Process by which procurement requirements are divided into lots to segregate into smaller packages or packages that requires specific set of qualifications
Considerations for Division into Lots
The division of a procurement requirement into lots, which could otherwise be procured as a single contract, should be considered when:
- It is anticipated that the award of several separate contracts may result in the best overall value for the Procuring Entity through enhance competition;
- The division of a requirement into a package of separate lots is permitted where it is likely to increase the number of responsive bids by enabling the participation of bidders who are able to bid for some, but not all, types of item; or small enterprises that would not be qualified to bid for the complete package as a single contract. This might support economic development policies. The justification should clearly establish the link to such a policy and the impact of the division.
A requirement cannot be divided into lots:
- For the purpose of avoiding procurement thresholds;
- Where the award of several separate contracts would create problems of compatibility or inter-changeability between items purchased as separate lots;
- Where the award of several separate contracts would invalidate or otherwise restrict any contractor‘s warranty or liability;
- Where the award of several separate contracts would increase the costs of servicing, maintenance or similar requirements;
Where a procurement requirement is divided into lots of equal packages, especially with the purpose of ensuring greater competition and / or participation of SMEs, no single vendor should be awarded more than one lot as it would otherwise defeat the purpose of the division process. Where a requirement is divided into lots, which may result in separate contracts, the selection of the procurement method may be determined by the estimated value of each individual lot and not necessarily by the total value of all the lots.
Where a requirement which could be procured as a single contract is divided into lots with equal packages, the Procuring Entity shall permit bidders to bid for a single lot, any combination of lots or all lots.