The "or equivalent" rule (section 71) – using brand names and demonstrating equivalence in public procurement
One of the central aims of the Procurement Act is to safeguard equal and non-discriminatory competition. This principle stands out especially when a contracting authority defines the properties of the product or service being bought, that is, the technical specifications.
Section 71 of the Procurement Act sets strict limits on how tender documents may refer to particular brands, origins or patents. Knowing this rule is vital for a bidding company so that it can secure acceptance of its own solution and challenge any unlawful requirements in time.
1. The main rule: brand references are prohibited
A contracting authority may not draft technical specifications so that they unjustifiably favour or discriminate against particular companies or products. As a rule, tender documents may not refer to a specific trade mark, patent, type, origin or production.
A public sector buyer must describe the required properties, performance or functionality objectively. If the authority needs a new ERP system or a machine, for example, it must list the properties required of the device or software instead of demanding a particular software house's or manufacturer's product outright.
2. The exception and the "or equivalent" addition
The law recognises practical reality: describing some complex procurements objectively can be technically very difficult. Referring to a specific brand or standard is exceptionally permitted if the subject matter cannot otherwise be described precisely and understandably enough.
In these exceptional cases the legislation requires that the reference must always and without exception be accompanied by the expression "or equivalent".
So if the tender documents name a particular manufacturer's model or a software brand, it must be followed by a note that equivalent products are accepted. This keeps the market open to alternative solutions that can produce the same outcome.
3. Demonstrating equivalence is the bidder's responsibility
When the contracting authority allows an equivalent product to be offered, the burden of proof shifts to the bidder. The law (section 72) requires the bidding company to demonstrate the equivalence of its solution reliably in its bid.
Equivalence means that the product or service offered meets the technical and functional minimum requirements set in the tender documents at least as well as the original product or standard the authority referred to.
The seller's own assurance is not enough as proof of equivalence. The bidder must be able to present objective evidence, such as:
- The manufacturer's technical documents and specifications.
- Test reports from independent testing bodies or authorities.
- Certificates or other reliable evidence verifying the product's performance or technical properties.
4. The bidder's actions and risk management
A bidding company should study the technical specifications immediately after the tender documents are published.
- React to shortcomings during the question period: If the tender documents insist on a particular brand with no "or equivalent" note (and this is not a lawful direct award), the requirement is probably contrary to the Procurement Act. The matter should then be raised at once during the clarification period, asking the authority to amend the specification so that it complies with the law.
- Justify equivalence carefully: If you offer an equivalent solution, reserve enough time to assemble the documentation. Equivalence must be demonstrated systematically and against exactly the properties required of the original reference product. Inadequately proven equivalence leads to the bid being rejected as non-conforming, and the authority has no duty to ask the bidder to supplement the evidence afterwards.
Frequently asked questions
May tender documents refer to a specific brand?
As a rule no — the subject matter must be described objectively through properties and performance (section 71). A brand reference is permitted only exceptionally, when the subject matter cannot otherwise be described precisely enough, and then the words "or equivalent" must always follow.
Who proves that a product is equivalent?
The bidder. Under the law (section 72) the bidding company must be able to demonstrate reliably that the solution it offers meets the required properties and produces the same outcome.
What do I do if the tender documents are tailored to one supplier?
Raise it during the question period of the tender and ask for a clarification or correction. An unjustified brand requirement without the "or equivalent" addition is contrary to the Procurement Act.