new petrobras procurement regulations...c. tender process 5. compliance regulations –pppc and ddi...

Oslo, 2018

NEW PETROBRAS PROCUREMENT

REGULATIONS

Rogério Campos

[email protected]

1. Context – State Companies Law

2. Decree 2.745:1998-2018

3. New Regulatory Framework

4. The RLCP

a. RLCP’s new procurement rules

b. Decree 2.745 vs. RLCP – Major differences

c. Tender Process

5. Compliance Regulations – PPPC and DDI

6. Petrobras’ Suppliers Registry

7. Pre-Qualification

8. Survival of Contracts Ruled by Decree 2.745/98

9. Training and information

Summary

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Law 13.303/2016CONTEXT – STATE COMPANIES LAW

Context:

Scandals involving public entities or mixed-capital companies evidenced the need to update procurement regulation.

State Companies Law:

Applicable exclusively to public companies and mixed-capital companies;

New rules for the appointment of officers and board members;

New public procurement rules;

Revocation of Article 67 of the Petroleum Law and consequent revocation of Decree 2.745/1998 and Petrobras Procurement Guide (MPC);

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DECREE 2.745: 1998-2018PETROBRAS’ SIMPLIFIED REGULATION

Bid modalities under Decree 2.745/1998:

Competition Tender - Any interested party that meets the conditions set in the tender can be admitted to this bid process;

Submission Of Prices – Only the suppliers previously registered and classified by Petrobras are admitted;

Tender - Any interested party can be admitted (usually applicable to technical or artistic works);

Auction - Any interested party can be admitted. Sale of Petrobras’ permanent assets to the lowest bidder (equal to or greater than the valuation);

Tender By Invitation – At least 3 suppliers, regardless of previous registration with Petrobras. At least 3 days for presentation of the bids. – VAST MAJORITY OF CASES.

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THE NEW REGULATORY FRAMEWORK

May 2018 – Petrobras

adopts the new bidding

rules under the RLCP.

Petrobras have no specific

bidding rules.

State Companies Law (Law 13.303/2016)

Revocation of the

Decree 2.745/98

January 2018 - Petrobras’

Board approves the RLCP

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RLCP - PETROBRAS PROCUREMENT REGULATIONS

General Principle:

Bid procedures are now

open to the interested

parties able to meet the

requirements set forth in

the tender notice.

Ways of publicizing the tenders:

Publication in the Federal Official Gazette

(DOU);

Available on Petronect’s website; and

The companies enrolled with Petrobras’

Suppliers Registry may receive direct

notifications.

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NEW MODALITIES UNDER THE RLCP

Auction (Pregão) – The main modality for common goods and services (i.e., with standards of performance and quality). Lowest price, regardless of the estimated value. Successive bids (can be electronic);

Open Tenders – Bidders submit written or electronic proposals in a public session and then start to bid successively, increasing or decreasing the price, according to the criteria of judgment adopted in the bid rules;

Closed Tenders – Bids shall be confidential until the date/time designated for their disclosure, similar to the current procedure (requires justification);

Mixed Tenders – The tender notice may establish that the modes of dispute are combined (closed+open), when the object can be divided; and

Direct Hiring: Carried out in cases of non-applicability or waiver of bidding, all as provided under the State Companies Law and the RLCP (similar to Decree 2.745).

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Decree 2.745 RLCP

Best Price - Best proposal implies the

minimum expense for Petrobras. Lowest Price & Highest Discount

Technique and Price – Whenever technical

factors are weighed along with offered

prices;

Best Technique and Cost Combination

Best Technique - Technical quality prevails

over the price (e.g. architectural

projects);

Best Technical Proposal

Best Artistic Content

Highest (Purchase) Price

Best Economic Return – NEW! - Purpose of providing savings to

PB by means of the reduction of its current expenses.

Remuneration based on the percentage of such savings.

Best Destination To Disposed Goods – NEW! - Bid shall consider

the repercussion, in the social environment, of the purpose for

which service the good will be used.BID

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RLC

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RLCP COMPLIANCE REQUIREMENTS

INTEGRITY RISKS – PPPC AND DDI

The New Procurement Regulations highlights

Petrobras’ commitment to ethics, integrity and

transparency.

Contractors must comply with Petrobras’ Corruption

Prevention Program (PPPC).

Companies interested in initiating/maintaining

relations with Petrobras are subject to an Integrity

Due Diligence (DDI) in the light of the PPPC, being

assigned a degree of low, medium or high integrity

risk.

Companies assigned with a high integrity risk degree

should not participate in Petrobras’s bids.

