keeping of the policy
or policies.
(b)
When an accident takes place resulting in personal injury, section 15 of the
Employees’ Compensation Ordinance (Cap. 282) obliges the firm as employer
to notify the Commissioner for Labour in the prescribed form. If not already
specified in the terms of the contract, the public officer in charge of the
contract shall instruct the firm to send a copy of such notice to the department
responsible for the contract. Should any claim be made by the injured person
or his representative directly against the Government under the Employees’
Compensation Ordinance or at common law or under the Fatal Accident
Ordinance (Cap. 22), the department responsible for the contract shall
immediately notify the firm, the Commissioner for Labour and the D of J.
CONTRACT PAYMENTS
515. (a)
All payments properly due to a firm must be made in accordance with the
terms of the contract and should normally be effected within 30 calendar days
upon acceptance of the deliverables. Should circumstances arise where a
payment has to be made before all the necessary authorities have been
obtained, the department concerned must seek prior approval from the
Treasury Branch of FSTB for the opening of an advance account to facilitate
the payment. Opening of advance accounts should only be considered in
exceptional circumstances, e.g. an unexpectedly high arbitration award. An
advance account is opened on the personal responsibility of the CO and must
be cleared as soon as the necessary authorities have been obtained.
(b)
Payments for contracts quoted in a foreign currency are normally paid in that
foreign currency. If it is agreed by both contracting parties that payments are
to be made in Hong Kong dollars instead of the quoted currency, the date and
conversion rate for each payment shall be clearly specified in the contract.
(c)
For contracts with a total foreign currency (other than US dollar) commitment
less than the equivalent to HK$10 million, the department concerned shall
report to the Hong Kong Monetary Authority at the end of each month all
known or anticipated foreign currency requirements in the format as specified
by the Hong Kong Monetary Authority.
(d)
For contracts with a total foreign currency (other than US dollar) commitment
equivalent to HK$10 million or more, the department concerned shall ask the
Treasury to arrange forward purchase through the Hong Kong Monetary
Authority before the contract is awarded. The transaction of forward
purchases will normally take place on the day the contract is awarded, unless
otherwise advised by the Hong Kong Monetary Authority. The requisition
memorandum to the Treasury and the Hong Kong Monetary Authority shall
quote the authority for contract award and provide a schedule of payment dates
and amounts of foreign currency required.
VARIATIONS TO CONTRACTS
520. (a)
Under no circumstances may a department vary a contract which will result in
the approved commitment or approved project estimate being exceeded.
(b)
A CO, or a designated officer of appropriate rank, may approve any number of
variations to a contract (including extension of the contract period for a
contract awarded by his department and minor variations to the GLD
contracts, i.e. contracts awarded by the GLD), which are inevitable and
do not
increase the original contract value (or do not affect the original contract
value in the case of a revenue contract), provided that all relevant factors,
including rates, are no less favourable. Contingencies (such as notional value
for additional services in the case of consultancy agreements for architectural
or engineering services) or optional items contemplated in and falling within
the terms of the contract shall not be counted as part of the original value of a
contract. For works contracts, departments should follow the guidelines issued
by DEVB from time to time in defining the optional items for the purpose of
this provision.
(c)
The cumulative value of contract variations for
all contracts
should not
normally exceed 50% of the original contract value. Contingencies or
optional items referred to in SPR 520(b) shall not be counted as part of the
original contract value. Excesses have to be approved with fully documented
justifications. Such contract variations should be avoided as far as possible
and should normally be used as a stop-gap measure, unless they are otherwise
justified in accordance with the GLD Circular issued from time to time. Any
variation to a contract which will increase the original value of the contract (or
affect the original value of the contract in the case of a revenue contract), or
any increase in contract sums must be approved by the
appropriate authority
in Appendix V(B).
(d)
COs shall ensure that public officers responsible for matters concerning
contract variations interpret the limits specified at Appendix V(B) strictly and
that they do not evade the limits by including items which have the effect of
bringing down the original increase in the contract value had those items not
been included. For the avoidance of doubt, for a contract that involves
variations leading to a decrease in contract value in one area and an increase in
contract value in another during the contract period, only the variation that
leads to an increase in contract value will count under the accumulated value
of the contract for determining the appropriate level of authority for seeking
approval for contract variation as specified in Appendix V(B). For variations
which inevitably involve the replacement of original contract items with new
items which are collectively part and parcel of the subject variation, only the
net value of the variation will count.
(e)
Contract variations, especially those which are not provided for in the original
contract, may amount to new procurements. For contract variations amounting
to new procurements
covered by WTO GPA, procuring departments shall
ensure that all relevant requirements of WTO GPA are complied with. In case
of doubt as to whether contract variations amount to new procurements
covered by WTO GPA, procuring departments should seek legal advice from
the D of J or, in the case of works contracts, LAD(W)/DEVB.
(f)
Departments should copy correspondence on approved contract variations and
any supplementary agreements consequentially signed to the D of A.
CONTRACT NEGOTIATIONS
525.
If a department proposes to vary the terms of a contract, it shall seek agreement
of the relevant authority (as specified in SPR 520 and Appendix V(B)) on the proposed
variation and seek its prior agreement to the strategy or bottom line for the contract
negotiation. For GLD contracts, the PS(Tsy) has delegated to the DGL the authority to
approve contract negotiation. Departments shall conduct contract negotiations in accordance
with the principles set out in SPR 385 and Appendix III(J).
DISPOSAL OF CONTRACT DOCUMENTS
530. (a)
Departments shall retain the original copy of an executed contract, and the
related original security bond, bank guarantee and insurance policy, if any. A
certified true copy of the executed contract shall be forwarded to the D of A
for audit purpose.
(b)
Departments shall not keep the original documents in files required for
working purposes or with working copies. The documents must be stored in a
safe or strongroom if available; otherwise they shall be kept in a locked
cabinet or cupboard. The public officer responsible for the safe custody of the
documents shall keep the cabinet or cupboard key.
(c)
Departments may destroy documents submitted by unsuccessful firms in a
tender or consultants selection exercise three months after the date the relevant
contract has been executed.
(d)
For procurements covered by WTO GPA, departments shall maintain the
tender documents, all documents submitted by the tenderers, any other
documents and reports of tendering procedures and contract awards, including
the records required under SPR 390(c), and data that ensure the appropriate
traceability of the conduct of procurements by electronic means for a period of
not less than three years from the date of contract award.
MONITORING OF PERFORMANCE OF CONTRACTORS AND CONSULTANTS
535.
Departments shall devise an effective monitoring mechanism to ensure that a
contractor or consultant performs to standard and complies with the terms of a contract.
Specifically for contracts with a value exceeding the quotation limits specified in SPR 220,
departments shall follow SPR 536-541 below.
536.
Departments shall evaluate the performance of their contractors or
consultants —
(a)
at least once every six months until completion of the contract for contracts
lasting more than one year; and
(b)
upon completion of the contract for contracts lasting a year or less.
537.
As soon as it becomes apparent that the performance of a contractor or
consultant is not satisfactory or deteriorating, the concerned department must —
(a)
notify the contractor or consultant in writing;
(b)
invite him to explain the reasons for the unsatisfactory performance;
(c)
request him to make improvements; and
(d)
step up monitoring.
538.
If despite the action taken in accordance with SPR 537, the contractor or
consultant fails to make any improvement in performance and the department is not satisfied
with the reasons (if any) given by the contractor or consultant for his unsatisfactory
performance, the department should consider taking further action in accordance with the
terms of the contract or consultancy agreement. For example, the department should warn the
contractor or consultant in writing that further unsatisfactory performance of the contractor or
consultant may result in the termination of the contract and/or suspension of the contractor or
consultant from bidding Government’s new contracts. The department may also suspend
payment to the contractor or consultant in the event that pre-agreed contractual milestones are
not achieved.
539.
Departments shall keep these performance records on contractors or
consultants for as long as they consider necessary but in any case, not less than three years
upon completion of the contracts.
540.
For the purpose of monitoring the performance of works contractors,
departments shall follow the guidelines and procedures set out in the Contractor Management
Handbook and the relevant DEVB TC(W). For the purpose of monitoring the performance of
consultants appointed by CCSB, AACSB and EACSB, departments shall follow the
guidelines and procedures set out in Appendix V(C) of SPR, Handbook on Selection,
Appointment and Administration of Architectural and Associated Consultants or Handbook
on Selection, Appointment and Administration of Engineering and Associated Consultants,
and DEVB TC(W), where appropriate. For the purpose of monitoring the performance of
consultants appointed by the DCSCs, departments may draw up their own procedures or
follow the arrangements of the relevant consultants selection board.
541.
Departments shall take into account the relevant past performance records of a
contractor or consultant where available in evaluating his tender or consultancy proposal.
CHAPTER VI
STORES RECORDS
GENERAL
600.
Except where otherwise approved by the DGL, departments should record all
stores items in ledgers, vouchers and registers specified in these Regulations for stock control.
Public officers who certify on the above stores forms are personally responsible for the
accuracy of the certification.
605.
Departments which seek to introduce computerised stock records or stores
vouchers should consult and agree with the Government Chief Information Officer, DGL,
DAS and D of A the scope and details of the software package to ensure completeness of data
and compliance with prevailing Government Regulations and instructions.
LEDGERS
610.
Departments should keep complete records of the receipt and issue of all stores
held in a departmental store unit, including livestock, in manual or preferably computerised
stores ledgers.
615.
Stores ledgers should be posted by a public officer other than the one in direct
control of the stores.
620.
Departments should observe the following in the use of ledgers —
(a)
Account for new (unused), serviceable (used) and unserviceable stores in
separate ledgers.
(b)
Allocate a unique folio reference number to each type of stores item in stock
and strictly control the creation of new stores items by means of control index
in the ledger.
(c)
Post all ledgers promptly, and support each entry by a voucher, the nature and
number of which should be recorded against the entry.
(d)
Show the unit of issue, e.g. number, kilogram, metre, etc. in the ledger and
record items taken on charge in that unit.
(e)
Avoid making erasures in the stores ledgers. The public officer responsible for
keeping the ledger should mark all corrections clearly in red ink and initial
them in case of manual stores ledgers; and support all amendments by
vouchers and a brief explanatory note on each supporting voucher in case of
computerised stores ledgers.
(f)
For the use of manual stores ledgers, remove completed ledger sheets from a
loose-leaf ledger in current use only after the transactions on the sheets have
been checked and the balances carried forward to the new sheets have been
verified by the D of A. File these completed ledger sheets in numerical order
in a separate binder and update the control index accordingly. Where
computerised stores ledgers are used, maintain back up copies of the ledgers.
625.
Departments should notify the DGL, DAS and D of A of any loss of, or
damage to ledgers and investigate the matter immediately.
630.
In the event of any loss or damage to ledgers, the CO concerned should appoint
a board of survey to carry out a full stock-taking exercise immediately. After the Board’s
findings have been endorsed by the CO, the DSM appointed under SPR 135 shall open a new
ledger to account for the stores which were recorded in the lost or damaged ledgers subject to
the value of the stores not exceeding $250,000. If the value of the stores exceeds $250,000,
the department should obtain the prior approval of the DGL.
635.
Subject to the approval of D of A, the DSM may destroy completed manual or
computerised stores ledger sheets seven years after the end of the financial year containing the
last entry without reference to DGL and DAS. He should sign the relevant destruction
certificate and retain it for audit inspection.
VOUCHERS AND FORMS
650.
DGL is the authority for introducing new stores vouchers and forms and for
revising existing stores vouchers and forms. Departments may, in consultation with DGL,
revise existing stores vouchers and forms or develop new stores vouchers and forms to cater
for their operational requirements in accounting for and management of stores.
660.
Departments should observe the following in the use of vouchers —
(a)
File completed vouchers, which contain full particulars of authorities, dates,
numbers, quantities and rates, in numerical order.
(b)
Quote the relevant reference numbers such as ledger folio reference number or
inventory sheet reference on the receipt copy of the voucher in case the stores
ordered are required to be taken on charge.
(c)
Avoid making erasures on the vouchers. Mark corrections by striking out the
erroneous figures or words and entering amendments above. The public
officer who is authorised to sign such vouchers should initial the amendment.
(d)
If a voucher is cancelled, file all copies, except the last one which should
remain in the pad, with the completed vouchers in correct numerical sequence.
Mark clearly all cancelled vouchers “Cancelled” and have them initialled by
the public officer who is authorised to sign such vouchers.
665.
Departments should notify the DGL, D of A and DAS of any loss of, or
damage to used or unused stores vouchers and controlled numbered stores forms.
670.
DSM may destroy general forms, non-control-numbered stores forms, books of
unused stores vouchers/control-numbered stores forms which are either obsolete or in excess
of requirements. In the latter case, the CO who issues the forms or vouchers must authorise
their destruction. After destruction, the DSM should sign the destruction certificate and file it
for D of A’s examination.
675.
DSM may destroy, in the same manner as that described in SPR 670 above,
used or partly used books of stores vouchers/control-numbered stores forms after they have
been retained for three years and audited by the D of A. If a book contains original copies of
used vouchers or forms, departments must seek approval from the DAS for the destruction
unless the book has been retained for seven years after the end of the financial year containing
the last entry.
REGISTERS
680.
Departments should maintain registers of various stores records in accordance
with the guidelines set out at Appendix VI.
CHAPTER VII
ACCOUNTING FOR STORES
CLASSIFICATION OF STORES
700.
There are two types of stores : GLD unallocated stores and departmental
stores.
GLD unallocated stores
705. (a)
GLD unallocated stores are stores purchased by the DGL in bulk and held in
stock pending subsequent sale or issue to departments and other bodies.
(b)
The costs of these stores are chargeable in the first instance to the Unallocated
Stores Suspense Account established under section 30 of the Public Finance
Ordinance and administered by the DGL. When these stores are issued to
departments, DGL informs the DAS to debit the appropriate subheads of
expenditure of the departments concerned and to credit the Unallocated Stores
Suspense Account correspondingly.
Departmental stores
710. (a)
Departmental stores are stores acquired by departments solely for their own
use. They may be standard stores from the GLD unallocated stores or other
items acquired by departments through direct purchase or other means.
(b)
Departmental stores are further classified into inventory and non-inventory
items. Inventory items are generally stores of permanent or non-consumable
nature and with a unit cost at or above $1,000 at the time of purchase, while all
the other stores are non-inventory items.
ACCOUNTING FOR GENERAL INVENTORY ITEMS
715.
DSM is responsible for proper accounting of inventory stores received and
issued. He should —
(a)
ensure that the public officer maintaining the inventories in a store unit records
all the issues and receipts correctly and makes cross-references of the entries
in the relevant inventory records such as Inventory Stores Ledger Sheet
(GF 270) and Inventory Sheet and Distribution Record (GF 272) with the
relevant vouchers such as the Departmental Order for Supply of Stores
(GF 219) or Departmental Combined Requisition and Issue Voucher (GF 277);
(b)
arrange to check inventories at least once a year and ensure that any
discrepancies are dealt with in accordance with SPR 1030; and
(c)
maintain a control index to record the number of inventory sheets in use.
720.
DSM should account for inventory items as follows —
(a)
Items received as stock in the first instance
(i)
Enter the items in GF 270 when they are received into the departmental
stores.
(ii) Strike the items off the GF 270 when they are issued from stock and
enter them in bulk on GF 272 of an entity (which can be a branch,
section or unit of a department, or a floor or wing of an office block).
(iii) In the case of departmental quarters or in exceptional circumstances
where departments consider there are operational needs, enter also the
items on the reverse side of the GF 272 and on the Room Inventory
Record (GF 273). DSM and the inventory holder should each hold a
copy of the GF 273.
(b)
Items brought into immediate use
Account for the items as in (a)(ii)-(iii) above, but without first taking them on
charge on a GF 270 and then striking them off.
(c)
Items on loan from individuals or non-government organisations
Account for the items as in (a) or (b) above for the period on loan.
(d)
Items donated by individuals or non-government organisations
Bring the items on charge using a Departmental Stores Return Note (GF 278)
as soon as acceptance of the donation has been approved and account for the
items as in (a) or (b) above as appropriate.
730.
Departments may transfer items from one GF 272 to another. The public
officer requiring the items should raise a Departmental Combined Requisition and Issue
Voucher (GF 277) and route this through the DSM for his approval. Once the transfer is
completed, the public officer concerned should duly inform the DSM so that the latter can
update the records accordingly. In cases where GF 273 is maintained, departments may
transfer items from one GF 273 to another without the use of vouchers provided that both
records are under the same GF 272 and all relevant records are updated with the inventory
holder receiving the items signed to that effect.
ACCOUNTING FOR SPECIAL INVENTORY ITEMS
735.
Departments should account for special inventory items including fire fighting
equipment, electrical and gas appliances, books, uniforms and accoutrements in accordance
with the procedures set out in SPR 740-760 below.
Fire fighting equipment
740.
User departments are responsible for the procurement of all portable
fire-fighting equipment in their buildings and should account for the equipment on GF 272.
The installation, testing, maintenance, inspection and repair of the equipment should be
arranged by user departments or their appointed agents. In the event of loss or damage of the
equipment, user departments should initiate write-off action in accordance with
SPR 1035-1040 as appropriate.
Electrical and gas appliances
745. (a)
For accounting purposes, electrical and gas appliances are classified into
non-specialist, i.e. those which are listed in the Inventory Distribution Sheet of
Electrical and Gas Appliances (GF 269), and specialist, i.e. those which are
not listed in GF 269.
(b)
Departments should account for the appliances as follows —
(i) Non-specialist electrical and gas appliances for office
accommodation—follow SPR 720, but use GF 269 instead of GF 272.
(ii)
Non-specialist electrical and gas appliances for departmental quarters—
use GF 273 with the disposition summarised on GF 269.
(iii) Specialist electrical and gas appliances—follow SPR 720.
(c)
The Director of Electrical and Mechanical Services should account for the
non-specialist electrical and gas appliances provided to each non-departmental
quarter on the Inventory of Electrical and Gas Appliances (EMSD 32), and
summarise the disposition of the appliances on GF 269.
Books
750. (a)
For the purpose of these Regulations, books are classified into books typified
as non-inventory stores, books held on departmental charge and books
maintained in departmental libraries.
(b)
Each library should maintain an Accession Register (GF 39). Each line in the
Register should be assigned a number in strict numerical sequence, called the
accession number, for allocation to each book when it is received.
(c)
Apart from those classified as non-inventory items, which need not be taken
on charge, departments should account for books as follows —
(i)
Books held on departmental charge—in accordance with SPR 720.
(ii)
Books maintained in departmental libraries—allot to each book the next
accession number immediately upon receipt and enter the number onto
GF 39. Record the accession number outside on the binding panel of
the book. Where not practicable, record the number on the inside front
cover.
(d)
Departments should maintain a Loan Register to record books issued on loan.
Uniforms
755. (a)
The authorities for the supply and design of uniforms are laid down in
CSR 570-572. Departments should follow the Uniform Scale approved by the
relevant authorities under the provisions of CSR 570-571 for the issue and
replacement of uniform items. COs may personally grant exemption for
certain uniform items from returning upon replacement or by outgoing officers
having regard to the value of the items concerned and the security concern.
The exempted items should usually be of low value and may create hygiene
problems in case they are returned to departments for central disposal.
Examples are socks, stockings and pantyhose. Uniform items bearing insignia,
badges, departmental logo, department’s name/acronym should not be
exempted from returning.
(b)
Departments should maintain either a Uniform Record Card (GF 203) or an
approved departmental uniform record card/sheet for each public officer and
ensure its accuracy. All record cards/sheets should be serially numbered and
supported by a control index.
(c)
Except where otherwise authorised by the DGL, departments should follow the
following procedures in (d)-(g) below for the issue of uniforms.
(d)
Except for direct counter issues as described in (g) below, the public officer in
charge of the requisitioning unit should submit to the DSM lists of public
officers for whom issues are required, together with either —
(i)
a GF 277 for initial issue; or
(ii) an Exchange Voucher for Stores on Inventory Charge (GF 275) for
replacement issue, together with the items to be replaced (except for the
exempted items).
(e)
In case of an initial issue, the DSM should issue the items required, account
for the issue in GF 270 by means of GF 277/GF 275 and update the GF 203 of
the public officers concerned accordingly. In case of a replacement issue, the
DSM should examine the items returned (except for the exempted items) and
satisfy himself that they are unserviceable before issuing replacement items.
(f)
Upon receipt of the uniform items, the officer-in-charge of the requisitioning
unit should distribute them according to the name lists attached to the GF 277
or GF 275 and request the public officers concerned to acknowledge receipt by
signing against their names on the lists. He should retain the lists for audit
purpose.
(g)
In case of counter issues, unless the requisitioning officer can produce a
GF 277 or GF 275 in which case the procedure in (e) should be followed, the
DSM should record the issue on a Counter Record of Issues/Returns of
Uniforms (GF 292) and the public officer’s GF 203 and request the public
officer to sign on both records to acknowledge receipt. When a GF 292 is
completely filled up, he should raise a GF 277 to account for all the issued
items on the GF 292 and then strike the items off the GF 270 accordingly.
760. (a)
DSM should withdraw unserviceable items (except for the exempted items)
and bring them on charge in the Unserviceable Ledger (see SPR 620(a)) for
subsequent condemnation in accordance with the procedures laid down in
Chapter XI.
