procurement policies and rules€¦ · procurement policies and rules august 2000 4574 procurement...

ProcurementPolicies and Rules

August 2000

4574 Procurement pol&rules (E) 25/8/00 15:56 Page F2

EBRD

Amendment

Paragraph 2.9 of this policy has been amended as of 2 May 2007. See page 3 for the new text.

First published January 1992Revised August 1994, May 1995, March 1996,February 1998, April 1999, August 2000

© European Bank for Reconstruction and Development One Exchange Square London EC2A 2JN United Kingdom

All rights reserved. No part of this document may bereproduced or transmitted in any form or by any means,including photocopying and recording, without writtenpermission of the copyright holder. Such writtenpermission must also be obtained before any part of thisdocument is stored in a retrieval system of any nature.

4574 Procurement Policies and Rules (E) – 01/08/00


Procurement Policies and Rules

for projects financed by the

European Bank for Reconstruction

and Development


A number of revisions to the Bank’s Procurement Policies and Rules were approved by the Bank’s Board of Directors on 23 August 1994, 16 May 1995, 20 March 1996, 24 February 1998 and 31 May 2000. This edition includes a new Annex 2 – Guidance to tenderers – and changes the following paragraphs in the April 1999 version of Procurement Policies and Rules to reflect this addition.

paragraph numbers

new amended renumbered

Contents

3.34

5.12

Annex “Annex” to

“Annex 1”

Annex 2

August 2000

Following approval by the Bank’s Board of Directors on 2 May 2007 paragraph 2.9 of this edition of the Procurement Policies and Rules (August 2000) has been further amended with effect of May 2007 to reflect revisions of the Bank’s policy on fraud and corruption. The amended paragraph is only available in the internet version of the Procurement Policies and Rules.

Revisions

Contents

1. Introduction 1

2. Principles and considerations 2

Eligibility 3

Client responsibilities 3

Fraud and corruption 3

3. Procurement Rules for public sector operations 5

General 5

Applicability of the Rules 5

Procurement process 6

Procurement planning 6

Notification 6

Open Tendering 7

Prequalification of tenderers 7

Two-stage tendering 7

Exceptions to Open Tendering 8

Selective Tendering 8

Single Tendering 8

Shopping 8

Local Competitive Tendering 8

Utilities 9

Open Tender documentation 9

Evaluation criteria 9

Co-financing 10

Language 10

Standards and specifications 10

Tender prices 10

Currency 11

Payment 11

Time limits 11

Conditions of contract 11


Eligibility to submit tenders 12

Tender opening 12

Tender evaluation and contract award 13

Advance contracting 13

Contract administration 13

Procurement monitoring and Bank review 13

4. Procurement in private sector operations 15

5. Procurement of consultant services 16

General 16

Consultant selection procedures 16

Short lists 17

Evaluation and selection 17

Contract negotiations 18

Contract administration 18

Bank review 18

Annex 1

Bank review of procurement decisions 19

Annex 2

Guidance to tenderers 21


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1.Introduction

1.1 In their transition to market economiesand in applying the principles of multipartydemocracy, the countries of operations ofthe European Bank for Reconstruction andDevelopment need to achieve economy andefficiency in both public and private sectoroperations, and transparency and account-ability in public administration. Theestablishment of sound procurement policiesand practices must be an integral part of thetransition process. Competition is the provenway to do this, and it is also the fundamentalprinciple of good procurement practice.

1.2 Open and fair procedures for awardingpublic sector contracts for goods, works andservices help to create dependable and stablemarkets for efficient private enterprises. Theyalso form the basis for establishing account-ability and encourage the cost-effective use ofpublic funds, a matter that is of concern forboth the Bank and its countries of operations.Article 13 of the Agreement Establishing theEuropean Bank for Reconstruction andDevelopment requires that:

“(xii) the Bank shall place no restriction uponthe procurement of goods and services fromany country from the proceeds of any loan,investment or other financing undertaken inthe ordinary or special operations of the Bank,and shall, in all appropriate cases, make itsloans and other operations conditional oninternational invitations to tender beingarranged; and

(xiii) the Bank shall take the necessarymeasures to ensure that the proceeds of anyloan made, guaranteed or participated in bythe Bank, or any equity investment, are usedonly for the purposes for which the loan orequity investment was granted and with due

attention to considerations of economy andefficiency.”

1.3 At the level of specific projects, whichare the focus of the Bank’s operations, theefficiency of the procurement process directlyaffects the costs and the time required forproject execution and the ultimate perfor-mance of the operation. Good procurementpractices should lead to significant time andmoney savings for the Bank’s clients andhelp ensure successful project implemen-tation and operation.

1.4 The Bank will help countries of oper-ations meet their objectives of achievingeconomic development and transforming theirpublic administration systems by carefullyselecting and designing the projects it supportsand by assisting in the development of appro-priate institutions that are consistent with thephilosophy and needs of market economies.Fostering sound procurement policies andcompetent organisations to administer themwill be an important target in this effort.

1.5 Supplementing the principles containedin the Agreement Establishing the Bank, thisdocument sets out the procurement policiesand rules to be followed in Bank-financedoperations. Section 2 describes general prin-ciples and considerations that are applicablefor all operations. Section 3 contains rules forprocurement in operations involving thepublic sector. Section 4 describes procure-ment arrangements in Bank-financedoperations in the private sector. Section 5concerns the selection of consultants byclients in Bank-assisted public sectoroperations and by the Bank when administer-ing Technical Cooperation Funds or whenengaging consultants directly.

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2.Principles and considerations

2.1 The “Chairman’s Report on theAgreement Establishing the European Bankfor Reconstruction and Development”,Article 13, paragraph 6, notes agreement:

“... upon completely open procurement (andnot procurement open only to members) basedon international tendering, where appropriate,and ... such tenders should be genuinelycompetitive, in line with the GATT Agreementon Government Procurement.” 1

The WTO/GPA (Government ProcurementAgreement) establishes a framework of rightsand obligations with respect to laws, regula-tions, procedures and practices regardingpublic procurement. The aim of the WTO/GPA is to achieve greater liberalisation andexpansion of world trade by establishingtransparent, fair and open procurementpractices. The Bank supports the develop-ment of public procurement laws andpractices within its countries of operationsthat are consistent with the principles ofthe WTO/GPA.

