With only days remaining before the close of the tender for an electronic toll system for Czech roads, the proceedings have drawn unexpected fire from some bidders who accuse the government of discrimination.

As a result, the long-awaited launch of an e-toll system on Czech roads originally planned to start operating in 2007 could well be delayed again.

"We'll consider filing a suit against the government," said Bruno Corthier, project manager of Toll Sat, one of 102 companies that considered participating in the tender.

Like many other companies offering satellite technologies, Toll Sat opted not to bid for the contract because it found the rules unrealistic.

The government is still scheduled to announce the winning bid by the end of November, but some of the applicants who withdrew say they won't give up easily.

Toll Sat, along with other suppliers of satellite toll systems such as Toll Collect, IBM and Siemens, cried foul over rules of the tender, which allegedly favor suppliers of competing microwave technologies.

Among the key competitive disadvantages for satellite technology suppliers is, says Corthier, a deadline of just 10 months for the delivery of the e-toll system, a requirement that clearly helps applicants who use microwave systems.

These systems, which employ older technology to relay data from toll booths to a central computer, could be set up more quickly than a more advanced satellite system, which would incorporate GSM data, be customized for Czech roads and use the latest systems for tracking traffic and collections.

The requirement that satellite system suppliers equip their units with microwave interfaces, which would raise the final price, is also discriminatory, Corthier said, given that bid price is a key criterion in the tender.

Transportation Ministry officials have said that the terms of the tender do not rule out the participation of applicants who use satellite systems. Yet only the four bidders that focus on microwave technology remain in the running for the tender; all satellite-based companies have withdrawn.

The Directorate General for Energy and Transport of the European Commission (EC) supports their laments. The EC sent a letter in August to the Transportation Ministry questioning the conditions of the tender.

Deputy Transportation Minister Jiří Kubínek insists the conditions of the tender were tough but fair enough for all bidders. He said the EC's letter was aimed at merely providing more information about the process to Brussels.

"We cannot talk about any criticism because the conditions do not interfere with any EU norms," Kubínek says.

Against the flow

The Transportation Ministry announced in early October that the consortium of Ascom Fela, Damovo and ABD group presented the lowest bid. The consortium requested 15 billion Kč ($603.6 million) with which to build and run the electronic toll system for 10 years.

Meanwhile, Autostrade has offered its system for 17.5 billion Kč; Kapsch/PVT has asked for 22 billion Kč; and a consortium of A-WAY, AZD Praha, Efkon and EGIS Projects proposed 33.7 billion Kč to build and run the system.

Transport officials are pushing to have the e-toll system implemented as soon as possible, a circumstance that favors a less efficient but easier-to-install microwave system, which could be up and running well within the 2007 deadline.

That stand seemingly defies European Union policy, since the union requires that all member states switch to the Galileo satellite system by 2010. Thus if the government selects a microwave system in the current tender, it would soon find itself required to convert it to a satellite system.

Kubínek maintains that a microwave system could go up in time to provide revenues that will more than cover the costs.

The highway-use stickers currently required on 712 kilometers (442 miles) of roads in the Czech Republic bring in about 1 billion Kč per year; the e-toll booths will cover 3,000 kilometers of blacktop and are expected to generate 8 billion to 12 billion Kč annually.

According to the government's timetable, the Transportation Ministry should assess the four remaining bids by mid-November.

A steering committee is set to recommend a tender winner to the Cabinet by the end of the month. The Cabinet could then sign a contract with the winner within one month so that the selected company has time to set up e-toll booths by January 2007.