AQS 2151

Pre-Contract Administration for

Quantity Surveyors
Tendering:
Methods of Tendering
Invitation & receipt of tenders
Processes & procedures in the public &
private sectors
 Methods of Tendering
The objective of tendering is to select a suitable
contractor at an appropriate time and obtain from
him an acceptable offer upon which a contract
can be let.

Generally there three (3) types of tendering used:

Open Tendering
Selective Tendering
Negotiated Tender
 Methods of Tendering
Open tender
Open to all eligible contractors
Invitation to tenders through the mass media (e.g. general press)
Maximum competition
A tender document fee is required from each contractor
Selective tender
As the name implies, a list of selected tenderers is produced as a basis
for this method of obtaining tenders
The design team together with Client will normally determine which
contractors will be invited to tender.
Design team will take into account contractors’ track records, business
record, financial stability and capacity to carry out project
 Methods of Tendering
Negotiated Tender
Series of negotiation will take place between the client and
selected contractor. Normally under design and build
procurement.
 Methods of Tendering
OPEN TENDERING
Advantages of Open Tendering
No favouritism
Introduction to new firms
Maximum competition

Disadvantages of Open Tendering

Is the lowest firm capable?
Is it financially secure?
Experience in tender submission?
Cost of tendering increased as number of tenderer increases
 Methods of Tendering
SELECTIVE TENDERING
Advantages of Selective Tendering
Only capable firms are invited to tender
Reduces the overall cost of tendering

Disadvantages of Selective Tendering

Higher tender prices
Possible charges of favoritism
 VALUE OF WORKS
Works < RM 10 million
Invited for local Companies with 100%
bumiputera
Works RM 10 million – RM 25 million
Invited for local Companies with 100%
bumiputera OR Public Listed companies on
BSKL with foreign shares not more than 30%
and Managing Director and workers are
100% local.
 VALUE OF WORKS
Works > RM 25 million
Invited for local Companies with
100% bumiputera
Local companies listed on BSKL OR JV
companies, with foreign equity not
more than 49% and majority of Board
of Directors, Management and
workers are local.
 Invitation & Receipt of
Tenders

Tender advertisement
Local tender - minimum: in one
main BM daily
International tender - in one main
BM daily and one main English
daily, and distribute to foreign
embassies
 Invitation & Receipt of
Tenders
Information in tender advertisement:
name of department calling the tender
title of project
type of tender
contractors’ qualifications
Class head and sub-head (PKK & CIDB)
place, date & time to purchase tender document
place, date & time to submit tender document
price of tender document
site visit (if any)
(See sample of tender advertisement)
 Invitation & Receipt of
Tenders

Submission of tender:
submit the priced tender document to and at
the time as stated in the tender advertisement
closing time is normally no later than 12 noon

Late Submission:
Late not more than 30 minutes. Can be
accepted. (Subject to approval)
 PKK Classifications
Class Limits on Value of Projects
A > RM 10,000,000
B RM5,000,001 – RM10,000,000
C RM2,000,001 – RM5,000,000
D RM500,001 – RM2,000,000
E RM200,001 – RM500,000
F <RM200,000
 CIDB Classifications
Grade Limits
G7 No Limit
G6 Not exceeding RM 10,000,000

G5 Not exceeding RM 5,000,000

G4 Not exceeding RM 3,000,000
G3 Not exceeding RM 1,000,000
G2 Not exceeding RM 500,000
G1 Not exceeding RM 100,000
Tendering Procedures
Special Approval For
Tender
PKK has the power to consider and
approve any special request from
contractors to participate in
tenders for which they are not
eligible to participate due to their
registration of classes and
experiences
 Tendering Procedures
(with specific reference to the Public
Sector)

Why public sector?

Largest single owner/developer

one-third of total construction

procedures are more structured and formalised (e.g.

governed by factors such as source of funding and
type, nature and estimated cost of project)

basis for good practice

 Category of
Procurement
Works
infrastructure, building & engineering, M&E

Goods
raw materials, intermediate and finished
goods

Services
manpower, consultants and expertise
 Types of Procurement
Direct Purchase
goods & services up to RM10,000 - directly from any
known suppliers
goods & services between RM10,000 - RM50,000 -
from suppliers registered with MOF
works up to RM50,000 - indent to a contractor
registered with CIDB and PKK

Quotation
works, gods and services between RM50,000 –
RM200,000
may be invited through registered post, by hand or
posted on designated notice board

Tender
next slide..
Tendering Procedures
Project >RM 200,000 to be let on
open tendering (there are
exceptions)

Selective tendering / negotiation

allowed in specific circumstances
(e.g. urgent or sole supplier) - prior
approval from MOF
Tendering Procedures
Issuance of Tender
Document
Issue from the office that prepares Tender
Document i.e. PWD offices
Before the issuance. The office shall ascertain
That only authorized representatives of contractors are
allowed to take the document and they should produce
evidence or credentials of their authorities
That they have to show their Bumiputra status
That a verification of status shall be made to ensure that
it is still valid on that date

The issuing officer should record names,

addresses and classes of registration of
contractors
 Tendering Procedures
Mandatory requirement for all tenders for
works funded by the govt. own source of
fund to be opened to Malaysian contracting
firms only

The exceptions:
incapability of Malaysian contractors to
undertake certain works
for civil engineering works valued >RM50
million each
 Tendering Procedures

Tender Deposit
local tender - no tender deposit
international tender - tender deposit
varies between RM50,000 - RM1
million

Tender Period
local tender - 21 days
international tender - 56 days
 Tendering Procedures
Tender Validity Period
90 days (may be extended)
withdrawal after closing date - disciplinary
action by PKK and/or agency concerned
1st Offence : 2 years suspension from participating
in government tenders
2nd Offence: 5 years
3rd Offence: Cancellation of registration
Shareholders : blacklisted
Board of Directors : blacklisted
Tendering Procedures
Receipt and Opening of
Tenders
Tenders shall be submitted at the office or
deposited into tender boxes provided on or
before the date mentioned in the Tender Notice
Tenders shall be opened by Tender Committee
On opening Committees shall prepare a schedule
of tenders consisting of names, classes and
registrations, status of tenderers, amount of
tenders and time for completion
No tender shall be open after the closing time
but shall be accepted and forwarded to Tender
Committee as they are.
Next
Opening of tenders
Evaluation
Acceptance