(b)
DSM should take on charge used but serviceable uniforms returned from
outgoing officers as serviceable (used) stores in accordance with SPR 620(a).
He may subsequently issue such items to a public officer in excess of the
latter’s normal uniform scale as a supplementary issue and record this on the
public officer’s uniform record card. When the public officer no longer
requires the supplementary issues, he should return the items and the DSM
should then update the public officer’s GF 203 accordingly.
ACCOUNTING FOR NON-INVENTORY ITEMS
765.
Departments should account for non-inventory items as follows —
(a)
Items held in stock in a departmental store unit—in a Non-inventory Stores
Ledger (GF 291). Except those cases set out in SPR 775 below, no further
accounting for the stores is necessary once their issue has been recorded in the
Ledger.
(b)
Items issued for immediate use, for use on Working Stores Tables or specific
jobs—state the purpose of the issue in the relevant voucher such as the
Unallocated Stores Requisition and Delivery Note (GF 210) or GF 219, e.g.
put down the relevant job number or cross-reference it with a GF 277.
770.
To facilitate control and to simplify the accounting procedure, the DSM
should, where necessary, prepare Working Stores Tables for controlling the issue of stores
which are regularly required in fairly large quantities by individual units. The Table should
specify the approved maximum permissible stock level for the unit concerned.
775.
If departments consider that certain non-inventory items should be accounted
for as inventory items for control purposes, they should account for the items in accordance
with SPR 715-760. Once so accounted, departments should continue to treat them as
inventory items unless otherwise agreed by the DGL.
CHAPTER VIII
MANAGEMENT OF STORES
GENERAL
800. (a)
COs are responsible for the general supervision and control of stores. In order
to make the best use of government stores, departments should follow good
stores management practices in their daily operation.
(b)
DSM is responsible for the proper use of Government mark when procuring
stores. Departments should deface the Government mark when selling such
stores for private use.
805. (a)
Departments should consult the Director of Fire Services on the storage of
highly inflammable or explosive items where the quantities exceed the
exemption levels stipulated under the Dangerous Goods Ordinance, and on the
adequacy of fire-fighting facilities, where necessary.
(b)
Departments should make special arrangements for the storage of corrosive,
radioactive or other dangerous materials in consultation with the Government
Chemist or the Senior Physicist in-charge, Radiation Health Unit of the
Department of Health.
810.
In compiling draft Schedules of Accommodation for office fitting-out purpose,
departments should —
(a)
give due consideration to the provision of proper and adequate storage
facilities and the subsequent safety and safe-keeping of all stores including
dangerous and perishable stores, and valuable, attractive or delicate items of
equipment; and
(b)
include in the Schedules a full specification of the storage facilities covering
layout, fixtures, fitments and special conditions, if any, and where appropriate,
consult the relevant authorities.
RECEIPT OF STORES
815.
The DSM is responsible for ensuring that stores supplied by a supplier are in
full compliance with the contract or order specifications. The public officer who receives the
stores should report immediately to the DSM any incidents of sub-standard stores received.
820.
A public officer authorised to sign an order voucher should ensure that the
stores ordered are delivered to the correct location within the stipulated time. This public
officer should sign for any subsequent alteration or amendment to the order or cancellation of
delivery and agree this in writing with the supplier.
825.
Upon receipt of stores, departments should —
(a)
inspect the stores received within a reasonable period of time. If stores
received are subject to extensive testing procedures, payment may only be
made upon satisfactory completion of the acceptance testing; except where the
contract specifies otherwise; and
(b)
account immediately for the accepted stores and give due consideration to any
discount for prompt payment offered by the supplier. Payment should be made
in accordance with the relevant provisions in the Financial and Accounting
Regulations.
830.
Departments should account for the proper handling/disposal of any
containers/pallets, etc. received from suppliers but having resaleable value —
(a)
Take on charge empty non-returnable drums of a capacity of 200 litres or more
in the Inventory Stores Ledger Sheet (GF 270) and record their subsequent
disposal.
(b)
Maintain a record on the receipt and return of all containers returnable to or on
loan from suppliers.
835.
Departments which reject stores from local suppliers should do so in writing,
with a copy to the DGL for an order placed or a contract let by the GLD.
ISSUE OF GLD UNALLOCATED STORES
845. (a)
DGL may issue unallocated stores to departments for use in government
services.
(b)
DGL may issue on payment basis to non-government organisations or
individuals, unallocated stores which he considers are surplus to government
requirements in accordance with the following procedures —
(i)
charges the stores at stock price plus an additional overhead charge of
20%, which may be waived only with the authority of the PS(Tsy); or
(ii)
where there is a significant increase in market price over the stock price,
consults the PS(Tsy) on whether the issue price should be calculated as
stated in (i) above, or in some other way.
ISSUE OF DEPARTMENTAL STORES
850.
Departments should follow the procedures set out at Appendix VI when
issuing departmental stores for government works or services, for transfer between depots, for
conversion into different specifications or units, or for sale.
Issue of stores on loan
855. (a)
Subject to the approval of the DSM and to the loan period not exceeding six
months, departments may issue departmental stores on loan in accordance with
the following procedures —
(i)
To public officers within a department—record the issue in a Loan
Register and retrieve the items immediately after the specified period of
loan or before the public officers leave the department (e.g. on transfer
or retirement).
(ii) To other departments—similar to (i) above. In addition, the issuing
department should require the borrowing department to raise a GF 277
and a Departmental Stores Return Note (GF 278) to cover the issue and
return of the stores respectively. Throughout the loan period, the stores
remain on charge with the issuing department.
(iii) Contractors engaged in government works—similar to (ii) above except
that the issuing department raises GF 277 and GF 278 on behalf of the
contractor. In addition, the contractor has to provide a written
agreement, including appropriate financial arrangements to safeguard
Government’s interests.
(b)
Where authorised personally by the CO or his deputy, departments may also
issue stores on loan to private individuals or non-government organisations by
following the procedures stated in (iii) above. The issuing department will
raise GF 277 and GF 278 on behalf of the borrower.
Issue of tools on loan to government employees
860. (a)
Departments should follow the procedures below for the issue of departmental
tools on loan to government employees —
(i)
Long-term loan in respect of items required by the employees for
carrying out their normal daily work —
—
Make issues in accordance with a standard scale where possible.
—
Record the issues on an Inventory Sheet and Distribution Record
(GF 272) or a register/card (one sheet/page for each employee)
designed to suit departmental requirements.
—
Check all tools issued physically against the records at least once
every six months.
(ii) Short-term loan in respect of items required by the employees for a
specific job outside the course of their normal daily work —
—
Record the issues in a Loan Register.
—
Retrieve the tools immediately to the departmental store unit
once the job is completed.
(b)
Government employees are required to return all departmental tools on loan to
them before taking leave of seven or more consecutive days.
Issue of stores to other departments
865. (a)
Subject to the following authorities, a department may issue departmental
stores which are no longer required to another department —
Original value of stores
issued in any one case
Authority
Not exceeding $50,000
CO
More than $50,000 but not exceeding
DGL
$250,000
Over
$250,000
PS(Tsy)
(b)
The issuing department should require the receiving department to raise a
GF 277 for the issue. The GF 277 should bear the reference of the approving
authority.
Issue of stores on payment
870.
Subject to the approval of the DGL, departments may issue departmental
stores, which are considered surplus to the department's requirements, on payment basis to
non-government organisations, or individuals as follows —
(a)
charge the stores at stock price plus an additional overhead charge of 20%,
which may be waived only with the authority of the PS(Tsy); or
(b)
where there is a significant increase in the market price over the stock price,
consult the PS(Tsy) on whether the issue price should be calculated as stated in
(a) above, or in some other way.
RETURN OF STORES
Stores issued from GLD unallocated stock
875. (a)
Serviceable departmental stores received from GLD Unallocated Stock which
are no longer required may be listed on a GLD Unallocated Serviceable Stores
Return Note (GF 224) and return to the GLD for acceptance into GLD
Unallocated Stock provided that they are —
(i)
not obsolete or surplus to government requirements;
(ii) in a condition acceptable to the DGL and suitable for re-issue to other
departments; and
(iii) in complete units of quantity.
(b)
The DGL will take the returned stores on charge in the GLD unallocated stores
account at the current stock price. After receiving the notification from the
DGL, the DAS will debit the Unallocated Stores Suspense Account and —
(i)
credit the returning department’s vote if they are returned in the same
financial year in which they were issued; or
(ii)
credit the General Revenue if they are returned in a year subsequent to
the financial year in which they were issued.
Stores issued from departmental stock
880.
If serviceable stores received from departmental stock are no longer required,
the public officers concerned should return them to departmental stock. They should indicate
on the GF 278 whether the stores are new (unused) or serviceable (used).
SAFE CUSTODY OF STORES
885.
Public officers are personally responsible for the safe custody of all stores
received by them in the course of their duties. They may be surcharged for any loss resulting
from a failure to follow these Regulations, and/or any instructions issued by the DGL
regarding the safe custody of stores.
HANDOVER OF STORES
890. (a)
When stores on ledger charge are handed over, both the outgoing and
incoming officers should verify that all items shown in the stores ledgers are
actually held in stock and that all items in stock are correctly recorded in the
ledgers. However, if the DSM considers that, owing to a large number of
items, it is not practicable for the incoming officer to check all of them, he
may permit the incoming officer to select a number of items, which should
include valuable and highly attractive items, for verification.
(b)
The outgoing officer should record all surpluses and deficiencies noted during
verification on a Departmental Stocktaking—Schedule of Discrepancies
(GF 241) and report them to the CO through the DSM by completing
paragraph 1 of the Departmental Stocktaking Report (GF 237). He should also
immediately raise a GF 277 and/or GF 278 as necessary to deal with the
discrepancies in accordance with SPR 1030-1070.
(c)
On completion of the verification, both the outgoing and incoming officers
should sign on the Handing Over Certificate (GF 239) and forward it to the CO
through the DSM.
895. (a)
If the outgoing officer is unable to hand over stores issued to him personally,
the CO should appoint a Handing Over Board which should proceed in
accordance with SPR 1015 (a)-(c)(i). A completed Certificate of Handing
Over by a Board (GF 240) should be forwarded to CO through DSM.
(b)
The outgoing officer may be held responsible for any deficiencies reported;
whilst the incoming officer may be held responsible for any deficiencies not
reported but subsequently discovered.
SECURITY OF STORES
896.
DSM is responsible for assisting the CO in general supervision and control of
stores and stores accounts within his purview. In this respect, DSM should –
(a)
inspect each store unit under his direct control at least once every two years,
including examining the adequacy of security arrangements, and report the
results of the inspection to the CO on the Periodical Stock Inspection Report
(GF 238); and if necessary, also on the Departmental Stocktaking-Schedule of
Discrepancies (GF 241); and
(b)
carry out surprise stock and security checks at irregular intervals at least once
every three months unless DGL has authorised otherwise. However, if it is
impractical or not cost-effective for him to inspect each and every store unit,
he should ensure that the respective head of the unit concerned or his deputy
will conduct such checks. In all cases, the public officer conducting the check
should properly record the findings in the Surprise Inspection Book (GF 235).
CHAPTER IX
COLLECTION AND DELIVERY OF STORES
FROM SUPPLIERS OUTSIDE HONG KONG
GENERAL
900.
DGL may assist departments to receive specialised stores, such as arms and
ammunition, consigned by suppliers outside Hong Kong.
905.
When a department receives any bill of lading or airway bill addressed directly
to it, the responsible officer of the department should endorse the bill “For delivery to the
Director of Government Logistics” by signing on behalf of his CO and then forward it to the
DGL.
HANDLING OF CONSIGNED GOODS RECEIVED BY THE DIRECTOR OF
GOVERNMENT LOGISTICS
915.
The requisitioning department should retain all packing materials in separate
lots and maintain a record of all related documents until the actual receipt of all the stores said
to have been delivered. In the event of loss, these packing materials can be used for checking
the gross and net weight of the particular package against the weights given in the shipping
documents.
RECEIPT OF STORES
920.
Immediately upon receipt of stores from the DGL or directly from suppliers
outside Hong Kong, departments should take on charge the full quantity of stores shown on
the invoices.
INSPECTION OF STORES RECEIVED
925.
Department should raise an Inspection Report of Goods Received (Imported)
(GF 280) and inspect the stores received —
(a)
within seven days of delivery in respect of general stores; and
(b)
within 30 days of delivery or as specified in the terms of order/contract in
respect of stores requiring special testing procedures.
930.
Immediately after the inspection, the department will complete the relevant
sections of the Inspection Report of Goods Received (Imported) giving details of any
differences between the stores actually received and those listed in the invoices or packing
lists and of any losses or damages of stores. For stores received through the GLD, the
department should send a copy of the Inspection Report of Goods Received (Imported) to the
DGL.
CLAIMS
935.
If stores ordered are not received in good order and condition, and if the loss or
damage exceeds $1,000, or if essential accessories or parts of any equipment, regardless of
their value, are not received in good order and condition, the department concerned should
immediately —
(a)
submit a Claims Report (GF 296) to the DGL or notify him through the GLD’s
Procurement and Contract Management System so that the GLD will create a
Claim Record and lodge claims on the appropriate parties and the department
concerned should follow the procedures set out in SPR 955-965 in the case of
stores purchased through the GLD; or
(b)
lodge claims on the appropriate parties by following the procedures set out in
SPR 950-965 in the case of stores purchased by departments direct.
940.
Departments should not consider a claim being settled until —
(a)
the value of the loss or damage has been recovered in full; or
(b)
the stores have been replaced; or
(c)
a write-off has been authorised.
945.
Departments should maintain a Claim Register (GF 207) for recording claims
on account of breakages or deficiencies of stores received from sources outside Hong Kong.
Departments should treat any broken item which cannot be repaired as a deficiency.
950.
After the claim has been settled, the department concerned will strike off
charge the quantities of stores broken or found deficient by means of a Departmental
Combined Requisition and Issue Voucher (GF 277) and make cross reference with the Claim
Register.
955.
The DGL will follow the accounting procedures outlined below when dealing
with claims in respect of stores ordered by/through the department —
(a)
Debit the cost of the stores to the appropriate subhead of expenditure.
(b)
Prepare a Claim Record Card on receipt of a claim through Procurement and
Contract Management System or GF 296 from the requisitioning department.
(c)
(i)
If the exact amount to be claimed is known, raise a journal transfer
crediting the appropriate subhead of the requisitioning department and
debiting “Advances—Claims”. After the liable party has settled the
claim, credit the amount to clear the Advance Account. This is
regardless of whether the claim is settled in the same or subsequent
financial year.
(ii) If the exact amount to be claimed is not known (e.g. for broken or
damaged parts of plant, instruments or other equipment where the value
of the parts will not be known until after receipt of the required
replacement invoice or claims for refund of repair, alteration and
associated charges and where the charges cannot be ascertained until
after completion of the jobs or where the claim is in a foreign currency),
allocate the credit received direct to the appropriate subhead if received
within the same financial year, or to revenue if received in a subsequent
year.
(d)
Debit the cost of any subsequent replacements to the appropriate subhead of
the requisitioning department.
(e)
If the liable party admits liability and the supplier provides a free replacement,
irrespective of whether this is done in the same or subsequent financial year,
the DGL will take no further action. Except where an Advance Account has
been opened under (c)(i) above, the DGL will reverse the original entry by
journal transfer, forwarding the original and three copies to the requisitioning
department. On receipt of the free replacement, the department concerned will
accept the debit by retaining the quadruplicate and forwarding the original and
duplicate to the DAS, and the triplicate to the DGL.
960.
When dealing with claims in respect of stores purchased by departments direct,
departments should follow the accounting procedures outlined in SPR 955(a), (c), (d) and (e).
Whenever necessary, departments may write to the DAS for the opening of an Advance
Account for debiting the amount to be claimed, and should credit the Advance Account
immediately after the claims have been settled.
965.
Departments may not lodge claims on the appropriate parties if the amount of
breakages or deficiencies of stores received does not exceed $1,000 ledger value, and the
stores involved are not essential. Under such circumstances, departments may write off the
items in accordance with SPR 1040(b).
CHAPTER X
STOCK VERIFICATION AND WRITE-OFF
STOCK VERIFICATION
1000. (a)
The following bodies may verify the stocks of government stores held by
departments on ledger charge —
(i)
Supplies Surveys and Stock Verification Section of GLD;
(ii)
Board of Survey appointed by DGL;
(iii) Departmental Stock Verification Team appointed by the CO; and
(iv) Special Board of Survey appointed by the Chief Secretary for
Administration.
(b)
Except in the case of a Special Board of Survey, DGL determines the checking
and verifying criteria for verification of stocks of government stores by the
bodies listed in SPR 1000(a). PS(Tsy) may amend or make exceptions to the
prescribed criteria.
GLD Supplies Surveys and Stock Verification Section
1005. (a)
The Supplies Surveys and Stock Verification Section of GLD verifies
completely or randomly stocks of government stores held by departments
according to prescribed criteria at least once every three years.
(b)
The DGL lays down the procedures for the supplies surveys and stock
verification exercises conducted by the Supplies Surveys and Stock
Verification Section of the GLD. The terms of reference of the Section are as
follows –
(i)
to compare ledger balances with quantities found in stock and to report
any discrepancies;
(ii)
to examine the general conditions of the stores held in stock and the
stock control system with particular reference to dormant and excessive
stocks;
(iii) to advise on the arrangements for the security of stores; and
(iv) to conduct compliance checks on stores management and procurement
activities performed by the departments to ensure compliance with the
Regulations and other relevant instructions.
(c)
On completion of the supplies survey and stock verification exercise, the DGL
should forward a report on details of the findings together with
recommendation to the CO concerned for follow up action and making
improvements, copying it to D of A.
Boards of survey
1010. (a)
DGL appoints Boards of Survey to verify stocks of government stores held by
departments, which the Supplies Surveys and Stock Verification Section of
GLD is unable to verify within the approved checking period stipulated in
SPR 1005(a). Unless the DGL has authorised otherwise, such Boards do not
include any staff of the department concerned, and their terms of reference are
as follows —
(i)
to confirm that the balances of stores on charge are actually in stock and
to report any discrepancies;
(ii)
to report on any stores which are found not taken on charge; and
(iii) to report on the general conditions of stores in stock.
(b)
On completion of the survey, the Chairman of the Board should submit to the
DGL a Report of Board of Survey on Stores (GF 236), attaching a
Departmental Stocktaking Schedule of Discrepancies (GF 241).
(c)
DGL should forward the Report (GF 236) to the CO concerned for necessary
action required under SPR 1030-1065, copying it to D of A.
Departmental stock verification team
1015. (a)
In addition to the stock verification by either the Supplies Surveys and Stock
Verification Section of GLD or Boards of Survey, CO may appoint public
officers of his department to inspect and verify completely stocks of all items
held on ledger charge in all stores under his control by following the
procedures set out in (b) and (c) below.
(b)
Unless otherwise approved by the DGL, the appointed officers should inspect
and verify —
(i)
progressively, in the case of large store, ensuring that each item is
checked at least once every three years. COs should, where necessary,
arrange more frequent verifications and inspections to be carried out;
(ii) completely, stores by stores in the case of small stores, at least once a
year, and preferably about six months after the last verification by either
the Supplies Surveys and Stock Verification Section of the GLD or a
Board of Survey; and
(iii) completely, stores by stores, immediately prior to and immediately
following the transfer of stores from one storage area to another.
(c)
The inspection and verification should include —
(i)
a comparison of the ledger balances with the actual stocks, and a report
of the surpluses and deficiencies on a GF 241;
(ii)
an examination of the conditions of the items of stores and the manner
in which they are stored; and
(iii) an examination of the conditions of the warehouses, yards, locks and
fastenings for the storage of stores.
1020.
On completion of the inspection and verification in the case of either
SPR 1015(b)(ii) or (b)(iii), and monthly in the case of SPR 1015(b)(i), the appointed officers
forward their reports together with recommendations, on the Departmental Stocktaking
Report (GF 237), to the CO concerned for necessary action required under SPR 1030-1065 in
respect of any discrepancies.
Special boards of survey
1025. (a)
The Chief Secretary for Administration may appoint a Special Board of
Survey where there is reason to believe that losses of stores have been caused
by fraud or gross negligence, or in other circumstances as deemed necessary.
The Chief Secretary for Administration will determine the specific terms of
reference and responsibilities of the Board.
(b)
On completion of the survey, the Chairman shall prepare a report containing a
detailed account of the findings and recommendations of the Board in
accordance with the specific terms of reference, and forward the report, in
quadruplicate, through the DGL who detaches one copy and passes the other
three to the Chief Secretary for Administration with his comments.
PROCEDURES FOR DEALING WITH DISCREPANCIES
1030.
When a CO becomes aware of any discrepancies between the physical and
ledger balances of stores under his control, he will arrange to —
(a)
account for any deficiencies by a Departmental Combined Requisition and
Issue Voucher (GF 277), which should bear a reference to the appropriate
authority for the necessary adjustment made; and
(b)
take on charge any surplus by a Departmental Stores Return Note (GF 278).
1035. (a)
The CO concerned should
report immediately in writing all cases of loss or
deficiency where fraud, suspected fraud or negligence is involved to the DGL,
copying it to PS(Tsy), DAS and D of A. The CO concerned should make a
report to the police if the losses or deficiencies involve a criminal act or
suspected criminal act.
