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Make It Easier To Do Business With The Government

On Behalf of | Sep 10, 2012 | Business Litigation

Although vendors can give the government a “proposal acceptance period” after which the vendor’s prices are no longer valid, the government can ask vendors to extend that period so the government can have more time to evaluate offers. When asked to extend, it’s risky to refuse because reviving an expired bid, although possible, is by no means a sure thing.

In a recent case, Global Automotive, Inc. agreed to several extensions of its bid acceptance period but refused to extend the period to February 29, 2012 saying that “Our prices are valid until 1 February only and we reserve the right to adjust prices thereafter.” After the government awarded the work to another vendor on April 10th, Global protested to the Government Accountability Office (GAO) arguing that the government should have allowed Global to “revive” its expired bid.

According to GAO, it is possible for a vendor to revive an expired bid and extend its prices after-the-fact, but not under these circumstances. Global’s refusal to extend the acceptance period had tried to give Global “the right to adjust prices thereafter.”  This unfairly put Global in the position of unilaterally setting the revived price which, if market trends had allowed lower prices, would have been unfair to other vendors.

As this case shows, it’s easier to simply extend acceptance periods than to have to rely on the government allowing you to revive your expired prices.

Author Terrence O’Connor is the Director of Government Contracts for the Washington, DC regional business law firm of Berenzweig Leonard, LLP.  He can be reached at [email protected].