1. PRAG WORKSHOP Introduction to Practical Guide (PRAG)
to contract procedures
for EU external actions
Ivanina Beleva, Bulgaria
Belgrade, 22 May 2018

2. PRAG WORKSHOP Objective
To introduce the Practical Guide to participants
To discuss the link between PRAG and related EU regulations specific for procurement
To present a summarized overview of PRAG basic rules and procedures for procurement of services/supplies/works and award of grants
To discuss and share examples of good practices and/ or lessons learnt in public procurement

3. What is PRAG
Practical Guide (PRAG) for procurement procedures applying to all EU external actions financed from the EU general budget (the EU budget) and the European Development Fund (EDF)
The PRAG provides users with the comprehensive information on procurement or grant procedures, including:
Guidelines for award procedures (from tender announcement to signature) and for contract execution (implementation phase)
Templates/ formats for use: PRAG Annexes: (cover both the award phase and the execution phase).

4. Who must use PRAG
PRAG: …………..all EU external actions financed from the EU general budget (the EU budget) and the European Development Fund (EDF).
Applicable regulations:
Financial Regulation No 966/2012 of 25 October 2012 as amended
CIR Regulation (Common Rules and Procedures for the Implementation of the Union's instruments for External Action), adopted March 2014
IPA Regulations (IPA, IPA II)
Legal Framework (Regulations applicable)

5. When PRAG is not applicable
European Commission when it acts as contracting authority on its own account and in its sole interest (Vade-mecum on Public Procurement)
PRAG does not apply to humanitarian crisis management aid, civil protection operation and humanitarian aid operations carried out by ECHO
PRAG does not apply when the Contracting Authority is from a partner country, or is an international organisation and/ or is a national body which the European Commission has authorised to use its own procurement/grant award procedures
PRAG does not apply to institution building under Twinning contracts with Member States public administration (Common Twinning Manual)

6. How do they go together? Practical Guide (PRAG) Directive 2014/24/EU
Financial Regulation
REGULATION (EU, EURATOM) No 966/2012

7. Procurement procedures
PRAG
Directive 24/2014/EU
Open procedure
Restricted procedure
Competitive negotiated procedure
Framework contracts
Dynamic purchasing system
Competitive dialogue
Negotiated procedure/
single tender procedure
CHAPTER I: Procedures
Article 26: Choice of procedures
Article 27: Open procedure
Article 28: Restricted procedure
Article 29: Competitive procedure with negotiation
Article 30: Competitive dialogue
Article 31: Innovation Partnership
Article 32: Use of the negotiated procedure without prior publication
Article 33: Framework agreements
Article 34: Dynamic purchasing systems
Article 35: Electronic auctions
Article 36: Electronic catalogues

8. PRAG Basic Rules PRAG rules and instructions Directive 24/2014/EU
Financial Regulation (FR)
Rules of Nationality and Origin
List of eligible countries in PRAG
for each specific EU instrument
Not applicable;
Defined in the basic act of the respective instrument
Requirements for publication and transparency
Directive 24/2014/EU: Section 2: Publication and transparency
Exclusion criteria from participation/ award in public procurement/ grants
Fully identical: Article 106, 107 of FR
Article 57 of Directive 24/2014/EU:
Technical Specifications/ Terms of Reference
Article 42 of Directive 24/2014/EU
Procurement procedures (list)
Article 104 of FR
Article of Directive 24/2014/EU
Selection criteria & Award criteria
Directive 24/2014/EU: Article 58 and 67; Article 110 (Financial Regulation)

9. How do they go together?
Candidate countries: apply Practical Guide (PRAG) when financing is from EU financed instruments (IPA, IPA II).
EU Member States:
Apply national procurement legislation
Obligation to transpose Directive 2014/24/EU into the national legislation (2016)
REGULATION (EU, EURATOM) No 966/2012 (Financial Regulation) as amended
on the financial rules applicable to the general budget of EU
Binding and directly applicable to EU Member States
Applicable to EU financing instruments
PRAG is developed in line with Title V – Procurement; Title VI – Grants of the FR