(b)
The CO should then
investigate the loss or deficiency and forward his report,
to be supported by the police report if appropriate, to the DGL, copying it to
PS(Tsy), DAS and D of A. He has to include in the report his
recommendations for clearing the loss or deficiency, any necessary action
taken against the public officer(s) responsible, and a statement of the steps
taken to prevent a recurrence. Where appropriate, he should submit monthly
reports on the progress of the investigation.
(c)
Where appropriate, the DGL
may conduct enquiries into the loss or
deficiency, and submit his recommendations to the PS(Tsy), copying them to
DAS and D of A.
(d)
Where negligence (but not fraud or suspected fraud) is involved and the value
of the lost items does not exceed $50,000, the CO, after conducting an
investigation of a case of loss or deficiency in accordance with SPR 1035(b),
may, subject to DGL’s advice,
arrange to write off the loss or deficiency in
accordance with SPR 1070 or consider asking the public officer(s) concerned
to
replace the lost or deficient stores in accordance with SPR 1075. PS(Tsy)’s
approval has to be sought where DGL’s advice does not agree with that of the
CO.
(e)
Where fraud, suspected fraud or negligence is involved, the CO should
submit an application in respect of each case to the
PS(Tsy) for the write-off
of losses or deficiencies, using an Application for Write-off under
SPR 1070(a)(ii) (GF 403), copying it to DAS, D of A and DGL. Except for
cases described in (f) below, this procedure should be followed, irrespective of
the amount involved.
(f)
For the purposes of write-off, departments should treat any loss arising from
theft or suspected theft as a loss involving fraud or negligence on the part of a
public officer. The only exception for this treatment is when such a loss does
not exceed $50,000 in value, for which departments may, on completion of a
departmental investigation,
write off departmentally on a Record of Lost or
Deficient Stores Written-off (GF 190) in accordance with the authorities stated
in SPR 1070(a)(i).
1040. (a)
Where no fraud, suspected fraud or negligence is involved but where the
amount in any one case exceeds $750,000, the CO has to submit an
application to the PS(Tsy) as soon as possible for the write-off of losses or
deficiencies, using an Application for Write-off under SPR 1070(b)(v)
(GF 402), copying it to DAS, D of A and DGL with supporting information set
out in Annex B of FC No. 5/2017.
(b)
Where no fraud, suspected fraud or negligence is involved and where the
amount of loss or deficiency in any one case does not exceed $750,000, COs
may write off such an amount on a GF
190 in accordance with
SPR 1070(b)(i)-(iv). When approving the write-off, the public officer with the
delegated authority needs to sign on the GF 190 personally and certify in each
case that —
(i)
no fraud, suspected fraud or negligence is involved;
(ii)
an investigation and a record have been made of the circumstances and,
where appropriate, steps have been taken to prevent a recurrence;
(iii) the amount is not in excess of his delegated authority; and
(iv) he is satisfied that the stores are irrecoverable.
(c)
Departments should submit a half-yearly return to the PS(Tsy) on the Half
Yearly Return of Lost or Deficient Stores Written-off under SPR 1040(b)
(GF 401), showing the description and amount written off in respect of each
case during the first/second half of a financial year. Returns must be submitted
within two months after the end of the reporting period, with copies to the
DAS, D of A and DGL. A nil return is required.
1045.
In respect of deficiencies appearing in the Stock Movement Journal of the
GLD, the DGL has the authority to write off deficiencies up to a value of $50,000 in any one
month, provided that such deficiencies are not caused by fraud, suspected fraud or negligence.
1050.
If any surplus stock of a value exceeding $50,000 in respect of one store is
found, the CO will report to the DGL, and copy it to PS(Tsy), DAS and D of A.
1055.
For the purpose of these Regulations, “value” means the GLD stock price or
the original purchase cost or, where neither of these can easily be determined, the replacement
cost.
1060.
COs are responsible for investigating the practicability of protective measures
for safeguarding government property.
1065.
These Regulations, in no way, inhibit the DAS, D of A or DGL from
conducting an investigation into any losses or deficiencies which they consider necessary.
AUTHORITY FOR WRITE-OFF OF LOST/DEFICIENT STORES
1070.
The authorities for approving the write-off of any loss or deficiency of stores
are as follows —
(a)
Where caused by fraud, suspected fraud or negligence of a public officer —
(i)
in respect of cases involving theft or suspected theft as described in
SPR 1035(f) —
Value of stores in each case or
in respect of any one cause
Authority
Not exceeding $10,000
Deputy/Assistant
Head
of
Department/ Bureau of D2/DL2
rank or above
Not exceeding $50,000
Head of Department/ Bureau or
CO personally (irrespective of
rank)
(ii)
in all other cases –
Not exceeding $500,000
PS(Tsy)
Exceeding
$500,000
Finance Committee of the
Legislative Council
(b)
Where not caused by fraud, suspected fraud or negligence of a public officer
(with the exception of those cases described in SPR 1045) —
Value of stores in each case or
in respect of any one cause
Authority
(i)
Not exceeding $7,500
Departmental Secretary ranked
at or above Point 45 of the
Master Pay Scale or other public
officers of equivalent rank who
oversee stores and supplies
matters as designated by CO
(ii)
Not exceeding $30,000
Directorate Officer of D1/DL1
rank
(iii) Not exceeding $150,000
Deputy/Assistant
Head
of
Department of D2/DL2 rank or
above
(iv) Not exceeding $750,000
Head of Department/Bureau or
CO personally
(v)
Exceeding
$750,000
PS(Tsy)
REPLACEMENT OF STORES
1075.
The CO, or his designated directorate officer of seniority at least one
substantive rank higher than the public officer(s) involved in the loss or deficiency, may
approve the replacement of the lost or deficient item(s) by the public officer(s) concerned
provided –
(a)
no fraud or suspected fraud is involved,
(b)
the total value of such loss or deficiency
does not exceed $50,000 in value,
and
(c)
the CO or his designated directorate officer is satisfied that replacement by the
public officer(s) would be
reasonable having regard to the duty to protect
public funds and the circumstances leading to the loss or deficiency.
In these cases, when the public officer concerned has replaced the loss or deficiency on
repayment basis, no write-off of such loss or deficiency on GF 190 is necessary. The DSM
will support the replacement issue from stock by a Departmental Combined Requisition and
Issue Voucher (GF 277), with the relevant demand note number quoted thereon.
SURCHARGE
1080. (a)
The CO, after conducting an investigation in accordance with SPR 1035(b),
may recommend in his report to the PS(Tsy) to surcharge the public officer
concerned under section 32 of the Public Finance Ordinance for the deficiency
in, or loss or destruction of, or damage to stores for which he is responsible.
Unless otherwise authorised by the PS(Tsy), departments should calculate the
proposed charge as follows —
(i)
for new items—the current replacement cost plus an additional charge
of 20% for overheads;
(ii) for used items—the greater of the scrap value or the depreciated value
of the item(s), plus an additional charge of 20% for overheads; and
(iii) for damaged items which are not beyond economical repair—the cost of
repair plus an additional charge of 20% for overheads.
(b)
The depreciated value of an item is calculated using the following formula —
unexpired useful life span
current replacement cost ×
useful life span
(c)
The current replacement cost, life span, scrap value and repair cost of an item
are determined by the GLD and the specialist department(s) responsible for the
procurement, maintenance or repair of the item. Where the item is out of
production, or the current replacement cost for the item is unknown, the
current price of the equivalent substitution will be used for calculating the
replacement cost. In case a public officer objects to the Government’s
valuation, he may, at his own expense, appoint an independent valuer
approved by the Government for the purpose of proposing an alternative
valuation. The valuation made by this independent valuer will be binding on
both the public officer and the Government.
1085.
The PS(Tsy) shall process all cases referred to in SPR 1080 in accordance with
the guidelines and procedures set out in the prevailing FC on surcharge.
CHAPTER XI
DISPOSAL OF SURPLUS STORES
SCOPE
1100.
These regulations apply to the disposal of store items that have become surplus
to the requirements of a department. They cover all stores, inventory as well as non-inventory
items which are serviceable or otherwise. Items that can be used for trade-in purposes are not
counted as surplus stores.
DEPARTMENTAL DISPOSAL AUTHORITY
1105.
Each CO shall appoint a Departmental Disposal Committee (DDC) comprising
a chairman who is a public officer at or above senior professional level and at least two other
members (at or above the rank of an Assistant Supplies Officer or Executive Officer II or
equivalent) from within his department.
1106.
A DDC may approve the disposal of surplus stores items with a value at or
below the quotation limit for procurement of stores specified in SPR 220(a). A DDC may
sub-delegate its work relating to the disposal of non-inventory unserviceable stores items to
designated officers not lower than the rank of an Assistant Supplies Officer or Executive
Officer II or equivalent. CO or a directorate officer designated by him may, on the
recommendation of the DDC, approve the disposal of surplus stores items exceeding the
approval limit of the DDC.
1107.
“Value” means the GLD stock price or the original purchase cost or, where
neither of these can easily be determined, the replacement cost. The threshold specified in
SPR 1106 may apply to the value of each individual surplus stores item or if there are separate
items, the collective value of all the items concerned in each case or in respect of any one
cause.
1108.
A CO may decide the exact mode of operation for his DDC provided that the
DDC operates in a transparent manner and sufficient checks and balances are in place.
DISPOSAL PROCEDURES
1110.
Departments shall follow the key steps summarised below and explained in
greater detail through other regulations in this Chapter —
Disposal of Surplus Stores
Surplus store item
Is it an inventory item
under
SPR 710 or 775?
Yes
No
(Inventory)
(Non-inventory)
Is it
Is it
serviceable
serviceable
(SPR 1115)?
(SPR 1115)?
No
No
Yes
Yes
DDA may
dispose of the
Is it covered
item by dumping
by GLD
Is it a GLD
(SPR1120)
term
unallocated
contract or
store item
waiver list?
(SPR 1130)?
Yes
No
No
Yes
DDA may
Return to GLD
dispose of the
Does it have
(SPR 875)
item by
residual value
dumping
(SPR 1126)?
(SPR1125)
No
Yes
DDA may
Notify GLD to post a notice
dispose of the
on CCGO
item by
(SPR 1135)
dumping
(SPR 1126)
Is it
wanted?
Yes
No
Consider disposal through
Consider disposal through
Arrange transfer under
donation, commercial disposal, or
donation, commercial disposal, or
SPR 1136
as last resort, dumping under
as last resort, dumping under
SPR 1137-1151
SPRs 1137-1151
DISPOSAL OF UNSERVICEABLE STORES ITEMS
1115.
The decision on whether or not a surplus stores item is serviceable rests with
the departmental disposal authority (DDA) which, depending on the value of the stores items
to be disposed, may be the DDC or a designated officer specified in SPR 1106.
Non-inventory
1120.
A DDA may arrange to dump a non-inventory stores item which is found to be
unserviceable, i.e. unsuitable for use either because it is worn out or broken and is certified by
the supplier, competent technician or technical department to be beyond economical repair; or
because it is technically obsolete.
Inventory
1125.
A DDA may dispose of an unserviceable inventory store item —
(a)
by selling it to a term contractor if it is an article or material covered by the
disposal term contracts arranged by the GLD; or
(b)
by dumping it direct if it is of such low value as to be covered by a waiver list
which the GLD regularly publishes on its webpage.
1126.
If the unserviceable inventory stores item is not covered by SPR 1125 and the
DDA considers that it may have residual value of some kind (for display, training, or
preservation, etc.), the DDA shall arrange for its disposal in accordance with SPR 1135-1151.
Otherwise, the DDA may dispose of the item by dumping.
DISPOSAL OF SERVICEABLE STORES ITEMS
GLD unallocated stores items
1130.
A DDA should return serviceable GLD unallocated stores items to the GLD in
accordance with SPR 875. A DDA shall follow the procedures set out in SPR 1135-1151 for
the disposal of all serviceable allocated stores items, inventory as well as non-inventory.
Items that may be wanted by other departments
1135.
If a surplus stores item under SPR 1126 or 1130 is available, a DDA should
ascertain whether it is needed within other parts of the Government, by requesting the DGL to
post a notice on the Central Cyber Government Office (CCGO) to publicise the availability of
the surplus stores item. The releasing department should provide details on the condition of
the surplus stores items (including whether they are still serviceable, and whether spare parts
are available, etc.) and a contact point for follow-up enquiries. The DGL updates the relevant
website at least once a week and posts individual notices of availability on the CCGO for no
less than ten working days.
1136.
If another department indicates interest in receiving the concerned surplus
stores item the releasing and receiving departments should make their own arrangements for
transfer and reconciliation of necessary accounts and inventory lists, etc., in line with
SPR 865. The same procedures will apply to the transfer of surplus stores items between
trading funds and government departments, except that such a transfer may be subject to a
charge on the receiving department; the proposed level of charges should be made on the
notice. The releasing department should consider competing bids for surplus stores items on a
first-come-first-served basis.
1137.
When, after action is taken under SPR 1135, a DDA establishes that a surplus
stores item is not wanted within the Government, it shall consider whether to dispose of it
through donation, commercial disposal or dumping. Donation and commercial disposal
should be considered in parallel and the final decision depends on the merits of each case. In
general, factors including the residual value, resaleable value and the public interest should be
taken into consideration. On the resaleable value, advice from DGL should be sought where
appropriate.
Donation
1140.
A DDA may, either at its own initiative or upon request, donate a surplus
stores item to non-government organisations subject to the following conditions —
(a)
the recipient organisations must be established solely or principally for
educational, scientific, cultural or charitable purpose;
(b)
the recipient organisations will only use the surplus stores items for
non-profit-making purpose; and
(c)
the provision of surplus stores items will not have any capital or recurrent
expenditure implications on the Government.
1141.
If the value of the surplus stores items to be donated exceeds $200,000 in each
case or in respect of any one cause, the releasing department must seek the prior approval of
PS(Tsy).
1142.
The prior approval of the Finance Committee must be sought for a donation
that does not meet the conditions specified in SPR 1140.
1143.
If a DDA decides to make a donation of surplus stores items, it may liaise with
the relevant non-government organisations either directly or through the DGL as co-ordinator.
If the non-government organisations agree to receive the surplus stores items, the releasing
department should directly arrange to issue the items to the organisations concerned after
obtaining the necessary approval provided under SPR 1140-1142. The releasing department
should provide details of the donation (e.g. the name of the recipient organisations, the
description of stores items and the quantity) to the DGL for record.
1144.
If there are more applications for surplus serviceable stores items than the
stock of stores available, the DGL will advise the releasing department concerned as to whom
and what surplus stores items and quantities to be donated, having regard to the past donation
records to ensure equity.
Commercial disposal
1145.
If a DDA considers that a surplus stores item has saleable value, it shall request
the DGL to arrange for commercial disposal of the stores item. DGL may advise the
department to sell the stores item to the GLD disposal term contractors direct or arrange for a
quotation, a tender or an auction exercise, having due regard to the value of the stores item
and the cost-effectiveness of various disposal options. Under exceptional circumstances,
departments may seek PS(Tsy)’s approval for selling their surplus stores by means other than
those set out in this Regulation. Application should be submitted through DGL with full
justifications.
Dumping
1150.
If a DDA is satisfied that a surplus stores item, which has been established as
not wanted within the Government, is not fit for donation, and commercial disposal is not
cost-effective, it may arrange to dump the item.
1151.
If a department decides to dump a surplus stores item that does not fully meet
the foregoing conditions, it shall seek the prior consent of DGL who, if in doubt, shall consult
PS(Tsy).
PROPER ACCOUNTING FOR STORES
1155.
Whatever the method of disposal, COs are responsible to ensure that the
movement of stores is properly recorded and accounted for, in line with the requirements in
Chapter VII of these Regulations (Accounting for Stores) and for items dumped, follow the
format set out at Appendix VII.
CHAPTER XII
DISPOSAL OF DANGEROUS OR CONFISCATED GOODS
DISPOSAL OF MATERIALS IN A DANGEROUS CONDITION
1200. (a)
When CO considers that any materials under his control are in dangerous
condition and might endanger life or property, he may authorise immediate
disposal of the materials. He should consult the Director of Fire Services,
Government Chemist, or Senior Physicist in-charge, Radiation Health Unit of
the Department of Health as appropriate.
(b)
CO should keep proper records on all such disposals, following the format set
out at Appendix VII.
DISPOSAL OF CONFISCATED GOODS
1205.
The department which initiates the confiscation of goods under the relevant
legislation will hand over all the goods confiscated to those departments ultimately
responsible for their disposal in accordance with the relevant legislation and/or standing
instruction from the Financial Secretary (see SPR 1215 and 1220).
1210.
When handing over the confiscated goods, the department should present a
Confiscation Order (GF 83), bearing reference to the legislation or authority (either a Court or
a public officer empowered by the relevant ordinance) under which the confiscation has been
ordered. The Confiscation Order should be distributed as follows —
Original
— To the officer-in-charge of the case for attachment to the
charge sheet or relevant document.
Duplicate
— To be retained by the office which issues the GF 83.
Triplicate
— To the department which receives the confiscated goods
to support entry in the forfeited goods ledger.
Quadruplicate — To the department which initiates the confiscation.
1215.
The following departments are responsible for the disposal of the specific
categories of confiscated goods —
Department Confiscated
Goods
Agriculture, Fisheries and (a) Tree
Wood
Conservation Department
(b)
Fish
Civil Engineering and
(c) All dangerous goods listed in Category
Development Department
I of the Dangerous Goods (Application
and Exemption) Regulations
(Cap. 295) other than ammunition
(d) Minerals (confiscated under the
Mining Ordinance (Cap. 285))
Customs and Excise
(e) All goods including kerosene, gasoline
Department
and diesel fuel, to which the Dutiable
Commodities Ordinance (Cap.
109)
applies, and rice and dried food not fit
for human consumption
EMSD
(f) Liquefied petroleum gas as prescribed
in the Gas Safety Ordinance (Cap. 51)
Fire Services Department
(g) All dangerous goods listed in the
Dangerous Goods (Application and
Exemption) Regulations (Cap.
295)
other than those in Category I,
kerosene, gasoline and diesel fuel, and
liquefied petroleum gas as prescribed
in the Gas Safety Ordinance (Cap. 51)
Food and Environmental
(h) Perishable goods for destruction
Hygiene Department
Hong Kong Police Force
(i) Arms and ammunition
(j) Counterfeit currency (bank notes and
coins) as prescribed in Standing
Accounting Instruction 1971
Hong Kong Police Force or (k) Dangerous drugs paraphernalia
Customs and Excise
Department
Hong Kong Police Force or (l) Dangerous drugs as prescribed in the
Department of Health
Dangerous Drugs Ordinance
(Cap. 134) and dried food not fit for
human consumption
Treasury
(m) Currency as prescribed in Standing
Accounting Instruction 1970
1220.
DGL is responsible for the disposal of any other confiscated goods not listed in
SPR 1215. The department which initiates the confiscation will report to the DGL who, after
assessing the transportation and storage costs likely to be incurred, will decide on the most
appropriate disposal method and arrangements.
1225.
The following COs are empowered to destroy the specific categories of goods
which are confiscated under the relevant ordinances —
CO
Confiscated Goods
Commissioner of Customs (a) Goods of a perishable nature or the sale
and Excise
of which will give rise to a harmful
effect to the public
Import and Export Ordinance (Cap. 60)
(b) Obscene books, films, magazines,
photographs, etc.
Post Office Ordinance (Cap. 98)
(c) Goods bearing a forged trade mark or to
which a false trade description is
applied and where obliteration of such
markings or description is inapplicable
Trade Descriptions Ordinance
(Cap. 362)
(d)
Items infringing copyrights and
unsuitable for public sale
Copyright Ordinance (Cap. 528) and
Prevention of Copyright Piracy
Ordinance (Cap. 544)
Commissioner of Customs (e) Controlled chemicals
Note 1
and Excise and Commissioner
Control of Chemicals Ordinance
of Police
(Cap. 145)
(f) Obscene publications, video tapes,
video compact discs, photographs,
etc. Note 2
Control of Obscene and Indecent
Articles Ordinance (Cap. 390)
Commissioner of Customs (g) Indecent articles not complying with
and Excise, Commissioner of
statutory requirements for their
Police and Director of Film,
publication Note 2
Newspaper and Article
Control of Obscene and Indecent
Administration
Articles Ordinance (Cap. 390)
Commissioner of Police and (h) Hawker’s equipment, carts, trolleys and
Director of Food and
stalls
Environmental Hygiene
Public Health and Municipal Services
Ordinance (Cap. 132)
Note
1. Exceptions —
Chemicals which are suitable for laboratory use such as cholesterol test, or
having a saleable value, will be dealt with in accordance with SPR 1220.
2. Exceptions —
Machinery or apparatus for projecting or showing and/or plates,
instruments or utensils used for printing which are considered suitable for
public sale, will be dealt with in accordance with SPR 1220.
1230.
In the case of perishable goods handed over to recognised charitable
institutions, the releasing department will require the receiving institution to sign the triplicate
of GF 83 and return it to the issuing department. In such cases, the quadruplicate of GF 83
will not be used.
1235.
In the case of goods earmarked for destruction, public officers carrying out the
destruction will certify destruction on the triplicate of GF 83, and in such cases, the
quadruplicate of GF 83 will not be used.
