Regulators

Govt. finally calls for bids for e-auctioneers for third phase of FM Radio

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NEW DELHI: After several months of delay, the government has finally invited Request for Proposal (RFP) for selection of agency for conducting e-auction of FM channels in FM Radio phase-III for 839 channels in 294 cities.

The RFP also indicates that the e-auctions will take place after June this year – that is, when the new government is in place after the ongoing Lok Sabha elections.

The bidders have been invited in two parts: technical and financial. The proforma detailing requirements has been placed on the website of the Information and Broadcasting Ministry (mib.nic.in) which says that the bids should be submitted by 2.30 pm on 20 June.

The bids should contain both technical and financial bids separately sealed and complete in all respects along with the eligibility criteria format and the power of attorney for the authorized signatory should be submitted in a third sealed cover.

The auctions will be on the basis of the detailed guidelines which had been issued on 25 July 2011.

The bidder will not have any equity directly or indirectly in any FM radio broadcasting company in India. Similarly, any FM radio broadcasting company, and no broadcaster company will have equity directly or indirectly in the bidder. The bidder will not have any commercial dealings with the prospective FM operators. The bidder will be required to disclose any past business deals in the proposal drawing attention to the same. The decision of the Ministry is final in respect of interpretation as to what constitutes the conflicting commercial dealings.

The bidder should be a company registered under the Companies Act, 1956 in India or a foreign company incorporated in a country outside India or a joint venture of such companies or a consortium of such companies having a registered office in India. The bidder will declare its Indian and foreign equity holding (Both direct and indirect). It will have a minimum paid up capital of Rs. 1 crore or equivalent on the date of application. The bidder and its substantial equity holders in the bidder company or the lead partner in case of consortium shall have a combined net worth of at least Rs 5 crore or equivalent. The substantial equity holders shall be those who have at least 10 per cent or more equity stake in the total equity of the bidder company. This information should be duly authenticated under the relevant law.

A consortium will be a group of companies having a lead partner wherein each partner of the consortium is jointly and severally responsible/liable for the bid and the performance of the contract and this liability has been formalised and secured through an MOU approved by the competent authority. An ink signed copy of the MOU by all concerned shall be furnished along with the bid. The bid will be submitted by the lead partner of the consortium as per the guidelines along with a copy of the MOU(s).

The bidder will pay a non-refundable application fee of Rs 50,000 in the form of Demand Draft drawn on any Scheduled Bank payable at Delhi in favour of ‘Pay and Accounts Officer, Ministry of Information and Broadcasting’, New Delhi.

The government has also clarified that for the purpose of this RFP, an FM radio Broadcasting Company is a company pursuing FM broadcasting activity, directly or indirectly, in any form under a license granted by the Ministry.

The bidder who has conducted simultaneous, controlled ascending e-auctions of any commodity or resource would be given preference.

An Earnest Money Deposit (EMD) of Rs10,00,000 in the form of Bank Guarantee issued by a scheduled bank in India according to the given proforma must be submitted along with the proposal. The validity period of the EMD is six months after the completion of finalisation of entity “e-auctioneer” -that is, signing of contract. Proposals not accompanied by EMD shall be considered as non-responsive and summarily rejected. The EMD of the unsuccessful bidders would be returned to them at the earliest after expiry of the final bid validity and latest within one month of signing of the contract with successful bidder.

The work of the selected e-auctioneer will be to conduct the e-auction in as many batches of separate e-auctions as may be decided by the Ministry, and according to the detailed policy guidelines issued by the Ministry on 25 July 2011 for FM radio Phase III, as amended from time to time.

The functions of the selected agency shall be to design, structure and implement the overall process of e-auction on a simultaneous, controlled, ascending basis including the e-aspects with the approval of the government to ensure a transparent and fair auction and selection process with optimum revenue and help in promoting equitable growth of FM radio.

The selected bidder will advise on setting the rules for the bidding process, prepare bid documents for e-auction, develop an optimum auction plan taking into account the availability of FM channels and the competition characteristics, create appropriate market interest and excitement in India , advise on/incorporate on the safeguards in the-auction system to ensure the security of the entire process,  document the entire process of e-auction of FM radio channels, provide all the incidental services till the completion of the process and selection of the successful bidder(s).

The bidder and all its substantial equity holders, consortium and all its members would be jointly and severally responsible for conducting e-auction as per scope of the signed contract.

