H&R CONSULTANTS
Determinations
File No.: PR-97-002
Ottawa, Monday, June 23, 1997
File No.: PR-97-002
IN THE MATTER OF a complaint filed by H&R Consultants under subsection 30.11(1) of the Canadian International Trade Tribunal Act, R.S.C. 1985, c. 47 (4th Supp.), as amended;
AND IN THE MATTER OF a decision to conduct an inquiry into the complaint under subsection 30.13(1) of the Canadian International Trade Tribunal Act.
DETERMINATION OF THE TRIBUNAL
Pursuant to section 30.14 of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal determines that the complaint is not valid.
Charles A. Gracey
_________________________
Charles A. Gracey
Member
Susanne Grimes
_________________________
Susanne Grimes
Acting Secretary
Date of Determination: June 23, 1997
Tribunal Member: Charles A. Gracey
Investigation Manager: Randolph W. Heggart
Counsel for the Tribunal: Heather A. Grant
Complainant: H&R Consultants
Government Institution: Department of Public Works and
Government Services
FINDINGS OF THE TRIBUNAL
INTRODUCTION
On April 10, 1997, H&R Consultants (H&R) filed a complaint under subsection 30.11(1) of the Canadian International Trade Tribunal Act [1] (the CITT Act) concerning the procurement by the Department of Public Works and Government Services (the Department) for the supply and delivery of 788 17-in. colour monitors and the provision of one year on-site warranty services for the Supply Operations Service Branch of the Department (Solicitation No.: EN532-6-0165/A).
H&R alleged that the Department interpreted arbitrarily certain mandatory requirements of the Request for Proposal (RFP), specifically item g) of Appendix “B” which sets out the specifications for the colour monitors, resulting in its offer being deemed non-compliant. H&R maintained that the monitor that it proposed met all the technical requirements of the RFP and that its offer was almost $100,000 lower than that of the contract awardee. In support of its allegation of arbitrariness on the part of the Department, H&R cited another procurement, Solicitation No. 45045-6-002/A, as a similar example of arbitrariness on the part of the Department.
H&R requested, as a remedy, that the Department’s award decision be reversed and that it be awarded the contract. In the alternative, H&R requested a compensation equivalent to the value of the contract plus damages.
BACKGROUND
On April 14, 1997, the Tribunal determined that the conditions for inquiry set forth in section 7 of the Canadian International Trade Tribunal Procurement Inquiry Regulations [2] (the Regulations) had been met in respect of the complaint and decided to conduct an inquiry. On May 12, 1997, the Department filed with the Tribunal a Government Institution Report (GIR) in accordance with rule 103 of the Canadian International Trade Tribunal Rules. [3] On May 23, 1997, H&R filed its comments on the GIR with the Tribunal.
Given that there was sufficient information on the record to determine the validity of the complaint, the Tribunal decided that a hearing was not required and disposed of the complaint on the basis of the information on the record.
PROCUREMENT PROCESS
On January 20, 1997, the Department published a Notice of Proposed Procurement (NPP) and an RFP for this requirement in Government Business Opportunities. The NPP indicated that the RFP, with a closing date of March 3, 1997, was a procurement process subject to the North American Free Trade Agreement [4] (NAFTA), the Agreement on Internal Trade [5] (the AIT) and the Agreement on Government Procurement [6] (the AGP).
Part II of the RFP, “BIDDERS’ PROPOSALS” at section 2.0, “Technical Proposal,” states, in part, the following:
2.1 The Bidder’s Technical proposal MUST contain the following information:
2.1.1 For each article in the Technical Specification (Appendix “B”), it is MANDATORY that bidders indicate the statement of compliance in a paragraph by paragraph response and in the same form and sequence as the specification. Any exception or alternatives to the specified requirements shall be fully described in the proposals. All references to descriptive material, technical manuals and brochures must be included in the appropriate response paragraph.
2.1.3 Technical documentation, such as specification sheets and technical brochures describing the unit proposed in the List of Deliverables. It is the Bidder’s responsibility to ensure that the submitted technical documentation provides adequate detail to prove that the proposed product meets the client’s requirements.
