IPA Programme Management Training 12-19 September 2011 asli.gulgor@ecorys.tr

1. Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım Technical Assistance on Institutional Building for the Implementation of RCOP in Turkey IPA Programme Management Training12-19 September 2011asli.gulgor@ecorys.com.tr IPA Funds Programme Management 12-19 sept. 2011

2. Content This project is co-financed by the European Union and the Republic of Turkey • Introduction & Objective • Basic Rules PRAG • PRAG Procurement • Types of Procurement • Evaluation • Questions IPA Funds Programme Management 12-19 sept. 2011

3. Objective • Know the basic rules of procurement applied to all • EU externalaid contracts • Understand the PRAG procurement process • Be able to apply the relevant procurement procedure considering the needs of a project • Be acquainted with PRAG procurement in practice IPA Funds Programme Management 12-19 sept. 2011

4. There are strict rules governing the way in which contracts are awarded. Ensuring the suitably qualified contractorsare chosen without bias and that the best value for money is obtained,with the full transparencyappropriate to the use of public funds. IPA Funds Programme Management 12-19 sept. 2011

5. PRAGPractical Guide to Contract Procedures for EU External Actions • First came into force in January 2001 • Revised versions came out on 2003, 2006(2), 2007, 2008, 2009 and latest version November 2010 (amended March 2011) • Explains in substantial detail the contracting procedures that apply to EU external aid for service, supply, works and grants projects (FWC and Twinning covered under separate manuals) • Contains standard templates which use is mandatory IPA Funds Programme Management 12-19 sept. 2011

6. PRAG Sections • Introduction • Basic rules • Service contracts • Supply contracts • Works contracts • Grants • Legal Texts • List of Annexes IPA Funds Programme Management 12-19 sept. 2011

7. Contracting Authority CA Solely responsible for launching tender procedures: • submission of Contract Forecasts & Procurement Notices • Approval of ToR and TS • drafting the Tender Dossier (TD) • dispatch of Invitation to Tender and TD • receiving tender bids • chairing tender evaluation sessions • preparation of Tender Evaluation Reports • preparation & signature of contracts • publishing the award of contract on the Internet • Management of the projects (financially and technically) IPA Funds Programme Management 12-19 sept. 2011

8. DIS in Turkey IPA Funds Programme Management 12-19 sept. 2011

9. Basic Procurement Fundamentals Under PRAG IPA Funds Programme Management 12-19 sept. 2011

10. Eligibility Rule • Participation in all procurement and grant procedures is open on equal terms to all natural and legal persons of the EU member states and the countries covered by the Regulation under which the contract is financed • No restrictions for individual experts Regulation No 2112/2005 Article4:“All experts engaged by tenderers may be of any nationality” IPA Funds Programme Management 12-19 sept. 2011

11. Eligible Countries • Member States of the European Community: • Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom • Member States of the European Economic Area: • Liechtenstein, Norway • Candidate Countries: • Croatia, Former Yugoslav Republic of Macedonia, Montenegro, Turkey • Potential Candidate Countries: • Albania, Bosnia and Herzegovina, Iceland, Kosovo under UNSCR nº 1244, Serbia, • ENPI Countries: • Algeria, Armenia, Azerbaijan, Belarus, Egypt, Georgia, Israel, Jordan, Lebanon, Libya, Moldova, Morocco, Palestinian Authority of the West Bank and Gaza Strip, Russian Federation, Syria, Tunisia, Ukraine Participation is also open to: Developing Countries specified by the OECD DAC (thematic programmes) International Organisations Beneficiary Countries that have reciprocal access to External Aid A third country (with a derogation endorsed by the EC) IPA Funds Programme Management 12-19 sept. 2011

12. Rule of Origin • All supplies and equipment purchased must originate in the EU or in an eligible country as defined above in the nationality rules • In its tender, a tenderer must state the origin of supplies IPA Funds Programme Management 12-19 sept. 2011