2.2 The underlying principle of WTO/GPAand the underpinning for the Bank’s policiesis that public sector contracts shouldnormally be awarded on the basis of opencompetitive tenders. Only in special casesshould contracts be awarded on the basis ofselective or single tendering. The laws andpractices for carrying out procurement shouldnot discriminate between foreign and localproducts, suppliers or contractors and theprocedures should be transparent andfairly applied.

2.3 The Bank will periodically review withits countries of operations their procurement

laws, regulations and procedures andwill provide advisory services, technicalassistance and training to help them reachconsistency with the principles of theWTO/GPA and harmonisation with theBank’s policies and rules.

2.4 The Bank works in close cooperationwith other multilateral institutions includingthe World Bank, the International FinanceCorporation, the Multilateral InvestmentGuarantee Agency, the European Union andthe European Investment Bank and seeksto increase the flow of investments to itscountries of operations by co-financingprojects with multilateral and bilateraldevelopment agencies, export credit agenciesand commercial entities. When projects areco-financed on a joint basis, the Bank’sprocurement policies and rules wouldnormally be applied for co-financedcontracts. When projects are co-financed on aparallel basis, the co-financiers’ procurementprocedures would be applied for contractsfinanced by them but the Bank will assureitself that quality goods and services arereceived at economic prices, that contractsare fair and provide adequate protection tothe project and that contracts are completedin a timely manner.

2.5 The Bank’s concerns for economy andefficiency, quality of results, contractualprotection and timely completion cover anentire project even if Bank funds are appliedonly to a portion of the project. The Bankwill finance only those contracts that are anagreed part of a project and that have beenawarded and executed in accordance withthe Bank’s rules as agreed to be appliedto that project.

1 Replaced by WTO/GPA (Government Procurement Agreement), effective by 1 January 1996.


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Eligibility

2.6 The Bank permits firms and individualsfrom all countries to offer goods, works andservices for Bank-financed projects regard-less of whether the country is a member ofthe Bank. Firms from developing countriesas well as from the Bank’s countries ofoperations are encouraged to participateon equal terms and thereby assist theirown country’s development process. Anyconditions for participation shall be limitedto those that are essential to ensure the firm’scapability to fulfil the contract in question.2

Clients will not exclude a firm from opencompetition for a contract for reasonsunrelated to its capability to perform thecontract in question unless, as a matter oflaw or official regulation, the client’s countryprohibits commercial relations with thefirm’s country.

2.7 Consistent with international law,the proceeds of the Bank’s loans, equityinvestment or guarantees should not be usedfor payment to persons or entities or for anyimport of goods, if such payment or importis prohibited by a decision of the UnitedNations Security Council taken underChapter VII of the Charter of the UnitedNations. Persons or entities, or suppliersoffering goods and services, covered by suchprohibition should therefore not be eligiblefor the award of Bank-financed contracts.

Client responsibilities

2.8 Clients are responsible forimplementing Bank-financed projects,including all aspects of the procurementprocess from the planning stage through

the award of contracts, as well as theadministration of the contracts themselves.The Bank may advise and assist clients inthe procurement process and institutionaldevelopment for specific projects but is nota party to the resulting contracts. The rightsand obligations of the client vis-à-vistenderers for goods, works and services tobe furnished for the project will be governedby the tender documents issued by the clientand not by these Policies and Rules.

Fraud and corruption

2.9 It is the Bank’s policy to require thatclients (including beneficiaries of Bankloans), as well as tenderers, suppliers,contractors, concessionaires and consultantsunder Bank-financed contracts, observethe highest standard of ethics during theprocurement and execution of such contracts.

In pursuance of this policy, the Bank defines,for the purposes of this provision, the termsset forth below as follows:

i) “corrupt practice” means the offering,giving, receiving, or soliciting of anything of value to influence the action ofa public official, or the threatening ofinjury to person, property or reputation,in connection with the procurementprocess or in contract execution in orderto obtain or retain business or otherimproper advantage in the conductof international business.

ii) “fraudulent practice” means a misrep-resentation of facts in order to influencea procurement process or the executionof a contract to the detriment of the client,and includes collusive practices among

2 See also Paragraphs 3.26, 3.27 and 3.28.


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tenderers (prior to or after tender sub-mission) designed to establish tenderprices at artificial, non-competitive levelsand to deprive the client of the benefitsof free and open competition.

The Bank, in respect of the procurementof goods, works and services governed bySection 3, the selection of concessionairespursuant to Paragraph 4.4, and the selectionof consultants governed by Section 5:

a) will reject a proposal for award if it determines that the supplier, contractor,concessionaire or consultant recom-mended for award has engaged in corruptor fraudulent practices in competing forthe contract in question;

b) will cancel the portion of the Bankfinancing allocated to a contract for goods,works, services or concessions if it at anytime determines that corrupt or fraudulentpractices were engaged in by representa-tives of the client or of a beneficiary of theBank financing during the procurement orthe execution of that contract, without theclient having taken timely and appropriateaction satisfactory to the Bank to remedythe situation;

c) will declare a firm ineligible, either indef-initely or for a stated period of time, to beawarded a Bank-financed contract if it atany time determines that the firm hasengaged in corrupt or fraudulent practicesin competing for, or in executing, a Bank-financed contract;

d) reserves the right, where a client or a firmhas been found by a judicial process orother official enquiry to have engagedin corrupt or fraudulent practices,

(i) to cancel all or part of the Bankfinancing for such client; and

(ii) to declare that such a firm is ineli-gible, either indefinitely or for a statedperiod of time, to be awarded a Bank-financed contract; and

e) will have the right to require that, incontracts financed by the Bank, aprovision be included requiring suppliers,contractors, concessionaires and consul-tants to permit the Bank to inspect theiraccounts and records relating to theperformance of the contract and to havethem audited by auditors appointed bythe Bank.


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General

3.1 Competition is the foundation for goodprocurement practice. In addition to economyand efficiency, the public sector requirestransparency and accountability for the useof public funds, and this affects the choiceof the procurement method and the docu-mentation and procedures that are used.Therefore the Bank requires its public sectorclients, in all appropriate cases, to obtaingoods, works and services through opentendering procedures in accordance with therules outlined in this section. Other methodsmay be appropriate for special circumstances,depending on the nature and value of thegoods, works or services to be obtained,the required completion time and otherconsiderations. All exceptions to opentendering should be clearly justified andagreed by the Bank, and specified in theoperation report and the legal documentation.

