PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...

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PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
PRAG 2020
         Overview

                     Dolores Dominguez Perez
                             Nicolas Provençal
                        European Commission
DG International Cooperation and Development
                  DEVCO Unit R.3 Legal Affairs
                     Brussels 26 November 2020
                                           1
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Introduction

               2
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
What is the PRAG?
Practical Guide to procurement and grant            award
procedures for European Union external actions

It explains the contracting procedures applying to all EU
external actions financed by the EU budget and the European
Development Fund (EDF).

Which DGs in the Commission use the PRAG?
DG DEVCO, DG NEAR, FPI, DG REFORM (for Turkish
Cypriot community aid programme)
                                                         3
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Sources of funding EU external
actions: MFF 2014-2020
• Union budget: DCI, ENI, IPA II, EIDHR, EINS,
  IcSP.
•
• European Development Fund: ACP countries and
  Overseas Countries and Territories

• Different set of rules. Regulatory convergence.
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Sources of funding EU external
actions: MFF 2021-2027
• European Development Fund: “budgetisation”
•
• Union budget: NDICI, IPA III, EINS, ODA-
  Greenland

• Off budget: European Peace Facility
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Where do I find the PRAG?

Public document, available at:

• http://ec.europa.eu/europeaid/prag

Financial Regulation 02/08/2018

https://myintracomm.ec.europa.eu/budgweb/EN/leg/finrules/Pages
/financial-regulation.aspx

                                                                 6
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
The PRAG and all related contractual annexes are available for
consultation and download. Previous versions are also accessible.
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Core principles of procurement
  - Transparency

  - Proportionality
  - Sound financial management
  - Equal treatment and non-discrimination
  - Avoidance of any conflict of interests
  - Non-retroactivity

Why?
2 interests:
   - Contracting Authority: gets a good deal
   - Contractors: get a fair chance to compete for the contract   8
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Which procedure for which amount?

                                    9
PRAG 2020 Overview Dolores Dominguez Perez Nicolas Provençal European Commission DG International Cooperation and Development DEVCO Unit R.3 Legal ...
Procurement procedures with publication
1. Open tender
Any operator can send a bid/proposal. It is a one phase
procedure.

2. Restricted tender
Any interested applicants may apply to participate, but only
selected ones will be invited to submit an offer following the
results of the selection phase (selection criteria). There are
therefore two phases in the restricted procedure.
International => OJEU, DEVCO website, any appropriate media
Local => National gazette, DEVCO website, any appropriate media
                                                                  10
Funding and tender opportunities

On the website of DG International Cooperation and Development – soon to
              be renamed DG International Partnerships – at:
        https://ec.europa.eu/international-partnerships/home_en
 the funding tab or the right box below will direct you to the funding and
              tenders opportunities hosted on the F&T portal
Searching for procurement notices
  All Commission published tender opportunities can be
found on the F&T portal; when selecting tenders related to
      external actions you will access a search engine
Searching for procurement notices
Search engine for tenders launched by DG International
            Cooperation and Development

                                                         13
Searching for procurement notices
  Alternatively, tenders above the thresholds for international tender
procedures are also published on TED which is a supplement to the OJEU
Procurement procedures without publication
1. Simplified procedure (ex competitive negotiated procedure)
    /Single tender procedure
The contracting authority invites at least three/one candidate(s)
of its choice to submit tenders. Shorter deadline for tendering.

2. Negotiated procedure
The contract is awarded directly to a company/consortium
following a negotiation. It is used in defined cases, such as:
• Following an unsuccessful tender
• Extreme urgency or operations carried out in crisis situations
• For the repetition of similar supplies/services/works
• Secret contracts, cases of monopoly, etc.
                                                                 15
Other important rules

 - Nationality/Establishment (annex a2a PRAG)

 - Origin (annex a2a PRAG)

 - Exclusion criteria

 - Code of conduct and respect of ethical clauses
 (art.8 GC for service contracts, SEA explicitly referred to in art.8.2)

 - Administrative and financial sanctions                          (art. 10 GC

 for service contracts: grave professional misconduct, fraud, corruption (…);
 financial penalties up to 10% of contract value)
                                                                                 16
Exclusion and selection Criteria
            1. Exclusion criteria (Art. 136 FR)
            See full list of cases in PRAG 2.6.10.1.1
Purpose: to determine if the operator is allowed to participate.
Operators will be excluded if (non exhaustive list !):
• Bankruptcy, affairs administered by court, arrangement
  with creditors, suspension of business activities
• Guilty of grave professional misconduct
• Not in compliance with social security contributions or
  payment of taxes
• Fraud, corruption, money laundering, involvement in a
  criminal organisation/terrorist offences, child labour
• Subject to penalty under the EU Financial regulation or the
  contract
• Committed an irregularity
• Empty Shell Company                                       17
Exclusion criteria

• Evidence to be provided: PRAG 2.6.10.1.3
• A) Declaration on honour (PRAG annex a14)
• Candidates, tenderers and applicants must sign a
  declaration together with their applications, certifying that
  they do not fall into any of the exclusion situations cited
  under Sections 2.6.10.1.1 and 2.6.10.1.2 and, where
  applicable, that they has taken adequate measures to
  remedy the situation.
• Where the candidate or tenderer intends to rely on capacity
  providing entities or subcontractor(s), he shall provide the
  same declaration signed by this/these entity(ies).

