Civil society Procurement Monitor. Civil Society Organization Engaged through through competitive...

Civil societyProcurement Monitor

Civil Society Organization

• Engaged through through competitive bidding to undertake performance monitoring, evaluation, and audit of procurement and contract implementation

Procurement Guiding Principles(Article 6)

• Transparency• Equal opportunity to compete• Economy and efficiency• Responsibility

These same principles can inform the monitoring framework of civil society groups evaluating public procurement.

These same principles can inform the monitoring framework of civil society groups evaluating public procurement.

CSO Monitoring Framework

TransparencyTransparency

Fair competition

Fair competition

Economy/ EfficiencyEconomy/ Efficiency

AccountabilityAccountability

Questions to ask when monitoring

Tips and notes for monitoring

Questions to ask when monitoring

Tips and notes for monitoring

HOW PROCUREMENT IS ORGANIZED

Evaluation Committee: Composition(Art. 47)


Fair competition

Fair competition



Who are the members of the committee?

Are the members specialized in procurement or the item to be

procured?

Are there conflict of interest relations?

Is there an NGO member? Who?

Has any of the members had a record of civil servant duty violations in the

past year?

Are majority of the members procurement specialists?

Who are the members of the committee?

Are the members specialized in procurement or the item to be

procured?

Are there conflict of interest relations?

Is there an NGO member? Who?

Has any of the members had a record of civil servant duty violations in the

past year?

Are majority of the members procurement specialists?

Family relations

Contractual relations with tenderer in the past 3

years

Evaluation Committee: Code of ethics and conduct


Fair competition

Fair competition



Ensure fair competition

Promote state interests

Should not accept bribes and other illegal proposals

Should inform supervisor of potential conflict of interest

Should inform supervisor immediately if tenderer attempted to

influence procurement results

Ensure fair competition

Promote state interests

Should not accept bribes and other illegal proposals

Should inform supervisor of potential conflict of interest

Should inform supervisor immediately if tenderer attempted to

influence procurement results

Do the committee members adhere to the

following?

SELECTION OF PROCUREMENT PROCEDURE

Three Types of Procurement Procedures

1. Open procurement procedure2. Exceptional procurement procedure3. Selection of a contractor of consulting services

Selection of procurement procedure is based on cost estimate of goods, works, or services or GWS (Art. 8.4)

CABINET SETS THRESHOLDS

UPPER CEILING of cost estimates for…

LOWER CEILING of cost estimates for…



LOWER CEILING of cost estimates for…

Threshold Values and Procurement Method (Art. 8)


Fair competition

Fair competition



Goods, works or services (GWS)

under Comparison Method



GWS under Direct procurement


Consulting services under least-cost

method


method

GWS that require state administrative body authorization for budget issues

GWS that require state administrative body authorization for budget issues

GWIS whose Invitation to tender is posted in

nationwide newspapers and other

mass media

GWIS whose Invitation to tender is posted in

nationwide newspapers and other

mass media



If cost estimates > upper ceiling set for comparison

method, OPEN PROCUREMENT

PROCEDURE and following 3 methods should be used



If cost estimates > upper ceiling set for comparison

method, OPEN PROCUREMENT

PROCEDURE and following 3 methods should be used

Threshold Values and Procurement Method (Art. 8)


Fair competition

Fair competition








method


method

Community participation method,

where cost estimation is below

20mn MNT

Community participation method,

where cost estimation is below

20mn MNT

Creating Packages of Goods, Works, and Services

General Rule:Splitting of GWS into packages is prohibited

Splitting of goods, works, and services into several packages

Transparency

Fair competition

Fair competition



Did splitting result in greater competition?

Are packages created rationally?

Did the procuring entity indicate the existence of

packages in the invitation to tender and tender documents?

Did the procurement procedure minimize the total

cost of all contracts?

Did splitting result in greater competition?

Are packages created rationally?

Did the procuring entity indicate the existence of

packages in the invitation to tender and tender documents?

Did the procurement procedure minimize the total

cost of all contracts?

