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Client Query 168:- Hi, wanted to discuss that bids invited according to rule 36 (b) where in technical bids have been opened and forwarded for technical evaluation according to prescribed rule. One of bidder in his cover letter has mentioned about performance guarantee as:-

“The project is a service oriented project, hence no performance security is applicable nor any retention money should be deducted. It is to be noted that we will be deducting taxes on salaries payable to various employees that PSO will advise is to hire, therefore no performance security can be paid either against salaries of personnel engaged nor services rendered by the agency.”

Now does this pertain to matter of technical or bid is to be rejected due to aforementioned argument or to seek further clarification from bidder in accordance with rule 31. However commercial bids have not yet opened? Your assistance in this regard would be highly appreciated!


Farooq Ali, Pakistan


Answer:- Thank you very much for writing to us. As per your query, it seems that PSO intends to hire the services of a firm to provide manpower for certain task. It would have been more appropriate if PSO may have categorically mentioned in the query that what type of procurement is to be made. It is however, clarified that Public Procurement Rules, 2004 and the relevant regulations made thereunder govern the procurement of goods, works and services. Performance guarantee can be demanded by the procuring agencies from the successful bidder in terms of Rule 39 of Public Procurement Rules, 2004.

See also  PPRA Rules Query on Direct Contracting/Negotiated Tendering

If you wish to inquire anything else you may set up an appointment with our extremely competent team of lawyers and visit our office which is located at GF-13, Tower A, The Centaurus, Islamabad, Pakistan.

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