                                                             18
Exclusion criteria
• B) Documentary evidence
• In the case of restricted procedures for services, the
  supporting documents must be sent by all shortlisted
  candidates together with the tender and verified by the
  contracting authority before signature of the contract with
  the successful tenderer(s).
• In restricted procedures for works, these supporting
  documents must be sent by all candidates together with the
  application. Evidence of non-exclusion must be verified for
  all candidates invited to tender. In addition, the tenderers
  and candidates must certify that the situation has not
  altered since the date of issue of the evidence.
• See PRAG 2.6.10.1.3 for satisfactory evidence to be
  provided.                                                    19
Documentary evidence
Please indicate on each document the name of the exclusion criteria they refer
                                     to

                                                                             20
Selection criteria

Purpose: to determine if the operator has the necessary
capacity to perform the contract. 3 types:

• Economic and financial capacity (in the last 3 years)
  Financial standing: the awarded tenderer is not living of the EU-funded
  project.

• Professional capacity (in the last 3 years)
  Available resources, qualifications.

• Technical capacity (in the last 3(service) -5 (works) years)
  Past experience in similar activities.

                                                                            21
Selection criteria
Example: service contract worth 600 000 € of 2-year duration
          for automated customs systems

• Economic and financial capacity
   tenderer's average annual turnover between 300 000 € < 600 000 €
   (FR, Annex I, point 19: minimum yearly turnover shall not exceed two
   times the estimated annual contract value)

• Professional capacity

- at least 5 permanent staff currently work in fields related to the contract

- the tenderer has an ISO 9000 certificate

• Technical capacity
   at least 1 contract of at least 500 000 € in the fields of automated customs
   systems and/or computerised transit system
                                                                                22
Award criteria

• Lowest price: in supplies and works tender procedures
  The contract is awarded to the cheapest offer amongst those technically
  compliant.

  • Best price-quality ratio: in services procedures
  Used always in services and sometimes in works and supplies.

  The award criterion is a combination of price and quality according to a
  fixed weighting: 80% to the technical score and 20% to the financial score.

                                                                            23
• Main steps of procurement procedures
    1. Publication*
    2. Shortlist**
    3. Tender launch***
    4. Tenders received
    5. Evaluation
    6. Contract Award
    7. Standstill Period
    8. Contract Signature
* Not for competitive negotiated, single tender, negotiated procedures.
** Only international restricted procedures.
                                                                          24
*** Not for open procedure.
• Time Line for Service Contract - international restricted

Procedure takes at least 6-7 months!

Contract
 Notice
30 days       Tender invitation
                  50 days                   Award of
                                            contract

                                                       Standstill period
                                                                   Signature
                                                                   of contract

                                       Evaluation

                 Short List

                                                                                 25
                          3                            6
Evaluation

Normally in 5 phases:

  • Tender Opening Session
  • Administrative compliance
  • Technical Evaluation
  • Financial Evaluation
  • Conclusion
Specificities
of service
contracts

                27
SERVICES
 Service contract:
 Contract between a service provider and the Contracting
 Authority for the provision of services such as technical
 assistance or studies

  Technical assistance:
  The service provider is called on to play an advisory role, to
  manage or supervise a project, or to provide the expertise
  specified in the contract (generally a fee-based contract)

  Studies:
  It includes studies for the identification and preparation of
  projects, feasibility studies, economic and market studies,
  technical studies and audits (global price contract)
                                                                   28
Types of service contracts

      Global Price                         Fee-based

 Specifies an outcome            Specifies the means

 Final Product                   Tasks performed
                                 Payment linked to services
                                 actually provided
 E.g. Study, audits, training,   E.g. Technical Assistance,
 conferences                     Supervision.
Key documents:

   Instructions to Tenderers (ITT)
   Terms of Reference (ToRs)
o Different templates for global price and fee based
o Requirements: min. quality standard
o Contract objectives
o Tasks
o Logistics & timing
o Expertise required
o Key / non-key experts