Part III of the RFP entitled “EVALUATION,” moreover, provides, in part, at section 1.3 that “[a] proposal will be considered NON-RESPONSIVE if it is not supported by proper and adequate detail, particularly where supporting evidence is required by a Mandatory item, and will receive no further consideration.”
Appendix “B” to the RFP, “SPECIFICATIONS,” further states, in part:
The 17 inch colour monitor must meet the following mandatory requirements:
c) have a minimum 100 MHz. bandwidth
g) support the resolutions of 640 x 480, 800 x 600 and a non-interlaced 1024x768 VGA resolution at a minimum refresh rate of 100 Hz and a non-interlaced resolution of 1280x1024 at a 75 Hz. refresh rate.
h) be auto scanning or multi scanning to accept any vertical sync rate from a minimum range of 50-100 Hz. and accept any horizontal sync rate from a minimum range of 31-65 KHz.
For ease of understanding, the Tribunal adopts the following definitions proposed by the parties for the expressions “pixel resolution,” “refresh rate” and “video bandwidth”:
A pixel is the smallest part of the video screen that can be turned on or off or varied in intensity. The image on the monitor is a composite of thousands of pixels. The monitor’s resolution is determined by the number of pixels it is displaying in horizontal and vertical rows at any time. The greater number of pixels, the higher the image resolution and the greater the viewing area. One of the resolutions required by Item (g) of Appendix “B” … is 1024 x 768, with the first number (1024) being the number of pixels in each horizontal row and the second number (768) the number of rows displayed.
The refresh rate (also referred to as the vertical scan frequency) is the number of times per second the image is painted onto the screen. Refresh is necessary, because the phosphorescent coating on the inside of the monitor’s face holds the displayed image for just a fraction of a second. The higher the refresh rate, the more solid the image will appear on screen.
Bandwidth is the transmission capacity of an electronic line. It is expressed in bits per second, bytes per second or in Megahertz. It determines the amount of data the monitor will accept from the PC’s video controller.
During the bid solicitation period, three RFP updates were issued by the Department to all potential suppliers through the Open Bidding Service. Update No. 1, dated January 31, 1997, includes the following question and answer:
Q4. Please clarify the following in Appendix B part (g): Minimum refresh rate of 100 Hz. This is a very unusual specification.
A4. These monitors will be driven by high performance Matrox Mystique video controllers that have already been bought. The intent of these specifications is to procure monitors that will exploit the capabilities of these controllers.
Twenty-six bids, including one from H&R, were received by the Department by the time of bid closing on March 3, 1997. The evaluation of bids was completed by the Department on March 7, 1997, and seventeen of the bids received, not including the H&R bid, were found to be compliant.
In its proposal, H&R offered to supply SAMPO Model KM750D monitors. The H&R proposal further stated: “This monitor meets all the specifications as per Appendix “B” page 19 of 25 of Part 2 of 2 of this solicitation.” In their response to item g), section 2.1 of Appendix “B,” the proposal sets out the following:
| Item |
COMPLAINT (YES/NO) |
Comments |
| “g” |
YES |
supports all resolutions as specified - p15 [7] |
Page 15 of the user’s guide reads, in part, as follows:
Typical Display Modes
The AlphaScan 750 has a Maximum Resolution of 1280 x 1024 , a Vertical Sync Frequency range of 50-200 Hz and a Horizontal Sync Frequency range of 30-86KHz .
The following table is an illustration of some of the typical video display modes. It is by no means an all-inclusive list of the frequencies to which the monitors can autosync.
| Graphic Standard (Resolution) |
Vertical Refresh, Horizontal Scan |
| VESA ErgoEVGA (1024 x 768) |
70 Hz, 56.5 KHz |
| VESA (1024 x 768) |
72 Hz, 58 KHz |
| XGA-2 (1024 x 768) |
76 Hz, 61.1 KHz |
H&R also included in its bid a technical specification sheet published by SAMPO, the manufacturer of the monitor. The sheet, titled “KM-750,” states, in part, under “Typical Display Modes”:
| Resolution |
Graphic Standard |
Vertical Refresh |
Horizontal Scan |
| 1024x768 |
VESA Extended VGA |
60 Hz |
48.4 KHz |
| 1024x768 |
VESA ErgoEVGA |
70 Hz |
56.5 KHz |
It also states, under “PC COMPATIBILITY”: “1024x768: 60 to 76 Hz.”
