Public procurement notice: Contract Notice
Published: 2018-10-25
Buyer: Transport for the North
Country: UK
Contract type: Services
Procedure: Competitive procedure with negotiation
CPV classification: 30144400 | 48000000 | 48217000 | 48600000 | 48900000
Estimated value: 7000000 GBP
Submission deadline: 2018-11-27
Award criteria: The most economic tender

Technical requirements: TfN is working in partnership with transport Operators, Local Transport Authorities and the Department of Transport on its Integrated and Smart Travel Programme to deliver a multi-operator, multi-modal account-based ticketing solution. Central to the programme’s proposition is the Account-Based Back Office for Travel (ABBOT), a shared ‘back office’ to be used by third-party Operators which will collect information on all trips (across multiple Operators and transport modes initially in the North of England with the realistic potential to grow to a UK wide scope excl. London). The scope of this procurement is to appoint a Merchant Acquirer for ABBOT for the acceptance of contactless EMV bank cards or similar form of payment for integrated ticketing. Particular focus of this procurement will be processing of UKCA Model 1 and 2 transactions, and the minimisation of declined transactions to reduce the cost of sale of this retail channel as well as commercially attractive transaction fees.
This Procurement will use a Competitive Procedure with Negotiation process. The Merchant Acquirer will provide merchant acquirer services and associated advisory services to TfN and a Special Purpose Vehicle (SPV) being constituted of the Commercial Operators in the North to manage and operate the scheme once developed. The scope of this procurement is:
— providing integration advice and support to TfN during the procurement of the main back-office service,
— processing UKCA Aggregated PAYG (Model 2) transactions as specifically implemented by each supported card scheme (Visa/Mastercard/Amex),
— providing the capability for customers to link their mobile device with their transit account, without knowledge of the underlying device PAN (supported DPAN),
— supporting UKCA Single PAYG (Model 1) transactions, specifically the capability to support delayed authorisation,
The Merchant Acquirer will be an integral advisor alongside TfN in procuring the Account Based Back Office for Travel contract and provide consultation to Operators on their processes and equipment to be compatible with the end-to-end service and processes. TfN has appointed Qualified Security Assessor partner, and the Merchant Acquirer Services partner will be expected to work closely with them.
On this basis, the final contract value could be subject to change given that actual volumes could be higher or lower.
It is expected that the Merchant Acquirer will enter into a bipartite agreement initially with TfN for advisory services which would then novate to the Special Purpose Vehicle (SPV) for the run services. The SPV will be constituted and managed by Commercial Operators and Local Transport Authority representatives (along with TfN in its statutory capacity as the Sub-National Transport Body for the North) across all transit modes in the North and will be limited by guarantee.
Through a series of detailed market engagements TfN has established that the potential supply market capable of meeting TfN’s mandatory requirements is small. As such several interested Merchant Acquirers have waived the opportunity to progress with TfN’s engagement as they are unable to meet the mandatory positions discussed at length with the market as a whole and in specific one-to-one sessions with Potential Bidders.
In addition, a large proportion of MA contracts are mandated positions from either the Card Schemes or from the Financial Regulator. As such, TfN has been able to formulate a draft Merchant Service Agreement which takes into account this position with a TfN-specific front-end to cover its requirements. This approach greatly reduces the amount of negotiation needed for this contract Furthermore, TfN has articulated its intent to follow an accelerated procedure with the Potential Bidders all of whom have supported the approach and timescales this would result in.
The Contracting Authority considers that this contract may be suitable for economic operators that are Small or Medium Enterprises (SMEs). However, any selection of tenderers will be based solely on the criteria set out for the procurement.
TfN has adopted the use of a web-based ‘e-tendering’ tool Delta-eSourcing to manage this procurement. Therefore, your tender must be submitted by this means.
Any communication concerning this procurement must be submitted through Delta-eSourcing portal. Organisations wishing to be considered for appointment as a provider of these services must submit a completed response form in compliance with the instructions and before the prescribed deadline.
(iii) to make whatever changes it may see fit to the structure, timing and dates of the competition. TfN shall not be liable for any costs or expenses incurred by any candidates in considering and/or responding to the procurement process.


Award value: 7000000