13. Exceptions from the Rule of Origin • Decided on case-by-case basis by the EC before the procedure is launched • May extend eligibility to natural and legal persons from a country not eligible • May allow the purchase of supplies and materials originating from a country not eligible • (Price will not be accepted as justification) • Any derogation must be foreseen at PN stage IPA Funds Programme Management 12-19 sept. 2011

14. WHO COULD NOT PARTICIPATE TENDERS IPA Funds Programme Management 12-19 sept. 2011

15. Grounds for exclution from the tenders PRAG 2.3.3 a) they are bankrupt or being wound up, are having their affairs administered by the courts, haveentered into an arrangement with creditors, have suspended business activities, are the subjectof proceedings concerning those matters, or are in any analogous situation arising from asimilar procedure provided for in national legislation or regulations; b) they have been convicted of an offence concerning their professional conduct by a judgmentwhich has the force of res judicata; (i.e. against which no appeal is possible); c) they have been guilty of grave professional misconduct proven by any means which theContracting Authority can justify; d) they have not fulfilled obligations relating to the payment of social security contributions or thepayment of taxes in accordance with the legal provisions of the country in which they areestablished or with those of the country of the Contracting Authority or those of the countrywhere the contract is to be performed; e) they have been the subject of a judgment which has the force of res judicata for fraud,corruption, involvement in a criminal organisation or any other illegal activity detrimental tothe Communities' financial interests; f) following another procurement procedure or grant financed by the Community budget, theyhave been declared to be in serious breach of contract for failure to comply with theircontractual obligations. THE POTENTIAL TENDERERS MUST DOCUMENTATE THAT NON OF THE CONDITIONS LISTED ABOVE ARE VIABLE FOR THEM IPA Funds Programme Management 12-19 sept. 2011

16. Documentary proofs • Relevant Commercial Court /Court of Liquidation and Bankruptcy Chambers of Commerce-Trade Registry • Public Procurement Authority-PPA or for Companies Commercial Court and for partners (natural persons) and managers, General Directorate of Record of Convictions or Statistics or relevant Public Prosecutor • To be checked by EC/CFCU and/or Records of Public Procurement Authority-PPA • Social Security Institution, Tax Offices • Same as (a) • Same as (b) IPA Funds Programme Management 12-19 sept. 2011

17. Other reasons for exclutions • THOSE WHO COULD NOT PROVE TAHT THEY DID NOT FALL INTO THE ABOVE POINTS • THOSE WHO PROVIDE MISLEADING DECELARATION • THOSE WHO HAVE FOUND TO HAVE CONFLICT OF INTERESTS IPA Funds Programme Management 12-19 sept. 2011

18. Conflict of Interest GENERAL DEFINITION A conflict between an individual’s personal interest and his or her public duty. This can exist whether or not money is involved, and whether the conflict is actual or only perceived. PRAG’s DEFINITION (FOR TENDERS IN GENERAL) Any firm or expert participating in the preparation of a project must be excluded from participating in tenders based on this preparatory work, unless they can prove to the Contracting Authority that the involvement in previous stages of the project does not constitute unfair competition. IPA Funds Programme Management 12-19 sept. 2011

19. Examples of Conflicts • A Public Officer's relatives participating in the tender when the Officer is the member of the tender evaluation committee, • A relative of a Public Officer attending the Civil Service Examination when their relative is in the jury, • A tax officer auditing the company where his/her wife/husband works, • A Public Officer who is responsible for the credits and incentives accepting the credit and incentive application of the company that he/she is a shareholder of and conducting the process, • Brother/sister of the Mayor participate the tenders IPA Funds Programme Management 12-19 sept. 2011

20. Penalties For who have been guilty of • making false declarations or • making substantial errors or committed irregularities and fraud • having been found in serious breach of their contractual obligation Excluded • may be excluded from all contracts and grantsfinanced by the EU for a maximum of fiveyears and this period may be extended to 10 years in theevent of a repeatedoffence withinfive years • Before deciding on excluding a party, in principle the concerned partyhas the rightto be heard (contradictory procedure) IPA Funds Programme Management 12-19 sept. 2011

