Guide to Bidding Processes


Bidding is the administrative procedure for contracting of services or purchases of goods by the state, municipal or other entities. In a number of jurisdictions, for bidding by entities that make use of public funds, the process is governed by ordinary law.

Bidding Process

It consists of several procedures that have as their goal the constitutional principles of legality, equality, impersonality, morality, publicity and efficiency in order to provide for the administration of the acquisition, sale or provision of service.

This happens using a system called the comparison of budget proposals from companies that meet the necessary legal specifications, all contained within the announcement. The company that offers major benefits to the contracting entity will be chosen to supply the product or service.

Best tender can translate to the criterion of lower prices, better technology or a technical advantage. Or offer for cases of alienation of property or concession of real right of use. Among these, the criterion of ‘lowest price’ is more commonly used. Beside this, the criteria listed in the best technique ‘, takes into consideration, besides price, the qualifications of the bidder and the features of his proposal.

The correct preparation of the bidding documents and the precise definition of the characteristics of goods or services sought by the bidder entity are essential for achieving a good tender finalization.

In some countries, bidding procedures are guided primarily by Federal Laws which define the following methods of tendering:

    – Competition
    – Outlet Price
    – Auction
    – Contest
    – Call
    – Proclamation – in person or electronically

The bidder must have the human resource capacity to accompany the customer throughout the implementation and life of the product or service, in particular must have a distribution network and after-sales service sufficient for  the geographical area of the client. This is an important criterion as the financial test.

The contracting authority is obliged to make a prior estimate of its financial need. It will then choose the best offer to satisfy this need. The lowest bidder criterion for selecting the successful tender is not necessarily in financial terms.

The highest bidder – who offers the best value for money – it is often preferred. The latter criterion, leaves a margin of subjectivity which can be difficult to reconcile with the Public Contracts Code, and makes the management of advanced projects difficult to achieve directly by government agencies.

Revocation can only occur in an administrative court on grounds of public interest. Since the cancellation occurs both at the administrative level (the principle of self-protection) should be fully substantiated by the body to be canceled.