Appendices
Appendix I
(A) Specimen Declaration and Undertakings by Public Officers Involved
in Preparing Tender Documentation (including Tender
Specifications and Marking Schemes), Assessing Tenders and
Conducting Tender Negotiations
(B)
Specimen Undertakings by Head or Chairperson, Members and/or
Secretary of Tender Opening Teams/Departmental Tender
Committees/Departmental Consultants Selection
Committees/Tender Boards/Consultants Selection Boards
(C)
Declaration and Undertakings by Technical Advisor who are not
Public Officers
Appendix II
Endorsement Authorities and Procurement Agents for Specific
Stores
Appendix III
(A) Specimen Notice for Approved Lists of Qualified
Contractors/Suppliers/Service Providers for Selective Tendering
(B)
Specimen Application for Authority to Prequalify Tenderers
(C)
Specimen Gazette Notice for Prequalification of Tenderers
(D)
Specimen Application for Approval of Prequalified Tenderers
(E)
Specimen Gazette Tender Notices
(E)1
Note to Tenderers
(to be included in tender documents for tenders covered by
WTO GPA)
(E)2
Note to Tenderers and Condition of Tender
(to be included in tender documents for tenders invited from
contractors/suppliers/service providers in both the private and public
sectors including department(s) of the Government of the Hong
Kong Special Administrative Region whose operation of the
services is managed and accounted for by trading funds established
pursuant to the Trading Funds Ordinance, Cap. 430)
(F)
Guidelines for Drawing Up Tender Specifications
(G)
Guidelines for Adopting a Marking Scheme for Tender Evaluation
(G)1
Guidelines on Tender Assessment Panel
(H)
Guidelines for Financial Vetting of Recommended Tenderers for
Service Contracts
(I)
Standard Tender Report Format
(J)
Guidelines for Tender and Contract Negotiations
Appendix IV
(A) Specimen Submission for CCSB Stage 1 Approval
(B)
Specimen Submission for CCSB Stage 2 Approval
Appendix V
(A) Guidance Notes on Execution of Contracts
(B)
Schedule of Authorities for Variation of Contracts
(C)
Guidelines for Monitoring Performance of Consultants Appointed
under the Central Consultants Selection Board Procedures
Appendix VI
Guidelines for Keeping Stores Records and Issuing Stores
Appendix VII
List of Stores for Dumping
Appendix I (A)
Declaration and Undertakings by Public Officers Involved
in Preparing Tender Documentation (including Tender Specifications
and Marking Schemes), Assessing Tenders and
Conducting Tender Negotiations
(SPR 186)
[Tender Reference and Subject]
I hereby declare that there is no conflict of interest, whether actual, potential or
perceived, between my official duties to the Government in relation to the captioned tender
exercise, including without limitation those in relation to the preparation of the tender
documentation (including tender specifications and marking schemes), the assessment of
tenders and the conduct of negotiations, and my financial, professional, commercial, personal
or other interests.
2.
I undertake to —
(a) hold in strict confidence all tender information that I have access to
through my official duties to the Government in relation to the captioned
tender exercise, including without limitation those in relation to the
preparation of the tender documentation (including tender specifications
and marking schemes), the assessment of tenders and the conduct of
negotiations. Tender information includes details of tenders received
and any other sensitive, restricted or confidential information relating to
a tender;
(b) refrain from making any unauthorised disclosure or taking advantage of
any tender information referred to in paragraph 2(a) above whether or
not for personal gain;
(c) declare any actual, potential or perceived conflict of interest with my
official duties to the Government in relation to the captioned tender
exercise, including without limitation those in relation to the preparation
of the tender documentation (including tender specifications and
marking schemes), the assessment of tenders and the conduct of
negotiations immediately when I become aware of any such conflict;
and
(d) take steps to avoid any conflict of interest with any potential tenderer or
tenderer by not putting myself in a position of obligation towards any of
them; for example, by not accepting any favour or lavish or excessive
entertainment, and not over-socialising with any of them.
3.
The undertakings in paragraphs 2(a) and (b) above shall not apply —
(a)
if and when the disclosure and information therein referred to becomes a
matter of public knowledge (other than by reason of a breach of
paragraphs 2(a) and (b) above); or
(b) to any communications or disclosures caused or permitted by me to
colleagues in the Government who are or are expected to be involved in
the course of their official duties in the captioned tender exercise or
parts thereof.
(c) to disclosures of any information in circumstances where such
disclosure is required pursuant to any law, regulation, rule of any
relevant stock exchange, or order of a court or arbitral authority of
competent jurisdiction.
4.
I understand that I may be subject to disciplinary action should I make a false
declaration or fail to observe any of my above undertakings.
Signed :
Name (block letters)
:
Title/Rank :
Date :
Appendix I (B)
Undertakings by Head or Chairperson, Members and/or Secretary of
Tender Opening Teams/Departmental Tender Committees/Departmental
Consultants Selection Committees/Tender Boards/
Consultants Selection Boards
(SPR 187)
I undertake to hold in strict confidence all tender information that I have access
to through my position as a head/chairperson/member/secretary of the above Tender Opening
Team/Departmental Tender Committee/Departmental Consultants Selection Committee/
Tender Board/Consultants Selection Board. Tender information includes details of tenders
received and any other sensitive, restricted or confidential information relating to a tender.
2.
I undertake not to make any unauthorised disclosure or take advantage of any
tender information referred to in paragraph 1 above whether or not for personal gain.
3.
I undertake to declare any actual, potential or perceived conflict of interest
with my official duty as a head/chairperson/member/secretary of the Tender Opening
Team/Departmental Tender Committee/Departmental Consultants Selection Committee/
Tender Board/Consultants Selection Board immediately when I become aware of any such
conflict.
4.
I undertake to take steps to avoid any conflict of interest with any potential
tenderer or tenderer by not putting myself in a position of obligation towards any of them; for
example, by not accepting any favour or lavish or excessive entertainment, and not
over-socialising with any of them.
5.
I understand that I may be subject to disciplinary action should I fail to observe
any of my above undertakings.
Signed :
Name (block letters)
:
Title/Rank :
Date :
Appendix I (C)
Declaration and Undertakings by
Technical Advisor who are not Public Officers
(SPR 197 and Appendix III(G)1)
[Tender Reference and Subject]
To: The Government of the Hong Kong Special Administrative Region (“Government”)
I hereby declare that there is no conflict of interest, whether actual, potential or
perceived, between my role as the technical advisor in relation to the captioned tender
exercise and my financial, professional, commercial, personal or other interests.
2.
I undertake to —
(a) hold in strict confidence all tender information that I have access to
through my role as the technical advisor in relation to the captioned
tender exercise. Tender information includes details of tenders received
and any other sensitive, restricted or confidential information relating to
a tender;
(b) refrain from making any unauthorised disclosure or taking advantage of
any tender information referred to in paragraph 2(a) above whether or
not for personal gain;
(c) declare any actual, potential or perceived conflict of interest with my
role as the technical advisor in relation to the captioned tender exercise
immediately when I become aware of any such conflict;
(d) take steps to avoid any conflict of interest with any potential tenderer or
tenderer by not putting myself in a position of obligation towards any of
them; for example, by not accepting any favour or lavish or excessive
entertainment, and not over-socialising with any of them;
(e)
perform my role as the technical advisor on a professional and impartial
basis in accordance with applicable professional standards in the Hong
Kong and international markets; and
(e)
not to offer, solicit or accept any advantage as defined in the Prevention
of Bribery Ordinance (Cap. 201 of the Laws of Hong Kong) in relation
to my duties as the technical advisor in the captioned tender exercise.
3.
The undertakings in paragraphs 2(a) and (b) above shall not apply —
(a)
if and when the disclosure and information therein referred to becomes a
matter of public knowledge (other than by reason of a breach of
paragraphs 2(a) and (b) above);
(b) to any communications or disclosures caused or permitted by me to the
public officers of the Government who are or are expected to be
involved in the course of their official duties in the captioned tender
exercise or parts thereof; or
(c) to disclosures of any information in circumstances where such
disclosure is required pursuant to any law, regulation, rule of any
relevant stock exchange, or order of a court or arbitral authority of
competent jurisdiction.
4.
I agree that in the event of any breach or threatened breach of the provisions of
this Declaration and Undertakings, money damages are unlikely to be a sufficient remedy and
the Government shall be entitled, in the discretion of the court, to an injunction to restrain the
said breach or threatened breach in addition to and not in lieu of any other equitable or any
legal relief including damages.
5.
Each of the provisions of this Declaration and Undertakings is severable and
distinct from the others and, if one or more of such provisions or any part thereof is or
becomes illegal, invalid or unenforceable, the legality and enforceability of the remainder of
this Declaration and Undertakings shall not be affected or impaired in any way.
6.
This Declaration and Undertakings shall be subject to and construed in
accordance with the laws of Hong Kong.
In witness whereof, this Declaration and Undertakings has been executed and delivered as a
deed on the date written below.
Signed, sealed and delivered
)
by
[name of individual] on
[date]
)
[signature of individual]
as his deed in the presence of:
)
[affix seal]
[signature of witness]
Name:
[witness name] Address:
[witness address]
Appendix II
Endorsement Authorities and Procurement Agents for Specific Stores
(SPR 210)
Endorsement #Procurement
Stores
Reference
Authority
Agent
I. Safes combined with steel filing cabinet Secretary for
DGL Standing Accounting
maintained in GLD’s unallocated stock
Security and/or
Instructions 1835 and
DAS
1845
Security Regulations
II. Stores items not included under I. above and
those items not covered by standard stores
items available for drawing off by
departments from GLD’s term contracts -
(financial limits refer to unit cost of items)
1. Furniture and equipment items
(A) Specific furniture and equipment
items regardless of costs
(a)
All forms of receipting
DAS
DGL or user FC No. 3/2016
equipment
department Standing Accounting
Instruction 216
(b)
Computer
systems/equipment
(i) Administrative
computer Government
DGL or user Office of the Government
systems
Chief Information department Chief Information Officer
Officer
Circular No. 3/2007
(ii)
Systems/equipment
Government
DGL or user Office of the Government
connected to existing
Chief Information department Chief Information Officer
system
Officer
Circular No. 3/2007
(c)
Furniture
and
equipment
for
projects in the Public Works
Programme except hospital,
clinic and standard primary and
secondary schools projects
(i) Furniture
and
equipment Head of user
DGL or user FC No. 3/2016
not exceeding $5 million
department
department
per department per
project
(ii)
Furniture
and
equipment Government
DGL or user FC No. 3/2016
exceeding $5 million but
Property
department
not exceeding $30 million Administrator
per department per
project
(iii)
Furniture
and
equipment PS(Tsy)
DGL or user FC No. 3/2016
costing over $30 million
department
per department per
project
# For those stores with “DGL or user department” shown as the procurement agent, DGL is the procurement
agent where the value of the stores to be procured exceeds the departmental limit set out in SPR 220(a).
Endorsement #Procurement
Stores
Reference
Authority
Agent
(d)
Furniture
and
equipment
for Secretary for
DGL (for
FC No. 3/2016
hospital and clinic projects in Health (S for
clinic projects)
the Public Works Programme
Health) or other
or user
directorate
department
officers in Health
Bureau whom S
for Health has
delegated such
authority
(e)
Furniture
and
equipment
for Secretary for
DGL or user FC No. 3/2016
standard primary and secondary Education or
department
schools projects in the Public other directorate
Works Programme
officers in the
Education Bureau
(EDB), subject to
the annual cost
ceiling for
respective school
types specified by
the Treasury
Branch of the
Financial
Services and the
Treasury Bureau
or EDB
(f)
Safes
not
maintained
in
GLD’s Secretary for
DGL or user FC No. 3/2016
unallocated stock
Security and/or
department Standing Accounting
DAS
Instructions 1835 and
1845
Security Regulations
(g)
Strongrooms/strongroom
doors Secretary
for DGL or user FC No. 3/2016
Security and/or
department Standing Accounting
DAS
Instructions 1835-1845
Security Regulations
(h)
Secure
telephone
and
facsimile Secretary for
DGL or user Security Regulations
equipment and accessories Security
department General Regulations 625-
including scramblers,
649
encryptors and interface
(B) Equipment items (other than those
included under II.1.(A)) costing
over $50,000 per item
(a)
Computer
systems/equipment
- Government
DGL or user Office of the Government
standalone systems/equipment
Chief Information department Chief Information Officer
not connected to existing
Officer
Circular 3/2007
system
(b)
Printing plants, machinery,
equipment and accessories and
reprographic equipment
# For those stores with “DGL or user department” shown as the procurement agent, DGL is the procurement
agent where the value of the stores to be procured exceeds the departmental limit set out in SPR 220(a).
Endorsement #Procurement
Stores
Reference
Authority
Agent
(i) Photocopying
machines
DGL
DGL
or
user
General Regulation 600
department
(ii)
Optional accessories
DGL
DGL or user General Regulation 600
(including sorting and
department
collating equipment) for
standard and
non-standard model
photocopiers
(iii)
Offset
duplicators
and
DGL
DGL or user General Regulation 600
plate makers
department
(iv)
Folding
machines
DGL
DGL or user General Regulation 600
department
(v)
Sorting/Collating
DGL
DGL or user General Regulation 600
equipment
department
(C)
Radiocommunications apparatus
Director-General DGL or user Cap. 106Z
using radio frequencies^; or an
of
department General Regulation 629(2)
apparatus that may generate radio Communications
General Circular No.
frequency emission exceeding the
9/2016
level permitted under the
Telecommunications (Control of
Interference) Regulations (Cap.
106B)
2.
Other
items
(A) Vehicles and mobile plant
(a)
Vehicles
(i) general
purpose
DGL DGL
General
Regulation
236 (1)
^ Please refer to the Telecommunications (Telecommunications Apparatus) (Exemption from Licensing) Order
(Cap. 106Z) and the list of Class Licences published at the web site of the Communication Authority
(https://www.coms-auth.hk/en/licensing/telecommunications/class/index.html) for radiocommunications
apparatus which do not require endorsement from the Director-General of Communications (DG Com) before
procurement.
Please refer to General Circular No. 9/2016 (as may be updated from time to time) for advice on procurement of
radiocommunications apparatus which requires assignment of specific radio frequency by OFCA and
endorsement from DG Com. Once the user department obtains a valid frequency assignment from OFCA, the
corresponding procurement of apparatus should be deemed to be endorsed by DG Com.
# For those stores with “DGL or user department” shown as the procurement agent, DGL is the procurement
agent where the value of the stores to be procured exceeds the departmental limit set out in SPR 220(a).
Endorsement #Procurement
Stores
Reference
Authority
Agent
(ii)
specialised
DGL
and
user DGL or user General Regulation
department
department or 236 (1)
Electrical and
Mechanical
Services
Trading Fund
as mutually
agreed
between DGL,
user
department
and Electrical
and
Mechanical
Services
Trading Fund
(b) Mobile plant
User department
DGL or
General Regulation
Electrical and 236 (2)
Mechanical
Services
Trading Fund
or user
department
(B)
Vessels
Director of
Director of General Regulation 200
Marine
Marine
# For those stores with “DGL or user department” shown as the procurement agent, DGL is the procurement
agent where the value of the stores to be procured exceeds the departmental limit set out in SPR 220(a).
Appendix III (A)
Specimen Notice for Approved Lists of Qualified
Contractors/Suppliers/Service Providers for Selective Tendering
(SPR 320(e))
Firms on the approved list of qualified contractors/suppliers/service providers
for the provision of (a description of goods, services, or categories thereof) maintained by the
(name of department) are published below for general information —
(List of contractors/suppliers/service providers)
Tender invitations will be (#published in the Government Gazette, on the
Internet, and/or sent by letter to firms on the approved list). The approved list is valid *for
(number of years) year(s) commencing (date) or until it is terminated by separate notice. The
approved list shall be reviewed regularly to ensure that firms who cease to be qualified are
deleted from the list. The concerned contractors/suppliers/service providers will be informed
of the deletion in writing separately.
The following criteria and method of assessment are used for the selection of
qualified contractors/suppliers/service providers for the approved list —
(State the qualification criteria and method of assessment)
Firms interested in providing (a description of goods, services, or categories thereof) and
meeting the above criteria may apply to and obtain all relevant documents relating to the list
from (state the name, address and telephone/fax number/e-mail address of the office, and
other information necessary to contact the office and obtain all relevant documents).
*
The approved list may be used for procurements covered by the Agreement on
Government Procurement of the World Trade Organization.
*
This notice also serves as a summary notice required under the Agreement on
Government Procurement of the World Trade Organization.
Date
Name of Head of Department
# to be amended by the procuring department as appropriate
* delete if not applicable
Appendix III (B)
Specimen Application for Authority to Prequalify Tenderers
(SPR 330(b))
RESTRICTED (TENDER)
MEMO
From : Head of Department
To : Chairman, Central Tender Board
Contract Title
Request for Authority to Prequalify Tenderers
A.
Type and Duration of Contract
B.
Brief Description of Contract
C.
Authority to Call for Tenders
D.
Reasons for Prequalification
E.
Source of Potential Tenderers
F.
Method of Selection of Tenderers
—
Essential requirements and marking scheme including assessment criteria,
weighting attached to each criterion and passing mark(s) for qualification.
—
Number of tenderers to be prequalified.
—
Selection process including membership of selection panel, normally chaired
by a public officer of D2 rank or above.
—
Relevant parts of the prequalification document pertaining to the method of
selection of tenderers. (A specimen format of prequalification document is
appended.)
G.
Availability of Funds
—
Approved project estimate (if applicable)
$ . . . . . . . . . . . . . .
—
Sum allowed for this contract in the approved $ . . . . . . . . . . . . . .
project estimate (if applicable)
—
Funds in (financial year) Estimates
$ . . . . . . . . . . . . . .
(Head . . . . . . Sub-head . . . . . . )
H.
Declaration of Interest
—
Confirm whether public officers involved in preparing prequalification
documentation (including specifications and marking scheme(s)) have
declared their interest in accordance with SPR 186, and state, whether or not
any conflict of interest (actual, potential or perceived) has been identified, and
if yes, what remedial action has been made.
—
Confirm whether the consultant(s) has/have declared their compliance with the
relevant terms and conditions of the Consultancy Agreement on conflict of
interests and confirmed that there was no actual, potential or perceived conflict
of interest in connection with their services in the preparation of
prequalification documents and in the prequalification exercise.
I.
Name and Telephone Number of Contact Officer
—
Public officer(s) who will answer questions from the tender board or attend
board meetings for this item, if necessary.
( )
Signed by a directorate officer
for Head of Department
Annex to Appendix III (B)
Specimen Format of Prequalification Document
Contract Title
Contract No. /Public Works Programme No.
I.
Information to Applicants
—
State the eligibility for application, method of application, closing time for
submission of applications and selection criteria for the prequalification
exercise.
—
State how late submissions, unsuccessful applications, and changes to the
status and proposals of a prequalified tenderer will be handled.
II.
Information on Contract
—
State the scope of the contract, tender documentation, tender programme,
implementation programme, delivery requirements, etc.
III.
Information Required from Applicants
—
Relevant information, including the applicant’s technical and financial
capability for assessment purpose.
Appendix III (C)
Specimen Gazette Notice for Prequalification of Tenderers
(SPR 330(c))
G.N. DEPARTMENT
Contract Title
Contract Number /Public Works Programme Number
NOTICE OF PREQUALIFICATION OF TENDERERS
It is intended to invite tenders in (month and year) from prequalified tenderers
for (state the name, nature and quantity (or where the quantity is not known, the estimated
quantity) of the project/services/goods). *The tenders to be invited will be covered by the
Agreement on Government Procurement of the World Trade Organization and will not
involve electronic auction. *This notice also serves as a summary notice required under the
Agreement on Government Procurement of the World Trade Organization.
*
Contractors/suppliers/service providers on the (title(s) of the approved list(s)
and state a list and brief description of the qualifications/conditions for participation and any
requirements for specific documents or certifications to be provided by contractors/suppliers/
service providers in connection therewith (if such requirements for specific documents or
certifications are
not included in the prequalification documents that are made available to
contractors/suppliers/service providers)) are invited to apply for prequalification and the
prequalification documents are obtainable from (state the name, address and telephone/fax
number/e-mail address of the office, and other information necessary to contact the office and
obtain the prequalification documents). Contractors/suppliers/service providers not yet on the
(title(s) of the approved list(s)) may also apply for prequalification if they submit a request for
participation by (deadline) to (address) and meet (state a list and brief description of the
qualifications/conditions for participation and any requirements for specific documents or
certifications to be provided by contractors/suppliers/service providers in connection
therewith (if such requirements for specific documents or certifications are
not included in the
prequalification documents that are made available to contractors/suppliers/service
providers)). *A sum of $..........., which will not be refunded, is required to cover the cost of
the prequalification documents.
(State the number) of applicants will be selected for tender invitations on the
basis of the following criteria —
(List of criteria)
Completed prequalification applications shall be submitted not later than (time)
on (date) to (state name and address of the office/tender board). If tropical cyclone signal
No. 8 or above is hoisted, or a black rainstorm warning signal or “extreme conditions after
super typhoons” announced by the Government is/are in force at any time between (time) and
(time) on (closing date for receipt of prequalification applications), the closing time will be
postponed to (time) on the first working day after the tropical cyclone signal No. 8 is lowered,
or the black rainstorm warning signal or the “extreme conditions after super typhoons”
announced by the Government has/have ceased to be in force. In case of blockage of the
public access to the location of the relevant office/tender board at any time between (time)
and (time) on (closing date), the Government will announce extension of the closing time
until further notice. Following removal of the blockage, the Government will announce the
extended closing time as soon as practicable. The above announcements will be made via
press releases on the website of Information Services Department
(http://www.info.gov.hk/gia/general/today.htm).
