Electronic Public Procurement in Turkish Public Procurement System M. Çağatay TAŞYÜREK cagataytasyurek@kik.gov.tr Public Procurement Specialist Public Procurement Authority

Agenda Introduction Public Procurement System in Turkey Public Procurement Authority E-Procurement Electronic Public Procurement Platform Business Intelligence Benefits Future Developments

Turkish Public Procurement System (TPPS) Turkish Public Procurement Sytem has four historical background dates: 1) Auction, Contest and Tender Law no 661 dated 22 April 1925 2) Auction and Tender Act no 2490 dated 10 December 1934 3) State Tender Law no 2886 dated 08 September 1983 4) Public Procurement Law (PPL) no 4734 dated 04 January 2002 PPL has created an advanced model of international procurement regulations. 3

Turkish Public Procurement System (TPPS) Currently, Public procurement is regulated by Public Procurement Law No. 4734 which entered into force on January 1, 2003. One of the objectives of preparing a new law on public procurement was adaptation to international instruments on public procurement (EU Procurement Directives, UNCITRAL Model Law on Procurement, World Bank Procurement Guidelines, etc.). Public Procurement Law no. 4734 4

Turkish Public Procurement System (TPPS) Main Principles of PPL are; Transparency Reliability Fullfillment of Needs Efficient Use of Resources Competititon Confidentiality Equal Traetment Public Supervision Taxpayers’ Expectations 5

Public Procurement Authority (PPA) Public Procurement Authority which is administratively and financially autonomous was established in 2002. The main duties of the PPA are; Regulation Dispute Resolution Training E-Procurement Gathering Information and Statististics International Relations 6

E-Procurement Transparency Speed Cost Saving Standardization Public Supervision Effective Procurement System Sustainability Therefore, E-Procurement has a crucial role in procurement system 7

E-Procurement in Turkey: Electronic Public Procurement Platform (EPPP) Electronic Public Procurement Platform (EPPP) became operational on 1 September 2010. Operations that can be performed in EPPP, include publication of contract notices, preparation of contract document by the contracting authorities, downloading of the contract document by economic operators, verification of tax liability, balance sheet and income statement information, social security premium debt information of the economic operators. EPPP which is one of the most important e-government applications with over 30.000 registered economic operators, 25.000 registered contracting authorities and 400.000 registered users is being continuously improved. 8

Electronic Public Procurement Platform Legal and Administrative Background Articles related to EPPP, Dynamic Purchasing System and E-Auction added to the Public Procurement Law at the end of the year 2008. “11 Primary E-Government Projects” determined by the Prime Ministry 2009 and 2010 Annual Government Program: Development of an Electronic Public Procurement System “Communiqué No 1 about the use of the Electronic Public Procurement Platform” - 17.12.2010 “Electronic Procurement Application Regulation” - 25.02.2011 2012 Annual Program, Action 290: “E-tender Submission and Evaluation at the Call-Off Stages of Framework Agreements”

Electronic Public Procurement Platform Development Stages 12 May 2009 Legal and technical work of the project started. 23 February 2010 Registration of contracting entities and economic operators started. EPPP Call Center (444 0 545) in operation. 1 September 2010 EPPP V1.0 in operation. All Contracting Authorities (CAs) could use EPPP. 1 December 2010 EPPP V1.1 in operation. Economic operators can download the contract documents with their e-signatures and so that they gain the status of «potential tenderer» according to the law. 1 March 2011 EPPP V1.2 in operation. The first e-tendering and e-tender evaluation of bids realized in a pilot sector (medical devices).

EPPP by Numbers 01 September 2010 – 31 December 2012 EKAP Registered Economic Operators (EO) + 30.000 Registered Contracting Authorities (CE) + 25.000 Registered Users + 400.000 Registered Tenders + 500.000 Contract Notices Published + 250.000 Black List Confirmations + 1.400.000 Contract Award Notices Daily Hit of EPPP 90.000 Total Number of Visitors + 40.000.000

BENEFITS OF ELECTRONIC PUBLIC PROCUREMENT Standardization, transparency, speed, accord and public supervision in procurement procedures Efficiency and effectiveness in tender dossier preparation and tender evaluation Up to 20% savings in procurement costs 13

1 2 3 4 5 6 7 e-Procurement in 7 Steps CA and Supplier Database Registration of CA and Suppliers Definition of Needs Preparation of Needs Report Procurement Registration Operations Registration of Procurement Calculation of Estimated Cost Procurement Registration No Preparation of Tender Document Administrative Specification Technical Specification Draft Contract Standard Forms Procurement Notices Preparation of Tender Download of Procurement Documents Preparation of Tender Documents Encryption and e-Signature Submission of Tenders (2 phases) Tender Evaluation Qualification Controls for Participation Control for Prohibited Tenderers Determination of Economically Most Advantageous Offer Conclusion and Approval Electronic Notifications Notification of Finalised Tender Decision Other Notifications Contract Management Assignment of Contract Prohibition Invoice & Payment e-Signature / Encryption / Digitalization 14 14

Procurement Procedures on the EPPP Preparation of tender documents: Contracting authorities that are registered on the system started to prepare the tender documents (pre-qualification documents, administrative and technical specifications, the draft contract, framework agreement, individual contract, standard forms) through EPPP. Errors are reduced to a minimum level in the tender documents through automatic checks by EPPP for compliance with legislation.