Applicability of the Rules

3.2. For the purpose of these rules, publicsector operations3 are operations:

a) which are guaranteed by the governmentor a public agency or instrumentalityof the country of operations; or

b) for utilities4 majority owned by nationalor local governments, or governmentagencies of the country of operations,other than such utilities operated byconcessionaires who were awardedtheir concession following competitivetendering procedures acceptable to theBank, and which in the Bank’s judgement

are operating autonomously and aresubject to bankruptcy and insolvencylaw; or

c) for national or local governments of thecountry of operations or agencies andenterprises majority beneficially owned byany of them, other than such enterprisesthat in the Bank’s judgement are operatingautonomously in a competitive marketenvironment and are subject tobankruptcy or insolvency law.

3.3 These rules shall apply to goods, worksand services contracts (except consultantservices, for which the procedures aredescribed in Section 5) financed in wholeor in part by the Bank in public sectoroperations. Contracts shall be procuredfollowing open tendering5 if their value isestimated to equal or exceed €200,000 forgoods and services and €5 million for works.If the Bank determines that the abovethresholds may have the effect of limitingcompetition or are not likely to ensure themost economic and efficient outcome, moreappropriate thresholds would be required forsuch specific circumstances and would bespecified in the Bank’s operation report andthe legal documentation. No procurementrequirement shall be divided with the intentof reducing the value of the resultingcontract(s) below these thresholds with thepurpose of circumventing these rules. Forgoods, works and services contracts belowthese threshold values, clients areencouraged to follow open tendering butmay use other procedures6 that are consistentwith principles concerning competition,

3 “Operations” refer to loans, equity investments or guarantees of the Bank.4 “Utilities” are authorities or undertakings directly involved in providing, through fixed networks, a service to the public in water,

electricity, gas, heat, telecommunications or rail transport.5 See Paragraph 3.9. 6 See Paragraphs 3.12 and 3.13.

3.Procurement Rules for public sector operations


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transparency, economy and efficiency andwhich are acceptable to the Bank.

3.4 The rules apply to all forms ofacquisition of goods, works and services(except consulting services for which theprocedures are described in Section 5),including, inter alia, purchase, hire-purchase, rental and leasing.

Procurement process

3.5 The normal process for public sectorprocurement involves the following steps:

a) notification of opportunities for tendering;

b) prequalification where appropriate;

c) invitation to tender and issuance of tenderdocuments;

d) receipt of tenders, evaluation of tendersand contract award; and

e) contract administration.

The extent of the process and specific pro-cedures to be followed for each step will de-pend on the method of tendering that is used.

Procurement planning

3.6 Sound planning of procurement iscrucial. The client must determine whatgoods, works and services are required tocarry out the project, when they must bedelivered, what standards are needed, theneed for co-financing7 and which procure-ment and contracting procedure is mostsuitable for each contract. The client shouldcomplete the overall procurement planand the Bank should clear it before anyprocurement begins.

The particular procedures and the goods,works and services to which they apply aredetermined by agreement between the Bankand the client and are specified in the Bank’soperation report and the legal documentation.Adjustments and refinements to the planwith the Bank’s concurrence should continueas needed throughout the duration of theproject. Review and approval of the procure-ment plan by the Bank is one of the essentialsteps for establishing the use of the proceedsof the loan.

Notification

3.7 After the procurement plan has beenprepared and as early in the project cycleas possible, the client must issue a GeneralProcurement Notice that advises the businesscommunity about the nature of the project.This notice should include the amount andpurpose of the loan and the overall procure-ment plan, including:

a) the goods, works and services to beprocured;

b) the expected timing; and

c) a name and address to contact to expressinterest and obtain additional information.

This notice shall be published in anewspaper with wide circulation in theclient’s country and in official gazettes andinternational trade publications, as appro-priate. In addition, the notice shall be sub-mitted to the Bank not later than 60 daysbefore invitations to tender are issued. TheBank will arrange for publication of the noticein the Procurement opportunities section ofthe Bank’s Web site (www.ebrd.com) andin the United Nations’ Development Business.

7 See Paragraph 3.17.


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The General Procurement Notice shall beupdated annually so long as any goods,works or services remain to be procuredby open tender.

3.8 Open tendering, including prequalifi-cation where required, for individual con-tracts shall be advertised in a newspaper withlarge circulation in the client’s country andin official gazettes and international tradepublications, as appropriate. The Bank willarrange for publication of the notice in theProcurement opportunities section of theBank’s Web site. Tender and prequalificationnotices shall also be sent to potential tender-ers that have responded with an expressionof interest to the General Procurement Noticeand to local representatives of foreigncountries that are potential suppliers of thegoods and works required. Publication oftender notices in international publicationssuch as the United Nations’ DevelopmentBusiness and the Official Journal of theEuropean Communities is also encouraged.In order to encourage and facilitate theparticipation of sub-contractors and suppliersin contracts, the client should make availableto interested parties the list of potentialtenderers that have purchased tenderdocuments and, where pre-qualification isbeing followed, the list of pre-qualifiedtenderers.

Open Tendering

3.9 Open Tendering procedures are thoseprocedures under which all interestedsuppliers or contractors are given adequatenotification of contract requirements and allsuch tenderers are given an equal opportunityto submit a tender. It provides the greatest

opportunity for competition and satisfiesthe needs for economy and efficiency. Theclient must give sufficient advance publicnotification of open tendering opportunitiesfor potential tenderers to determine theirinterest and to prepare and submit theirtenders.8

Prequalification of tenderersClients may require potential tenderers toprequalify for large and complex contractsand all tenderers that meet the prequalifi-cation criteria should be allowed to submittenders. The notification for prequalificationand the evaluation procedure shall beconsistent with those for open tendering inthese rules. Prequalification is not a formof selective tendering. The prequalificationcriteria, which shall be specified in theprequalification documents, shall be basedentirely upon the capability and resourcesof prospective tenderers to perform theparticular contract satisfactorily, taking intoaccount such factors as their (a) experienceand past performance on similar contracts,(b) capabilities with respect to personnel,equipment, and construction or manu-facturing facilities, and (c) financial position.