* Joint ventures with other firms will be considered.
The Government of the Hong Kong Special Administrative Region reserves the
right to reject any application and to negotiate with any applicants about the terms of their
offers.
Date
Name of Head of Department
* delete if not applicable
Appendix III (D)
Specimen Application for Approval of Prequalified Tenderers
(SPR 330(e))
RESTRICTED (TENDER)
MEMO
From : Head of Department
To : Chairman, Central Tender Board
Contract Title
Request for Approval of the Prequalified Tenderers
A.
Type and Duration of Contract
B.
Brief Description of Contract
C. Authority
—
Authority to call for tenders . . . . . . . . . . . . . . . . . . .
—
Authority to prequalify tenderers . . . . . . . . . . . . . . .
D.
Details of Invitation
—
Dates of Gazette notifications.
—
Dates and media of advertisements or other means of invitation, if any.
—
Any restrictions on applicants, e.g. Approved Contractors for Public Works
only.
—
Closing date and office for submission of applications.
—
A copy of the prequalification document should be attached for inspection.
E.
Details of Applications
—
Number of firms obtaining prequalification documents.
—
Number of firms submitting applications.
—
Essential requirements, marking scheme including assessment criteria,
weighting attached to each criterion, and passing mark(s) required for
qualification approved by the PS(Tsy) on the advice of the CTB.
—
Details of assessment of applications : composition of selection panel, method
of assessment, assessment of specific items by bodies other than the panel, e.g.
financial assessment by Chief Treasury Accountant of DEVB (Works Branch),
etc.
F. Recommendation
—
Names of firms recommended for inclusion in the list of prequalified
tenderers.
—
A summary of the results of assessment showing the relative merits of all
applicants under each selection criterion and an overall assessment on
individual applicants as a conclusion.
—
The assessment reports of individual panel members should be attached, where
necessary, drawing specific attention to any opinion which is contrary to the
general recommendation.
—
Results of the financial vetting of the prequalified tenderers, if applicable.
G.
Availability of Funds
—
Approved project estimate, if applicable
$ . . . . . . . . . . . . . .
—
Sum allowed for this contract in the approved $ . . . . . . . . . . . . . .
project estimate, if applicable
—
Funds in (financial year) Estimates
$ . . . . . . . . . . . . . .
(Head . . . . . . Sub-head . . . . . . )
H.
Declaration of Interest
—
Confirm whether public officers involved in this prequalification exercise have
declared their interest in accordance with SPR 186, and state, whether or not
any conflict of interest has been identified, and if yes, what remedial action has
been made.
—
Confirm whether the consultant(s) has/have declared their compliance with the
relevant terms and conditions of the Consultancy Agreement on conflict of
interests and confirmed that there was no actual, potential or perceived conflict
of interest in connection with their services in the preparation of
prequalification documents and in the prequalification exercise.
I.
Name and Telephone Number of Contact Officer
—
Public officer(s) who will answer questions from the tender board or attend
board meetings for this item, if necessary.
( )
Signed by a directorate officer
for Head of Department
Appendix III (E)
Specimen Gazette Tender Notices
(SPR 340(a))
G.N.
DEPARTMENT
It is hereby notified that sealed tenders in *duplicate/triplicate are invited for
(state the tender reference, name, nature and quantity (or where the quantity is not known, the
estimated quantity) of the project/services/goods and the time-frame for delivery of
project/services/goods or the duration of the contract, whichever is applicable, and, where
applicable, a description of any option).
Tenders must be clearly marked with the tender reference and the subject of the
tender on the outside of the envelope (but should not bear any indication which may relate the
tender to the tenderer) addressed to the Chairman, (state the name of the tender board to be
addressed, address of the relevant tender box, and the closing date and time for receipt of
tenders). Tenders must be deposited in the tender box as specified in this tender notice
(“Specified Tender Box”) before the tender closing time. Late tenders or tenders not
deposited in the Specified Tender Box will not be accepted. If tropical cyclone signal No. 8
or above is hoisted, or a black rainstorm warning signal or “extreme conditions after super
typhoons” announced by the Government is/are in force at any time between (time) and (time)
on (tender closing date), the tender closing time will be postponed to (time) on the first
working day after the tropical cyclone signal No. 8 is lowered, or the black rainstorm warning
signal or the “extreme conditions after super typhoons” announced by the Government
has/have ceased to be in force. In case of blockage of the public access to the location of the
Specified Tender Box at any time between (time) and (time) on (tender closing date), the
Government will announce extension of the tender closing time until further notice.
Following removal of the blockage, the Government will announce the extended tender
closing time as soon as practicable. The above announcements will be made via press releases
on the website of Information Services Department
(http://www.info.gov.hk/gia/general/today.htm).
Forms of tenders and further particulars are obtainable from (state the name,
address and telephone/fax number/e-mail address of the office, and other information
necessary to contact the office and obtain the tender documents). *A sum of $..........., which
will not be refunded, is required to cover the cost of the tender documents.
*Open tendering is adopted. All interested contractors/suppliers/service
providers are invited to tender. (State a list and brief description of the
qualifications/conditions for participation and any requirements for specific documents or
certifications to be provided by contractors/suppliers/service providers in connection
therewith (if such requirements for specific documents or certifications are
not included in the
tender documents that are made available to contractors/suppliers/service providers).)
*Selective tendering is adopted. Contractors/suppliers/service providers on the
(title(s) of the approved list(s) and state a list and brief description of the
qualifications/conditions for participation and any requirements for specific documents or
certifications to be provided by contractors/suppliers/service providers in connection
therewith (if such requirements for specific documents or certifications are
not included in the
tender documents that are made available to contractors/suppliers/service providers)) are
invited to tender. Contractors/suppliers/service providers not yet on the (title(s) of the
approved list(s)) may also submit a tender if they submit a request for participation by
(deadline) to (address) and meet (state a list and brief description of the
qualifications/conditions for participation and any requirements for specific documents or
certifications to be provided by contractors/suppliers/service providers in connection
therewith) (if such requirements for specific documents or certifications are
not included in
the tender documents that are made available to contractors/suppliers/service providers).
Contractors/suppliers/service providers will be liable to have their names removed from the
approved list(s) if they fail or refuse to implement an accepted tender.
*Tenderers must attach to each tender a cheque/cashier order/the original copy
of a receipt for the sum of $........ as a pledge of the bona fides of their tenders, which amount
shall be forfeited to the Government of the Hong Kong Special Administrative Region if any
tenderer fails or refuses to implement an accepted tender. The amount will be returned to the
unsuccessful tenderers without interest.
*This tender is covered by the Agreement on Government Procurement of the
World Trade Organization and will not involve electronic auction. *This notice also serves as
a summary notice required under the Agreement on Government Procurement of the World
Trade Organization.
The Government of the Hong Kong Special Administrative Region does not
bind itself to accept the *lowest/highest (for revenue) tender or any tender, and reserves the
right to negotiate with any tenderer about the terms of the offer.
Details of the award of this contract will be published on the Internet at
http://www.gld.gov.hk/eng/services_2_c.htm.
Date
Name of Head of Department
* delete as appropriate or if not applicable. Where a marking scheme is adopted for tender
evaluation, the reference to “lowest/highest (for revenue) tender” should be changed to
“tender with the highest overall score”.
Appendix III (E)1
NOTE TO TENDERERS
(to be included in tender documents for tenders covered by WTO GPA)
(SPR 345(c))
This tender is covered by the Agreement on Government Procurement of the World Trade
Organization (WTO GPA) and the provisions of the WTO GPA will apply to this tender.
Tenderers are requested to note that a Review Body on Bid Challenges (under WTO GPA)
(“the Review Body”) has been set up by the Government to deal with challenges made against
alleged breaches of the WTO GPA and the relevant procedures for handling bid challenges
are set out in the Rules of Operation of the Review Body (“the Rules”), which are available
for inspection at the Secretariat of the Review Body located at the Trade and Industry
Department or which may be sent to the interested parties upon request. In the event that a
tenderer believes that a breach of the WTO GPA has occurred, the supplier may, within ten
working days after he/she knew or reasonably should have known the basis of the challenge,
lodge a challenge to the Review Body on the alleged breaches of the WTO GPA.
Nevertheless, the tenderer is encouraged to seek resolution of its complaint in consultation
with the procuring department before lodging a complaint to the Review Body. In such
instances, the procuring department shall accord impartial and timely consideration to any
such complaint, in a manner that is not prejudicial to obtaining corrective measures through
the Review Body.
Tenderers should note that the Review Body may receive and consider a late challenge but a
challenge shall not be considered if it is filed later than 30 working days after the basis of the
challenge is known or reasonably should have been known.
Appendix III (E)2
NOTE TO TENDERERS and CONDITION OF TENDER
(to be included in tender documents for tenders invited from
contractors/suppliers/service providers in both the private and public sectors including
department(s) of the Government of the Hong Kong Special Administrative Region
whose operation of the services is managed and accounted for by trading funds
established pursuant to the
Trading Funds Ordinance, Cap. 430)
(SPR 345(c))
Note to Tenderers
Tenderers should note that tenders are invited from contractors/suppliers/service providers in
both the private and public sectors including department(s) of the Government of the Hong
Kong Special Administrative Region whose operation of the services is managed and
accounted for by trading funds established pursuant to the Trading Funds Ordinance, Cap.
430 (hereafter referred to as “the relevant trading fund department”).
All tenders will be evaluated on a fair basis. Every effort has been and will be made by the
Government to ensure that the relevant trading fund department would not undertake both the
role of consultant and contractor in this tendering exercise and where appropriate,
independent consultant has been or will be engaged for the preparation of the tender
documents, assessment of tenders and subsequent monitoring on the performance of the
contractor/supplier/service provider.
[
Where the Electrical and Mechanical Services Trading Fund may submit a tender.] The
Electrical and Mechanical Services Trading Fund may submit a tender for this contract. A
code of conduct for staff of the Electrical and Mechanical Services Department seconded to
other department(s) is also in place for the staff to observe to avoid conflict of interest and is
available for inspection by tenderers.
**************************
Condition of Tender
Tenderers should note that tenders are invited from contractors/suppliers/service providers in
both the private and public sectors including department(s) of the Government of the Hong
Kong Special Administrative Region whose operation of the services is managed and
accounted for by trading funds established pursuant to the Trading Funds Ordinance, Cap.
430 (hereafter referred to as “the relevant trading fund department”).
Unless it is in the public interest not to do so, the Government will award the contract to the
tenderer who has been determined to be fully capable of undertaking the contract and whose
tender, whether for domestic products or services, or products or services of others, is either
the lowest tender or the tender which in terms of the specific evaluation criteria set forth in
this tender documentation is determined to be the most advantageous. In the situation where
the tenderer selected in accordance with the foregoing criteria is the relevant trading fund
department, the Government may, instead of issuing a contract, enter into a service level
agreement with the relevant trading fund department.
*********************************
Appendix III (F)
Guidelines for Drawing up Tender Specifications
(SPR 254, 280(a), 295(a) and 350(e))
These notes provide guidelines for the preparation of tender specifications.
They supplement any specific instructions given by the body/public officer authorising the
tender.
User Requirements
2.
A tender specification defines the requirements of the procuring department
and consequently, what the tenderer is expected to provide. As a rule, tender specifications
should meet the basic government procurement policy and principles specified in SPR 106-
109.
3.
Public officers drawing up tender specifications should have regard to the
following —
(a) specifications form the basis for seeking tenderers’ response and should
be easily comprehensible. They should be precise and concise and
should not render the preparation of bids by tenderers an unduly time-
consuming and costly process;
(b) specifications form the framework for evaluating the suitability of offers
received from tenderers. They should be framed in terms that encourage
open and fair competition by providing potential tenderers an equal
opportunity to develop solutions capable of satisfying the procuring
departments’ requirements. They shall not include any feature which
could be perceived as discriminatory because it is specific to a
trademark or trade name, patent, copyright, design, type, origin,
producer, supplier or brand of product, unless there is no sufficiently
precise or intelligible way of describing the procurement requirements
and provided that words such as “or equivalent” are included in the
tender documentation;
(c)
they should be comprehensive and should contain sufficient information
for the tenderers to determine the nature, scope and estimated quantity
or value of goods or services required, their characteristics, standards to
be met, performance under specified conditions and other relevant
information in order to obtain conforming and competitive bids;
(d) departments should guard against over-prescribing requirements.
Output- or performance-based (rather than input-based) specifications
should be adopted. Over-prescription or input-based specifications may
perpetuate incumbent advantage, inhibiting competition and leading to
over-reliance on single contractor. It may reduce the scope for
innovative responses and exclude some potential tenderers who would
be capable of meeting the performance levels required in a more cost
effective manner, depriving Government of the chance to obtain more
competitive tenders. It may also require products to be custom designed
at additional cost rather than making use of goods available in the
market, hence not conducive to achieving the best value for money for
Government; and
(e) to encourage competition and minimise entry barriers (particularly for
start-ups and SMEs), as a general rule, tenderer’s experience should not
be set as an essential requirement in non-works procurements,
irrespective of value. If it is absolutely necessary, prior approval must
be sought from the relevant tender board/DTC (for procurements
adopting marking schemes under tendering procedures) or public
officers (normally at directorate level) designated by COs (for
procurements not adopting marking schemes under tendering procedures
or for procurements under quotation procedures irrespective of the use
of marking schemes). The justifications for seeking exception from the
general rule and the grounds for approval should be properly recorded.
Where appropriate, tenderer’s experience may be set as an assessment
criterion in the marking scheme as a desirable feature.
(f) consideration should be given, as far as possible and where
economically rational, to avoiding single-use disposal items and
procuring stores —
(i) with improved recyclability, high recycled content, reduced
packing and greater durability;
(ii) with greater energy efficiency;
(iii) utilising clean technology and/or clean fuels;
(iv) which result in reduced water consumption;
(v) which emit fewer irritating or toxic substances during installation
or use; or
(vi) which result in smaller production of toxic substances, or of less
toxic substance, upon disposal.
4.
In general, there are four categories of specifications —
(a)
Functional Specifications
These outline the proposed function or role to be performed by the
goods, services and revenue contracts in helping the end-user to achieve
the desired outcome. They focus on what is to be achieved rather than
how it is to be done.
(b)
Performance Specifications
These detail the required performance characteristics and performance
parameters by specifying details of operating input or output required,
but not the method to achieve them or how they should be manufactured
or provided. For example, the performance specifications for wire may
require it to withstand a given temperature, have a designated level of
resistance to abrasion and have a given level of conductive capability.
No mention needs to be made of the material to be used or how the wire
is to be manufactured.
(c)
Material Specifications
These state the physical characteristics of the specific materials to be
used for manufacturing the goods.
(d)
Technical Specifications
These provide a physical description of the items required, such as size,
capacity, tolerances and strength. Technical specifications may include
detailed plans, designs and technical drawings.
5.
The use of material and/or technical specifications is unavoidable in some
tenders, particularly where compatibility with existing equipment is required. However, the
use of such specifications at the outset might limit innovative solutions or new technologies
or products which tenderers might be able to offer, and restrict competition. In preparing
tender specifications, departments should use functional and performance specifications,
supplementing them by a material or technical specification only if absolutely necessary.
Where design or descriptive characteristics are used in the technical specifications,
departments should indicate, where appropriate, that it will consider tenders of equivalent
goods or services that can be demonstrated to fulfil the requirements of the procurement by
including words such as “or equivalent” in the tender documents. Where dimensions or other
measurable characteristics are critical to performance, a permitted range rather than a fixed
dimension should be used wherever possible.
6.
In drawing up specifications, particularly for mission-critical or high-value
contracts, departments —
(a)
are encouraged to research the market or conduct non-binding EOI
exercises for likely sources of supply and other relevant information on
current features of the goods or services to be procured and
technological trends. Market research or EOI may be particularly
warranted for contracts with poor tender response in the past
procurement exercise, or for cases where the potential for innovation of
the procurement needs to be further assessed. This might occasionally
involve the department discussing with contractors/suppliers/service
providers how particular functional and performance requirements can
best be met;
(b) should use functional and performance requirements in the
specifications, with a distinction drawn between mandatory and
desirable features. Mandatory features are those features that are so
fundamental or essential to the acceptability of the tender that non-
compliance with any of them will render the tender non-conforming.
Desirable features are not standards or specifications that must be met
but normally take the form of assessment criteria in the marking scheme
and more technical scores will be given if the tenderer can provide more
desirable features with performance better than the specified level.
Once accepted, the successful tenderer will be required to incorporate
the desirable features in providing the stores or services, or in
performing the revenue contracts;
(c)
should specify in the tender document all the essential requirements as
well as the consequences that non-compliance with any of the specified
essential requirements will render the tender non-conforming. These
requirements must be made known to the potential bidders in the
invitation for procurements. Mandatory features which must be
proposed and met, requirements which must be complied with and
documents which must be submitted at the time of tender opening must
be specified as “essential requirements”. Given that non-compliance
with a requirement specified as an “essential requirement” will render
the tender non-conforming, departments should vigorously assess
whether a requirement should be specified as an “essential
requirement”. Use of separate sealed envelopes for technical and price
proposals should not be specified as an “essential requirement” since,
subject to appropriate measures being adopted to ensure the integrity of
the tender evaluation process, permission of compliance after tender
opening will neither give rise to manipulation nor affect the outcome of
the tender evaluation. Those requirements which can be complied with
after tender opening should be specified as “requirements”, but not
“essential requirements”. To discourage late submission of missing
documents (such as copies of required documents where the original has
been submitted, certificates, licences or proof of minimum experience)
which should be requirements but not essential requirements,
departments may state in the tender document that failure to comply
with the requirements may (but not “will”) render the tender non-
conforming. If in doubt whether a tenderer should be disqualified for
such failure, advice from the D of J or, in the case of works tenders,
LAD(W)/DEVB should be sought;
(d) where departments consider it appropriate to allow tenderers to make
alternative proposals which could better meet their requirements, should
include in the tender documents a standard clause that alternative
proposals will be considered by the Government and may be offered;
and
(e) should determine the evaluation criteria before inviting tenders and
include an outline of the evaluation criteria in the tender documents to
assist tenderers in preparing their tenders. Where departments consider
it necessary to evaluate the technical and price aspects of tenders
separately, including the use of a marking scheme, they should follow
guidelines set out at Appendix III(G) and adopt a two-envelope
approach where appropriate.
Other Considerations
7.
Apart from tender specifications, departments, in drawing up the terms and
conditions for inclusion in tender documents, should have special regard to the following —
(a)
Duration of contract
Market conditions should be taken into account in determining the
length of the contract. Where market developments are characterised by
the presence of a large number of potential tenderers and rapid
technological improvements, it may be appropriate to adopt break
clauses to give flexibility to take advantage of favourable trends and
avoid being committed to products that may become obsolete quickly.
When the barriers to enter into the market are high for a tenderer, such
as the requirement to invest substantially in capital assets, the
department should consider letting a longer contract in order to generate
more interest among potential tenderers and to enable them to offer
more competitive prices.
(b)
Price adjustment
A price adjustment clause may be used where wages, material costs or
other major determinators of market prices are prone to rapid and
substantial fluctuation or adjustment. For non-works contracts of a
duration of one year or less, it is usually not necessary to provide for a
price adjustment. For capital works contracts, provisions for price
adjustment may be made irrespective of the contract duration.
(c)
Payment schedule
Where applicable, milestone payments related to performance targets
should be used. A contract may be divided into several stages and
payment be made after the completion of a particular stage.
(d)
Over-reliance on single contractor
In case of re-tender, departments should, in the light of the degree of
market competition in the past procurement exercises, review and refine
the tender specifications as well as essential requirements and marking
scheme with a view to encouraging competition.
(e)
Bundling vs splitting into smaller contracts
While larger contracts created through bundling of say different
geographical districts or venues may achieve better economy of scale,
considerations should also be given to whether splitting them up into
smaller ones will enable more new comers, such as start-ups or SMEs,
to enter the market and hence more choices for the Government. In no
circumstances should a contract be spilt with the intention of totally or
partially excluding it from the application of the WTO GPA.
(f)
Exclusion of a contractor/supplier/service provider
Departments may consider including a clause to reserve the right for the
Government to exclude a contractor/supplier/service provider from a
tender exercise on grounds such as:
(i) bankruptcy;
(ii) false declarations;
(iii) significant or persistent deficiencies in performance of any
substantive requirement or obligation under a prior contract or
contracts;
(iv) final judgements in respect of serious crimes or other serious
offences;
(v) professional misconduct or acts or omissions that adversely reflect
on the commercial integrity of the contractor/supplier/service
provider; or
(vi) failure to pay taxes.
Appendix III (G)
Guidelines for Adopting a Marking Scheme for Tender Evaluation
(SPR 221A, 350(h), 370(c) and 445(d))
Introduction
To ensure adequate room will be in place in the tender evaluation process to
assess innovative suggestions, departments are encouraged to adopt marking schemes.
Marking schemes should be clear and objective so as to provide a level playing field for
bidders and encourage innovative suggestions. In formulating marking schemes, departments
should bear in mind user-friendliness and ensure that they are commensurate with the nature,
scale and value of the tender concerned.
