EIGHTH REGIONAL PUBLIC PROCUREMENT FORUM TIRANA, ALBANIA, MAY 22 - 25, 2012 E-procurement: Developing a Legal Framework that Maximizes its Advantages Caroline Nicholas UNCITRAL April 2012

E-procurement: Developing a Legal Framework that Maximizes its Advantages Background: 1994 (first Model Law, GPA): EDI in its infancy Today: some systems entirely electronic EU 50% e-procurement (goal) A big deal: procurement = 10-20% GDP Online trade worldwide $12.8 trillion (2006, Forrester) What is its potential?

E-procurement: Developing a Legal Framework that Maximizes its Advantages “[e-procurement] is emerging worldwide with the potential to reform processes, improve market access, and promote integrity in public procurement” (Schapper, 2008) Is e-procurement living up to these expectations?

E-procurement: Developing a Legal Framework that Maximizes its Advantages Key policy goals in introducing e-procurement (1) better Transparency Participation and competition Objectivity and accountability Efficiency Potential for better value for money

E-procurement: Developing a Legal Framework that Maximizes its Advantages Key Policy goals in introducing e-procurement : (2) better Oversight (external and internal) Measurement of performance/results Identification of risk areas (red flags) Potential for enhanced accountability and integrity – longer-term goal

E-procurement: Developing a Legal Framework that Maximizes its Advantages UNCITRAL Model Law e-procurement tools: e-advertising e-communications e-reverse auctions Framework agreements e-tenders e-signatures e-records

E-procurement: Developing a Legal Framework that Maximizes its Advantages Policy approach of UNCITRAL Encourage e-procurement Where appropriate (infrastructure) Safeguards and public confidence Main policy issues Staged implementation and where to start Don’t over-regulate Business models International market access Treat as a reform issue, not a technology issue

E-procurement: Developing a Legal Framework that Maximizes its Advantages Staged implementation and where to start Simple tools E-advertising, e-communications Uploading and downloading documents Communications during the procurement process Second-stage tools E-reverse auctions Framework agreements

E-procurement: Developing a Legal Framework that Maximizes its Advantages Simple tools – e-advertising and e-communications Legal standards for e-communications, e-advertising, e-tendering, meetings Public confidence and safeguards – authenticity, integrity, confidentiality Safeguarding market access Functional equivalence/Technological neutrality i.e. put all communications on a par Don’t describe technology

E-procurement: Developing a Legal Framework that Maximizes its Advantages Second-stage tools: e-reverse auctions (e-catalogues, framework agreements) Competitive market Common/simple procurement Goods, construction and services Price-only procurement Strict transparency rules Overheads for both parties in early stages Refinements: quality criteria, auctions as a phase

E-procurement: Developing a Legal Framework that Maximizes its Advantages Don’t over-regulate Avoid higher standards for e-procurement e-signatures UNCITRAL does not require advanced signatures EU recommends them e-tendering requirements Equivalent to previous requirements for paper tenders MDBs e-tendering requirements

E-procurement: Developing a Legal Framework that Maximizes its Advantages Business model Proprietary systems/specialist software Restrict access? Charges Outsourcing Organisational conflicts of interest

E-procurement: Developing a Legal Framework that Maximizes its Advantages Longer-term goals: e-procurement as reform issue Redesigning the procurement system Integrated from planning to payment and evaluation Not a technological issue alone Costs of investment in new system System to fit needs Select your tools Staged approach

E-procurement: Developing a Legal Framework that Maximizes its Advantages Longer-term goals: e-procurement as reform issue Enhancing value for money “Toolbox” approach to procurement Involves discretionary decisions Guidance and oversight – ensuring objectivity E-records

E-procurement: Developing a Legal Framework that Maximizes its Advantages Longer-term goals: e-procurement as reform issue Enhancing efficiency Reduced transaction costs and times Standardisation of purchases Better management information Better processes Better supplier knowledge

E-procurement: Developing a Legal Framework that Maximizes its Advantages Longer-term goals: e-procurement as reform issue Enhancing governance Removal of human interaction “Internal” transparency Enhancing accountability Traceability E-records - monitoring trends, red flags

E-procurement: Developing a Legal Framework that Maximizes its Advantages Conclusions UNCITRAL has a facilitative approach to e-procurement With safeguards Recognises the value of process reform when implementing e-procurement

E-procurement: Developing a Legal Framework that Maximizes its Advantages For more information Website: http://www.uncitral.org/uncitral/en/commission/working_ groups/1Procurement.html http://www.uncitral.org/uncitral/ru/commission/working_g roups/1Procurement.html Contact: caroline.nicholas@uncitral.org THANK YOU