H&R’s bid was found by the Department to be technically non-compliant, as that portion of the documentation referred to in the proposal (page 15 of the user’s guide) and submitted with the proposal specified that the monitor offered by H&R would support refresh rates of 70 to 76 Hz at a resolution of 1024 x 768. The mandatory minimum requirement for this purchase was a refresh rate of 100 Hz at a resolution of 1024 x 768.
On March 10, 1997, H&R sent a facsimile to the Department inquiring as to the status of its bid. On March 17, 1997, a contract in the amount of $664,209.48 was awarded to the lowest-priced compliant bidder. On March 18, 1997, the Department informed H&R that a contract had been awarded, to whom and in what amount. During the period from March 10 to April 16, 1997, H&R and the Department exchanged numerous communications and, on April 14, 1997, the Department provided H&R with a debriefing.
VALIDITY OF THE COMPLAINT
H&R’s Position
In its comments, H&R states that it does not accept the explanation provided by the Department in the GIR. It submits that there was enough technical information in the specification sheet that it submitted with its proposal for the contracting officer to evaluate the monitor, notwithstanding the typical resolution numbers presented by SAMPO. H&R suggests that, if the Department can overlook the mandatory requirement for bilingual documentation for Solicitation No. 4504-6-002/A, then it is reasonable to expect that the Department would accept H&R’s statement that the monitor proposed by H&R meets the display resolution requirement set out in item g), section 2.1 of Appendix “B” when such statement was supported by indicating the monitor’s capabilities in terms of video bandwidth and vertical and horizontal frequency ranges.
H&R submits that the monitor is like a black box attached to a system which responds to video signals generated by the video card. The monitor either will or will not respond to the signals of the video card depending on its video bandwidth and vertical and horizontal frequency ranges. There is no mechanical or electronic device on the monitor which reads at what setting the video card is operating. H&R further submits that, in order to produce a display at any resolution, both vertical and horizontal refresh rates are important.
Indeed, H&R submits that, given that the video bandwidth and the vertical and horizontal frequency ranges of the product that it offered are well above the requirements of the RFP, it is not unreasonable to expect that the technical evaluator would accept H&R’s statement that the monitor meets 1024 x 768 at 100 Hz and that, if it had any doubt, the Department should have asked pertinent questions.
Department’s Position
In its response to H&R’s complaint, the Department submits that it acted in good faith, was fair in its application of the evaluation terms of the RFP and adhered to the obligations set out in the trade agreements. It submits that it is the supplier’s responsibility to prepare its proposal in such a way as to allow the evaluation team to evaluate the technical compliance of its proposal. H&R’s proposal, the Department submits, was evaluated based on the information provided therein and was properly found to have failed to meet a mandatory requirement of the RFP.
Concerning H&R’s position that the Department should have contacted it for clarification if there was any doubt about H&R’s compliance with the RFP, the Department submits that the evaluation team was not in doubt as to whether or not H&R’s bid was compliant. The manufacturer’s technical specification sheet indicated that the requirement was not met. The proposed SAMPO monitor supported a refresh rate of 60 to 76 Hz, not the required 100 Hz. This was confirmed in the user’s guide, which indicated a refresh rate of 72 Hz at the required resolution. The Department further submits that, when resolution goes up, the refresh rate goes down. Therefore, the maximum 200 Hz refresh rate stated in the SAMPO specification sheet is only achieved at a low pixel resolution. The monitor’s bandwidth of 135 MHz meets the technical specification; however, this does not result in a compliant resolution and refresh rate combination. The manufacturer’s specification sheet provided by H&R for the SAMPO monitor does not confirm the required 100 Hz refresh rate at the 1024 x 768 resolution. Rather, the Department submits, it states “PC COMPATIBILITY: 1024x768: 60 to 76 Hz” refresh rate. The supporting monitor user manuals state that the “typical” combination is 1024 x 768 at 72 Hz. The documentation provided with H&R’s proposal is specific about the refresh rate for the required resolution, and nowhere does it state that a 100 Hz refresh rate is possible at any resolution. Moreover, contrary to H&R’s position that items c) and h) in Appendix “B” are the “principal” specifications, the Department submits that all mandatory requirements were given equal weight in the evaluation scheme, and bidders were required to meet each and every individual criterion listed in order to be found compliant.