Standard Marking Scheme Framework (SMS Framework) for the procurement of
stores, services (excluding works contracts) and revenue contracts
2.
The SMS Framework is provided in FC No. 2/2019 (as may be updated from
time to time). The SMS Framework sets out the limitations on the use of essential
requirement(s), the normal range of technical and price weightings, the permitted range of
marks in respect of different assessment criteria and the guidelines on giving marks and
setting passing marks, etc. It is applicable to the procurement of stores, services (excluding
works contracts) and revenue contracts. For the avoidance of doubt, if a marking scheme is
adopted for stores, services (excluding works contracts) and revenue contracts under
quotation procedures set out in Chapter II, departments should also follow the SMS
Framework.
3.
Marking schemes formulated according to the SMS Framework do not require
approval from the relevant tender board/DTC (or directorate officer for adopting marking
schemes under quotation procedures). Any deviation from the SMS Framework will be
subject to the prior approval of the relevant tender board/DTC (or the relevant directorate
officer for adopting marking schemes under quotation procedures). Justifications for the
proposed deviations must be provided and recorded.
4.
Departments are encouraged to adopt marking schemes to assess bidders’
proposals for service contracts that rely heavily on the deployment of non-skilled workers. If
departments opt to adopt a marking scheme for this type of contract under the tender
procedures or quotation procedures, the SMS Framework should be followed, unless
otherwise approved by the relevant tender board/DTC (or the relevant directorate officer for
adopting marking schemes under quotation procedures). For this type of contract,
departments should observe other requirements set out in FC No. 3/2019.
5.
Departments may draw up their own departmental procedures on the
endorsement of marking schemes to ensure compliance with the SMS Framework. The
procedures should be approved by DGL in accordance with SPR 126. As specified in SPR
350(a) and SPR 350(h), non-works tenders not adopting marking schemes or setting essential
requirements on tenderer’s experience for procurement should be approved by public officers
(normally at directorate level) designated by COs.
6.
Submission to the relevant tender boards/DTCs (or directorate officers for
adopting marking schemes under quotation procedures) to approve any deviation from the
SMS Framework shall include a brief description of the goods or service to be procured, its
estimated value, tentative tender program, findings of a market research (if any), details of the
deviations from the SMS Framework and justifications for such deviations, where
appropriate.
Marking Scheme for Works Tenders
7.
For works tenders, departments should follow the provisions in the relevant
DEVB TC(W) and any subsequent amendments issued by DEVB from time to time in
deciding whether and how to apply marking schemes for evaluating such tenders.
8.
All marking schemes, including deviation from the standard ones (i.e.
paragraph 9 of the Appendix), have to be approved by the relevant tender boards.
Submissions to the relevant tender boards on the use of a marking scheme or deviation from
the approved standard marking scheme shall include a brief description of the scope of works,
its estimated value, tentative tender program, findings of the market research (if any),
justifications for the use of the marking scheme, proposed weighting for technical and price
assessments, assessment criteria and their relative weighting, and passing marks for
assessment criteria (if any), where appropriate.
Standard Marking Scheme for Individual Procurement
9.
If considered appropriate, departments may seek the approval of the relevant
tender board/DTC (or the relevant directorate officer for adopting marking schemes under
quotation procedures) for adoption of a standard marking scheme (including marking
schemes that deviate from the SMS Framework) for particular types of works or non-works
contracts. The standard marking scheme, if approved, may be used in future procurement
exercises for the same type of contracts.
Design of Marking Schemes for Tender Evaluation
10.
In formulating a marking scheme, the assessment criteria should be drawn up
in consistent with basic government procurement principles set out in SPRs 106 – 109. They
should be able to differentiate the relative merits of tenderers’ technical proposals and obtain
better value for money for Government. The assessment criteria should be objective and as
far as possible quantifiable. Assessment criteria that may have the effect of favouring
incumbent contractors should be avoided. Proposals committed by the recommended
tenderer under the marking scheme should be incorporated into the contract and enforceable
by the procuring department as part of contract management. The enforceability of these
proposals and the administrative costs involved should hence be taken into account by the
department in developing the assessment criteria.
11.
Departments should state in the tender documents the use of a marking scheme
in tender evaluation with an outline of the evaluation criteria to assist tenderers in preparing
their tenders. In line with the basic government procurement principle of transparency,
departments should provide information including descriptions of assessment criteria and
their individual technical marks, passing marks set for technical assessment (if any), formula
to be used to calculate the technical/price scores, technical to price assessment weighting, etc.
Once the marking scheme is published, departments should adhere to the evaluation basis set
out in the marking scheme in deciding on the award of contract.
Two-envelope Approach for Submission of Tenders
12.
Since the use of a marking scheme invariably involves a technical evaluation
conducted separately from the tendered sum comparison, a two-envelope approach should be
adopted when requiring the tenderers to submit their tenders, i.e. technical and price
information should be submitted in separate envelopes. Under the two-envelope approach,
departments shall ask the tenderers to enclose all the information and documents required for
price assessment in sealed envelope(s) with the clear indication that it contains the price
information; and to enclose all the other information including those required for technical
assessment in separate sealed envelope(s) with the clear indication that it contains the
technical information. Normally departments should not open the envelopes containing the
price information until the completion of technical assessment. When departments, having
regard to exceptional circumstances, consider it necessary to open the price envelope(s) prior
to completion of the technical assessment because of the urgency of the exercise, departments
should ensure that assessment of the technical and price proposals should be carried out by
separate teams which should not communicate with each other until after completion of their
assessment. The prior approval of the relevant tender board/ DTC (or directorate officer for
adopting marking schemes under quotation procedures) has to be obtained for any such
arrangement. For works contracts, departments should follow the guidelines promulgated in
relevant DEVB TC(W).
Scoring Methodology for Technical and Price Proposals
13.
Price proposals should only be opened and assessed after completion of the
technical assessment. Any exceptional arrangement such as those in paragraph 12 above
should be fully justified and require the prior approval of the relevant tender board/DTC (or
the relevant directorate officer under quotation procedures).
14.
TAPs should apply pre-determined weighting given to the technical and price
assessment. In normal circumstances, the contractor meeting the essential requirements in
full and obtaining the highest overall score should be recommended.
15.
The following method should be adopted for calculating the technical and
price scores in tender evaluation —
(i)
Technical
score
Formula :
Technical mark of the
tender being assessed x Technical weighting
Highest technical
mark among the
conforming tenders
Example
:
Price to technical weighting
:
50 : 50
Maximum mark for technical assessment in
the marking scheme
:
100
Tenderer A obtains 90 marks
(the highest mark of all conforming tenderers)
Tenderer B obtains 60 marks
90
Tenderer A’s technical score :
x 50 = 50
90
60
Tenderer B’s technical score :
x 50 = 33.33
90
(ii)
Price
score
Formula
:
Lowest tender price
among the conforming x Price weighting
tenders
Tender price of
the tender being assessed
Example
:
Price to technical weighting
:
50 : 50
Tenderer A’s price proposal
(the lowest price of all conforming tenderers)
:
$5,000,000
Tenderer B’s price proposal
: $6,000,000
$5,000,000
Tenderer A’s price score :
x50 =
50
$5,000,000
$5,000,000
Tenderer B’s price score :
x 50 = 41.67
$6,000,000
Contract Award
16.
When a marking scheme is used to assess tenders, departments shall follow the
evaluation basis set out in the tender documents to award the contracts for that procurement.
The tenderer who has submitted a conforming offer with the highest overall score (i.e. the
sum of price and technical scores) under the marking scheme should normally be awarded the
contract. For tenders for service contracts that rely heavily on the deployment of non-skilled
workers, if two or more tenderers obtain the same overall score after technical and price
assessments, the tenderer which obtains the highest score in technical assessment should
normally be awarded the contract.
Appendix III (G)1
Guidelines on Tender Assessment Panels (TAP)
(SPR 370(a) and 440(c))
Establishment of TAP
Departments should normally establish a TAP1 for the evaluation of tenders/
consultancy proposals. A TAP should consist of not less than two persons. Where necessary,
departments may set out specific terms of reference for the TAP (e.g. whether the Chairman
is a marking or non-marking member at the appointment of the TAP, and the role and
responsibilities of TAP members if not all TAP members will take part in the scoring of a
particular assessment criterion).
2.
To safeguard the integrity of the procurement exercise, a TAP should comprise
government officials only. Departments should ensure that only properly qualified persons
are appointed to assess the technical submissions. Where a two-envelope approach is used,
departments may consider whether separate teams should be set up within the TAP to assess
technical and price proposals respectively.
3.
Under special circumstances such as handling innovative proposals from
tenderers, advice may need to be sought from technical experts outside the Government. In
determining the need to engage an outside technical expert, the department should explore
and ascertain whether the expertise is available within the Government, the merits and the
cost-effectiveness of engaging the outside technical expert. Outside technical experts may be
engaged only if the required expertise is not available within the Government. If it is
considered necessary to engage an outside technical expert to serve as a technical advisor,
departments should set out clearly the role of the technical advisor in the procurement process
and the specific assessment criteria that require advice from him. The technical advisor may
be engaged before or after receipt of tenders, to be agreed by the TAP having regard to the
need of the operation of the TAP. To enable the technical advisor to render useful advice, he
may have access to tender information relevant to the assessment criteria that his advice is
required. In any case, the technical advisor should not give marks to any assessment criteria
or have access to price proposals submitted by tenderers.
4.
TAP Chairman and members should observe the requirements laid down in
Chapter IA of SPR and avoid conflict of interest in government procurement. TAP Chairman
and members should declare any actual, potential or perceived conflict of interests as soon as
they take up the duties and as soon as they become aware of such actual, potential, or
perceived conflict of interest. If a technical advisor outside the Government is engaged,
departments should ensure that sufficient safeguards are in place to avoid conflict of interest
in the procurement exercise. In particular, the technical advisor should sign an undertaking to
confirm, amongst others, the absence of any actual, potential or perceived conflict of interest
situations in the procurement exercise. A sample of the undertaking is at Appendix I(C).
1 Include both Tender Assessment Panel for tender exercises and Assessment Panel for consultants selection
exercises.
5.
Declarations/undertakings of TAP members and technical advisor should be
drawn to the attention of TAP Chairman while the declaration of the TAP Chairman should
be drawn to the attention of his supervisor. All such declarations/undertakings and follow-up
actions taken (if any) must be recorded and filed properly before proceeding to the next stage
of the tender process/ consultants selection process.
6.
The membership of the TAP, the declarations/undertakings made by the TAP
and the technical advisor as well as the specific terms of reference of the TAP (if any) should
be covered in the submission(s) to the DTC, DCSC, tender board or consultants selection
board when seeking approval in relation to the marking scheme (if applicable) and for the
proposed award of the tender / appointment of consulting firm. The procuring department
should take into account comments offered by the DTC, DCSC, tender board or consultants
selection board as appropriate.
Evaluation by TAP
7.
The assessment criteria adopted in a marking scheme should be objective and
quantifiable as far as possible. Where practicable, tender documents / consultancy briefs
should be drawn up to allow assessment to be made without the TAP knowing the identity of
the bidders.
8.
TAP members should be conversant with the assessment criteria. To facilitate
the assessment of technical proposals by TAP members on a consistent basis according to the
pre-determined assessment criteria, the TAP Chairman may arrange briefing for TAP
members as appropriate before evaluation of tenders / consultancy proposals.
9.
TAP members should score the technical proposals submitted by tenderers
individually in accordance with the approved marking scheme. For non-works procurements,
in case the procuring department considers that a collective assessment by the full TAP in
accordance with the marking scheme is necessary, it should seek prior exceptional approval
from the DTC, DCSC, tender board or consultants selection board (or the relevant directorate
officer if a marking scheme is used under quotation procedures) before evaluation of
technical proposals.
10.
Before proceeding to evaluation, TAP should agree on the mechanism for
consolidating the marks given by individual TAP members to derive the overall technical
score for a tenderer. For example, TAP may take the average mark given by TAP members
as the overall technical score awarded to a tenderer.
11.
To facilitate better understanding of the tender proposals (such as the
innovative suggestions), TAP may invite the bidders to make a verbal presentation/
demonstration after the tender closing date. Bidders may introduce, explain and clarify their
tender proposals during the presentation/demonstration. In no circumstances should
additional information or new/amended proposal not set out in their tender submissions be
accepted. If a technical advisor outside the Government has been engaged, the bidders
should be informed of the presence of the technical advisor. Unless the
presentation/demonstration is an essential requirement set out in tender documents, bidders
refusing to offer presentation/demonstration should not be disqualified on ground of their
refusal. TAP should evaluate the tenders according to the assessment criteria set out in the
tender documents. Normally, the presentation/demonstration will not be taken into account
in marking. If the presentation/demonstration will be taken into account in the marking as
pre-determined and specified in the marking scheme and tender documents, TAP should
ensure that the evaluation of the presentation/demonstration should be based on the tender
specifications and the pre-determined assessment criteria.
12.
Normally, TAP members should meet to deliberate the tenders / consultancy
proposals received. The TAP Chairman may decide whether the technical advisor outside the
government should be invited to join the TAP meeting or provide input in writing. In the
former case, the outside technical advisor should only take part in the deliberation of the
areas where his expertise is required. The TAP Chairman should facilitate deliberation
amongst TAP members with a view to making recommendations to the DTC, DCSC, tender
board or consultants selection board. In case there are substantial differences in marks given
by individual TAP members according to the marking scheme, the TAP Chairman should
check whether the assessment was based on the same understanding of the marking scheme
or the information contained in the tenders/ consultancy proposals received. This is to ensure
that evaluation is made on a consistent basis. If the differences remain after checking, the
marks given by individual TAP members should be consolidated based on the agreed
mechanism referred to in paragraph 10 above. TAP’s deliberations and decision should be
properly documented.
13.
A TAP is responsible for making recommendation(s) to the DTC, DCSC,
tender board or consultants selection board for the tender / consultants selection exercise
under its purview. If there is a division of opinion on a contract award between TAP
members, the differing views should be submitted by the TAP along with TAP’s
recommendation(s) for review by the DTC, DCSC, tender board or consultants selection
board.
Appendix III (H)
Guidelines for Financial Vetting of Recommended Tenderers
for Service Contracts
(SPR 370(b)(i))
Introduction
To safeguard Government’s interest, we have to ensure that a tenderer
recommended for the award of a service contract of a significant value is, in addition to its
technical capability, financially capable of completing the contract by conducting financial
vetting in respect of the recommended tenderer by a public officer of the Treasury Accountant
grade including a non-civil service contract staff who is performing accounting/financial
duties.
Applicability
2.
Except for consultancy services and works contracts, these guidelines apply to
all service contracts of a value exceeding $15 million. Examples of service contracts include
contracts for the management and operation of carparks, provision of cleaning services, etc.
For the purpose of these guidelines, a contract for supply of stores is classified as a service
contract if the contract requires also the provision of services of a value above $15 million.
These guidelines should be read together with the Financial Vetting Guidelines published by
the Treasury (as may be updated from time to time). Departments may also draw reference to
these guidelines if financial vetting is considered necessary for revenue contracts.
Financial Vetting
3.
When inviting tenders for a service contract of a value exceeding $15 million,
departments should include in the tender document the conditions that tenderers have to
demonstrate their financial capability and/or provide the specified contract deposit before
they can be considered for the award of the contract. For contracts where periodic financial
vetting is required, departments should also stipulate the frequency of the financial vetting in
the tender document.
4.
For the purpose of financial vetting, departments should require tenderers to
provide the following information —
(a) audited financial statements of the tenderer, and the audited
consolidated financial statements of the group if the tenderer is a
subsidiary of another company, for the past three years. The financial
statements shall be prepared on the same basis for each year in
accordance with accounting principles generally accepted in the
HKSAR and the requirements of the Companies Ordinance, Cap. 622;
and
(b) projected statement of profit and loss and other comprehensive income
and statement of cash flows of the contract for each contract year and
pre-operating period (if applicable), and if necessary, of the company
during the contract period, showing the revenue, operating expenses,
capital expenditure including the initial investments and the sources of
finance.
5.
For contracts which require significant working capital for financing its
operation, such as the management contract for tunnels let by the Transport Department, the
following information will also be required of the recommended tenderer —
(a)
supporting letter(s) from the tenderer’s banker(s) as to the availability of
credit facilities and the undrawn balance as at a particular date (shortly
before the submission of tenders) and/or a commitment in principle to
provide credit facilities for the contract; and
(b) guarantee by the major shareholder(s) of the tenderer as security for the
due and faithful performance of the contract, as and when required. In
determining the amount of guarantee required, departments should
consider, inter alia, the additional costs to be incurred by Government in
the event that the successful tenderer fails to commence operation or
defaults during the term of the contract.
6.
In assessing the financial capability of a tenderer, departments should establish
the following of the tenderers —
(a)
the past and projected earning performance;
(b) the financial strength; and
(c) the financial arrangements including the degree of the tenderer’s
financial commitment to finance the investment and operation of the
contract.
Departments should refer to the Financial Vetting Guidelines published by the Treasury (as
may be updated from time to time) for details when conducting financial vetting for service
contracts.
7.
Tenderers who have passed the financial vetting should be required to pay a
contract deposit (in the form of cash) or submit a performance bond (in the form of a
guarantee arranged by a bank, insurance company, or the parent company which has been
assessed to be financially capable) at 2% of the contract value as an additional protection of
the Government’s interest. For tenderers who have failed the financial vetting, or who are
unable to provide adequate financial information for a meaningful assessment to be conducted
(e.g. newly established companies), they should be required to pay a contract deposit or
submit a performance bond at 5% of the contract value for low risk contracts, or 6% for high
risk contracts.
8.
The contracts or contract types which are considered to be high risk include,
without limitation mission-critical, emergency-related or health-related contracts (for
example, systems that relate to law and order, life and death and social security payments),
and contract types with high concentration risks (for example, where the lion’s share of
contracts for like services awarded by the same department is dominated by one or two
contractors, where there was only one conforming bid in the past two consecutive tender
exercises, or where the award of a high-value contract will render the successful tenderer
dominant). COs or designated directorate officers would be the authority to determine,
before tender invitation, whether a contract or contract type is high risk and whether a 5% or
6% contract deposit should be required.
9.
Procuring departments are required to conduct periodic financial vetting for
contracts of high risk and long duration, with a view to ensuring that the contractor concerned
remains financially healthy. As a general guideline, periodic financial vetting should be
conducted for contracts lasting more than five years at three-year intervals. If a contractor
fails the periodic financial vetting, procuring departments should check if any obvious
irregularities have emerged (such as a drastic or continuous reduction in profitability, working
capital and/or employed capital, discontinuation of related business operations, increase in
customer complaints, etc.), and step up monitoring measures where necessary, such as
conducting regular interviews with employees under the contract to see if their wages are paid
in a timely manner, expanding the sample size for checking the service records (e.g.
attendance log books), with a view to detecting early signs of default and taking appropriate
actions if warranted.
Exception
10.
Where the recommended tenderer has a net worth of 20 times more than the
value of the contract, the financial vetting procedures described in paragraph 6 above may be
waived on condition that it has passed the profitability, liquidity and gearing ratio tests.
Please refer to the Financial Vetting Guidelines published by the Treasury (as may be updated
from time to time) for details. Exceptions to the arrangements on financial vetting and
contract deposit are allowed, but only where the Controlling Officer is personally satisfied
that the deviation is justified and such decisions are to be recorded.
Tender Report
11.
In making their recommendation on the award of a service contract,
departments should confirm in the tender report that financial vetting of the recommended
tenderer has been carried out based on the information submitted and that the tenderer is
considered financially capable. Where financial vetting has not been conducted, the tender
report should include an explanation as to why this was not undertaken.
12.
In case a contractor fails to complete a service contract because of a financial
problem, the procuring department should review whether the financial problem should have
been revealed in the assessment of the financial capability of the contractor at the tendering
stage and assess the loss to the Government as a result of the contractor’s failure to complete
the service contract. The result of the review should be sent to the DAS.
Appendix III (I)
Standard Tender Report Format
(SPR 375(a) and 380(e))
(Note : Departments may provide additional information having regard to the
individual circumstances of their tenders and delete those part(s) in this tender
report format which is/are not applicable to their tenders.)
RESTRICTED (TENDER)
MEMO
From : Head of Department/Chairman, To : Chairman, . . . . . . Tender Board/
Tender Assessment Panel of
Departmental Tender Committee
Procuring Department
Contract Title
Tender Reference/Contract Number
A.
Type and Duration of Contract
—
Example : This is a 3-year service contract at an estimated value of
HK$26.9 million with provision for price fluctuation adjustment based on
Consumer Price Index (A).
B.
Brief Description of Contract
—
For goods or service tenders, give a brief description of the goods or services
required, user departments, delivery schedule, etc.
—
For revenue tenders, give a brief description of the venue or location, method
to calculate revenue, etc.
—
For works tenders, give a brief description of the scope of works and location
of the project, and state whether the contract is subject to the “pay for safety
and environment” scheme.
—
State the importance and sensitivity of the contract and any special tendering
and contract requirements which have affected the tender recommendation, if
applicable.
—
Highlight the initiatives that have been incorporated in the tender requirements
to promote innovation, if any, the major changes in essential requirements, the
marking scheme used (including deviations from the SMS Framework, if
applicable), tender requirements and specifications as compared with the
previous tender exercise, if applicable, and provide reasons for such changes.