The first simultaneous, ascending e-auction of FM channels in selected category of cities(to be decided by the Ministry)will be conducted by the selected auctioneer according to the time frame decided by the Ministry at the time of signing the contract.

Thereafter, auctions would be conducted from time to time within a period of one year which may be further extended by 6 months according to the decision of the Ministry. The auctioneer and its joint venture partner(s) in case of consortium shall not subcontract any or part of activities under the contract for conduct of the e-auction.

The bid will be evaluated in three stages - eligibility, technical and financial. The bid therefore, will comprise of a covering letter in duplicate detailing the eligibility criteria along with supporting documents, application fee and EMD, technical bid in duplicate sealed in a separate envelope and complete in all respects with supporting documents and clearly marked as “Technically Bid” on the envelope, financial bid in duplicate sealed in a separate envelope and complete in all respects and clearly marked as “Financial Bid” on the envelope, power of attorney by resolution of Board of Directors that the person signing the application is authorised signatory for the company.

All the above four documents shall be kept in a sealed cover and clearly marked “Bid for Selection as Agency for e-auction of FM Radio channels under FM Radio Phase-III”.

The selection of the bidder(s) will be based on technical and financial evaluation of the bid. The evaluation will be in two stages i.e. technical and financial. All applicants that meet the eligibility

criteria will have to make a presentation before the evaluation committee constituted by the Government of India, clearly demonstrating their experience and capacity to conduct the auction.

After the presentation, the technical bids of the eligible bidders shall be opened before the bidders or their authorised representative. Financial bid(s) shall be opened for only those bidders who are shortlisted after the evaluation of technical bids. Only bidders shortlisted on the basis of technical evaluation will be invited to send their representatives for the opening of the financial bid.

The parameter weightage will be: total value of e-auction conducted in the last three years 20 per cent; total number of e-auctions conducted in the last three years 10 per cent; total value of broadcast related e-auctions in the last three years 10 per cent; E-security aspects in design and conduct of the auction 20 per cent; E Ownership of domain and e-auction related software 20 per cent; and Design of auction process and development of bid documents 20 per cent.

Only those bidders scoring overall 70 per cent and above on the criteria will be declared technically qualified and their financial bids will be opened. The final selection will be done based only on financial bids of those bidders who will be technically qualified.

In situations where lowest quoted rate of two or more technically qualified bidders are the same, the bidders shall be called upon to offer discount on the quoted rates across the table in order to decide the lowest quoted rate.

Bids must remain valid for 150 days after the submission date. Should the need arise, however, bidders may be requested to extend the validity period of their bids. Bidders who agree to such extension shall confirm that their financial bid remains unchanged.

Payment shall be made for the actual auction conducted, and the bidder shall be paid a fee determined according to the RFP. No payment shall be made for any other charge or expenditure.

In case the Ministry identifies more number of FM Radio channels at any stage before, during or after the e-auction process, the government may ask the successful bidder (auctioneer) to again conduct the e-auction for such FM channels within the currency of the contract. This will be construed as new auction and the successful bidder shall be paid according to the set method.

A lumpsum drop dead fee of Rs10 lakh will be paid to the successful bidder (auctioneer) in case the government abandons entire e-auction at any stage after award of the contract to the auctioneer in all cities. The word abandon means calling off of the auction process, for no fault of the auctioneer, after the agreement with the e-auctioneer is signed and before actual conduct of the auction. Once the e-auction starts, the lumpsum fee quoted by the e-auctioneer would be paid as per the terms of the agreement with the e-auctioneer, if the e-auction is called off for no fault of the e-auctioneer.

The Ministry reserves the right to accept or reject any bid without assigning any reason. It reserves the right to modify terms and conditions of the contract which shall be granted to the successful bidder after the bidding process, if in its opinion it is necessary or expedient to do so in public interest or interest of the security of the state or for proper conduct of the e-auction. The decision of the Ministry shall be final and binding in this regard.

The Ministry reserves the right to suspend the e-auction, cancel the contract with the selected party in part or in whole, at any time if in its opinion it is necessary or expedient in the public interest. The decision of the Ministry shall be final and binding in this regard, it will not be responsible for any damage or loss caused or arisen out of aforesaid action.

Details are also available in different annexures available onmib.nic.in

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