Selection criteria and knock-outs: read them, challenge them, or team up

Four kinds of requirements

A buyer checks in a fixed order. First who is excluded, then who is suitable, and only at the end which bid is best. The Dutch terms are in brackets.

1. 1Exclusion grounds (uitsluitingsgronden)Situations in which you may not take part, such as certain convictions or unpaid taxes. You declare on them in the ESPD.
2. 2Selection criteria (geschiktheidseisen)Minimum requirements for your company: professional suitability, economic and financial standing, and technical and professional ability. Think turnover, references and certificates. Miss one, and you are out.
3. 3Shortlisting criteria (selectiecriteria)Only in procedures with a shortlisting stage: which suitable companies are invited to bid.
4. 4Award criteria (gunningscriteria)Which bid wins, on price and quality. See price and quality.

When is a requirement too heavy?

Requirements must relate to the contract and be in reasonable proportion to it. In the Netherlands, the Gids Proportionaliteit (the Proportionality Guide) works this out. A few limits are firm.

• TurnoverAt most three times the contractUnder Dutch law a turnover requirement may not exceed three times the estimated contract value, and needs a sound reason. The EU directive sets two times as the normal maximum.
• ReferencesAt most 60% of the contractUnder the Dutch guide, a reference need not be larger than 60% of the estimated value. More in references.
• CertificatesEquivalent countsAn equivalent certificate from another accredited body must be accepted.

The requirement that is too heavy most often in practice: reference contracts with a turnover that is unrealistic for the contract. A buyer asking for a one-million reference on a contract worth two hundred thousand shuts out a large part of the market for no reason.

A requirement almost nobody meets does not help the buyer either.

Ask about it

If a requirement seems too heavy, ask about it in the clarification round. Explain why, and propose a reasonable alternative. It works more often than you would think. A well-known example is ISO 27001: a buyer accepting only that certificate regularly changes the requirement after a good question to “ISO 27001 or equivalent”.

Do not wait. A requirement you only want to challenge after closing is usually too late to fight. If you object, you have to say so in time.

Missing a required certificate, and unable to get it in time for a reason that is not yours? Then you can sometimes show with equivalent measures that you meet the standard. That exception is narrow. If you started certification too late, you cannot rely on it, and according to Dutch courts your own manual without an external audit is not automatically equivalent.

Together you qualify

If you cannot meet a requirement alone, you can team up. You may rely on the experience or standing of another company, as long as you show you can use its resources. That can be as a consortium bidding together, or by relying on a subcontractor or another company.

• Outside your regionThe contract partly runs in a region where you do not work. A partner based there makes it deliverable.
• Too large in volumeThe work does not fit next to your existing clients. Together you can carry it without letting your own clients down.
• References or certificates combinedYou have one reference, the other company the other one, or the required certificate. Together you qualify.

Arrange it in time. In a consortium every partner fills in its own ESPD, and so does a company you rely on. And agree in advance who does what, who is accountable and how you divide the contract. Whether teaming up is worth it belongs in your bid or no bid decision.