Post tender negotiation (PTN) was defined by the Office of Government Commerce as:
"Negotiation after receipt of formal bids or tenders and before the letting of contract(s) with those companies submitting tender(s) offering the best value for money with a view to obtaining an improvement in content in circumstances which do not put the other tenderers at a disadvantage, distort competition or affect adversely trust in the competitive tendering process."
- PTN should not be used to conduct a ‘Dutch auction’ between the bidders or to distort competition. It should be used in moderation and only where there is an opportunity to lower prices and improve other aspects of the submissions.
- PTN should only be undertaken with the one or, perhaps, two bidders offering the best submissions under the stated award criteria.
PTN should involve your institution’s Head of Procurement (or nominee) and thorough preparation should be undertaken before starting.
- A detailed record should be kept of the PTN process, from the reasons and decision to undertake the negotiations; the negotiations themselves and the eventual outcome. These records will form part of the audit trail and could be subject to scrutiny by Audit (internal and external) and could be made public should there be a successful complaint from an unhappy bidder.
For contracts above the EU threshold and subject to the Public Contracts Regulations
Under the EU procurement rules apart from the competitive dialogue and negotiated procedures, there is little scope for negotiation especially in respect of the open or restricted procedures. The EU Commission has issued the following statement:
"in open and restricted procedures all negotiation with candidates or tenderers on fundamental aspects of contracts, variations in which are likely to distort competition, and in particular on prices, shall be ruled out; however, discussions with candidates or tenderers may be held but only for the purpose of clarifying or supplementing the content of their tenders or the requirements of the contracting authorities and provided this does not involve discrimination"
Therefore, in general, there is only scope to clarify a bid for tenders subject to the Public Contracts Regulations.
A risk assessment for this stage of the procurement cycle is provided.