Budget for fee based : Fees - Incidental Expenditure – Lump sums -
Expenditure Verification                                         30
Remember for services…
           Technical Score x 0.80
     (organisation and methodology, CVs of
                   Experts)
                      +
           Financial Score x 0.20
                    (price)
         Best value for money wins!
Novelties

            32
Reminder: novelties for procurement since FR
                     2018
  • Possibility to ask clarifications on the contract notice,
    provided the Contracting Authority has indicated a
    functional mailbox
  • System of submission of applications and offers aligned
    to the one in force in internal procedures (sent before
    deadline vs arrived before deadline)
  • Candidates included in the lists of EU restrictive
    measures (see Section 2.4. of the PRAG) at the moment
    of the award decision cannot be awarded the contract
    (not from FR but Council Decision; see website
    sanctionsmap.eu).

                                                            33
Novelties in PRAG 2020
   • Publication of contract notices and other
        procurement related publications:

• As from 1st August 2020, DEVCO, NEAR and FPI have adopted the
  same corporate system for publication as all other DGs and
  Agencies, namely PPMT (“Public Procurement Management Tool”).
• As a consequence, new Contract Notices (including Prior
  Information Notices and Contract Award Notices) and Calls for
  Tenders will be published in TED and F&T (and no longer on
  EuropeAid).
• The related Tender Dossiers will also be uploaded in PPMT.
• A single set of templates for all procurement related notices is
  now used (PRAG annexes A5a to A5g) and replaces the former
  notices that were specific to each contract type (ser, sup, wks). 34
Funding and tender opportunities

On the website of DG International Cooperation and Development – soon to
              be renamed DG International Partnerships – at:
        https://ec.europa.eu/international-partnerships/home_en
 the funding tab or the right box below will direct you to the funding and
              tenders opportunities hosted on the F&T portal
Searching for procurement notices
  All Commission published tender opportunities can be
found on the F&T portal; when selecting tenders related to
      external actions you will access a search engine
Searching for procurement notices
Search engine for tenders launched by DG International
            Cooperation and Development

                                                         37
Searching for procurement notices
  Alternatively, tenders above the thresholds for international tender
procedures are also published on TED which is a supplement to the OJEU
Novelties in PRAG 2020

    • Technical & professional capacity criteria

•   The reference period for technical & professional capacity was aligned in the PRAG
    2018 with the provisions of point 20.2 (b) (i) and second subparagraph of Annex I to
    the FR, which were consistent in that regard since the 2012 rules of application.
•   The reference period as reflected in PRAG 2020 is by default set at 3 years, except
    where, in order to broaden the access of economic operators to procurement
    opportunities, the Contracting Authority wishes to extend this reference period
    beyond three years.
•   The PRAG has therefore included the possibility to take a longer period into account.
    This has been highlighted in the PRAG and in point 18 of the annex complementing
    the contract notice, named “additional information about the Contract Notice” (PRAG
    Annex A5f).

                                                                                       39
Novelties in PRAG 2020

• New restrictions with the reference period
• for the technical capacity selection criteria
• PRAG 2020 clarifies the period taken into account for the
  references to be provided under the technical selection criterion,
  by removing the distinction which existed until then between the
  references relating to projects in progress and those relating to
  projects completed.
•
• This decision has been taken with the aim of a uniform application
  of this selection criterion, and in compliance with the principle of
  equal treatment.

                                                                    40
Novelties in PRAG 2020
▪ Declaration on honour: PRAG Annex A14 is
  now split into two different annexes: A14a for
  procurement and A14b for grants
▪ Capacity providing entities: PRAG 2020 also
  further details the obligations of capacity-
  providing entities when they provide the technical
  or financial capacity for a tenderer to meet the
  selection criteria.
▪ Prior information notice (PIN): The
  publication of the prior information notice
  becomes optional, although still recommended.
                                                  41
What’s next?

           42
What’s next

• PRAG 2021

• New MFF funding instruments

• Transition to digital: e-management and e-
  submission

                                               43
Take part!

             44
What if my company does not fulfill the
selection criteria?

  • A candidate/tenderer may, where appropriate and for a
    particular contract, rely on the capacity of other entities,
    regardless of the legal nature of the links which it has
    with them– PRAG 2.6.11.1.

  • Try and gain relevant experience as
    consortium partner or subcontractor

  • Form a consortium (the consortium as a whole must
    meet the criteria, not each individual company)
                                                               45
Capacity providing entities
• Requirements:
• - The CA cannot impose a legal form but a can ask a written
    commitment
• -   Compliance with eligibility rules + exclusion criteria + relevant
    selection criteria
     • Financial/Economic capacity -> joint liability
     • Technical/Professional capacity -> subcontractor
•   With regard to technical and professional criteria, an economic operator may only
    rely on the capacities of other entities where the latter will perform the works or
    services for which these capacities are required.
•   Where an economic operator relies on the capacities of other entities with regard to
    criteria relating to economic and financial capacity, the economic operator and those
    entities are jointly liable for the performance of the contract

•                                                                                       46
Sub-contracting
Subcontracting must be indicated by the main
Contractor to the Contracting Authority:
- At tendering stage: in the tender (if known)
- During the implementation of the contract: for
prior autorisation.

