• Specifications
  
  Ministries and Departments are required to initially prepare tender specifications. For this purpose, a technical committee needs to be formed. Specifications should be as detail as possible to give the bidders a clear idea of what is required or expected. The specifications drawn are functional or performance based although technically detailed specifications are sometimes used. Compliance to acceptable international standards or their equivalent may also be included in the specifications. However, tailored specifications to suit any brand or country are strictly forbidden. The system provides for an objection from potential bidders, a period of 14 days from the date of issue of tender documents on any tailored specifications for local tender and 28 days for international tender.
  
  
• Tender Document
  
  Tender documents are prepared and distributed at a cost, the minimum being RM50. The contents of the tender documents include general and specific terms and conditions, specifications, a copy of agreement, price schedule, delivery period, objection period and the scope of works expected.
  
  
• Advertisement
  
  All tenders are advertised in at least one local daily in the Malay language. International tenders must be advertised in at least two local dailies i.e one in the Malay language and one in the English language. Procurement opportunities can also be accessed through the procuring agencies’ websites, MyPROCUREMENT portal (http://myprocurement.treasury.gov.my) and MyGovernment portal (www.malaysia.gov.my). Bidders are given a submission period of not less than 21 days for local tenders. For international tenders the submission period may not be less than 56 days..
  
  
• Sale of Tender Document
  
  Sale of tender documents may commence from the date of publication of advertisement in the dailies. Only contractors fulfilling the local registration requirement may purchase tender documents for local tenders. In the case of international tender, supplies and services contractors are exempted from the local registration requirement. However, works contracts require foreign contractors to register with the CIDB. The requirement to register with CIDB is mandatory for all contractors dealing with the construction industry in Malaysia under an Act of Parliament.
  
  
•  Tender Deposits
  
  Local suppliers and contractors registered with the Government are exempted from tender deposits. However, international bidders are required to furnish a tender deposit ranging from RM60,000 for bids below RM5 million, to RM 1 million for bids exceeding RM30 million for supplies and services. For works contracts, bidders are required to furnish tender deposits ranging from RM60,000 for contracts below RM10 million, to RM 1 millionfor contracts exceeding RM100 million.
  
  
• Closing and Opening of Tenders
  
  The tender advertisement stipulates the precise date and time of closing and the address to which all tenders must be sent. The tenders may be sent by post or dropped into boxes specially made available for this purpose. Tender proposals by bidders should include the technical and financial proposals prepared separately in two copies and sealed in separate envelopes to facilitate scheduling and independent evaluation. A Tender Opening Committee comprising of senior government officers will open and schedule all the tenders
  and prepare a schedule of prices quoted. All tenders will be accorded a serial number and the name of bidders will be omitted to enable fair, just and independent evaluation of tenders by the Technical and Financial Evaluation committees.

• Evaluation of Tenders

• Selection of Successful Bidder
  

    The Agency Procurement Boards will consider and select the successful bidder. Selection of tenders will be based on the
    general procurement principles, pre-determined criteria and final evaluation. All tenders are to be considered by the
    Agency Procurement Boards. However in cases where the tender value is above RM100 million for works and RM50 million
    for supplies and services, the tenders would then be sent with recommendation of the Agency Procurement Boards to the
    Ministry of Finance for final decision. Information of successful bidder will be displayed in the procuring agencies’ websites
    and MyPROCUREMENT portal.  

• Agency Procurement Boards

   All tenders i.e. procurement of supplies, services and works above the value of RM500,000 must be considered
   and decided by Agency Procurement Boards. The Minister of Finance appoints all Federal Government Procurement
   Boards and the Chief Ministers of the respective states appoints the State Government Procurement Boards. The
   chairperson is usually a Head of Department or a Controlling Officer who under the Financial Procedure Act 1957 is
   empowered to manage the annual allocation given to a particular Ministry or Department.

   Currently two (2) Agency Procurement Boards have been established in all federal ministries i.e. Agency Procurement
   Board ‘A’ and Agency Procurement Board ‘B’. The Agency Procurement Board ‘A’ is empowered to decide on tenders
   up to RM50 million for supplies and services, and up to RM100 million for works. The representative from the Ministry of
   Finance is the permanent member of the Agency Procurement Board ‘A’ and his presence is mandatory to validate the
   decision of the Board. This requirement is mainly to ensure that all procurement principles, policies, rules and regulations
   and procedures are strictly adhered to. The Agency Procurement Board ‘B’ is empowered to decide on all tenders below
   RM20 million without the presence of a representative from the Ministry of Finance.

   Tenders above the values of RM50 million for supplies and services and RM100 million for works for Government
   Ministries/Departments and  tenders above RM100 million for statutory bodies must be forwarded to the Ministry of
   Finance for final decision. Any decisions of the Agency Procurement Boards which are not unanimous must also be
   forwarded to the Ministry of Finance for final decision.



• Letter of Intent

    A Letter of Intent will be issued to the successful bidder, if necessary. The Letter of Intent may consist of additional terms
    and conditions,    mostly safeguards and important for the successful implementation of the contract. The Letter of Intent is
    not legally binding. The final decision on acceptance of the tender depends upon the successful negotiation and/or
    acceptance of additional terms and conditions.



• Letter of Acceptance

    A Letter of Acceptance is directly issued to the successful bidder if his bid is accepted in total. The successful bidder is then
    required to attest  and return the Letter of Acceptance to the Government. If negotiations are necessary where the
    Letter of Intent so requires, then upon completion of negotiations, the Letter of Acceptance is issued to the successful
    bidder and it must be returned to the Government for the formalisation of contract. The Letter of Acceptance forms
    a part of the contract documents and is legally binding.



• Formal Contract

     Formal contracts are drawn upon the receipt of the Letter of Acceptance from the successful bidder. Bidders are required
     to forward Performance Bonds based on stipulated rates according to the value of a contract. Performance Bonds must be
     obtained from locally incorporated banks, insurance companies and financial institutions that are licensed to operate in
     Malaysia. The current rates are as follows:
     a) For Supplies and Services contract
     i) 2.5 percent of contract value for contracts exceeding RM200,000 and less than RM500,000; and
     ii) 5.0 percent for contracts exceeding RM500,000.
 
     b) For Works contract 5.0 percent of the contract value exceeding RM200,000.

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