10. PRAG Contents Theoretical part (Basic rules and procedures)
Detailed procedures: Services/ Supplies/ Works/ Grants
Annexes (Templates)
General
Services
Supplies
Works
Grants

11. Procurement thresholds
Note: projects must not be split artificially to circumvent the procurement thresholds.

12. COFFEE BREAK

13. Procurement procedures - SERVICES
Restricted international tender procedure: (contracts > EUR 300 000)
Requirements for publicity: International publication
Complete tender dossier
2 phases:
pre-selection phase based on selection criteria / short-list
tendering phase – submission of tenders by short-listed companies
Award criteria: best price-quality ratio
Framework contract (contracts below EUR)
Multiple framework contracts
FWC- consultancy contracts awarded by the European Commission
A number of lots awarded which cover almost all type of sectors
Rules for award of specific contracts under the Framework contracts

14. Procurement procedures - SERVICES
Competitive negotiated procedure: (contracts under EUR 300,000)
Without publication of contract notice
at least three service providers must be invited to submit offers
a simplified tender dossier is prepared
the candidates must be allowed at least 30 days to prepare and submit offer
Single tender: (contracts for value of less than EUR )
Works for less than EUR may be awarded on the basis of a single tender

15. Procurement procedures – SUPPLIES
International Open tender procedure: (contracts > EUR 300 000)
Requirements for publicity: International publication (OJ, Europe Aid)
Complete tender dossier
Allow at least 60 days for submission of offers
Award criteria: cheapest offer which complies with TS
Local Open tender procedure: (contracts > EUR but > )
Requirements for publicity: local publication + Europe Aid
Allow at least 30 days for submission of offers

16. Procurement procedures – SUPPLIES
Competitive negotiated tender procedure: (contracts below EUR 100 000)
Without publication of a contract notice
At least three firms must be invited to submit an offer
Simplified tender dossier
Allow at least 30 days for submission of offers
Award criteria: cheapest offer which complies with TS
Single tender: (contracts with value less than EUR)
May be awarded on the basis of a single tender
For supplies with a value of less than/ equal to EUR 2 500, the contracting authority may pay on the basis of an invoice

17. Procurement procedures - WORKS
International open tender (for contracts of EUR 5 000 000 or more)
Requirements for publicity: International publication (OJ EU, Europe Aid)
Complete tender dossier
Allow at least 90 days for submission of offers
Award criteria: usually the lowest price (can be exceptions)
International restricted tender (exception) - for contracts above EUR 5 000 000
Local open tender (for contracts of at least EUR 300 000 and under EUR 5 000 000)
the contract notice is not published in EU OJ but only locally
Publication on Europe Aid web-site
Allow at least 60 days for submission of offers
Award criteria: usually the lowest price

18. Procurement procedures - WORKS
Competitive negotiated procedure: works contracts under EUR 300 000 by competitive negotiated procedure
Without publication of contract notice
Specific procurement dossier
Allow at least 30 days for submission of offers
Award criteria: usually the lowest price (can be exceptions)
Single tender (for works contracts of less than EUR 20 000)
Works for less than EUR may be awarded on the basis of a single tender

20. TENDER EVALUATION Tender Evaluation
Evaluation Committee – formation; roles
Evaluation procedures for services/ supplies/ works contracts
Evaluation Report structure and contents
Good practices?