According to type and

similarity of purpose, and geographical

locations

For packages, in determine procurement method to use…

• Total cost of all packages as determinant (Art. 8.7)

• Opt for procurement method where total cost of all contracts are signed at its minimum

Preferences allowed by law


Fair competition

Fair competition



• Tenderers that supply goods of Mongolian origin• Bodies tendering to execute at least 50% of works

independently– Mongolian citizens or legal entity– Foreign legal entity registered in Mongolia and with 50%

equity owned by Mongolian citizen or legal entity

• Tenderer with largest use of locally produced goods, materials and services

• Tenderer that employs largest share of local labor• Tenderer with 90% of employees Mongolian

• Tendering price shall be discounted:– 10% for goods of Mongolian origin– 7.5% for works

Is there bias against FOREIGN TENDERERS? Did the procuring entity exclude foreign tenderers for works costing more the MNT 10 million and goods and services costing

more than MNT 100 millon?

Is there bias against FOREIGN TENDERERS? Did the procuring entity exclude foreign tenderers for works costing more the MNT 10 million and goods and services costing

more than MNT 100 millon?

Bidding Process(Pre-contracting)

1. Procurement planning

2. Preparation of bid documents

3. Public announcement of invitations for tendering

4. Clarification of Bidding document and Pre-bid meeting

5. Submission of tenders

6. Opening of tenders

7. Review of tenders

8. Evaluation of tenders

9. Authorization to enter into a contract

Prequalification


Fair competition

Fair competition



What were the Cabinet procedures for pre-qualification?

Did the procuring entity make the announcement in a nationwide newspaper and other mass media

What were the Cabinet procedures for pre-qualification?

Did the procuring entity make the announcement in a nationwide newspaper and other mass media

Take note of the prequalification criteria – does it allow for greater competition or limits competition?

Are the requirements reasonable and appropriate?

Take note of the prequalification criteria – does it allow for greater competition or limits competition?

Are the requirements reasonable and appropriate?

Disqualified tenderers• Insolvent and under receivership• Not fulfilling tax payments and obligations• Operations of legal entity with whole or

partial state ownership• Bad track record (violation of contractual

obligations) for the past 3 years• With conflict of interest (design and

contract execution)• Submitted false information• Court decided that the tenderer

committed a corruption crime in past 3 years

Verify reasons for

disqualifying tenderers

Verify reasons for

disqualifying tenderers

Disqualification/ Blacklist


Fair competition

Fair competition



Did the state administrative body disclose publicly bodies whose rights to tender

were restricted?

Did the state administrative body disclose publicly bodies whose rights to tender

were restricted?

Tenderer’s proofs

• Court ruling and/or official document issued by the competent public administrative authority

• Certificate and/or other equivalent documents issued by competent authorities

OPEN PROCUREMENT PROCEDURE

Single or Two-stage Open Tendering


Fair competition

Fair competition



The default mode is single-stage open tendering. If the procuring entity

adopted two-stage open tendering, verify if there is presence/absence of conditions justifying use of two-stage

tendering.

The default mode is single-stage open tendering. If the procuring entity

adopted two-stage open tendering, verify if there is presence/absence of conditions justifying use of two-stage

tendering.– Scope of work is large; Cost estimates

are high; Contract includes goods, works, and services; Technically unequal proposals likely to be submitted; Several technical and equally acceptable solutions can satisfy requirements of procuring entity

– Unable to establish technical specifications in advance

Two-stage Open Tendering


Fair competition

Fair competition



Did the procuring entity indicate in invitation to tender and tendering documents use of two-stage open

tendering?

Did the procuring entity indicate in invitation to tender and tendering documents use of two-stage open

tendering?

Two-stage open tendering

• Tenderers invited to submit technical proposals– Technical proposals are assessed by procuring entity– Technical specifications are revised and clarified by

procuring entity => standard technical specifications

• Tenderers invited to submit financial proposals based on revised and clarified technical proposals– Procuring entity to evaluate

Two-stage Open Tendering


Fair competition

Fair competition



Are the revised standard technical specifications fair or is there bias for a

specific tenderer?

Are the revised standard technical specifications fair or is there bias for a

specific tenderer?

Tender Documents


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Fair competition



Where foreign tenderers are allowed to participate, are the tender documents presented in a language widely used in

international trade?

Is the cost of tender documents prohibitive?*

Are the tender documents made available to all interested parties without unreasonable

delay? Are the documents available the day before the publication of invitation to

tender?

Where foreign tenderers are allowed to participate, are the tender documents presented in a language widely used in

international trade?

