FBentchikou World Bank ECA Public Procurement Forum (Tashkent – April 25-28, 2005) Improving Public Procurement Regulation

2 Objectives of a Public Procurement Regulation  To produce best value for money.  To establish or reinforce government agencies’ credibility.  To enlist active involvement of business partners.

3 Scope of the Regulation  Procurement regulatory framework should preferably address all government contracts, given the risk that, otherwise, private considerations prevail over public interest.

4 Transparency  Effective advertisement.  Public bid opening.  Use of non-discriminatory and objectively quantifiable bid evaluation criteria.  Award to the lowest evaluated responsive bid without negotiations. Note: Procedural rules play an important role. HOW ?

5 Transparency  Using a two-envelope system.  Using a point system to evaluate bids.  Combining bid evaluation with evaluation of the bidder’s qualification.  Denying bidders access to bidding process or award for bureaucratic reasons.  Requesting bid securities when not needed. AVOID

6 Fair Treatment of Bidders  Losing bidders should have the opportunity to submit protests pertaining to contract award, before the award becomes final, to an independent entity with adequate expertise.  Prerequisites for an effective bid protest: timeliness, overall transparency of bidding process.

7 Fair Treatment of Contract Partners  Contract partners must be subject to fair contract conditions:  Payment to contracting party to be made within the time period stipulated in the contract.  Equitable price adjustment mechanism.

8  When contract with foreign supplier, payment by L/C.  Alternate dispute review mechanisms for complex contracts.  Final settlement of disputes.

9 Exceptions and Waivers  Regulation should provide any waiver needed in the context of international agreements.  Procurement regulations may include specific exceptions to contract law, for example, termination for convenience.

10 Regulatory Frameworks: Current Approaches Instruments:  Drafting a new law.  Revising an existing law, which requires preserving specificities of the national system.

11  Examples of country specificities  Latin America (scope of the law includes concession contracts, system extremely transparent, e.g. “la vista,” very formal, e.g., use of stamps or seals …).  Anglo Saxon countries (financial management regulation, simplified procurement rules, audits).  Francophone countries (clarity, discretionary provisions, scope of the law includes contract conditions).  Others (China, Philippines, Indonesia).

12 Regulatory Frameworks: Current Approaches UNCITRAL model law:  Best suited when starting with entirely new legislation, such as in the case of Tashkent conference participant countries.  Flexible (can be used selectively).  Comprehensive.  Guide.  A few provisions to add or modify.

13 Other ways to categorize a regulatory framework:  Procurement law specifying proceedings, contracting parties and controls.  Procurement law with primary emphasis on procurement institutions such central procurement tenders (Nigeria, Zambia, Rwanda, Uganda).

14  Regional models (WAEMU). Conclusion: Implementation of the same principles in all cases.