B
!
XCS(73)12
SECRET
· 2 ·
Modification of the Sequence of Events
3
In the course of these meetings, the sequence of events envisaged in paragraph 20 of memorandum XCS(73)8 was discussed. All the consortia considered that, given the Government's stipulation of a ceiling price, it would be necessary to afford each consortium a measure of freedom in determining the detailed designs of the civil engineering work and equipment involved, within the limits of the outline design and performance specifications laid down by the client.
4
In other words, all the consortia considered that they should not be required to submit their detailed designs for approval, as envisaged in sub-paragraph (g) of the sequence. In view of this, it was agreed between the Steering Group and the consortia that they should submit their price quotations as soon as possible after the end of March 1974; and that, thereafter, the detailed designs on which these quotations were based would be vetted.
T
5
A further point which arose during these meetings was that, because of the linear nature of the system, there was a possibility that a consortium might be able to put up a firm price before all the relevent information was made available. If such a "pre-emptive" bid were made and accepted, the consortium concerned would then be able to mobilise their resources quickly so as to minimise cost escalation. The Steering Group considered that, in the event that such a pre-emptive bid were made, the Government would certainly wish to reserve to itself the right to accept it if it was advantageous to do so. However, the Steering Group gave all four consortia an assurance that, if a pre- emptive bid were received from any consortium, a special procedure would be established for dealing with it. A supplementary procedure was accordingly drawn up and agreed with all four consortia.
A copy of this procedure is at Annex B. This procedure was designed to enable the other consortia to put in counter-bids should they so wish. It was made clear to the consortia that, if and when the supplementary procedure came into operation following receipt of a pre-emptive bid, the "main sequence" would still proceed in parallel until such time as step 5(a) or step 5(b)(iii) in the supplementary procedure were reached.
Japanese Pre-emptive Bid
6
Following meetings in Tokyo, the Japanese Consortium formally submitted a pre-emptive bid on 27th September 1973, confirming its acceptance in principle of all the Government's requirements with only one significant exception (see paragraph 8 below).
The Steering Group formally acknowledged this bid on 1st October 1973, the first date on which a pre-emptive bid could be submitted in accordance with Step 2 of the supplementary procedure.
SECRET