Is the cost of tender documents prohibitive?*

Are the tender documents made available to all interested parties without unreasonable

delay? Are the documents available the day before the publication of invitation to

tender?

Tender Documents


Fair competition

Fair competition



Is the invitation to tender posted in a nationwide newspaper and other mass

media?

Does it contain complete information?

Is the invitation to tender posted in a nationwide newspaper and other mass

media?

Does it contain complete information?

– Identity of procuring entity– Brief summary of the works, goods or

services to be procured– Address where tender documents and other

information can be obtained and submitted– Cost of tender documents

– Special requirements to tender selection– Deadline for tender submission

– Time of commencing the tendering– Participation of foreign tenderers allowed

or not– Granting of a margin of preference

Clarification on tender documents


Fair competition

Fair competition



Did the changes (clarification/ additional information) give undue advantage to any one

tenderer?

Did these changes affect the ability of other tenderers to respond to the tender

opportunity?

Did the changes (clarification/ additional information) give undue advantage to any one

tenderer?

Did these changes affect the ability of other tenderers to respond to the tender

opportunity?

Clarification of Bidding document and Pre-bid meeting


Fair competition

Fair competition



Did the procuring entity respond to the bidders clarification?

Was there amendment to the Bidding document in accordance with the potential clarification by

bidders?

Did procuring entity conduct pre-bid meeting and respond to the bidders clarification during

the meeting?

Did the procuring entity respond to the bidders clarification?

Was there amendment to the Bidding document in accordance with the potential clarification by

bidders?

Did procuring entity conduct pre-bid meeting and respond to the bidders clarification during

the meeting?

Deadline for submission


Fair competition

Fair competition



Did the procuring entity set the deadline for submission at least 30 days or more from

publication of invitation to tender?

Are the tenderers given sufficient and equal time to prepare their tenders?

Did the procuring entity set the deadline for submission at least 30 days or more from

publication of invitation to tender?

Are the tenderers given sufficient and equal time to prepare their tenders?

Submission and opening of tenders


Fair competition

Fair competition


AccountabilityAccountability Is there strict compliance with the deadline?*Is there strict compliance with the deadline?*

Take note of announced details of tenders opened (tenderer’s name, tendering price,

alternative tendering price, discounts offered, tender security, modifications,

withdrawals, etc.)*

Are the Notes of the procuring entity made available to any interested party?

Take note of announced details of tenders opened (tenderer’s name, tendering price,

alternative tendering price, discounts offered, tender security, modifications,

withdrawals, etc.)*

Are the Notes of the procuring entity made available to any interested party?

*Details of tenders not announced (ex: tendering price) shall not be considered in tender evaluation.

Review of tenders


Fair competition

Fair competition


ResponsibilityResponsibility

Check on whether the tenderers are qualified (see bases for disqualification)Check on whether the tenderers are qualified (see bases for disqualification)

Review of technical qualificationsEducation and professional

qualifications of management, supervision, and execution employeeWorks carried out in last 5 years

Tenderer’s instruments and technical facilities, list of plants and

equipmentQuality control measures (if sub-

contracting)Quality certificates issued by

competent authority

Review of tenders


Fair competition

Fair competition



Check on whether the tenderers are qualified (see bases for disqualification)Check on whether the tenderers are qualified (see bases for disqualification)

Review of Financial Qualifications Statements by correspondent

bank Audited financial statements

Table of consulting staff, remuneration and other cost

estimations Reports on annual sales up to last

5 years

Review of tenders


Fair competition

Fair competition



Has there been negative influence on scope, quality and performance of goods, works or

services?

Are the contract terms inconsistent with the law?

Has there been unfair influence on competition of other responsive tenders?

Has there been negative influence on scope, quality and performance of goods, works or

services?

Are the contract terms inconsistent with the law?

Has there been unfair influence on competition of other responsive tenders?

This is done only for the purpose of comparing tenders and shall not be a justification for changing tender price.

This is done only for the purpose of comparing tenders and shall not be a justification for changing tender price.

Evaluation of tenders


Fair competition

Fair competition

Economy/ Efficiency


IS THE KEY CRITERION THE TENDERING PRICE?

Are there other factors considered? What were these?

IS THE KEY CRITERION THE TENDERING PRICE?

Are there other factors considered? What were these?