—
Provide details of any observations/comments made by the tender board/DTC
in the previous tender exercise, if applicable, and state how such
observations/comments have been addressed.
C.
Authority to Invite Tenders
—
For prequalified, restricted or single tendering, or when parallel tendering is
adopted for contracts other than works contracts funded under the Capital
Works Reserve Fund, quote the approving authority and provide a summary of
reasons. When parallel tendering is not adopted for works contracts funded
under the Capital Works Reserve Fund, quote the approving authority and
provide a summary of reasons.
—
For selective tendering, state the title(s) of the approved list(s).
—
State whether the tender is subject to WTO GPA.
D.
Details of Invitation
—
Date(s) and mode(s) (e.g. Gazette, internet, newspaper, etc.) of tender
invitation.
—
The number of invitations issued (if not by Gazette notification).
—
Closing date (original and extended, where applicable) for receipt of tenders,
and if extended, the reasons.
—
Date of expiry of validity, and if extended, the revised date of expiry and the
reasons for extension.
—
Expiry date of patent, if there is a patent.
—
Reasons for delay in submitting the tender report, if applicable.
E.
Details of Tenders
—
State whether pre-tender market research or non-binding EOI exercise has
been conducted. If positive, the tender requirements that have been
incorporated to promote competition and innovation arising from the market
research or non-binding EOI exercise.
—
State the number of tenders received and withdrawn, if any. If only one or
very few tenders have been received, state the estimated number of potential
tenderers, the reasons for the poor tender response (if known) identified in the
pre-tender market research or non-binding EOI exercise and the measures that
will be taken to enhance tender participation in future tender exercises.
—
List the tenderers in the form of a comparative statement showing the tendered
sums quoted by each tenderer, starting with the lowest for goods or services
tender or the highest for revenue tender, discrepancies in tenders, etc.,
supplemented by an enclosure if necessary. If there are corrections to the
tendered sums, provide details and attach copies of tenderers’ letters
confirming their willingness to abide by the corrected tendered sums. List the
tenders according to the corrected tendered sums alongside the original
tendered sums.
F. Tender
Evaluation
—
State the composition of the TAP and the advice obtained from technical
advisor outside the Government, if any.
—
State the specific terms of reference of the TAP, if any.
—
State the evaluation criteria and basis of acceptance under the terms of tender,
and provide a copy of the marking scheme, and restriction on contract award,
if applicable. Give reasons for not using marking schemes, if applicable.
—
Provide details of each stage of the tender evaluation. Give reasons for not
considering tenders with non-compliance with tender requirements and
specifications, supplemented by an enclosure, if necessary.
—
Provide details of innovative suggestions proposed by tenderers and the TAP’s
assessments, if applicable.
—
If the tendered sums are very close and there are considerable differences in
the pricing of individual items or when tenders are considered ‘front-loaded’,
conduct a discounted cash flow analysis to confirm that the net present values
of the tendered sums do not change the position of the recommended tenderer.
If however the position changes after the discounted cash flow analysis, the
present value of the tendered sums should prevail in determining the ranking
of tenders. If there are reasons for not conducting a present value calculation,
state these reasons.
—
Confirm that post-tender closing contacts/clarifications with tenderer(s), if
any, were conducted in accordance with the relevant tender terms and SPR 365
and explain briefly why such clarifications are required.
—
Provide details and results of any negotiations with tenderer(s) if prior
approval to conduct tender negotiations has been obtained from the
appropriate authority.
G. Recommendation
—
State the recommendation on the tender to be accepted.
—
Provide detailed reasons for not recommending acceptance of the lowest
(highest for revenue contracts) conforming tender, or the tender of the highest
overall scorer when a marking scheme is used for tender assessment.
—
Confirm that the tender recommended for acceptance complies with the tender
terms, conditions and specifications. If not, state where the tender fails to
comply and explain.
—
Confirm that the recommended tenderer is suitable for performing the contract
having regard to its performance records, if any. For works tenders, check all
the performance reports of government contracts and relevant Housing
Authority contracts undertaken by the recommended tenderer during the
preceding five years and state the total number of these contracts together with
a summary of any adverse report(s) issued under these contracts. State the
reasons why a tender is recommended despite the tenderer has been given
adverse report(s) for other contract(s). If the recommendation is a
controversial one, e.g. if a recommendation is made against the advice of
consultants or if the lowest (highest for revenue contracts) conforming tender
or highest overall scorer as appropriate is not recommended for acceptance,
departments/TAP should comment on the suitability of other tenderers whose
tenders are nearest to the lowest (highest for revenue contracts) conforming
tender or highest overall scorers as appropriate so that the relevant tender
board/DTC may decide on the acceptance without referring the tender report
back to the department/TAP.
—
State any other special circumstances or important assumptions/considerations
governing the recommendation, any complaint(s) received relevant to the
tender exercise and how such complaint(s) has/have been handled.
—
For works tenders, confirm that the recommended tenderer has been
financially vetted by Chief Treasury Accountant, DEVB (Works Branch), and
state the vetting result.
—
For service contracts with a value exceeding $15 million, or contracts for
supply of stores which require also the provision of services of a value
exceeding $15 million, confirm that the recommended tenderer has been
financially vetted in accordance with the terms of tender and that the tenderer
is considered financially capable. State the vetting result and the amount of
contract deposit or performance bond, as a percentage of the contract value,
that is required from the tenderer. Where financial vetting has not been
conducted, or where the stipulated percentage under SPR 362(b) is not
followed, explain why.
—
For revenue contracts, in case financial vetting has been conducted, state the
vetting result and the amount of contract deposit or performance bond, as a
percentage of the contract value, that is required from the tenderer.
—
For works tenders, confirm the status of the recommended tenderer on the
respective approved list(s) of contractors and that the recommended tenderer is
not suspended from tendering under the provisions of the prevailing
DEVB TC(W) relating to the employment of illegal workers or having illegal
workers on sites under its control, site safety, Employment Ordinance, etc.
—
If special references to a tenderer’s conviction records have been made in the
report (e.g. as a major consideration for not accepting its tender even though it
is the lowest conforming tender/highest overall scorer), attach a list of
convictions for the related offences under the relevant Ordinances and
summarise the number of such convictions in respect of the concerned tenderer
during the specified period (as promulgated in relevant FCs, FSTBCM or other
relevant memoranda issued by FSTB, or concerned DEVB TC(W) issued by
DEVB which would be updated from time to time) prior to the tender closing
date.
—
For works tenders, state the aggregate value of the outstanding works of the
contracts which the recommended tenderer has in hand if the recommended
tenderer is of probationary status or subject to a financial limit on contract
values for other reasons, and whether the value of the contract in question
exceeds the allowed limit.
—
For cancellation of tender exercise, state the reasons, the way forward and the
legal advice obtained.
—
For tenders subject to WTO GPA, confirm that the requirements of WTO GPA
have been complied with.
H.
Comparison with the Estimate and Similar Contracts
—
For works tenders, state the following sums and compare the recommended
tendered sum with the sum allowed for the contract and the pre-tender
estimate. Explain the reasons for any significant difference (i.e. with a
difference of ±10% or more), where applicable —
(a)
Recommended tendered sum : $
(b) Sum allowed for this contract in the approved project estimate
(month/year of approval) : $
(c)
Pre-tender estimate (month/year of preparation) : $
—
Explain the basis on which the pre-tender estimate is drawn up.
—
Compare the recommended tendered sum/rates with the pre-tender estimate
and the award contract sum of the previous contract or those in similar
contracts (month/year of award), whichever is applicable, and explain the
difference, where applicable. If a price comparison cannot be made, this
should be stated and explained.
—
Compare the recommended tendered sum with the second and third lowest
(highest for revenue contracts) conforming tenders/highest combined scorers,
where appropriate.
—
Confirm with analysis that the recommended tendered sum is fair and
reasonable, and explain why it is considered realistic to accept the tender if the
tendered sum is significantly higher or lower than the pre-tender estimate, the
award contract sum of the previous contract or the sum allowed for the
contract in the approved project estimate.
I.
Claims History (for works tenders exceeding $100 million in value only)
—
State the number of performance reports on the recommended tenderer with
claim attitude marked as unreasonable in the preceding five years. Confirm
whether the recommended tenderer has demonstrated a reasonable claim
attitude, or otherwise, on an overall basis taking account of any reported
‘claims-conscious’ attitude, frivolous or vexatious claims or unjustified
pressure on the Government in the manner in which claims were pursued.
Where there is no record, this should be stated in the report.
J.
Availability of Funds
—
For works tenders, state the following and confirm whether a revision of the
approved project estimate will be required, if the tendered sum is greater than
the sum allowed for the contract —
(a)
Recommended tendered sum : $
(b)
Approved project estimate (month/year of approval) : $
(c)
Sum allowed for the contract in the approved project estimate : $
(d)
Funds in (financial year) Estimates under
Head /Subhead : $
—
For other tenders (except revenue contracts), confirm that funds are available
and the vote to be charged.
—
For tenders invited before funding is secured, state the expected date of
obtaining the funding approval.
K.
Declaration of Interest
—
Confirm whether public officers involved in preparing tender documentation
(including tender specifications and marking scheme), assessing tenders and
conducting negotiations have declared their interest in accordance with
SPR 186, and state, whether or not any conflict of interest (actual, potential or
perceived) has been identified, and if yes, what remedial action has been made.
—
Confirm whether the outside technical expert(s), if any, involved in assessing
tenders have declared their interest in accordance with Appendix III(G)1, and
state, whether or not any conflict of interest (actual, potential or perceived) has
been identified, and if yes, what remedial action has been made.
—
Confirm whether the consultant(s) has/have declared their compliance with the
relevant terms and conditions of the Consultancy Agreement on conflict of
interests and confirmed that there was no actual, potential or perceived conflict
of interest in connection with their services in the preparation of tender and
contract documents and in the tender exercise.
L.
Name and Telephone Number of Contact Officer
—
Nominate public officer(s) to answer questions from the tender board/DTC or
attend board/committee meetings for this item, if necessary. The telephone
numbers of the nominated officer(s) should be provided.
( )
Signed by a directorate officer*
for Head of Department/
Chairman, TAP of Procuring Department
* Tender reports which are submitted for consideration by CTB and subsidiary tender boards
should be signed by a directorate officer. Tender reports which are submitted for
consideration by DTCs should be signed by the Chairman, TAP of the procuring
department.
Appendix III (J)
Guidelines for Tender and Contract Negotiations
(SPR 296, 385(n), 455(e) and 525)
Public officers authorised (under SPR 296, 385, 455(e) or 525) to conduct
negotiations with tenderers and contractors shall observe the following guidelines when
preparing for and conducting negotiations with tenderers and contractors —
(a) Be clear about what is intended to be achieved from the negotiation.
For example, this can be a reduction of tender price, a change to the
payment terms, removal of a counter-proposal (e.g. restriction of
liability) from the tenderer or adjustment to the price for additional
requirements of items or service.
(b) Draw up a checklist of the items to be discussed. The tenderers and
contractors participating in the negotiations may be given a copy of this
checklist so that they know what to discuss and bring the right people to
the meeting.
(c) Determine what the baseline for negotiation should be and seek prior
clearance as necessary.
(d) Consider what fall back positions Government would need to adopt in
case the negotiation fell through and plan ahead, for example, by
considering the need to extend the contract period of existing contracts,
cancel the tender exercise, conduct a re-tender exercise, etc.
(e) Keep the negotiation team small and limit the number of staff to those
who are absolutely essential. There is no need to match the other party
in numbers.
(f)
Include a representative from the GLD and/or LAD(W)/DEVB or D of
J, if necessary.
(g) Hold the negotiation in a government office as a normal practice.
(h) Ensure that the government negotiation team as well as the tenderers
and contractors participating in the negotiations know who the leader of
the government negotiation team is, and make sure there is only one.
(i)
Hold a pre-meeting so that members of the government negotiation team
familiarise themselves with the ground rules and the relative strengths
and weaknesses of the parties to the negotiation.
(j)
Do not reveal to tenderers and contractors participating in negotiations
the Government’s baseline unless a deadlock persists after repeated
rounds of negotiations and the negotiation team is satisfied that the
disclosure is necessary.
(k) Do not give tenderers and contractors participating in negotiations
conditional treatment based on past or future procurements, except for
those already indicated in the tender document.
(l)
Do not furnish to tenderers and contractors participating in negotiations
information about other tenderers’ prices or technical proposals.
(j)
Keep proper record of the negotiations for audit purpose.
Appendix IV (A)
Specimen Submission for CCSB Stage 1 Approval
(SPR 440(h))
RESTRICTED (CONTRACT)
MEMO
From : Head of Department
To : Chairman, Central Consultants Selection
Board
Title of Consultancy
A.
Purpose of the Present Submission
This is a submission for Stage 1 approval to invite consultancy proposals from
[number] consulting firms listed in Section G below for the captioned consultancy.
B.
Brief Description of the Consultancy
C.
Estimated Duration of the Consultancy
D.
Estimated Cost of the Consultancy
E.
Authority to Employ Consultants
—
Policy support from the relevant Director of Bureau or a public officer
authorised by him, endorsement of the MA Division of FSTB for financial
consultants2 and EffO for general management consultants3, funding approval,
etc.
—
State whether the consultants selection exercise was initiated before funding is
secured (i.e. whether parallel tendering has been adopted).
—
For works-related consultancies funded under the Capital Works Reserve
Fund, if parallel tendering has not been adopted, quote the approving authority
and provide a summary of reasons.
—
For other consultancies, if parallel tendering has been adopted, quote the
approving authority and provide a summary of reasons.
2 Financial consultants may include, inter alia, accountants, actuaries, merchant bankers or financial
management consultants and also cover financial consultants to be engaged as sub-consultants to non-financial
consultancies. The need for appointing outside financial consultants may be justified by circumstances
including where the assignment requires special knowledge or expertise not available within the Government
or the required timeframe, where there is a need for acquiring independent financial appraisals to enhance the
credibility of the exercise, etc.
3 General management consultants may provide services including advisory, development and operational
support services concerning —
(a) business policy and strategy and the overall planning, organisation, management and control of an
organisation including management information systems, management audits, etc.;
(b) human resources management; and
(c) methods for improving productivity, reducing production costs and improving the quality of production.
F.
Details of the Present Submission
—
Provide information on the size and source of the long list, and state whether
EOIs have been invited.
—
If EOIs have been invited –
Provide information on the number of consulting firms which have expressed
interest to participate (with a sample of invitation for EOI), the criteria and
method used for short-listing consulting firms, the recommended list of
short-listed consulting firms derived based on the pre-determined criteria and
method (with reasons for the inclusion of the short-listed firms and the
rejection of other interested firms from the long list).
—
Attach a copy of the consultancy brief which should have been cleared with
the D of J and other relevant departments (such as the MA Division of FSTB
for financial consultancy and EffO for general management consultancy).
—
Provide information on the composition of assessment panel, the specific
terms of reference of the assessment panel (if any), the marking scheme
including the weighting for technical and fee assessments, the assessment
criteria and their relative weighting with passing marks (if any) for assessing
technical proposals and the method for scoring fee proposals.
—
Confirm whether all public officers involved in the Stage 1 process (including
formulation of the long list, the short-listing exercise, preparation of the
consultancy brief, etc.) have declared their interest in accordance with
SPR 186 and state, whether or not any conflict of interest (actual, potential or
perceived) has been identified, and if yes, what remedial action has been made.
G. Recommendation
—
If EOIs have been invited –
Recommend to issue the consultancy brief as approved by CCSB to invite
consultancy proposals from the short-listed consulting firms.
—
If EOIs have not been invited –
Recommend to issue the consultancy brief as approved by CCSB to invite
consultancy proposals from the recommended consulting firms direct.
—
Recommend to assess the consultancy proposals using the marking scheme as
approved by CCSB.
H.
Availability of Funds
These exclude public relations services, marketing management services, arbitration and conciliation services,
financial management services and information technology services.
—
Confirm the availability of funds and the title of the vote to be charged.
—
For initiation of consultants selection exercise before funding is secured, state
the expected date of obtaining the funding approval.
I.
Name and Telephone Number of Contact Officer
—
State the name(s)/tel. no(s). of public officer(s) who will attend the CCSB
meeting to discuss this item.
—
State the name/tel. no. of public officer who can provide further information
on this submission.
( )
Signed by a directorate officer
for Head of Department
Appendix IV (B)
Specimen Submission for CCSB Stage 2 Approval
(SPR 445(g))
RESTRICTED (CONTRACT)
MEMO
From : Head of Department
To : Chairman, Central Consultants Selection
Board
Title of Consultancy
A.
Purpose of the Present Submission
This is a submission for Stage 2 approval to appoint [name of the consulting
firm] for the captioned consultancy, subject to the fees and terms detailed in the
negotiating brief in Section G below being resolved satisfactorily.
B.
Brief Description of the Consultancy
C.
Estimated Duration of the Consultancy
D.
Estimated Cost of the Consultancy
E.
Authority to Employ Consultants
—
Policy support, funding approval, CCSB Stage 1 approval, etc.
—
State whether the consultants selection exercise was initiated before funding is
secured (i.e. whether parallel tendering has been adopted).
—
For works-related consultancies funded under the Capital Works Reserve
Fund, if parallel tendering has not been adopted, quote the approving authority
and provide a summary of reasons.
—
For other consultancies, if parallel tendering has been adopted, quote the
approving authority and provide a summary of reasons.
F.
Details of the Present Submission
—
Provide information on the invitation and receipt of consultancy proposals
from the consulting firms with a sample of invitation for proposals.
—
State the composition of assessment panel and the specific terms of reference
of the assessment panel (if any).
—
Describe the assessment process by the assessment panel based on the
approved marking scheme and assessment criteria, including any verbal
presentation arranged.
—
Summarise the results of assessment highlighting the relative merits of the
consulting firms under each of the assessment criteria and an overall
assessment of individual firms.
—
Confirm whether members of the assessment panel have declared their interest
in accordance with SPR 186 and state, whether or not any conflict of interest
(actual, potential or perceived) has been identified, and if yes, what remedial
action has been made.
G. Recommendation
—
State the consulting firm being recommended for appointment (with MA
Division of FSTB and EffO’s advice on the reasonableness of fees and
payment terms (if any) proposed by the recommended firm in case of financial
consultancies and general management consultancies respectively).
—
Negotiate, where applicable, with the recommended firm to resolve items set
out in a negotiating brief and the expected result for each item.
—
State, where applicable, the next course of action in the event that agreement
cannot be reached with the recommended firm.
H.
Availability of Funds
—
Confirm the availability of funds and the title of the vote to be charged.
—
For initiation of consultants selection exercise before funding is secured, state
the expected date of obtaining the funding approval.
I.
Name and Telephone Number of Contact Officer
—
State the name(s)/tel. no(s). of public officer(s) who will attend the CCSB
meeting to discuss this item.
—
State the name/tel. no. of public officer who can provide further information
on this submission.
( )
Signed by a directorate officer
for Head of Department
Appendix V (A)
Guidance Notes on Execution of Contracts
(SPR 505(c))
Corporate bodies are companies incorporated under the Companies Ordinance
(Cap. 622) or under private incorporation ordinances. Other bodies, not so incorporated but
often loosely referred to as companies are, in fact, sole proprietorships or partnerships trading
under the name of a firm. A simple distinction between corporate bodies and unincorporated
bodies is that only the former can use the word "Limited" in their titles and is a separate legal
entity whilst the latter is merely one or more persons trading together. The shareholders of a
corporation cannot be sued individually. On the other hand, sole proprietors can be sued
individually and the members of a partnership can be sued individually and severally.
2.
A corporate body will usually execute a contract with its company chop and
the actual words to be used will be determined by the provisions of the Articles of
Association or other constitution of that corporate body. With these qualifications a contract
will usually end as follows —
"Signed by ___[and ___] for and on behalf of [name of the contractor] in the
presence of ____”
3.
The appropriate persons to sign the contract should be ascertained by
inspection of the Articles of Association and the resolution of the Board.
4.
Where it is necessary or desirable to execute the contract as a deed with the
use of a common seal (e.g. the contract is not supported by consideration or is to be executed
as a specialty for the purpose of a longer limitation period), it is no longer compulsory for a
company to have a common seal. Where the company does not have a seal or is not using the
seal, the contract may be treated as being executed under seal if the document is expressed to
be executed by the company and is signed by two or more directors or by one director and the
company secretary (or signed by the sole director if the company only has one director). The
execution clause without use of a common seal may be worded as follows—
“Executed and delivered as a deed
)
by ___________[name of Contractor]
)
acting through ___________________
)
, its sole director,/ ________________
)
and _____________, its directors,/
)
__________, its director and ________,
)
its company secretary, in the presence
)
of ____________ [name of witness] :
)
Where the common seal is used, the execution clause may be worded as follows—
“Executed and delivered as a deed and
)
the common seal of ________________ )
[name of Contractor] was affixed in the
)
presence of ______________________, )
its director(s),/___________, its director )
and ________ , its company secretary,/
)
[name(s)] _______, person(s) authorised )
to sign the contract by its board of
)
director(s) and in the presence of ______ )
[name of witness]:
)
5.