21. VisibilityCommunications and Visibility Manual • Contractors for services, supplies, works or grant beneficiaries as well as entities managing funds on behalf of the EC must take the necessary measures to ensure the visibility of the EU financing or co-financing. • Such measures must be in line with Communication and Visibility Manual for EU External Actions:http://ec.europa.eu/europeaid/work/visibility/index_en.htm • Obligation of submitting a communication plan to be approved by the CA IPA Funds Programme Management 12-19 sept. 2011

22. Essentials • Awarding principles • No retroactive awards • Use of standard documents • Record keeping • Availability of funds • Environmental aspects • Joint procurement with an EU member state • Expost publication of beneficiaries http://ec.europa.eu/europeaid/work/funding/beneficiaries_en.htm IPA Funds Programme Management 12-19 sept. 2011

23. PRAG Procurement IPA Funds Programme Management 12-19 sept. 2011

24. Procurement Procedures The basic principle governing the award of contracts is competitive tendering. The purpose is twofold: • to ensure the transparency of operations; • to obtain the desired quality of services, supplies or works at the best possible price. There are several different procurement procedures, each allowing for a different degree of competition IPA Funds Programme Management 12-19 sept. 2011

25. Practical Guide to Contract Procedures for EU External Actions Procedures • Open Tender Procedure • Restricted Tender Procedure • Competitive Negotiated Procedure • Simplified Procedure • Single Tender IPA Funds Programme Management 12-19 sept. 2011

26. Which procedure? IPA Funds Programme Management 12-19 sept. 2011

27. Procedures (exceptional) • Dynamic Purchasing System • Competitive Dialogue • Negotiated Procedure IPA Funds Programme Management 12-19 sept. 2011

28. Types of Procurement IPA Funds Programme Management 12-19 sept. 2011

29. Service Procurement of consultancy, research, know-how and training SuppliesProcurement of equipment materials Works Infrastructure, superstructure and 0ther engineering works IPA Funds Programme Management 12-19 sept. 2011

30. Single Tender ≤ €10 000 Exceptional and duly justified cases. • where the factual or legal circumstances defined in articles 242, 244 and 246 of the Implementing Rules of the Financial Regulation are met • One offer sufficient • The identified provider must submit a brief technical proposal and a financial offer • Can be sent and received by fax • The CA must prepare a report (Annex A10b) explaining the manner in which the participant(s) in the negotiations were identified and the price was established, and the grounds for the award decision IPA Funds Programme Management 12-19 sept. 2011

31. Framework Contracts Services >€ 10000 but < €200000 Send to min four pre-selected (short listed) companies in 12 Lots • Lot 1: Rural development • Lot 2: Transport and Infrastructures • Lot 3: Telecommunications and information technologies • Lot 4: Energy and nuclear safety • Lot 5: Conferences • Lot 6: Environment • Lot 7: Governance and Home Affairs • Lot 8: Health • Lot 9: Culture, Education, Employment and Social • Lot 10: Trade, Standards and Private sector • Lot 11: Macro economy, Statistics, Public finance management • Lot 12: Humanitarian Aid, Crisis Managementand Post-Crisis assistance IPA Funds Programme Management 12-19 sept. 2011

32. Why Frameworks? Operations to fulfill the following conditions: • be financed with external aid funds; • be in the exclusive interest of an authority benefiting of external aid; • not exceed €  200 000, addenda included, without undue splitting; • not give rise to services exceeding 260 days per expert; • be implemented over maximum 2 years (730 calendar days), addenda included Rationale • Simplicity • Rapid application • Transparency & equality of competition • Quality • Pre-agreed fees per framework contractor for eachcategory of expert IPA Funds Programme Management 12-19 sept. 2011