Two-stage tenderingDetailed design and engineering of the goodsand works to be provided, including thepreparation of technical specifications andother tendering documents, normally precedethe invitation to tender for major contracts.However, in the case of turnkey contracts orcontracts for large complex plants or worksof a special nature, it may be undesirable orimpractical to prepare complete technicalspecifications in advance. In such a case, atwo-stage tendering procedure may be used,



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under which first unpriced technicalproposals on the basis of a conceptual designor performance specifications are invited,subject to technical as well as commercialclarifications and adjustments, to be followedby amended tendering documents and thesubmission of final technical proposals andpriced tenders in the second stage. Theseprocedures are also appropriate in the pro-curement of equipment which is subject torapid technological advances, such as majorcomputer and communication systems.

Exceptions to Open Tendering

3.10 Selective Tendering procedures aresimilar to those for open tenders except thatthe client preselects qualified firms, who willbe invited to submit tenders. It may be asuitable method for awarding contracts where:

a) the required product or service is highlyspecialised and complex;

b) there are only a limited number ofsuppliers of the particular goods orservices needed;

c) other conditions limit the number of firmsthat are able to meet contract require-ments; or

d) critical goods, works or services areurgently required.

In these cases a client may, with the Bank’sapproval, invite tenders from a list ofqualified firms, selected in a non-discriminatory manner. The list shouldinclude foreign firms wherever possible.

3.11 Single Tendering may be usedin exceptional cases where:

a) the extension of an existing contractawarded in accordance with proceduresacceptable to the Bank for additionalgoods, works or services of a similarnature would clearly be economic andefficient and no advantage would beobtained by further competition;

b) there has been an unsatisfactory responseto open or selective tenders carried out inaccordance with the Bank’s procurementrules;

c) a product can only be provided by a singlesupplier because of exclusive capabilitiesor rights;

d) standardisation with existing equipment isdetermined to be important and justified,the number of new items are generally lessthan the existing number and compatiblegoods cannot be provided by othersuppliers; or

e) it is a case of extreme urgency.

In these cases a client may, with the Bank’sapproval, invite a single firm to present itstender without prior public notification.

3.12 Shopping procedures may be agreed toby the Bank for contracts of a small value for(a) readily available off-the-shelf items; and(b) standard specification goods. Shopping isa simplified form of competitive purchasingthat only requires written price quotationsfrom at least three suppliers, includingforeign suppliers wherever possible.

3.13 Local Competitive Tendering inaccordance with national procedures maybe the most economic and efficient methodof procuring goods, works or services when:


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(a) contract values are small; (b) works arescattered geographically or spread over time;(c) the goods, works or services are availablelocally at prices less than the internationalmarket; or (d) by their nature or scopecontracts are unlikely to attract foreigncompetition. The procedures under whichlocal competitive tendering is carried outmust be acceptable to the Bank. They shouldprovide for adequate notification andcompetition in order to ensure reasonableprices, evaluation criteria should be madeknown to all tenderers and should be appliedfairly, and the conditions of contract shouldbe fair and appropriate to the project. Foreignfirms should be allowed to participate inaccordance with national procedures.

3.14 In operations with utilities9 which aremoving towards majority private ownershipor control10 by implementing programmes inthis respect, and already have a significantdegree of private ownership and control, suchutilities should normally be expected tofollow open tendering. However, where suchutilities are operating autonomously and aresubject to or have adopted sound procure-ment procedures, the Bank may agree thatsuch utilities follow competitive tenderingprocedures in accordance with their ownprocedures, subject to such procedures beingacceptable to the Bank. To be acceptablefor use in Bank-financed procurement, theprocedures of the utility should provide foradequate international notification,11 non-discriminatory competition, transparent andfair evaluation procedures, monitorablecompliance, as well as fair and balancedcontracts.

Open Tender documentation

3.15 Tender documents are the basisfor informing potential tenderers of therequirements to supply specific goods andservices or to construct works, so they shouldfurnish all information necessary to permittenderers to submit responsive tenders.Tender documents shall be drafted so asto permit and encourage internationalcompetition. They shall clearly define thescope of works, goods or services to besupplied, the rights and obligations of thepurchaser and of suppliers and contractors,and the conditions to be met in order for atender to be declared responsive, and theyshall set out fair and non-discriminatorycriteria for selecting the winning tender.The detail and complexity will vary accordingto the size and nature of the contract butgenerally they should include an invitationto tender, instructions to tenderers, the formof tender, tender security requirements, theconditions of contract, advance paymentguarantees, performance securityrequirements, technical specifications anddrawings, a schedule or requirements forthe goods, works or services, and the formof contract. Clients should use the Bank’sstandard tender documents appropriatefor each type of procurement.

3.16 Evaluation criteria. Tenderdocuments shall specify the relevant factorsin addition to price to be considered intender evaluation and the manner in whichthey will be applied for the purpose ofdetermining the lowest evaluated tender.Factors which may be taken into consider-

9 See Paragraph 3.2 (b).10 Control is measured by the ability to effectively determine the decisions and policies of the utility, and not merely by the ability to set

utility tariffs.11 See Paragraph 3.7.


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ation include, inter alia, the costs of inlandtransport to the project site, the paymentschedule, the time of completion of con-struction or delivery, the operating costs,the efficiency and compatibility of theequipment, the availability of service andspare parts, and minor deviations, if any.The factors other than price to be used fordetermining the lowest evaluated tendershould be expressed in monetary terms or,where that is not practicable, given a relativeweight in the evaluation provisions of thetender documents.

3.17 Co-financing.12 Where co-financingis required to complete the financing packagefor an operation and joint co-financing ofspecific contracts is appropriate, tenderinvitations may require that tenderers includein their tender specific co-financing offers forthe contract. This requirement shall only beused where, in the Bank’s judgement,significant competition will be maintained.The agreed level and general terms of the co-financing required shall be specified in thetender documents. These should normally beconsistent with the OECD consensus termswhen ECA financing is envisaged. Evaluationof tenders should be based on the evaluatedtender price, which could include any financecosts above the specified terms.

3.18 Language. Tender documentation,including all published procurement notices,shall be prepared by the client in one of theBank’s working languages. In the interest ofopen competition as well as economy andefficiency, the Bank may require that tenderdocumentation also be provided in anotherworking language of the Bank which shallbe specified in the tender documents as the

governing language. In addition, the clientmay prepare further sets of the tenderdocumentation in the local language, inorder to assist local firms in tendering.