Sub-contractors need to meet same non-exclusion
and eligibility criteria as main contractors.

No direct link with the Contracting Authority.     47
Consortium (1)
• A grouping of eligible natural and legal persons or
  public entities which submits jointly a tender
  under a tender procedure.
• It may be a permanent, legally-established
  grouping, or a grouping which has been
  constituted for a specific call for tenders,
  formalised by the statement signed by the Lead
  applicant on behalf of consortium members.
• All members of a consortium (i.e., the leader and
  all other partners) are jointly and severally liable
  to the Contracting Authority.
                                                    48
Consortium (2)
Exclusion criteria   apply separately to each
                     member of the consortium
Eligibility rules

                     apply to the tenderer
Selection criteria   (consortium) as a whole, with
                     exceptions (financial ratios)

    Being part of a consortium, is therefore a
    solution when a company does not meet the
    selection criteria on its own.
                                                     49
Example

Selection          Member A   Member B Member C   Result
criterion
Economic/
Financial
Annual turnover       X          √        X         √
Liquidity ratio       √          √        √         √
Professional
No. of staff          √          √        X         √
Cert. ISO             √          X        X         √
Technical
Projects of same
                      √          √        X         √
size
Projects in a
                      X          X        √         √
certain region
                                                           50
Practical
advice

            51
• Common mistakes made by tenderers and
  applicants (1)
  Administrative reasons

  •   Late dispatch
  •   Tender guarantee missing or not in right format
  •   Incomplete documentation
  •   Not in accordance with templates
  •   Tenderer/applicant/member of consortium/sub-contractor
      not eligible
  •   Offer not signed (tender submission form)
  •   Offer not in the currency/language required
  •   Selection criteria not fulfilled
  •   Financial offer not in a separate envelope or visible in the
      technical offer (service contracts) Not a reason for rejection since PRAG 201852
• Common mistakes made by tenderers and
  applicants (2)
  Technical reasons

  In Services:
  • Experts do not have the required experience/qualifications
  • Copy and paste of terms of reference
  • Experts not available during required dates
  • Unclear methodology

                                                            53
Some recommendations and
Suggestions (1)

  1. Define your strategy!
     Calls for tenders:
     Will you be a tenderer / member of a consortium / sub-
     contractor ?

  2. Use the clarification period to ask whatever is not clear
     in the contract notice or tender dossier

                                                                 54
Some recommendations and
Suggestions (2)

  3. Pay attention to all the instructions in the Call for
     tenders
  Pay extra attention to what is asked in:
  - Terms of reference (services)
  - Technical specifications (supplies)
  - Bill of quantities (works)

                                                             55
Some recommendations and
Suggestions (3)

  4. The consortium leader must check carefully:
  • Eligibility: nationality (all members of consortium,
    capacity providing entities and sub-contractors)
    Origin of goods (for supplies and works)

  • Selection criteria on Contract notice

  • Evaluation Grids (services)

  • Respect of formal submission requirements

  5. Ask for an extension if it is a complex tender or if there
    are many clarifications                                     56
Useful tips (1)
• Stay informed! Check the tenders published frequently!

• Make yourself known in the business community

• Select staff with writing skills (services) to draft offers

• Choose carefully your partners

• Check carefully all the elements of your offer prior to
  submission

• Capitalise on lessons learnt and strenghts/weaknesses of
  earlier applications/tenders
                                                                57
Useful tips (2)
• Check your prices. Try to be competitive.

DON'T:
• Contact the Contracting Authority / EU DEL concerning a
  Call for Tenders outside the communication channel opened
  for this purpose
• Try to influence the outcome of the procedure

• Ask for a prior opinion to the CA / EU of your bid

• Forget to ask for a reference letter to the CA for contracts
  successfully implemented
• Desperate if you don't get contracts in your first attempts!58
Useful tips (3)
LinkedIn groups for Consultancies (not endorsed by EC/EU):

1. EC-EuropeAid-Framework-Contracts-Projects
https://www.linkedin.com/groups/2953810

2. Technical Assistance Consultancy Network; EU, Worldbank, Calls,
Grants, International Development
https://www.linkedin.com/groups/82619/profile

Platforma (European local and regional authorities in development):
http://www.platforma-dev.eu/

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Questions?

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