– Time of completion of works and services and/or delivery of goods

– Current expenses or cost and efficiency estimations

– After-sales service and technical assistance

– Commitment to supply spare parts– Quality and and technical merits of

works, goods and services– Other criteria consistent with law

Evaluation of tenders

• Tenders shall be arranged from lowest to highest– Tender price adjusted according to margin of

preference discounts– Lowest price = BEST EVALUATED TENDER

• In case of foreign currency, currency to be converted at Mongolbank rate effective on day of tender announcement

Authorization to enter into a contract


Fair competition

Fair competition



Did the procuring entity authorize the tenderer with the BEST EVALUATED TENDER

to enter into contract?

Did the other losing tenderers get notification in writing?

Was the contract signed after 5 days from notification?

Did the procuring entity authorize the tenderer with the BEST EVALUATED TENDER

to enter into contract?

Did the other losing tenderers get notification in writing?

Was the contract signed after 5 days from notification?

Authorization to enter into a contract

• The procuring entity may extend tender validity period if it becomes impossible to sign contract due to reasons not dependent on the procuring entity.– Extension shall be justified in writing

Rejecting all tenders• All tenders are not responsive• Determination of unfair competition

– Court or competent authority determines that the tendering price was negotiated

– Conditions of tendering were not provided accurately to tenderers

– Competitors were put under pressure• Tendering prices of all responsive tenders exceeded

procuring entity’s cost estimate by more than 5%• Negotiation with tenderer whose tendering price

exceeded cost estimates failed– Negotiation is done to bring down tendering price to exceed cost

estimates by less than 5%

If procuring entity rejected all tenders…

• It shall examine the reasons that resulted in failure, make relevant amendments to content of tender documents, and conduct open tendering

• If reason for failure is all responsive tenders exceeded cost estimates by more than 5% and negotiation failed, relevant modifications will be made in tender documents, and conduct limited tendering

• Reoccurrence of rejection of all tenders after amendments and conduct of open tendering/ limited tendering (30.4.3) , procuring entity shall proceed to conduct direct contracting

EXCEPTIONAL PROCUREMENT PROCEDURES

LIMITED TENDERING

Limited Tendering


Fair competition

Fair competition



Are there limited tenderers capable of executing goods, works, services requiring high qualification, expertise, equipment,

technology?

Was there a rejection of all tenders because responsive tenders exceeded cost estimates by more than 5% and negotiations to bring down tender price to less than 5% in excess

of cost estimate have failed?

Are there limited tenderers capable of executing goods, works, services requiring high qualification, expertise, equipment,

technology?

Was there a rejection of all tenders because responsive tenders exceeded cost estimates by more than 5% and negotiations to bring down tender price to less than 5% in excess

of cost estimate have failed?

Procedure

• Simultaneous invitation to tender is sent to bodies with capacity to execute contract

• Tender documents shall be provided to interested tenderers without unreasonable delay

• Tender submission deadline is set to 15 or more days from delivery of invitation to tender

COMPARISON

When is comparison method allowed?

• If the cost estimate of goods, works, services does not exceed the threshold values

Take note of possible splitting of cost estimates to circumvent open tendering method and for availment of comparison method.

Take note of possible splitting of cost estimates to circumvent open tendering method and for availment of comparison method.

Procedure

• Procuring entity invites 3 or more bodies that satisfy the technical specifications and other conditions and requirements to submit price proposals

• Procuring entity to authorize qualified tenderer with lowest price to enter into contract

• Submission of price proposal shall be done in not less than 5 working days from the day the invitation was delivered

Procedure

• If there is failure to compare, procuring entity may proceed to direct contracting

DIRECT CONTRACTING

Direct contracting


Fair competition

Fair competition



• Second failure of open tendering and failure to compare

• Procured item is protected by copyright laws

• Additional supplies (replacement, repair, replenishment) do not exceed

20% of value of initial contract and change in supplier will result in cost-

inefficiencies and other technical difficulties

• Additional works do not exceed 15% of initial contract

• Emergency cases due to unforeseeable and force majeur circumstances

• Second failure of open tendering and failure to compare

• Procured item is protected by copyright laws

• Additional supplies (replacement, repair, replenishment) do not exceed

20% of value of initial contract and change in supplier will result in cost-

inefficiencies and other technical difficulties

• Additional works do not exceed 15% of initial contract

• Emergency cases due to unforeseeable and force majeur circumstances

Are these conditions present?