3.19 Standards and specifications. Clientsshould use international standards andspecifications wherever these are availableand appropriate. If particular national orother standards are used, the tenderdocuments shall state that other standardsthat ensure equivalent or higher quality orperformance than the specified standardwould also be accepted. The use of brandnames or other designations that woulddiscriminate among suppliers should beavoided. If they are necessary to clarify thenature of the product requirements, thetender documents shall state that products ofequal or higher quality would be acceptable.

3.20 Tender prices. Tender prices for thesupply of goods shall be requested on thebasis of Incoterms CIP, DAF or similar,border entry point, for foreign goods and ex-factory for local goods. Evaluation of tendersfor supply of goods should exclude importduties and taxes payable on imported goodsand on directly imported components to beincorporated in locally supplied goods, butshould include all costs associated with thesupply, delivery, handling and insurance ofthe goods to the final destination. Tenderprices for works and services contracts tobe substantially executed in the purchaser’scountry may be requested inclusive of allduties, taxes and other levies. The evaluationand comparison of tenders shall be on thisbasis and the selected contractor would beresponsible for all duties, taxes and leviesin the performance of the contract.



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3.21 Currency. A tenderer may express thetender price in any currency or in euro or acombination of these. Clients may requiretenderers to state the local cost portion of atender in the local currency. For the purposeof tender evaluation and comparison, tenderprices shall be converted to a singlecurrency, selected by the client, using theselling (exchange) rates for the currencies ofthe tender price quoted by an official source(such as the central bank) for similar trans-actions on a date selected in advance andspecified in the tender documents, providedthat such date should not be earlier than30 days prior to the date specified for theopening of tenders nor later than the originaldate prescribed in the tender documents forthe expiry of the period of tender validity.Payment under the contract will be madein the currency or currencies in which thetender price is stated in the tender of thesuccessful tenderer. For civil works and othersimilar contracts that involve performance inthe client’s country, and provided the client’scurrency is fully convertible, the tender pricemay be converted into that currency andpayment of equivalent amounts will be madein the client’s currency without loss or riskto the contractor.

3.22 Payment. Payment terms andprocedures shall be in accordance with theinternational commercial practices applicableto the goods, works or services and themarket in question. Contracts for supplyof goods shall provide for full payment ondelivery and inspection, if so required, ofthe contracted goods, except for contractsinvolving installation and commissioning, inwhich case a portion of the payment may be

retained until the supplier or contractor hascomplied with all its obligations.

3.23 Time limits. Prescribed time limits forpreparation and submission of tenders shallbe adequate for all tenderers to prepare andsubmit tenders. Generally not less than 45days from the publication of the invitationto tender or the availability of tenderdocuments, whichever is later, should beallowed for the preparation and submissionof tenders. For large or complex works oritems of equipment, this period should beextended to 90 days or more. Tender validityperiods and delivery dates shall be consistentwith the client’s reasonable requirements butshall not be used to discriminate against anypotential tenderer. In exceptional cases itmay be necessary to request tenderers toextend the validity of their tenders. In suchcases tenderers should not be allowed orrequired to change their tender and shouldbe free not to give such extension. Where thetender is for a fixed price contract, provisionshould be made in the tender documents forthe tender price of the successful tendererto be adjusted for inflation13 up to the dateof contract award, so as to mitigate therisk accruing to tenderers offering suchan extension.

3.24 Conditions of contract. The formof contract to be used should be appropriateto the objectives and circumstances of theproject. Contract conditions shall be draftedso as to allocate the risks associated withthe contract fairly, with the primary aimof achieving the most economic price andefficient performance of the contract. Thecontract shall clearly define the scope of

13 An appropriate index, such as the official cost of living index in a country which is expressed in the currency of the tender, should be used.


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goods, works or services to be supplied orperformed, the rights and obligations of theclient and of suppliers and contractors andshould include, inter alia, appropriate pro-visions for guarantees of performance andwarranties, liability and insurance, accept-ance, payment terms and procedures, priceadjustment, liquidated damages and bonuses,handling of changes and claims, forcemajeure, termination, settlement of disputesand governing law. Wherever appropriate,standard forms of contract incorporatinggenerally accepted international conditionsshould be used.

3.25 Nothing in the tender documents shallbe designed to restrict competition or offeran unfair advantage to a tenderer. Clientsshall not provide to any potential supplier orcontractor information regarding a specificprocurement which would have the effectof reducing or precluding competition. Allamendments to tender documents must besent to each recipient of the original tenderdocuments.

Eligibility to submit tenders

3.26 A tenderer may submit or participatein any capacity whatsoever in only one tenderfor each contract. Submission or participationby a tenderer in more than one tender fora contract will result in the rejection of alltenders for that contract in which the partyis involved. However, this does not limit theinclusion of the same subcontractor in morethan one tender.

3.27 No affiliate of the client, or of aprocurement agent engaged by the client,shall be eligible to tender or participate ina tender in any capacity whatsoever unlessit can be demonstrated that there is not a

significant degree of common ownership,influence or control amongst the client orthe client’s agent and the affiliate.

3.28 Where a firm, its affiliates or parentcompany, in addition to consulting, also hasthe capability to manufacture or supply goodsor to construct works, that firm, its affiliatesor parent company normally cannot be asupplier of goods or works on a project forwhich it provides consulting services, unlessit can be demonstrated that there is not asignificant degree of common ownership,influence or control. The only exceptionswould be turnkey, single responsibility,public works concessions or similarundertakings where design, supply andconstruction activities are an integral partof the contract or where certain proprietaryand critical items of equipment and materialsare an essential part of the process design.

Tender opening

3.29 Tenders solicited under open andselective procedures shall be received andopened under procedures and conditionsguaranteeing the regularity of the openingas well as the availability of information fromthe opening. The time specified for tenderopening should be the same as for the latestdelivery of tenders or promptly thereafter. Onthe date and at the time and place describedin the tender documents, the client will openall tenders that have been received beforethe latest time stipulated for the delivery oftenders. Tenders should be opened in thepresence of tenderers or their representativeswho wish to attend. The name of the tendererand the total amount of each tender, includ-ing alternative tenders if permitted, shall beread aloud and recorded when opened. Theclient shall maintain a complete record of


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the tender opening, which should be copiedto the Bank. Tenders received after the stipu-lated deadline for the submission of tendersshall be returned unopened to the tenderer.

