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can bidder claim experience showing sister concern certificate
25-Aug-2023 (In Corporate Law)
A bidder submitted client certificate for claiming experience. The certificate is in the name of ABC USA. Bidder, ABC UK claims it owns 100% stake in ABC USA, so it is eligible to claim the experience. Is it acceptable ??
Dear Sir,
It is completely acceptable and generally such arrangements are done to get big projects. However, there shall be back to back agreement between the ABC UK and ABC USA as both the entities are two separate legal entities having its own identity.
Also, need to carefully read the bid documents if there is any restriction contrary to this.
Should you require more clarity, please feel free to contact us.
Best Regards,
Saurabh
It is completely acceptable and generally such arrangements are done to get big projects. However, there shall be back to back agreement between the ABC UK and ABC USA as both the entities are two separate legal entities having its own identity.
Also, need to carefully read the bid documents if there is any restriction contrary to this.
Should you require more clarity, please feel free to contact us.
Best Regards,
Saurabh
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Adv. Saurabh Kumar
Delhi | 25+ Answers
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In general this should not be considered as illegal as the ABC UK claims 100% stake in ABC USA.
But, in spite of having 100% stake of the sister concern does not guarantee that both the organization has same set of decision making personalities and then the sub-level personality who will go ahead and implement those decisions which has been taken. It is possible that the decision making personalities at both the organization are same and that is duly allowed but in any case having same set of people at sub-level as well is a corporate fraud.
Further the assets, belongings and working of both the organization are different as they are two separate organization.
Moreover, in any tender the eligibility criteria are specifically mentioned and what is allowed and what is not is totally based on those eligibility criteria. If it is allowed to show the sister concern experience as your own then one can't object it to. However if it is not then again you fall into main stream.
So my final words over your query would be "any organization can't show his sister concern experience as its own to participate in any tender in spite of the fact that it is owned by them on 100% basis and the decision making personalities at both the organization are same."
But, in spite of having 100% stake of the sister concern does not guarantee that both the organization has same set of decision making personalities and then the sub-level personality who will go ahead and implement those decisions which has been taken. It is possible that the decision making personalities at both the organization are same and that is duly allowed but in any case having same set of people at sub-level as well is a corporate fraud.
Further the assets, belongings and working of both the organization are different as they are two separate organization.
Moreover, in any tender the eligibility criteria are specifically mentioned and what is allowed and what is not is totally based on those eligibility criteria. If it is allowed to show the sister concern experience as your own then one can't object it to. However if it is not then again you fall into main stream.
So my final words over your query would be "any organization can't show his sister concern experience as its own to participate in any tender in spite of the fact that it is owned by them on 100% basis and the decision making personalities at both the organization are same."
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Adv. Pulkit Prakash
Delhi | 400+ Answers
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As far as my expertise goes, this is not possible. Perhaps a clarification may be obtained from the project proponent before submitting the bid. Logically if experience of sister companies counts, file bid in name of sister company.
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Adv. Rishi Raj Sharma
Delhi | 100+ Answers
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