UAE infrastructure continues to develop. This is well illustrated by selection of projects in our article “Dubai Projects – mega projects – the development continues,” The is a number of the similar projects in Dubai and other Emirates of the UAE – construction of roads, railways and adjacent infrastructure, projects related to the oil and gas industry, projects of construction of the public buildings, hospitals, supply of various goods and equipment, etc. and the budgets of these projects are hundreds of millions of U.S. dollars.
For tender participation in Dubai, UAE it is required to have the proper registration and accreditation of the company – the tenderer. Accreditation includes the provision of all the required documents and the bank guarantee, the amount of which depends on the project size in which the company wants to participate. For example, for the tender participation in the for project of construction of several major road junctions in Abu Dhabi, the value of the required bank guarantees amounted to around 1 million USD. In the smaller size tenders the bank guarantee is on average 100 – 200 thousand USD.
The process of tender participation in Dubai, United Arab Emirates:
1. The official invitation of the relevant state authority to participate in the tender. The task on this phase – to select the suitable potential tender participants. Regularly the invitation to participate in the tender in Dubai is published in one of the national newspaper of the UAE or the official website of the relevant governmental authority.
2. Submission of documents for the tender with all details, including the technical documentation, project completion time, etc. The tender documents must be submitted, in most of the cases, in the Arabic language if the tender description does not indicate any other info in this respect.
3. Evaluation of the bidders is held on the basis of the most economically advantageous offer on the terms specified in the tender description. The company that wins the tender receives the respective legal notice and is invited to sign of the contract.
4. Provision of the “Performance Bond” – the company that won the tender shall provide the guarantee which is regularly 5% to 15% of the tender contract amount as the guarantee of works completion within the project. Performance bond is issued as the bank guarantee from a local bank. Typically this guarantee must be prepared already at the time of preparing the documents for the tender participation in Dubai.
5. Contract signing – the appropriate governmental authority or a private company shall prepare and sign the official contract with the company that won the tender.
Foreign tender participation in Dubai, UAE
Foreign companies can participate in the tender under the condition of having a full-scale operation in the UAE or the presence in the UAE over their local agent and the provision of Performance Bond to the tender committee as pointed out above. Foreign companies generally can participate in all tenders, but by the time of signing the contract on the execution of the works within the tender this company must be registered in the UAE.
Please note that for the governmental tenders participation in different Emirates of the UAE there may be slightly different requirements. For example, if you wish to participate in the tender in Abu Dhabi there may be a requirement to register the company in Abu Dhabi.
If you need to register the company for tender participation in Dubai or other Emirate of the United Arab Emirates, receive more information on tenders in the UAE or require assistance in preparing the tender documentation in the United Arab Emirates, please contact us.