33. Service tenders above € 200,000 • Must be carried out according to international restricted tender procedures • The tendering terms and conditions must be published on the the web site of the contratcıng authority, international and local newspapers (if possible) • a shortlıst must be estabished • the number of shortlısted tenderers (usually between 4 to 8) must be published • the evaluation of proposals must be undertaken objectively and integrity of the competitive process must be preserved. • only the candidates meeting the tendering criteria stated on the announcement and the ones who are invited can sent their offers IPA Funds Programme Management 12-19 sept. 2011

34. Supply Contracts The budget is 150 thousand euros and over • International open tendering procedure • Procurement notıces must be published in international and local press • The suppliers complying with theconditions stated can make an offer The contract amount is between 60 thousand and 150 thousand euros local open tender procedure procurement notıces must be published only in local press local and other participants must be treated equally IPA Funds Programme Management 12-19 sept. 2011

35. Supply cont. Contracts below 60,000 Euro • Competitive negotiated tender procedure can be applied in exceptional cases, • approval (ex-ante) must be recived in advance 3 tender notice is not necessary 4 at least three compliant offers must be recieved Contract amount10,000 Euros or below • Single tender (0ne offer) IPA Funds Programme Management 12-19 sept. 2011

36. Works Contracts The budget is 5 MEUR and over • International open tendering procedure • Procurement notıces must be published in international and local press • The contractors complying with theconditions stated can make an offer The contract amount is between € 300,000 and 5 MEUR (5,000,000 Euro) local open tender procedure procurement notıces must be published only in local press local and other participants must be treated equally IPA Funds Programme Management 12-19 sept. 2011

37. Local Open Tender • no publication of Contract Forecast required • publication of Procurement Notice • standard local advert published only in the Beneficiary Country • the EC only publishes the references of such tender opportunities • A local open tender procedure must provide other eligible suppliers/contractors with the same opportunities as local firms • Deadline for Submission of Tenders • minimum of 30 days between the date of publication of the PN and the deadline for receipt of tenders (Supplies) • minimum of 60 days between the date of publication of the PN and the deadline for receipt of tenders (Works) (voting members 3) • The contract is awarded by conducting the selection procedure (i.e., verification of the eligibility and of the financial, economic, technical and professional capacity of tenderers) and the procurement procedure (i.e., comparison of tenders) IPA Funds Programme Management 12-19 sept. 2011

38. International restricted tender • for Services  € 200000 • for Works  € 5 000000 Exceptional cases! SHORTLISTING IPA Funds Programme Management 12-19 sept. 2011

39. International restricted tender • Publication of contract forecasts and procurement notices for the widest possible participation in competitive tendering and the requisite transparency • At least 15 days before the intended date of publication, to allow for translations for the EU publication • A minimum of 30 days is required between the CF and the PN • The minimum deadline for submitting applications is 30 days, after the publication of PN • The PN should be clear enough to avoid candidates from having to request clarification or additional information during the procedure. Candidates may however submit questions should this be deemed necessary IPA Funds Programme Management 12-19 sept. 2011

40. Shortlisting • Objective: to identify between 4 to 8 candidates • Procedure - establish a long list - administrative compliance check (evidence) - check economic and financial status (capital resources) - verify professional capacities (staff resources) - verify technical capabilities (expertise & experience) • Result - if the number of candidates is less than 4, CA may invite only these candidates to submit a tender - if the number of candidates is more than 8, re-examine to identify the best eight candidates • Shortlist Notice - candidates not selected (standard letter of regret) - publication of approved shortlist on EU website - candidates selected (Letter of Invitation to Tender and Tender Dossier) IPA Funds Programme Management 12-19 sept. 2011

41. Tender stage • Deadline for submission of tenders • minimum period is 50 days after dispatch of the invitation letter • Additional info • clarification meeting / site visit may be foreseen • Tenderers may submit questions up to 21 days before the deadline for submission of tenders • the Contracting Authority must reply at least 11 days before the deadline • Submission of tenders • double envelope system IPA Funds Programme Management 12-19 sept. 2011

42. International open tender for Supplies  € 150 000 for Works  € 5 000 000 IPA Funds Programme Management 12-19 sept. 2011