Tender evaluation and contract award

3.30 When competitive procedures are used,the client must evaluate all tenders and com-pare them only on the basis of the evaluationcriteria set out in the tender documents. Thetender evaluation process up to the award ofthe contract should be confidential. Contractsshould be awarded within the period of tendervalidity to the tenderer whose tender has beendetermined as being substantially responsiveand, in terms of the specific evaluationcriteria set forth in the tender documentation,is determined as the lowest evaluated andwho has been determined to be fully capableof undertaking the contract. Tenderers shouldnot be allowed or asked to change theirtender nor required to accept new conditionsduring evaluation or as a condition of award.The terms and conditions of the contract shallnot, without the Bank’s concurrence, mater-ially differ from those on which tenders wereinvited. The client should only reject alltenders if there is evidence of collusion or ifthere has been unsatisfactory competition,including receiving tender prices that substan-tially exceed the cost estimates or fundsavailable. Before rejecting all tenders, theclient must obtain agreement from the Bankon the procedures to follow.

3.31 The client should submit to the Banka report containing the results of the tenderevaluation and its recommendation for theaward of the contract. The Bank will reviewthe findings and recommendations as the

final step in establishing the eligibility ofthe contract for Bank financing.14

Advance contracting

3.32 In some cases it may be advantageousfor the client to sign a contract before thesigning of the related Bank loan. Clientsundertake such advance contracting at theirown risk and the Bank’s concurrence withthe procedures, documents or the proposalfor award does not commit the Bank to makea loan for the project. All procurement pro-cedures must be consistent with the Bank’spolicies and rules in order for contractssigned in advance of loan approval to beeligible for Bank financing.

Contract administration

3.33 The client shall administer contractswith due diligence and shall monitor andreport to the Bank on the performance ofcontracts. The client shall seek the Bank’sconcurrence before agreeing to any materialmodification to the terms and conditions ofa contract including, but not limited to:(a) granting a material extension of thestipulated time for performance of a contract;or (b) issuing a change order or orderswhich in aggregate would increase the costof a contract by more than 15 per cent ofthe original price.

Procurement monitoring andBank review

3.34 As an integral part of their projectimplementation responsibilities, clients arerequired to prepare and maintain documentsand records pertaining to the procurementprocess and the administration of contracts



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following their award. The Bank’s review ofthe procurement and contract administrationprocesses will focus on critical steps that arenecessary to ensure eligibility of the contractfor Bank financing, in particular the procure-ment plan, the tender documents, the tenderevaluation and contract award recommenda-tions, and material changes and claims duringexecution of the contract. These reviewprocedures are described in Annex 1. Allcontracts to be procured following open orselective tendering should normally besubject to the Bank’s prior review. The LoanAgreement will specify the contracts subjectto review.

3.35 When a complaint regarding any aspectof a tender procedure is received by the Bank(see Annex 2), the Bank will ensure that thecomplaint is fully reviewed to its satisfactionand that, pending the outcome of suchreview, no decisions are made or approvalsgiven which could prejudice the outcomeof the review.

3.36 If the Bank finds that the procurementor administration of a contract has not beencarried out in accordance with the agreedprocedures, the contract would no longer beeligible for financing with the proceeds of theloan and the outstanding portion of the loanallocated to the contract would be cancelled.


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4.1 The Chairman’s Report, in Article 13,Paragraph 6, notes that:

“Delegates agreed upon completely openprocurement ... based on internationaltendering, where appropriate, and ... suchtenders should be genuinely competitive ...Private sector enterprises in which the Bankheld equity or debt might be encouraged, butnot obliged, to use international tenders toobtain goods or services efficiently andeconomically.”

The Bank’s concerns for the appropriate useof funds and for economy and efficiencyapply equally to its public sector operations(as defined in Paragraph 3.2) and its privatesector operations. Private sector enterprisesoften meet these concerns by followingestablished commercial practices other thanformal open tendering for their procurement.Nevertheless, wherever appropriate, the Bankwill encourage the use of competitivetendering methods by its private sectorclients, particularly for large contracts.

4.2 The Bank will satisfy itself that privatesector clients use appropriate procurementmethods which ensure a sound selection ofgoods and services at fair market prices andthat they are making their capital investmentsin a cost effective manner. Careful procure-ment planning that takes into account theparticular needs of the enterprise is essentialfor the Bank’s evaluation and agreement.

4.3 Contracts awarded by private sectorclients should be negotiated on an arm’slength basis and should be in the bestfinancial interest of the client companyas distinct from the sponsors. Where

a shareholder of the client company or oneof its affiliates, including parent companiesand affiliates of such parent companies, isalso a contractor or supplier to the project,the Bank will satisfy itself that the costs arein line with current market prices and theoriginal cost estimates in the operation report,and that the contract conditions are fair andreasonable. The Bank will not finance coststhat exceed market levels.

4.4 Where the Bank is involved in advisingor assisting a government or public entity incontracting with private operators for a publicworks concession, build-operate-transfer(BOT) operation or other similar undertakingwhich enjoys special or exclusive rights, orother state concession such as a recognisedmonopoly, with the objective of the Bankultimately financing the successful candidate,competitive tendering procedures acceptableto the Bank should be followed for theselection of the concessionaire. Such com-petitive selection procedures would beconsidered as meeting the objectives of acompetitive market environment for thepurpose of Paragraph 3.2 (c).

4.5 Where an operation provides funds toa financial intermediary to finance sub-loansto private beneficiaries such as small andmedium-sized enterprises, the procurementunder the sub-loan is undertaken by therespective beneficiaries in accordance withnormal procurement practices for privatesector operations acceptable to the Bank.Where sub-loans are made to public sectorbeneficiaries, procurement under such sub-loans must be in accordance with the Bank’sprocurement rules for public sectoroperations outlined in Section 3.