21. TENDER EVALUATION Evaluation Committee Non-voting secretary Voting
chairman
Voting
members

22. Tender Evaluation – SERVICES
Part 1: Administrative compliance
Part 2: Technical evaluation (80%)
Part 3: Financial evaluation (20%)
Composite evaluation/ ranking
= Result: Recommendation for contract award/ cancellation of procedure

23. Tender Evaluation - SERVICES
Part1: Technical Evaluation
Maximum possible
Tenderer 1
Tenderer 2
Tenderer 3
Evaluator A
100 55 88 84
Evaluator B 60 82
Evaluator C 59 90
Total
300
174
254
256
Average score (mathematical average)
174/3 = 58.00
254/3 = 84.67
256/3 = 85.33
Technical score =
(actual final score/ highest final score)
Eliminated*
(84.67/85.33) x 100 = 99.22
100.00
Example

24. Tender Evaluation - SERVICES
PART 2: FINANCIAL EVALUATION
Tenderer 1
Tenderer 2
Tenderer 3
FINANCIAL OFFERS
Financial offer not opened
951 322
1 060 452
100.00
89.71
(951 322 : 1 060 452 ) x 100
Financial scores=
Example

25. Composite Evaluation - SERVICES
Example

26. Tender Evaluation- SUPPLIES
Part 1: Administrative compliance
Part 2: Technical compliance
Part 3: Financial offers
Final evaluation/ ranking
Consideration of lots/ discounts
Example

27. Tender Evaluation- SUPPLIES
Example

28. Tender Evaluation Report
Structure and Contents
Tender Opening Report
Evaluation Report: contains: summarized information incl.
technical evaluation
financial evaluation
tenders rejected incl. reasons for rejection
recommendations for contract award
Annexes: Evaluation Committee Ordinance; Minutes of meetings, etc.
Templates available at:

29. Legal remedies Complaints to the Contracting Authority
If a candidate, tenderer or applicant believes he has been adversely affected by an error or irregularity allegedly committed as part of a selection or procurement procedure, or that the procedure was vitiated by any maladministration, he may file a complaint to the contracting authority. The complaint shall be substantiated and its sole subject shall not be to obtain a second evaluation for no reason other than the complainant disagrees with the final award decision.
Complaints to the European Ombudsman
any citizen of EU or any natural or legal person residing or having its registered office in a MS has the right to complain to the Ombudsman for any instance of maladministration by EU Institutions.

30. Legal remedies Ordinary Actions (PRAG Section 2.4.15.3)
When a candidate, tenderer or applicant believes he has been adversely affected by an error or irregularity allegedly committed as part of a selection procedure or procurement, he may also file ordinary actions, provided the conditions are met.
Where the European Commission is the Contracting Authority, the action shall be launched in accordance with the rules set out by the Treaty on the Functioning of the European Union.
Where the European Commission is not the contracting authority, the action shall be launched in accordance with the conditions and deadlines fixed by the national legislation of the contracting authority.

31. GRANTS
PROCUREMENT

32. GRANTS VS. PROCUREMENT GRANTS PROCUREMENT
Proposal to implement a project/ finance an action
Buying/ purchasing products, services, works
Initiator: the Applicant requesting the grant
Initiator: the Contracting Authority
Owner of results: the Grant beneficiary (Grantee)
Owner of results: the Contracting Authority
Non-profit
Profit making commercial
Partial Co-financing of the action by the Grantee
Fully financed by the Contracting Authority

33. GRANTS Rules specific for award of grants Grants are donation
A grant is a financial donation/non-commercial payment by the contracting authority given to a specific grant beneficiary to finance:
an action intended to help achieve a EU policy objective (action grant);
or the operation (i.e. the running costs) of an entity which supports a European Union policy (operating grant).
Award of grants
Programming
Transparency
equal treatment.

34. GRANTS Rules specific for award of grants Non-cumulation rule
A beneficiary may not receive more than one grant for the same action
A beneficiary may be awarded only one operating grant financed by the European Union per financial year
Non-retroactivity rule
Grants may only cover costs incurred after the date on which the grant contract is signed
No grant may be awarded retroactively for actions already completed.
Co-financing – obligatory
A grant may not finance the entire cost of the action
No-profit
Grants may not have the purpose or effect of producing a profit