43. International open tender • Deadline for submission of tenders • - Minimum period60 days after publication of PN (Supplies) • - Minimum period90 days after publication of PN (Works) • Additional info • clarification meeting / site visit may be foreseen • Tenderers may submit questions up to 21 days before the deadline for submission of tenders • the Contracting Authority must reply at least 11 days before the deadline • Submission of tenders • - Single envelope system • Award criterion: price – cheapest compliant offer • - after conducting selection procedure (verification of the eligibility and of the financial, economic, technical and professional capacity of tenderers) and procurement procedure (comparison of tenders) IPA Funds Programme Management 12-19 sept. 2011

44. Do not forget!! • Whatever the procedure used, the Contracting Authority must ensure that conditions are such as to allow fair competition. • Wherever there is an obvious and significant disparity between the prices proposed and the services offered by a tenderer, or a significant disparity in the prices proposed by the various tenderers (especially in cases in which publicly-owned companies, non-profit associations or non-governmental organisations are taking part in a tender procedure alongside private companies), the Contracting Authority must carry out checks and request any additional information necessary. • The Contracting Authority must keep such additional information confidential IPA Funds Programme Management 12-19 sept. 2011

45. Procurement Plan? • the type and the rules of procurement process to be followed (e.g. open or restricted tender, with or without pre-qualification); • the type of contract - services, supplies, works; • the timing of the various publications related to the procurement process; • the estimates for the financial envelopes of the different contracts; • proposed financial sources; (co-financing) IPA Funds Programme Management 12-19 sept. 2011

46. Evaluations International Restricted Tender • Administrative Compliance • Technical Evaluation • assessment of quality of Technical Proposal • interviews (if necessary) • Financial Evaluation (for those who have scored above 80 points from Technical Evaluation) • Award criterion: best value for money, • (i.e. the most economically advantageous tender) IPA Funds Programme Management 12-19 sept. 2011

47. The Evaluation Committees Composition, impartiality and confidentiality, responsibilities, timetable and period of validity Non-voting Members Evaluator to ensure respect for PRAG procedures, impartiality and transparency of the evaluation minimum 3 for service & supply tenders and minimum 5 for works tenders Oberver Evaluator Have equal voting rights keeping minutes, registering attendance and drafting the Evaluation Report Secretary possess the technical and administrative capacities necessary to give an informed opinion on the tenders Evaluator must sign a DeclarationofImpartiality & Confidentiality (including non-voting members) should attend all meetings whereby any absence has to be recorded and explained in the evaluation report Chairperson are appointed and nominated on a personal basis by the Contracting Authority IPA Funds Programme Management 12-19 sept. 2011

48. IPA experts at Evaluation manage... • Receipt and registration of tender bids • Preparatory meeting • Tender opening session - administrative compliance - technical compliance • Technical evaluation - assessment of quality of Technical Proposal - interviews (if necessary, for services only) • Financial evaluation • Choice of successful Tenderer • Preparation of Evaluation Report IPA Funds Programme Management 12-19 sept. 2011

49. Cont. • all proceedings are conducted incamera (except for the public tender opening session – supplies & works) • evaluation proceedings are COMPLETELY confidential and must under no circumstances be discussed with outsiders • only committee members should have access to the evaluation room • tender bids should not leave the evaluation room and should be kept in a safe place when not in use • Confidentiality is subject to CA’s legislation on access to documents. In case of any contradiction the CA shall ask for prior authorisation from the EC before disclosing any information IPA Funds Programme Management 12-19 sept. 2011

50. Contract award notification • Before the period of validity of tenders expires which is 90 days, and on the basis of the evaluation report, the CA notifies the successful tenderer • This notification implies that the validity of the successful tender is automatically extended for a period of 60 days • At the same time, the CA requests the successful tenderer i.e. to submit the evidence required by the tender dossier to confirm the declarations made in the tender submission form within 15 days of the date of the notification letter • There is no obligation to submit documentary evidence for • contracts with a value less than the international thresholds IPA Funds Programme Management 12-19 sept. 2011