4.Procurement in private sector operations


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General

5.1 The Bank and its clients employindividuals and consulting firms to provide awide range of expert advice and consultingservices in connection with their operationsand management responsibilities. The mainconcern when choosing consultants should bethe quality of the services that are provided.The procedures for selecting consultantsand contracting for their services shouldbe flexible and transparent to ensure thatassignments can be efficiently executedwith high standards of performance, whileproviding the necessary accountability. Theprocedures described below shall be followedfor consultant contracts to be financed withthe proceeds of Bank loans under publicsector operations and for contracts withconsultants engaged directly by the Bank.For consultant contracts financed withTechnical Cooperation Funds, theseprocedures shall also be followed to theextent that they do not conflict withagreements reached with the donors forthe use of such funds.

Consultant selection procedures

5.2 The selection process for consultantsnormally involves the following steps:

a) defining the scope, objectives andestimated budget of the proposed assign-ment and determining the selectionprocedure to be followed;

b) identifying consultants that are qualifiedto perform the required services andpreparing a short list of qualified firms;

c) inviting proposals from the short-listedfirms;

d) evaluating and comparing capabilities andproposals and selecting the preferredconsultant;

e) negotiating a contract with the selectedconsultant; and

f) contract administration.

5.3 Some of these steps may be simplifiedor omitted, depending on the value of thecontract for services to be performed:

a) For contracts estimated to cost less than€50,000 with individuals or firms, aqualified consultant may be selecteddirectly, without the requirement toprepare a short list, and a contractnegotiated with the selected consultant.

b) For contracts estimated to cost €50,000 ormore with individuals, selection should bemade on the basis of an evaluation ofshort-listed, qualified candidates and therationale for the choice should berecorded.

c) For contracts with firms that are estimatedto cost €50,000 or more and less than€200,000, a short list of qualified firmsshould be prepared. The selection shouldbe based on an evaluation of the short-listed firms’ proven experience andcurrent expertise related to theassignment, without a requirement thatthe firms submit specific proposals forcarrying out the assignment.

d) Major contracts with firms estimated tocost €200,000 or more should follow a competitive procedure based on invitedproposals from a short list of qualifiedfirms.

5.Procurement of consultant services


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Short lists

5.4 Short lists of consultants shouldnormally include no less than three and nomore than six qualified and experiencedconsultants (individuals or firms, as the casemay be). The list should normally comprisea wide geographic spread of consultants,including wherever possible at least onequalified consultant from one of the Bank’scountries of operations and normally no morethan two from any one country.

5.5 No affiliate of the client shall beincluded on a short list unless it can bedemonstrated that there is not a significantdegree of common ownership, influence orcontrol amongst the client and the affiliateand that the affiliate would not be placed in aposition where its judgement in the executionof the assignment may be biased.

5.6 For large assignments with firmsestimated to cost €200,000 or more, complexor specialised assignments, or operationsinvolving a significant number of similarassignments, a formal notice solicitingexpressions of interest from qualified firmsshall be published in the Procurementopportunities section of the Bank’s Web site.The short list shall be prepared on the basisof the responses to the solicitation.

5.7 Requests for proposals, including allpublished procurement notices, shall beprepared by the client in one of the Bank’sworking languages. The Bank may requirethat requests for proposals also be preparedin another working language of the Bankwhich shall be specified in the request forproposals as the governing language.

Evaluation and selection

5.8 When formal proposals are requestedfrom a short list of firms, the invitation forproposals should clearly state the criteriafor evaluating them. The evaluation ofconsultants should normally be based only ontechnical considerations including, but notlimited to, experience in similar assignments,local experience and presence, qualificationsof key personnel proposed for the assignment,and suitability and quality of the work plan.For some assignments of a straightforwardtechnical nature, the price of the services canbe a secondary consideration but qualityshould remain the principal factor inselection. When formal proposals have beenrequested, the consultant that submits thehighest rated proposal should be invited tonegotiate a contract with the client.

5.9 Competition through a short list ispreferred; however, in some circumstances itmay be necessary or advantageous to engageor continue with a specific firm, where:

a) the firm has unique expertise orexperience; or

b) the firm has been or is involved in theearly phases of the project such as feasi-bility or design and it has been deter-mined that continuity is necessary and noadvantage would be gained from followingcompetitive procedures. Provision for suchan extension, if considered in advance,should be included in the original termsof reference and contract, which prefer-ably should have been awarded aftera competitive selection.


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In such cases a client may, with the Bank’sprior approval, invite the firm in question tosubmit a proposal and negotiate a contract.

Contract negotiations

5.10 During contract negotiations theselected consultant’s proposal may bemodified by mutual agreement between theclient and the consultant. The client shouldindicate any changes that may be desirable inthe scope of services and in the staffingproposed by the consultant, and appropriateadjustments in the price of services shouldthen be agreed. The draft final contractshould be presented to the Bank for reviewbefore signing.

Contract administration

5.11 As in the case of other contracts inBank-financed projects, the client isresponsible for managing and administeringthe consultant’s work to ensure highperformance standards, authorising payments,making contract changes as may be needed,resolving claims and disputes, ensuringtimely and satisfactory completion of theassignment and evaluating the performanceof consultants.

Bank review

5.12 Where consultants are being engagedby a client, the qualifications, experienceand terms and conditions of employmentshall be satisfactory to the Bank. The Bankwill review the proposed scope of servicesand terms of reference, the proposed short listof firms, the recommendation for consultantselection and the final contract to ensure that

the assignment is eligible for Bank financing.The review procedures are described inAnnex 1. Consultancy contracts estimated tocost €200,000 or more should normally besubject to the Bank’s prior review. The LoanAgreement will specify the contracts subjectto review. The Bank will also require anevaluation by the client of the consultant’sperformance.

5.13 If the Bank finds that the procurementor administration of a contract has not beencarried out in accordance with the agreedprocedures, the contract would no longer beeligible for financing with the proceeds of theloan and the outstanding portion of the loanallocated to the contract would be cancelled.


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Contracts for goods, works andservices

1. For all contracts which, in accordancewith the legal documents, are subject to theBank’s prior review:

a) prior to an invitation to prequalify ortender, the client shall submit thecomplete prequalification or tenderdocuments to the Bank for its review andconcurrence;

b) prior to finalising a prequalification list orawarding a contract, the client shallsubmit a detailed prequalification ortender evaluation report setting forth thespecific reasons on which the recommen-dation to prequalify firms or award thecontract is based, to the Bank for itsreview and concurrence; and

c) one conformed copy of the contract shallbe furnished to the Bank prior to thesubmission of a withdrawal application inrespect of such contract.

