BNUMBER:  B-280603.2 
DATE:  November 4, 1998
TITLE: Container Products Corporation, B-280603.2, November 4, 1998
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Matter of:Container Products Corporation

File:     B-280603.2

Date:November 4, 1998

Joel Hughes for the protester.
Timothy F. Noelker, Esq., Linda L. Shapiro, Esq., and Steven E. 
Kellogg, Esq., Thompson Coburn, for Keco Industries, Inc.; David R. 
Wall for Charleston Marine Containers Inc.; James R. Bomberger for AAR 
Cadillac Manufacturing; and Richard A. Lidinsky Jr., Esq., for Sea 
Containers America Inc., intervenors.
Samuel J. Galbo, Jr., Esq., J. Page Turney, Esq., and Maj. Jeffery P. 
Colwell, U.S. Marine Corps, for the agency.
John Van Schaik, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Protest against solicitation requirement that cargo containers be 
certified prior to the submission of proposals is sustained where 
record does not establish that requirement is necessary to meet the 
agency's needs.

DECISION

Container Products Corporation protests the terms of request for 
proposals (RFP) No. M67854-98-R-3005, issued by the U.S. Marine Corps 
for cargo containers.  Container Products argues that the RFP is 
unduly restrictive of competition because it requires that prospective 
offerors obtain certification of their containers prior to submitting 
proposals.

We sustain the protest.

BACKGROUND

The RFP was issued to acquire quadruple containers (QUADCONs), 
container racks, and horizontal connectors to meet Marine Corps and 
Army requirements.  QUADCONs are intermediate size cargo containers 
designed to allow shipment and ground transportation of military 
supplies and equipment.  Agency Report at 2.  The contractor is to 
fabricate, produce, and field cargo containers meeting standards set 
forth in 49 C.F.R.  sec.  450-453 (1996).  RFP Attachment 4 (statement of 
work (SOW)) at 1.  The SOW and the RFP purchase description, as well 
as 49 C.F.R.  sec.  450.5 and 453.1, also require the QUADCONs to be 
certified to meet the requirements of the International Convention for 
Safe Containers (CSC).  RFP Attachment 1 (Purchase Description) at 2, 
SOW at 4.  Moreover, section L-6.1.1 of the RFP states that "[t]he 
required CSC certification must be successfully obtained, in full, for 
the proposed QUADCON container(s) prior to submittal of the offeror's 
proposal."  

The RFP contemplates the award of a fixed-price, indefinite-delivery, 
indefinite-quantity contract for 5 years.  RFP at B-2, F-3.  The RFP 
specifies a minimum of 4,000 and a maximum of 34,000 QUADCONs, as well 
as minimums and maximums for connectors and racks, with the first 
production delivery scheduled no later than 180 days after the first 
delivery order.  Id. at B-2, B-3, B-4, F-2, F-3.  

The RFP closed on July 23 and the Marine Corps received six proposals, 
but no proposal was received from Container Products.  Agency Report 
at 8.  The agency reports that four of those six proposals offered 
CSC-certified containers.  Id.

PROTEST ALLEGATIONS

Container Products notes that the RFP was issued on June 11 and 
proposals were due on July 10, and argues that due to the complexity 
of the CSC certification process, it is impossible to obtain 
certification in the 30 days between issuance of the RFP and proposal 
submission.  Protest, Attachment 1 at 1-2.  The result, according to 
Container Products, is that the RFP is open only to those firms whose 
containers had been certified prior to issuance of the RFP.  Id.; 
Comments at 2.  Container Products argues that this practice is unduly 
restrictive, establishes a preference for a few offerors and prevents 
qualified offerors, such as Container Products, from competing. 

Container Products acknowledges, however, that the government may need 
a portion of the QUADCONs as quickly as possible.  In recognition of 
this possibility,  Container Products argues that the agency should 
acquire under this solicitation only the quantity of QUADCONs it needs 
immediately and that the remainder of the solicited 34,000 units 
should be acquired under another contract allowing a realistic time 
for sources whose containers are not presently certified to obtain the 
certification and to compete.  Protest, Attachment 1 at 1-2; Comments 
at 3.[1]

ANALYSIS

Procuring agencies are required to specify their needs in a manner 
designed to permit full and open competition, and may include 
restrictive requirements only to the extent they are necessary to 
satisfy the agencies' legitimate needs (or as otherwise authorized by 
law).  10 U.S.C.  sec.  2305(a)(1)(B) (1994); see Mossberg Corp., B-274059, 
Nov. 18, 1996, 96-2 CPD  para.  189 at 2.  Where a protester challenges a 
specification as unduly restrictive, the agency must establish that 
the requirement is reasonably necessary to meet its needs; we will 
examine the adequacy of the agency's position to ensure that it is 
rational and can withstand logical scrutiny.  Mossberg Corp., supra.

The solicited QUADCONs are to be used by the Marine Corps and the Army 
to ship military cargo and equipment, as quickly as possible, to 
support their military missions.  As the Marine Corps reports, the 
International Safe Container Act, 46 U.S.C.A. App.  sec.  1502-07 (West 
Supp. 1998), and its implementing regulations, at 49 C.F.R.  sec.  450-53, 
require compliance with the International Convention for Safe 
Containers.  Those regulations also require that a container that is 
not CSC-certified cannot be used in international transport.  49 
C.F.R.  sec.  450.5, 453.1.  Thus, to the extent Container Products 
challenges the certification requirement itself, we conclude that CSC 
certification of QUADCONs is necessary to satisfy the   needs of the 
Marine Corps and the Army.

