[Code of Federal Regulations] [Title 48, Volume 1] [Revised as of October 1, 2003] From the U.S. Government Printing Office via GPO Access [CITE: 48CFR25.504-4] [Page 478-480] TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM CHAPTER 1--FEDERAL ACQUISITION REGULATION PART 25_FOREIGN ACQUISITION--Table of Contents Subpart 25.5_Evaluating Foreign Offers_Supply Contracts Sec. 25.504-4 Group award basis. (a) Example 1. [[Page 479]] ---------------------------------------------------------------------------------------------------------------- Offers Item -------------------------------------------------------------------------- A B C ---------------------------------------------------------------------------------------------------------------- 1.................................... DO = $55,000 EL = $56,000 NEL = $50,000 2.................................... NEL = 13,000 EL = 10,000 EL = 13,000 3.................................... NEL = 11,500 DO = 12,000 DO = 10,000 4.................................... NEL = 24,000 EL = 28,000 NEL = 22,000 5.................................... DO = 18,000 NEL = 10,000 DO = 14,000 -------------------------------------------------------------------------- 121,500 116,000 109,000 ---------------------------------------------------------------------------------------------------------------- Key: DO = Domestic end product; EL = Eligible product; NEL = Noneligible product. Problem: Offeror C specifies all-or-none award. Assume all offerors are large businesses. The Trade Agreements Act does not apply. Analysis: (see 25.503) STEP 1: Evaluate Offers A & B before considering Offer C and determine which offer has the lowest evaluated cost for each line item (the tentative award pattern): Item 1: Low offer A is domestic; select A. Item 2: Low offer B is eligible; do not apply factor; select B. Item 3: Low offer A is noneligible and Offer B is a domestic offer. Apply a 6 percent factor to Offer A. The evaluated price of Offer A is higher than Offer B; select B. Item 4: Low offer A is noneligible. Since neither offer is a domestic offer, no evaluation factor applies; select A. Item 5: Low offer B is noneligible; apply a 6 percent factor to Offer B. Offer A is still higher than Offer B; select B. STEP 2: Evaluate Offer C against the tentative award pattern for Offers A and B: ---------------------------------------------------------------------------------------------------------------- Offers -------------------------------------------------------------------------- Item Tentative award pattern Low offer from A and B C ---------------------------------------------------------------------------------------------------------------- 1.................................... A DO=$55,000 * NEL=$53,000 2.................................... B EL=10,000 EL=13,000 3.................................... B DO=12,000 DO=10,000 4.................................... A NEL=24,000 NEL=22,000 5.................................... B *NEL=10,600 DO=14,000 -------------------------------------------------------------------------- 111,600 112,000 ---------------------------------------------------------------------------------------------------------------- * Offer + 6 percent. On a line item basis, apply a factor to any noneligible offer if the other offer for that line item is domestic. For Item 1, apply a factor to Offer C because Offer A is domestic and the acquisition was not subject to the Trade Agreements Act. The evaluated price of Offer C, Item 1, becomes $53,000 ($50,000 plus 6 percent). Apply a factor to Offer B, Item 5, because it is a noneligible product and Offer C is domestic. The evaluated price of Offer B is $10,600 ($10,000 plus 6 percent). Evaluate the remaining items without applying a factor. STEP 3: The tentative unrestricted award pattern from Offers A and B is lower than the evaluated price of Offer C. Award the combination of Offers A and B. Note that if Offer C had not specified all-or-none award, award would be made on Offer C for line items 1, 3, and 4, totaling an award of $82,000. (b) Example 2. ---------------------------------------------------------------------------------------------------------------- Offers Item -------------------------------------------------------------------------- A B C ---------------------------------------------------------------------------------------------------------------- 1.................................... DO=$50,000 EL=$50,500 NEL=$50,000 2.................................... NEL=10,300 NEL=10,000 EL=10,200 3.................................... EL=20,400 EL=21,000 NEL=20,200 4.................................... DO=10,500 DO=10,300 DO=10,400 -------------------------------------------------------------------------- 91,200 91,800 90,800 ---------------------------------------------------------------------------------------------------------------- Problem: The solicitation specifies award on a group basis. Assume the Buy American Act applies and the acquisition cannot be set [[Page 480]] aside for small business concerns. All offerors are large businesses. Analysis: (see 25.503(c)) STEP 1: Determine which of the offers are domestic (see 25.503(c)(1)): ------------------------------------------------------------------------ Domestic [percent] Determination ------------------------------------------------------------------------ A 60,500/91,200=66.3%.............. Domestic B 10,300/91,800=11.2%.............. Foreign C 10,400/90,800=11.5%.............. Foreign ------------------------------------------------------------------------ STEP 2: Determine whether foreign offers are eligible or noneligible offers (see 25.503(c)(2)): ------------------------------------------------------------------------ Domestic + eligible [percent] Determination ------------------------------------------------------------------------ A N/A.............................. Domestic B 81,800/91,800=89.1%.............. Eligible C 20,600/90,800=22.7%.............. Noneligible ------------------------------------------------------------------------ STEP 3: Determine whether to apply an evaluation factor (see 25.503(c)(3)). The low offer (Offer C) is a foreign offer. There is no eligible offer lower than the domestic offer. Therefore, apply the factor to the low offer. Addition of the 6 percent factor (use 12 percent if Offer A is a small business) to Offer C yields an evaluated price of $96,248 ($90,800 + 6 percent). Award on Offer A (see 25.502(c)(4)(ii)). Note that, if Offer A were greater than Offer B, an evaluation factor would not be applied and award would be on Offer C (see 25.502(c)(3)). [64 FR 72419, Dec. 27, 1999; 65 FR 4633, Jan. 31, 2000]