1. Introduction to Procurement
Training on Project Management and Implementation
for Grant Beneficiaries and Partners TC Programme MD-UA
Introduction to Procurement
Oleksandr Korob, EaPTC MA, GIZ
Chisinau, Moldova 2017

2. CONTENT Legal framework
Main rule & general principles of the best procurement practice
Transparency and non-discrimination
Equal treatment
Avoiding conflict of interests
Rule of nationality
Rule of origin
Types of contracts
Service contract
Supply contract
Work contract
Procurement procedures
Frequent Asked Questions

3. LEGAL FRAMEWORK Procedures and practical guide (PRAG)
Annex IV “Procurement by grant Beneficiaries in the context of European Community external actions”
Partner’s own procedures*
*must be in accordance with Annex IV rules

5. Menu
Contents
Document

6. MAIN RULE
Contracts must be awarded to the most economically advantageous tender, i.e. the tender offering the best price-quality ratio. in accordance with
GENERAL PRINCIPLES
Transparency and non-discrimination
Equal treatment
Avoiding conflict of interests
Rule of nationality
Rule of origin*
In the event of failure to comply with the rules referred to above, expenditure is not eligible.
*if applicable

7. TRANSPARENCY AND NON-DISCRIMINATION
Maximum publicity of the tender procedure in national and English language
Opening the competition to as many tenderers as possible
Availability of tender documents for all the tenderers
at the headquarters of the Contracting Authority, website, sent directly to any interested tenderer
Equal level of information for all tenderers
when clarifications/supplementary information are required
Number of invited tenderers larger than the minimum recommended
In case of Single tender - more than one potential tenderer is consulted

8. EQUAL TREATMENT Transparency of information
all tenderers receive same information
Absence of restrictive conditions
Terms of Reference (services) / technical specifications (equipment and goods, works) as widely accessible as possible
Selection and award criteria
Provided at the start of the procedure and kept unchanged until the end of the process
Participation by tenderers with one tender only
Equal conditions in financial offers
stay away from any preferential discounts or preferential conditions of any nature

9. AVOIDING CONFLICT OF INTERESTS
Independent and confidential preparation of selection criteria and conditions
Independent and confidential evaluation of tenders
Impartiality of the persons who prepared or participate in tender procedures
THE EVALUATION COMMITTEE* - odd number of voting members (at least 3) with all the technical and administrative capacities necessary to give an informed opinion on the tenders
* tenders of a value of EUR or more
THE EVALUATION PROCESS – based on the exclusion, selection and award criteria announced in advance

10. Countries listed in the ENPI Regulation ENPI Partner Countries
RULE OF NATIONALITY
Participation in tender procedures open to all natural/legal persons from listed countries!
Countries listed in the ENPI Regulation
EU Member States
Portugal, Spain, France, Italy, Malta, Greece, Cyprus, Bulgaria, Romania, Poland, Czech Republic, Slovakia, Hungary, Slovenia, Austria, Germany, Lithuania, Latvia, Estonia, Finland, Sweden, Denmark, The Netherlands, Belgium, Luxemburg, United Kingdom and Ireland
ENPI Partner Countries
Russia, Belarus, Ukraine, Moldova, Georgia, Armenia, Azerbaijan, Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Occupied Palestinian Territories, Syria and Tunisia
IPA Countries
Croatia, Turkey, Albania, Bosnia, Montenegro, Serbia, Kosovo and FYROM
EEA
Norway, Iceland and Liechtenstein
Exception: The rule does not apply to experts proposed by service providers taking part in tender procedures.

11. RULE OF ORIGIN
All supplies purchased under a procurement contract, or in accordance with grant contract, financed under EU budget shall originate from an eligible country (listed in ENPI Regulation).
Exception: However, when the value of the supplies to be purchased is below euros per purchase, the supplies do not have to originate from an eligible country (full untying).
Certificate of origin:
issued by the competent authorities of the country of origin
proves the origin of supplies
submitted no later than when the first invoice is presented