Regarding the requirement that proposed QUADCONs be certified prior to 
proposal submission, Container Products contends, as noted above, that 
there was not sufficient time after release of the RFP for it and 
other firms to obtain certification of their QUADCONs.  The result, 
Container Products argues, is that the competition is unjustifiably 
limited to firms whose QUADCONs had been certified prior to issuance 
of the RFP.  Protest, Attachment 1 at 1-2; Comments at 2.

The Marine Corps argues that it was necessary to require offerors to 
propose containers that had already been certified.  The agency 
reports that it previously awarded three QUADCON contracts that did 
not require CSC certification when proposals were submitted; rather 
those contracts permitted containers to be certified up to the time of 
delivery.  Agency Report at 7-8.  Two of those contracts were 
terminated and the containers that had been delivered were removed 
from inventory because they were never able to be certified and, on 
the third contract, certification was not obtained until almost 2 
years after award, which significantly delayed delivery.  Agency 
Report at 7-8; Enclosure 9 at  para.  2-4.  Further, as the agency notes, 
one company that expressed interest in this acquisition described its 
certification efforts over an 18-to 24-month period and stated that 
"unless a company has been CSC-certified prior to responding to the 
RFP, there is simply no way they can deliver production units within 
six months."  Enclosure 12 at 2.  In addition, the agency reports that 
an official at the CSC certification authority who approved QUADCONs 
for the incumbent contractor and another firm informed the contracting 
agency's project officer that the peculiarities of the QUADCON, 
particularly the fact that a QUADCON is made up of four side opening 
containers connected together, offer a significant challenge to CSC 
certification.  Agency Report at 6-7; Enclosure 9 at  para.  6c.  

Due to the problems previous contractors have experienced obtaining 
certification of their QUADCONs after award, we conclude that the 
Marine Corps reasonably decided that CSC certification at the time of 
delivery would not meet its needs.  The RFP delivery schedule calls 
for delivery to start no later than 180 days after the first order is 
issued under the contract and the record shows that the agencies need 
a reliable source of supply for certified containers.  It would not be 
reasonable to require the Marine Corps to once again take the chance 
that a firm that has been awarded a contract could not obtain 
certification of its containers in time for required delivery.  

Nonetheless, the record does not support the Marine Corps's decision 
to require CSC certification prior to proposal submission.  None of 
the concerns expressed by the Marine Corps provide support for that 
requirement and, in fact, all of the agency's concerns would be 
satisfied by simply requiring certification by the time of award.  
Because the agency's legitimate need for timely delivery of 
CSC-certified QUADCONs would be satisfied by requiring certification 
by time of award, the requirement for certification by the closing 
date for receipt of proposals exceeds the agency's needs.[2]

Container Products also argues that the Marine Corps should solicit at 
this time only the quantity of QUADCONs which it urgently needs, and 
solicit the remaining quantity at a later date to allow firms that do 
not have the required certification to obtain it and compete.  
Container Products, in effect, is arguing that we should recommend the 
Marine Corps delay a portion of the procurement.  We have no basis to 
do so.  As discussed above, the Marine Corps has a reasonable basis 
for requiring CSC-certified containers, and we have no grounds to 
conclude that the failure of Container Products (and other potential 
offerors) to obtain certification by the time of award will be 
attributable to any improper government action.  Moreover, agencies 
generally need not delay a procurement in order to provide a potential 
offeror with an opportunity to demonstrate that it meets approval 
standards.  See OPS, Inc., B-271835, July 31, 1996, 96-2 CPD  para.  50 at 
3.   

We therefore recommend that the Marine Corps amend the RFP to permit 
certification of proposed containers by time of award, and resolicit 
the requirement. We also recommend that Container Products be 
reimbursed the costs of filing and pursuing its protest, including 
reasonable attorneys' fees.  4 C.F.R.  sec.  21.8(d)(1).  In accordance 
with 4 C.F.R.  sec.  21.8(f)(1), the protester's certified claim for costs, 
detailing the time expended and costs incurred, must be submitted 
directly to the agency within 60 days after receipt of this decision.  

The protest is sustained.

Comptroller General 
of the United States

1. The Marine Corps argues that the protest did not include 
information required by our Bid Protest Regulations at 4 C.F.R.  sec.  
21.1(c)(4), (5), (7), (8) (1998), such as a detailed statement of the 
factual and legal grounds of protest, information establishing that 
the protester is an interested party, a specific request for a ruling, 
and the form of relief requested.  Agency Report at 18 n.15.  We 
disagree.  In its protest to this Office, Container Products attached 
its agency level protest and the Marine Corps's response to that 
protest and disagreed with that response.  A fair reading of the 
protest and its attachments establishes that it meets the requirements 
of our regulations.

2. While Container Products may not succeed in having its containers 
certified by the date of award, there is no reasonable justification 
for denying the firm the opportunity to try to do so.