Individuals or partnerships (as distinguished from corporate bodies) may sign a
contract under hand by the signature of the individual or one or more partners by virtue of the
provisions of the Partnership Ordinance. Section 7 of the Ordinance provides that “every
partner is an agent of the firm and his other partners for the purpose of the business of the
partnership; and the acts of every partner who does any act for carrying on in the usual way
business of the kind carried on by the firm of which he is a member bind the firm and his
partners, unless the partner so acting has in fact no authority to act for the firm in the
particular matter and the person with whom he is dealing either knows that he has no
authority or does not know or believe him to be a partner”. However a partner has no
authority to execute a document under seal on behalf of the other partners unless specifically
authorised by them under seal to do so. Normally all works contracts and bonds to secure the
due performance of contracts must be executed under seal by the relevant parties. There is no
objection to other types of contracts being executed under hand but a bond to secure the due
performance of a contract must be executed under seal by the contractor and by the financial
institution which is giving a guarantee. Accordingly where a contract is to be secured by
bond, it is preferable that both the contract and the bond should be under seal.
6.
In any case where execution of a contract is by power of attorney, the original
power of attorney should be produced and a copy thereof retained with the contract.
7.
In every case the execution of a contract by each party thereto should be
witnessed by one person (not necessarily the same for each) who should sign his name and
add his address and his occupation.
8.
In every case where a contract is made with a partnership, the certificate of
registration under the Business Registration Ordinance should be produced prior to the
execution of the contract and the particulars of the partners should be checked.
Appendix V (B)
Schedule of Authorities for Variation of Contracts
(SPR 520(c) – (e) and 525)
A. WORKS CONTRACTS
Approval
Authority
Approval limit
(Public officers)
I. Subject to funds being
(i) Senior Engineer level or Up to the limit that the estimated
available –
equivalent
final contract sum, after
including all variations under
(a) any number of
Items I(a) and (b), would not
variations (e.g.
exceed the total sum of the
additional works,
original contract value plus the
deleted works, design,
contingencies allowed for in
method), excluding
accordance with the contract
extension of contract
terms [“
total contract value”].
period, essential for the
completion of works as (ii) Directorate level
Up to the limit that the estimated
defined in the original
final contract sum, after
contract; and
including all variations under
Items I(a) and (b), would not
(b) any additional payment
exceed the
total contract value
in accordance with the
plus 20% of the original
terms of the contract
contract value or plus 150% of
(e.g. price fluctuation
the quotation limit [SPR
clauses, certified
220(b)], whichever is the
claims, remeasurement,
greater.
arbitration awards).
(iii) COs
no limit
The above schedule of
Variations with individual value
authorities is subject to the
up to
% of quotation limit
condition that separate approval
[SPR 220(b)] –
of the public officer on the right
hand column is obtained, where
(i) Engineer level or
5%
necessary, for variations under
equivalent
Item I(a) –
(ii) Senior Engineer level or 20%
equivalent
(iii) Directorate level
100%
(iv) COs
no limit
(Note: For avoidance of doubt, supplementary agreement for additional works approved under
A.III and A.IV in this Appendix should be treated as a separate contract for the purpose of effecting
further variations to these additional works and the schedule of authorities for variation of
contracts under A.I should also be applicable where appropriate)
A. WORKS CONTRACTS
Approval Authority
Approval limit
(Public officers)
II. Acceptance of an alternative Directorate level
Not applicable
design, method, etc.,
proposed by a contractor
during the course of works,
subject to there being no
additional cost implications
or no additional works
outside the terms of the
original contract.
III. Additional works outside
Accumulated value of variations
the terms of the original
under Items III and IV up to
%
contract but within the
of quotation limit [SPR
approved scope of the
220(b)] –
project, subject to funds
being available.
(i) Senior Engineer level or 20%
equivalent
IV. Acceptance of an alternative
design, method etc.,
(ii) Directorate level
100%
proposed by a contractor
during the course of works
(iii) PS(Tsy)
no limit
involving additional cost
implications or additional
works outside the terms of
the original contract
provided that the additional
works are within the
approved scope of the
project, subject to funds
being available.
V. Extension of contract
Accumulated contract value up
period.
to –
(i) Directorate level
Quotation limit [SPR 220(b)]
(ii) PS(Tsy)
no limit
B. CONSULTANCY CONTRACTS Approval
Authority
Approval limit
(Public officers)
I. For contracts awarded under departmental authority
(a) Subject to funds being available, any number of variations other than (b) below, provided that
the additional services are within the approved consultancy scope and all the relevant factors
(including rates) are no less favourable
(i) For contracts awarded
Directorate level
Accumulated value of the
through quotations
contract up to
quotation limit
[SPR 220(a)]
(ii) For DCSC contracts
(i) Directorate level
Accumulated value of variations
up to
quotation limit [SPR
220(a)], provided that the
accumulated value of the
contract does not exceed
DCSC’s financial limit [SPR
426]
(ii) DCSC
Accumulated value of the
contract up to
DCSC’s financial
limit [SPR 426]
(b) Extension of contract period
(i) For contracts awarded
Directorate level
Accumulated value of the
through quotations
contract up to
quotation limit
[SPR 220(a)]
(ii) For DCSC contracts
(i) Directorate level
Accumulated value of variations
up to
quotation limit [SPR
220(a)], provided that the
accumulated value of the
contract does not exceed
DCSC’s financial limit [SPR
426]
(ii) DCSC
Accumulated value of the
contract up to
DCSC’s financial
limit [SPR 426]
B. CONSULTANCY CONTRACTS
Approval
Authority
Approval limit
(Public officers)
II. For contracts awarded on the advice of the CCSB / AACSB / EACSB
(a) Subject to funds being
Accumulated value of variations
available, any number of
up to the
quotation limit [SPR
variations other than (b)
220(a)] or
% of the original
below, provided that the
contract value, whichever is the
additional services are
greater
within the approved
consultancy scope and all
(i) Directorate level
10%
the relevant factors
(including rates) are no less
favourable
(ii) COs
20%
(b) Extension of contract period Directorate
level
Accumulated value of variations
up to the
quotation limit [SPR
220(a)]
III. Other variations not covered by I and II above
Subject to funds being available, (i) PS(Tsy)
no limit
and provided that the additional
(for appointment of
services are within the approved
consultants other than
project scope
(ii) and (iii) below)
(ii) AACSB
(for appointment of
architectural and
associated consultants)
(iii) EACSB
(for appointment of
engineering and
associated consultants)
C. SUPPLIES AND SERVICE CONTRACTS (OTHER THAN THOSE UNDER (A) AND (B)
ABOVE)
Approval
Authority
Approval limit
(Public officers)
I.
For contracts awarded under departmental authority
(a) Subject to funds being available, any number of variations provided that all the relevant factors
(including rates) are no less favourable
(b) Extension of contract period
(i) For contracts awarded
Directorate level*
Accumulated value of the contract
through quotation
up to
quotation limit [SPR 220(a)]
(ii) For DTC contracts
(i) Directorate level*
Accumulated value of the
variations up to
quotation limit
[SPR 220(a)], provided that the
accumulated contract value does
not exceed
DTC’s financial limit
[SPR 116]
(ii) DTC
Accumulated value of the contract
up to
DTC’s financial limit [SPR
116]
(iii) GLD Tender Board (for
Accumulated value of the contract
contracts awarded by
up to
GLD Tender Board’s
GLD only)
financial limit [SPR 116]
(c) Subject to funds being
PS(Tsy)
no limit
available, variations other
than those covered by (a)
and (b) above
II.
For contracts awarded on the advice of subsidiary tender boards
(a) Subject to funds being available, any number of variations other than (c) below, provided that all
the relevant factors (including rates) are no less favourable
Accumulated value of the
variations up to –
(i) For contracts awarded
(i)
Directorate level
25% of the original contract
by the departments
value or
quotation limit [SPR
itself
220(a)], whichever is the greater
(ii) COs
50% of the original contract
value
(ii) For contracts awarded
(i) GLD officers designated
50% of GLD Tender Board’s
by GLD
by DGL
financial limit [SPR 116] but not
exceeding the original contract
value
(ii) GLD Tender Board
GLD Tender Board’s financial
limit [SPR 116] but not exceeding
the original contract value
* For contracts awarded by GLD, the approval authority would be GLD officers (directorate or non-
directorate level) as designated by DGL
(b) Subject to funds being
(i) GLD Tender Board (for
Accumulated value of the
available, variations other
contracts awarded on the variations up to
GLD Tender
than those covered by (a)
advice of GLD Tender
Board’s financial limit [SPR 116]
and (c)
Board)
(ii) PS(Tsy)
no limit
(c) Extension of contract period
Accumulated value of the
variations up to –
(i) Directorate level*
Quotation limit [SPR 220(a)]
(ii) PS(Tsy)
no limit
III.
For contracts awarded on the advice of CTB
(a) Subject to funds being available, any number of variations other than (c), provided that all the
relevant factors (including rates) are no less favourable
Accumulated value of the
variations up to –
(i) For contracts awarded
(i) Directorate level
10% of the original contract
by the departments
value or
$4 million, whichever is
itself
the greater
(ii) COs
30% of the original contract
value or
$15 million, whichever is
the greater
(ii) For contracts awarded
(i) GLD officers designated
50% of GLD Tender Board’s
by GLD
by DGL
financial limit [SPR 116] but
not
exceeding 30% of the original
contract value
(ii) GLD Tender Board
30% of the original contract
value
(b) Subject to funds being
(i) GLD Tender Board (for
Accumulated value of the
available, variations other
contracts awarded by
variations up to
GLD Tender
than those covered by (a)
GLD only)
Board’s financial limit [SPR 116]
and (c)
(ii) PS(Tsy)
no limit
(c) Extension of contract
(i) Directorate level*
Accumulated value of variations up
period
to
quotation limit [SPR 220(a)]
(ii) PS(Tsy)
no limit
* For contracts awarded by GLD, the approval authority would be GLD officers (directorate or non-
directorate level) as designated by DGL
D. REVENUE CONTRACTS Approval
Authority
Approval limit
(Public officers)
I. For contracts awarded under departmental authority
(a) Any number of variations other than extension of contract period, provided that all the relevant
factors (including rates) are no less favourable
(i) For contracts awarded
Directorate level*
Accumulated value of the contract
through quotation
up to
quotation limit [SPR 220(a)]
(ii) For DTC contracts
(i) Directorate level*
Accumulated value of variations up
to
quotation limit [SPR 220(a)],
provided that the accumulated
contract value does not exceed
DTC’s financial limit [SPR 116]
(ii) DTC
Accumulated contract value up to
DTC’s financial limit [SPR 116]
(iii) GLD Tender Board (for
Accumulated contract value up to
contracts awarded by
GLD Tender Board’s financial
GLD only)
limit
(b) To approve variations other
PS(Tsy)
no limit
than those covered by (a)
above
II. For contracts awarded on the advice of GLD Tender Board / CTB
(a) For contracts awarded by
Accumulated value of variations up
GLD, any number of
to
% of GLD Tender Board’s
variations excluding
financial limit [SPR 116] but
not
extension of contract period,
exceeding the original contract
provided that all the
value
relevant factors, including
rates, are no less favourable (i) GLD officers designated
50%
by DGL
(ii) GLD Tender Board
100%
(iii) PS(Tsy)
no limit
(b) Variations other than those
PS(Tsy)
no limit
covered by (a) above
* For contracts awarded by GLD, the approval authority would be GLD officers (directorate or non-
directorate level) as designated by DGL
E. EXTRA-CONTRACTURAL SETTLEMENT OF CLAIMS
Contract Types
Approval Authority
Approval limit
I.
Extra-contractual settlement of claims involving payment by the Government
To approve, on the
(a) Works
(i) COs or designated
Accumulated value of
advice of D of J or
contracts
officers at
such payments up to
LAD(W)/DEVB
directorate level
quotation limit [SPR
where appropriate,
220(b)]
payment of a claim
which is not certified
(ii) PS(Tsy)
no limit
and is not the subject
of an arbitration
(b) Consultancy (i) COs or designated
Accumulated value of
award or an award of
contracts
officers at
such payments up to
the court, subject to
directorate level
quotation limit [SPR
funds being available
220(a)]
(ii) PS(Tsy)
no limit
(c) Supplies and (i) For contracts
service
awarded by the
contracts
department itself
(not covered
by (a) and
(i) COs
or
Accumulated value of
(b) above)
designated
claims up to
quotation
and revenue
officers at
limit [SPR 220(a)]
contracts
directorate level
(ii) PS(Tsy)
no limit
(ii) For contracts
awarded by GLD
(i) GLD directorate Accumulated value of
officers
claims up to
quotation
designated by
limit [SPR 220(a)]
DGL
(ii) PS(Tsy)
no limit
II. Extra-contractual settlement of claims involving acceptance of payment from the
contractor
To approve, on the advice of D of J or
PS(Tsy)
no limit
LAD(W)/DEVB where appropriate,
acceptance of payment of a claim which
is not certified and is not the subject of
an arbitration award or an award of the
court.
Appendix V (C)
Guidelines for Monitoring Performance of Consultants
Appointed under the Central Consultants Selection Board Procedures
(SPR 540)
Procuring
departments
should
closely
monitor the performance of consultants
to ensure that their services meet the requirements set out in the consultancy brief and
agreement. They should evaluate the performance of their consultants at the intervals as set
out in SPR 536. Performance reports on consultants shall be completed by a public officer at
or above senior professional level on GF 562 and forwarded to the Secretary, CCSB no later
than six weeks after they are due. The procuring department should copy the performance
report to other departments (if any) involved in selecting the consultant for the consultancy
study.
2.
As soon as it becomes apparent that any aspect of the consultant’s performance
is not satisfactory, the procuring department should take steps as set out in SPR 537. In
addition, the procuring department should state in the performance report to CCSB the action
taken to inform the consultant that his performance is considered unsatisfactory in a particular
aspect(s) and the response from the consultant. The procuring department should also
summarise any correspondence exchanged and discussions that have taken place with the
consultant. The procuring department should not give an unsatisfactory rating in the report
unless the consultant has been informed of his unsatisfactory performance in the aspect
concerned.
3.
When the performance of the consultant continues to be unsatisfactory
notwithstanding his being so advised in writing, the procuring department should take further
steps as set out in SPR 538, and put the consultant on a three-monthly reporting system.
4.
CCSB may consider suspending a consultant from bidding Government’s new
consultancy agreements up to a period of 12 months. The suspension may apply to —
(a)
consultancy studies in a field relating to the consultancy study for which
the consultant has received three adverse reports over a period of two
years; or
(b) consultancy studies in the same field for which the consultant has
received three adverse reports over a period of two years or if the
department has made a specific recommendation that the consultant is
not suitable for similar future studies; or
(c) consultancy studies in any field if the consultant has received four
adverse reports in studies in different fields over a period of 12 months.
5.
An adverse report mentioned in paragraph 4 refers to a performance report
with an overall grading of “unsatisfactory”. Six-monthly and three-monthly interim reports
carry the same weighting as full performance reports.
6.
Before considering whether to recommend to CCSB to suspend a consultant
from bidding new consultancy agreements, the procuring department should invite the
consultant to make representations. CCSB will then take into account recommendation by the
procuring department, explanations or representations made by the consultant in response to
the proposed suspension by the Government, and mitigating circumstances, if any. The
procuring department should inform the consultant of CCSB’s decision promptly upon
notification by Secretary, CCSB.
7.
If the consultant’s performance on an assignment continues to be
unsatisfactory after having been suspended from bidding under paragraph 4 above, CCSB
may consider deleting the consultant from the long list. Before doing so, the procuring
department should invite the consultant to make representations. CCSB will then take into
account recommendations by the procuring department, explanations or representations made
by the consultant on the proposed delisting and mitigating circumstances, if any. The
procuring department should notify the consultant of CCSB’s decision promptly upon
notification by Secretary, CCSB.
8.
Departments should ensure that payment to consultants should only be made in
accordance with the terms of the relevant consultancy agreement. Where the payment
schedule is based on milestone payments related to deliverables/performance targets, the
department must be satisfied that the deliverables/performance targets required for a
particular stage have been completed to Government’s satisfaction before payment for that
stage is made to the consultants.
Appendix VI
Guidelines for Keeping Stores Records and Issuing Stores
(SPR 680 and 850)
Registers
For proper control of stores, departments should maintain the following
registers –
(a) Register of serially numbered and controlled form (GF 298) – for
recording receipts, issues and disposal of books of stores vouchers and
controlled numbered stores forms. Separate folios should be used for
each type of book.
(b) Claims register (GF 207) – for recording details of imported goods
which are short-delivered, damaged, or in any other aspect not in
compliance with the contract.
(c) Loan Register – for recording details of departmental stores issued on
loan.
(d) Surprise inspection book (GF 235) - for recording results of surprise
inspections.
Issue of Stores for Government Works or Services
2.
Departments may issue government stores on a first-in-first-out basis to public
officers for use in government works or services. The public officer receiving the stores
should sign on one of the following forms —
(a)
if the stores are delivered to the public officer by the suppliers direct —
on a Departmental Order for Supply of Stores (GF 219) in respect of
stores purchased through GLD or by the department concerned under its
delegated authority; or
(b)
if the stores are issued from a departmental store unit —
(i) on a Departmental Combined Requisition and Issue Voucher
(GF 277) in respect of inventory items or non-inventory items
which are not regularly required in fairly large quantities; or
(ii) on a Non-inventory Stores Consolidated Issue Voucher (GF 283)
for non-inventory items which are issued in accordance with a
Working Stores Table maintained by DSM; or
(iii) in Column 7 of the Non-inventory Stores Ledger (GF 291) for
non-inventory items which are not regularly required in fairly
large quantities; or
(c) on a computerised stores voucher if the department concerned has
computerised its stock records and stores vouchers.
3.
The voucher and the relevant job numbers, where the latter are maintained,
should be cross-referenced.
Issue of Stores for Conversion
4.
If a department wishes to convert stores which have already been taken on
charge into items of different specifications or units, e.g. the issue of cloth for making
uniform, the public officer receiving the stores for the purpose should sign on a Stores
Conversion Voucher (GF 227).
Issue of Stores for Transfer between Depots
5.
For the transfer of stores from one departmental depot to another, the receiving
officer should sign on a Departmental Combined Requisition and Issue Voucher (GF 277).
Issue of Stores in Exchange for Unserviceable Items
6.
When stores that are held on charge and recorded in an Inventory Ledger Sheet
(GF 270) have become unserviceable, they need to be returned to a departmental store unit
pending examination by the departmental disposal authority. In exchange for these
unserviceable items, departments may issue new stores to the users and require the receiving
officer to sign on one of the following forms —
(a) an Exchange Voucher for Store on Inventory Charge (GF 275) for
non-uniform items; or
(b) a Counter Record of Issues/Returns of Uniforms and Accoutrements
(GF 292) for uniform items.
Issue of Stores for Sale
7.
Departments may issue surplus stores, serviceable or otherwise, for sale by the
disposal term contracts arranged by the GLD and commercial disposal under SPR 1145 after
receipt of payment and shall require the purchaser or his representative to sign on a GF 277.
Issue of Stores on Transfer to Other Departments or for Donation, Destruction or
Dumping
8.
Departments may transfer stores to other departments or arrange for donation,
destruction or dumping in accordance with the procedures set out in Chapters XI and XII. In
all cases, GF 277 must be completed and shall state clearly the approval reference.
Appendix VII
List of Stores for Dumping
(SPR 1155 and 1200(b))
Department :
File Reference
:
DDC Reference
:
In accordance with the recommendations of the Departmental Disposal Committee, I certify
that the stores listed below have been destroyed or dumped.
Item No.
Description
Unit
Quantity
Prepared by
Signature :
Name :
Designation :
Date :
Original - To be retained by the department which implements the recommended disposal
method
Copies - To Director of Government Logistics and Director of Audit
Glossary
AACSB
: Architectural and Associated Consultants Selection Board
CCGO
: Central Cyber Government Office
CCSB
: Central Consultants Selection Board
CO
:
Controlling
Officer
CTB
: Central Tender Board
D of A
: Director of Audit
DAS
: Director of Accounting Services
DCSC
: Departmental consultants selection committee
DDA
: Departmental disposal authority
DDC
: Departmental disposal committee
DEVB
:
Development
Bureau
DEVB TC(W)
: Development Bureau Technical Circular (Works)
DGL
: Director of Government Logistics
D of J
: Department of Justice
DSM
: Departmental Stores Manager
DTC
: Departmental tender committee
EACSB
: Engineering and Associated Consultants Selection Board
EDB
:
Education
Bureau
EffO
:
Efficiency
Office
EMSD
: Electrical and Mechanical Services Department
EOI
: Expression of interest
FC
:
Financial
Circular
FSTB
: Financial Services and the Treasury Bureau (The Treasury
Branch)
FSTBCM
:
Financial Services and the Treasury Bureau Circular
Memoranda
GLD
: Government Logistics Department
HKSAR
: Hong Kong Special Administrative Region
LAD(W)/DEVB
: Legal Advisory Division (Works) of the Development Bureau
MA Division
: Management Accounting Division of the Financial Services and
the Treasury Bureau (The Treasury Branch)
PS(Tsy)
: Permanent Secretary for Financial Services and the Treasury
(Treasury)
SFST
: Secretary for Financial Services and the Treasury
SMEs
: Small and Medium-sized Enterprises
SMS Framework
: Standard Marking Scheme Framework
SPRs
: Stores and Procurement Regulations
TAP
: Tender assessment panel
WTO GPA
: Agreement on Government Procurement of the World Trade
Organization