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RLC

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DD

I Pillars of the Integrity Due Diligence –supplier assessment:

Profile: company size, goods or services supplied/rendered, countries in which it operates or has headquarters, number of employees;

Influence in the Public Sector: level of public sector influence in company's business, level of relationship of the supplier with public agents;

History & Reputation: identification of involvement of the company and its business group in cases of ethical misconduct, fraud and corruption; and

Integrity Program: existence and application of mechanisms to detect and prevent irregularities and acts of corruption.

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Method:

1.Application of the Integrity Due Diligence Questionnaire;

2.Open source researches by Petrobras to confirm information provided by the company (expert database, company’s website, etc); and

3.Assessment of Risk of Integrity Level – based on the data obtained with steps 1 and 2.

A new questionnaire can be submitted within six months, in order to reevaluate the supplier’s integrity.

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i. the company presents sufficient evidence of (i) existencemechanisms to prevent, detect and correct irregularities andacts of corruption and (ii) due implementation of suchmechanisms, the company will have its Integrity Risk Levelclassified as low.

ii. the company presents evidence of existence ofprevention, detection correction mechanisms, but does notpresent any evidence of implementing such measures, thecompany will have its Integrity Risk Level classified asmedium or low, depending on its profile.

iii. the company does not present sufficient evidence ofexisting prevention, detection and correction of irregularitiesand acts of corruption mechanisms, the company will have itsIntegrity Risk Level ranked as medium.

Stage 1

Stage 2


If NO risk factor is identified on stages 1 and 2 but:

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If ANY risk factor is identified on stages 1 and 2 and:

iv. the company presents evidence of existence ofmechanisms to prevent, detect and correct irregularitiesand acts of corruption, but does not present any evidenceof implementing such measures, the company will haveits Integrity Risk Degree classified as medium or high,depending on the quantity and nature of the risk factorsidentified and on the company’s profile.

v. the company does not present sufficient evidence ofexisting prevention, detection and correction ofirregularities and acts of corruption mechanisms, thecompany will have its Integrity Risk Level ranked as high.

Stage 1

Stage 2

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PETROBRAS’ SUPPLIERS REGISTRY

Not a requirement to participate in the tender process!

However, it can be used in order to obtain prior qualification in future bidding procedures (expedites and simplifies participation in bids).

Documents necessary for qualification in a certain bid may be totally or partially replaced by the CRC, which simplifies and speeds up the process.

Petrobras’ contractors database (structured by supply families).

The registry is permanently open. Registration is valid for up to one year - it can be updated at any time.

The result of the registration process is the issuance of the Registration Certificate (CRC)

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New service/Supply “families” have been created, replacing the oldones.

The new families are already available to be registered and used ontender processes.

Old family registrations have been definitively cancelled as of June2018.

The companies that were qualified in the old families were notautomatically transferred to the new families.

All the suppliers that have any old family ("from") received a noticealerting about the creation of the new family ("to") and of the needto update their registrations.

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Source: Petronect Website

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SUPPLIER PRE-QUALIFICATION

Decree 2,745/98: Prior verification of legal qualification, technicalcapacity, economic-financial qualification and fiscal regularity,aiming at future and specific events, via tender invitations.

RLCP pre-qualification shall be:

Subjective - when intended to identify suppliers that meet thequalification conditions for the provision of goods or serviceswithin pre-established terms and requirements; or

Objective – when designed to identify goods/services thatmeet the technical and quality requirements.

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PRE-QUALIFICATION OF COMPANIES

Partial - when the technicalrequirements are only partiallyattained; or

Total - when all quality requisites ortechnical requirements are fulfilled

The pre-qualification has amaximum validity of one year,counted from its concession, andmay be updated at any time

The pre-qualification may replace,in whole or in part, thequalification documents in abidding procedure

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Certain bids may be restricted to pre-qualified companies or in the process ofpre-qualification.

In this case, only those suppliers whohave timely submitted the required pre-qualification documentation mayparticipate in specific bids - even prior tothe conclusion of the qualification.

PRE-QUALIFICATION OF COMPANIES

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SURVIVAL OF CONTRACTS RULED BY DECREE 2.745/98

Petrobras bids and contractsinitiated/executed under Decree2.745/98 remain governed by Decree2.745/98 until the contractualtermination or expiration.

According to the RLCP, possibleamendments to these contractsremain ruled by the “old” rules.

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TRAINING AND INFORMATION

More information can be found on the links below:

Petrobras’ English website- ( www.petrobras.com )

Petronect Portal – ( https://www.petronect.com.br/irj/portal/anonymous/en )

http://www.petrobras.com/https://www.petronect.com.br/irj/portal/anonymous/en

THANK YOU!

Rogério Campos

[email protected]