Finally, the Department submits that H&R’s proposal did not provide sufficient technical documentation in adequate detail with its bid to support its statement that it was compliant with the mandatory requirement of item g) in the RFP.
Tribunal’s Decision
Section 30.14 of the CITT Act requires that, in conducting an inquiry, the Tribunal limit its considerations to the subject matter of the complaint. Furthermore, at the conclusion of the inquiry, the Tribunal must determine whether the complaint is valid on the basis of whether the procedures and other requirements prescribed in respect of the designated contract have been observed. Section 11 of the Regulations further provides that the Tribunal is required to determine whether the procurement was conducted in accordance with the requirements set out in NAFTA, the AIT and the AGP.
Article 1015(4)(a) of NAFTA and Article XIII(4)(a) of the AGP both provide that, to be considered for award, a tender must, at the time of opening, conform to the essential requirements of the tender documentation. Article 506(6) of the AIT also provides that tender documents shall clearly identify the requirements of the procurement, the criteria to be used in the evaluation of bids and the method of weighting and evaluating the criteria.
In this instance, the Tribunal must decide whether or not the Department conformed to the above-mentioned provisions when it declared H&R’s proposal non-responsive to the mandatory technical requirement identified at item g) of Appendix “B” of the RFP, namely, the monitor’s required refresh rate.
The Tribunal finds that the RFP clearly indicated, as a mandatory requirement, that the monitor proposed should, amongst other things, support a non-interlaced VGA resolution of 1024 x 768 at a minimum refresh rate (vertical scan frequency) of 100 Hz. As well, it indicated that it was the bidder’s responsibility to ensure that the submitted technical documentation provide adequate detail to prove that the proposed product meets this requirement.
In its offer, H&R indicated that the monitor that it offered met all the specifications of Appendix “B” of the RFP. Specifically, it stated in respect of item g) of Appendix “B” that it was compliant, in that the monitor offered was able to support all resolutions as specified on page 15 of the user’s guide. The user’s guide at page 15 specifies, under typical display modes, refresh rates of 70 to 76 Hz at a resolution of 1024 x 768.
In the Tribunal’s opinion, the Department did not violate any procedural requirements when it concluded, from the technical documentation submitted by H&R, that the monitor proposed by H&R failed to meet the mandatory requirement of item g) of Appendix “B.” H&R’s bid did not contain the required information to show that the monitor that it was proposing complied with the mandatory requirement set out in item g).
Concerning H&R’s submission that the Department should have sought clarification from H&R on the refresh rate, the Tribunal is of the view that the Department was under no obligation to seek further clarification. Indeed, there is no indication in the technical information submitted by H&R that the monitor that it offered can support a refresh rate of 100 Hz at any resolution.
DETERMINATION OF THE TRIBUNAL
In light of the foregoing, the Tribunal determines, in consideration of the subject matter of the complaint, that the procurement was conducted in accordance with NAFTA, the AGP and the AIT and that, therefore, the complaint is not valid.
1. R.S.C. 1985, c. 47 (4th Supp.).
2. SOR/93-602, December 15, 1993, Canada Gazette Part II, Vol. 127, No. 26 at 4547, as amended.
3. SOR/91-499, August 14, 1991, Canada Gazette Part II, Vol. 125, No. 18 at 2912, as amended.
4. Done at Ottawa, Ontario, on December 11 and 17, 1992, at Mexico, D.F. on December 14 and 17, 1992 , and at Washington, D.C., on December 8 and 17, 1992 (in force for Canada on January 1, 1994).
5. As signed at Ottawa, Ontario, on July 18, 1994.
6. As signed in Marrakesh on April 15, 1994 (in force for Canada on January 1, 1996).
7. Refers to the page number in the user's guide for the SAMPO AlphaScan 750, Model KM-750/KM-750D.
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Initial publication: June 23, 1997