12. What to do
What NOT to do
to identify the applicable rules to your organisation
to revise your usual procedures to verify that they are compliant with Annex IV of your grant contract
To acquire services, supplies and works ‘as usual’
to plan all procurement at the beginning of the project
To assume that procurement can be done quickly
be aware of the thresholds for all subcontracting
To split contracts artificially to avoid the requirements e.g. by year or by category or by partner. Artificial splitting is not allowed and will make the total amount of all contracts ineligible
to consult the MA/TS and/or your auditor in case of doubt or just to double check
To trust only your past experience even if you had similar grants in the past – rules change
to provide all required information, make sure the Terms of Reference are clear and include check-lists for tenderers
To assume that tenderers have enough experience to submit eligible bids

13. TYPES OF CONTRACTS
PRAG
SUPPLIES

14. SERVICE CONTRACT
Studies: identification and preparation of projects, feasibility studies, economic and market studies, technical studies, evaluations and audits;
Technical assistance: advisory role, to manage or supervise a project, or to provide the experts specified in the contract;

15. SERVICE CONTRACT
Service contract
Draft contract

16. SUPPLY CONTRACT
Purchase, leasing, rental or hire purchase (with or without option to buy) of equipment. E.g.: furniture, IT equipment, office supplies, books, promotional items etc. A contract may include commissioning, installation, maintenance etc.

17. SUPPLY CONTRACT
Supply contract
Draft contract

18. WORK CONTRACT
A 'work' means the outcome of building or civil engineering works taken as a whole that is sufficient in itself to fulfil an economic or technical function.
Works contracts cover either the execution, or both the execution and design, of works or a work by whatever means, corresponding to the requirements specified by the Contracting Authority.

19. WORK CONTRACT
Work contract
Draft contract

20. Procurement Procedures (by PRAG)
The thresholds
SERVICE CONTRACT
≥ EUR
International restricted tender procedure
< EUR but
> EUR
Framework contracts
Competitive negotiated procedure ≤
Single tender
For services and supply contracts, a payment may be made against invoice without prior acceptance of a tender if the expenditure is
≤ EUR*
* EUR by GIZ
SUPPLY CONTRACT
International open tender procedure
≥ EUR
Local open tender procedure
< EUR but
WORKS CONTRACT
≥ EUR
< EUR but

21. Procurement Procedures (by PRAG)
The thresholds
SERVICE CONTRACT
≥ EUR
International restricted tender procedure
< EUR but
> EUR
Framework contracts
Competitive negotiated procedure ≤
Single tender
For services and supply contracts, a payment may be made against invoice without prior acceptance of a tender if the expenditure is
≤ EUR*
* EUR by GIZ
SUPPLY CONTRACT
International open tender procedure
≥ EUR
Local open tender procedure
< EUR but
WORKS CONTRACT
≥ EUR
< EUR but

22. Procurement Procedures (by Annex IV)
The contract must be awarded to the tender offering best value for money or offering the lowest price;
The Beneficiary shall avoid any conflict of interests and respect the following basic principles:
Where the Beneficiary does not launch an open tender procedure it shall justify the choice of tenderers that are invited to submit an offer.
The Beneficiary shall keep sufficient and appropriate documentation with regard to the procedures applied and which justify the decision on the pre-selection of tenderers (where an open tender procedure is not used) and the award decision.
The Beneficiary may decide to apply the procurement procedures set forth in the Practical Guide. If these procedures are correctly followed the principles above will be deemed complied with.

23. Recommended Procurement Procedure Competitive negotiated procedure
(up to EUR)
Invitation of selected candidates, at least 3 firm invited
Minimum 30 days for submitting tenders, 1 fully compliant offer is required
Tenders are evaluated by Evaluation Committee* (opening session, administrative compliances, financial and technical evaluation)
Contract award by the Evaluation Committee*
Contract Signature 1.
Competitive negotiated procedure 2. 3. 4. 5.
* tenders of a value of EUR or more

24. TENDER DOSSIER*
Instruction to tender (Scope of supply, selection criteria, etc)
Terms of Reference (ToR) (technical requirements, contract objectives, tasks to be achieved, logistics and timing, etc.)
Draft of contract & Annexes (General conditions, Technical specification, Technical offer, Financial offer, Guarantees forms, etc)
Administrative Compliance Grid
Evaluation Grid
Tender Submission Form
* Recommended

25. Frequent Asked Questions

26. Thank you for your attention!
Contacts
Oleksandr Korob