Procurement Procedures on the EPPP Preparation of contract notices: Contract notices began to be created automatically by the system when the tender documents are prepared by the contracting authorities. Economic operators have access to contract notice and documentation in electronic environment.

Procurement Procedures on the EPPP Downloading of of tender documents using e-signatures/m-signatures: The tender document can be downloaded free of charge via EPPP by using e-signatures or m-signatures, which eliminates the need for economic operators to go to the contracting authorities to purchase the tender document. Procurement Procedures on the EPPP

Procurement Procedures on the EPPP Tender Search Mechanisms: Real and legal persons who wish to participate in tenders may search for tender notices by setting certain criteria (sector, province, remaining period of tender date and tender type). Also they can be notified instantly via e-mail, about tender opportunities they may be interested in. Citizens can also search for tenders by three different ways according to their needs: Fast Search, Detailed Search and Sectoral Search. They can see tender notices and contract award information of the tender. Procurement Procedures on the EPPP

Procurement Procedures on the EPPP Tender At a Single Glance: Every detail of all public tenders carried out within the scope of Public Procurement Law, such as contract notice, contract document, information about the contracting authority, contract award notice, complaints by dissatisfied tenderers, black list confirmation, contract price and contract lots, can be seen in “Tender at a Single Glance” webpage within the EPPP. Thanks to this, public supervision is ensured in the public procurement system. Procurement Procedures on the EPPP

Procurement Procedures on the EPPP Tender Evaluation Records: Tender evaluation records are prepared by the contracting authorities by using EPPP. Procurement Procedures on the EPPP

Procurement Procedures on the EPPP For “Procurement of medical devices”, which has been identified as a pilot sector, all procurement procedures including the electronic submission and electronic evaluation stages, can be done in paperless electronic environment. Electronic submission of tenders in the pilot sector: 21

Procurement Procedures on the EPPP Inquiries from related systems: Contracting authorities can query tax liability, balance sheet and income statement information of economic operators over the Revenue Administration’s system and social security premium debt information over Social Security Institution’s system.

Electronic Public Procurement Platform Integration of EPPP with Other Institutions: EPPP Ministry of Finance National Satellite Corporation Ministry of Interior Social Security Institution Ministry of Health Banks

Procurement Procedures on the EPPP Blacklist Confirmation and PPA Decisions: Contracting Authorities and citizens Can access to the black list of economic operators and decisions taken by the Public Procurement Board upon complaint applications.

Procurement Procedures on the EPPP Submission of contract award information: Contract award notices are prepared, published and can be viewed by using EPPP. All notifications can be sent to economic operators through EPPP.

Procurement Procedures on the EPPP Contract Management Applications in EPPP were put into use regarding contract management issues, such as additional works or services, price adjustment (escalation), termination of contract, issuing certificates of satisfactory performance of the contract in order to collect data on signed public contracts, to do analysis on a sound basis and to digitize contract management process.

Benefits (Realized)-1 Contracting Authorities 1,4 billion TL Savings due to printing of tender documents (yearly) (350.000 tender documents, avg. 50 pages, cost per page0,2 TL) 3,5 million TL (1,5 million €) Time savings (yearly) (11 person/day, daily cost 50TL, 150.000 tenders annually) 82,5 million TL (37 million €) Contract Value Savings (Contract Value/Estimated Cost Ratio decreased from 81% to 74%, average number of tenders submitted increased from 3.3 to 5.6) Approximately 1,3 billion TL annually TOTAL REALIZED SAVINGS (yearly) 1,4 billion TL (600 million €)

Benefits (Realized)-2 Economic Operators 69,7 million TL Savings due to tender document acquisition (yearly) (350.000 tender documents* document price) 54 million TL (24 million €) Transportation savings (yearly) (350.000 tender documents* 10 TL/tender document) 3,5 million TL (1,5 million €) Time Savings (yearly) (350.000 tender documents* 1 man/day*35 TL daily) 12,2 million TL (5,5 million €) TOTAL REALIZED SAVINGS (yearly) 69,7 million TL (31 million €)

Business Intelligence Business intelligence within the EPPP was put into use in 2013 and instantaneous access to a huge amount of data was achieved. Objectives of the business intelligence are as follows: To gather statistical data about public procurements for the analysis of business processes, To standardize analysis of public procurement data and development of public procurement reports, To retrieve statistical data faster, instantly and up-to-date, To provide procurement data to the other units of PPA in a more efficient way, To provide statistical information within the scope of «The Right to Information Law No. 4982» to the applicants, To provide information about procurements to contracting entities, economic operators and public in a visually rich and dynamic way, To improve public procurement processes by employing data mining,

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Future Developments E-Procurement in goods and call-off stages of framework agreements E-catalogs and digitalization of procurement items E-Contract Management E-Auctions

Future Developments Certification/Registration Systems Secondary Legislation Certification Units Audit Mechanisms Other Integrations (such as judicial records) Business Continuity Center/Disaster Recovery Center

Integrated Appeal, Review and Board Project Appeals will be submitted over EPPP with the e-signatures of the related party. All necessary information related with a complaint will be retrieved electronically where possible, other documents will be scanned. The result of review by public procurement experts will be digitally signed by e-signatures and presented to the Board. Board Agenda will be prepared electronically. Board Members will be able to access to the documents electronically. Board Members will sign the decisions by their e-signatures. The notification of the decision of the Board will be sent automatically and electronically.

THANK YOU…