Procedure

• Procuring entity shall negotiate with one or more bodies that satisfy basic technical and financial qualifications. The procuring entity shall enter into contract with body that best satisfies the technical specifications, conditions and requirements

• Contract and statement justifying the application of procedure shall be sent to central administrative authority

PROCUREMENT OF CONSULTING SERVICES

Consultants can be…

• Individuals– Individual qualifications and expertise

• Legal entities–Multidisciplinary expertise and specialized

personnel

Procedure

• Procuring entity shall prepare terms of reference (TOR) detailing objectives, expected outcome, and other relevant information

• Procuring entity shall make cost estimations of service– Based on type and level of personnel background,

time required for works at field and office, office supplies and other expenses required for a given service

Consulting Services


Fair competition

Fair competition



Was there a publication of the invitation to tender in a nationwide newspaper

or other mass media?

Is there a general list of consultants? Where did the names come from?

Was there a publication of the invitation to tender in a nationwide newspaper

or other mass media?

Is there a general list of consultants? Where did the names come from?

– Consultants who responded to the invitation

– National and/or international consultants providing services in

Mongolia– Consultants listed in government

registry– Consultants affiliated with professional associations and

international financial organizations

Procedure• Procuring entity to draw up a shortlist from the general

list of at least three consultants that satisfy the basic technical and financial capacity requirements

• Procuring entity shall provide the Request for Proposal and TOR to shortlisted consultants. The RFP shall contain:– Brief description of assignment and details of financing– TOR– Qualification requirements, evaluation criteria and

methodology– Name of legal entities invited and/or individuals invited– Draft contract– Instructions for submitting proposals– Evaluation method to be used

• Deadline for submission shall not be more than 60 days. For legal entities, more than 30 days. For individuals, more than 7 days

Is the shortlist of consultants based on a clear set of criteria (basic qualifications)?

Is the shortlist of consultants based on a clear set of criteria (basic qualifications)?

Procedure

• Technical and financial proposals are prepared separately and submitted concurrently. They may be in separate sealed envelopes if the RFP requires so.– Technical: professional qualification and expertise.

For legal entities, this includes lead specialist and operating practice

– Financial: price• The financial proposal will be evaluated after the

evaluation of the technical proposal

Evaluation Methods

• Qualification

• Quality• Combined evaluation method• Least-cost method

Individual consultants

Consultingfirms

Qualification evaluation method

• Consultant’s knowledge, expertise, professional level, and other professional skills

Quality evaluation method• Contract requires simultaneous execution of a number of services

requiring comprehensive qualification expertise and technical qualifications

• Proposals are compared on operating practice, work schedule, personnel’s expertise and capabilities, and quality of service

• Technical proposals are assigned scores based on basic technical and financial qualification standards (Articles 14-16). Technical proposals will be ranked according to score

• Highest ranked firm shall have his financial proposal opened first. Procuring entity will negotiate to agree on price and other conditions.– Procuring entity shall not require consultant to reduce proposed price

without justification– If negotiation fails with first ranked, procuring entity will proceed to

open financial proposal of next ranked firm and undertake negotiations with the same

• Consultant may be asked to submit relevant documents, cost estimates and other information and evidence.

Combined evaluation method• For all other consulting services other than individual

consultants and those under quality evaluation method• Procuring entity to indicate minimum score for technical

proposal• Technical proposals will be evaluated and ranked. Those

meeting the minimum score will be notified for the opening of financial proposals. Those who did not meet the minimum score shall receive their financial proposals unopened.

• Financial proposals of those who met the minimum score shall be opened publicly at a date/time set by procuring entity and notified to qualified consultants.– Financial proposals will be scored in manner set in RFP

• Total score of quality and price evaluation = technical proposal score + financial proposal score

Combined evaluation method• Procuring entity will negotiate with highest ranked

firm– What can be negotiated

• # Person-days, # person-months• Time required for field work• Office supplies

– Unit costs cannot be modified– If negotiation fails, procuring entity shall proceed to

negotiate with next-in-rank

Least-cost method

• For consultancy assignments with established practices, the least cost method shall be adopted (Negotiation with firm with lowest priced financial proposal)

Thank you!

Date post:	24-Dec-2015
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