2. For contracts not subject to prior review,the client shall furnish to the Bank, prior tothe submission of a withdrawal application inrespect of such contract, a conformed copy ofsuch contract, together with a tender evalua-tion report for its review and concurrence.

Contracts for consultant services

3. For all contracts which, in accordancewith the Loan Agreement, are subject to theBank’s prior review:

a) prior to an invitation to submit proposals,the client shall submit the proposed shortlist of firms, the scope of services andterms of reference and the evaluation

criteria for the assignment, to the Bank forits review and concurrence;

b) prior to inviting a selected firm for negoti-ations, the client shall submit a detailedevaluation report setting forth the specificreasons on which the recommendation toselect the successful firm for negotiationsis based, to the Bank for its review andconcurrence; and

c) one conformed copy of the contract shallbe furnished to the Bank prior to thesubmission of a withdrawal application inrespect of such contract.

4. For contracts not subject to prior review,the client shall furnish to the Bank, prior tothe submission of a withdrawal application inrespect of such contract, a conformed copy ofthe contract, together with an evaluationreport for its review and concurrence.

All contracts

5. The client shall make such modificationsin procurement documents or reports as theBank shall reasonably request. The approveddocuments or reports shall not be materiallychanged without the Bank’s concurrence.

6. Before agreeing to any materialmodifications or waiver of the terms andconditions of a contract or granting a materialextension of the stipulated time forperformance or issuing any change order ororders (except in cases of extreme urgency)which in aggregate would increase the cost ofa contract by more than 15 per cent of theoriginal price, the client shall get the Bank’sconcurrence to the proposed modification,waiver, extension or change order.

Annex 1 – Bank review of procurement decisions


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7. If the Bank determines that the award ofa contract, the contract itself or any modifica-tion or waiver of such contract is not consis-tent with the Loan Agreement, it shallpromptly inform the client and state thereasons for such determination.

8. Upon the award of any contract to befinanced by the Bank, the Bank may publisha description of such contract, the name andnationality of the party to which the contractwas awarded and the contract price.


Purpose

1. This annex provides guidance to potentialtenderers wishing to compete in Bank-financed procurement for goods, works andservices and concessions in accordance withSection 3 and for consultant services inaccordance with Section 5.

Responsibility for procurement

2. The client is responsible for all aspects ofthe procurement of contracts in accordancewith Section 3. It invites, receives andevaluates tenders and awards the contract,which in all cases is concluded between theclient and the supplier, contractor orconcessionaire. The client is also responsiblefor all aspects of the procurement of contractswith consultants engaged by the client inaccordance with Section 5. The Bank isresponsible for the procurement ofconsultants in accordance with Section 5engaged by the Bank itself.

The Role of the Bank in procurement

3. The Bank reviews the procurementprocedures, documents, tender evaluationreports, award recommendations and finalcontracts to ensure that the tendering processis carried out in accordance with agreedprocedures, as required in the LoanAgreement. In the case of major contracts(defined usually as those exceeding aparticular euro threshold established in eachLoan Agreement), the documents are to bereviewed by the Bank prior to their release. Ifat any time in the procurement process (evenafter award of contract), the Bank concludesthat the agreed tendering or contractadministration procedures were not

substantially followed in any materialrespect,15 the Bank may also declare that thecontract is no longer eligible for Bankfinancing, consistent with Paragraphs 3.36and 5.13. However, if the client hasproceeded to award such a contract afterissuance of the Bank’s no objection, the Bankwill declare the contract to be ineligible forBank financing if it determines that its noobjection was based on incomplete,inaccurate or misleading information aboutthe procurement process furnished by theclient, or if it determines that the client or thesuccessful tenderer has engaged in corrupt orfraudulent practices. The Bank may alsodeclare a contract or a portion of it to beineligible for Bank financing if, during theadministration of the contract, it appears thatit has not been carried out in accordance withthe agreed procedures, consistent withParagraphs 3.33 and 5.11, or if it determinesthat either the client or the successfultenderer has engaged in corrupt or fraudulentpractices.

4. The Bank has published several StandardTender Documents (STDs) for various types ofprocurement. As stated in Paragraphs 3.15and 3.24, clients should use these documentswhen they prepare specific tender documentsfor each type of procurement, with minimumchanges and additions to address country,project and contract-specific issues andrequirements.

Information on tendering

5. Information about tendering opportunitiesbeing procured through open tenderingprocedures in accordance with Paragraph 3.9may be obtained from General Procurement

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Annex 2 – Guidance to tenderers

15 The judgement as to whether a procedural or other deviation is considered “material” or “critical” will be made exclusively by theBank based on a reasonable assessment of all the facts in each case.


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Notices and Specific Invitations to pre-qualify or tender, as described in Paragraphs3.7 and 3.8. General guidance on how toparticipate, as well as advance information onbusiness opportunities in upcoming projects,may be obtained in the Procurementopportunities section of the Bank’s Web site(www.ebrd.com), which also containsinvitations for expressions of interest for largeconsultant contracts, in accordance withParagraphs 5.6 and 5.7.

Guidance for tenderers

6. Once a tenderer receives a pre-qualification or tender document, thetenderer should first study the documentscarefully to decide if it can meet the keytechnical, commercial and contractualrequirements and conditions. Failing that, theeffort and cost of preparing and submitting atender would not be justified. The tenderershould next critically review the documentsto see if there is any ambiguity, omission orinternal contradiction, or any feature in thetechnical specifications or elsewhere whichare unclear or appear discriminatory orrestrictive. If so, it should seek clarificationfrom the client, in writing, within the timeperiod specified in the tender documents forseeking clarifications. Requests forclarification should be copied to the Bank.

7. The criteria and methodology forselecting the successful tenderer are definedin the tender documents, usually in theInstructions to Tenderers (ITT). If these arenot clear, or if there are apparent ambiguitiesor inconsistencies between the criteria andmethodology set forth in the ITT and othersections of the tender documents, e.g. the

technical specifications, clarification shouldbe similarly sought from the client. It shouldbe emphasised that the specific tenderdocuments issued by the client govern eachtender process, as stated in Paragraph 3.30.If a tenderer feels that certain tenderdocument provisions are inconsistent with theBank’s Procurement Policies and Rules, itshould raise this directly with the client,copying the Bank on the query.

8. The tenderer should raise any issue ofambiguity, contradiction, omission or anyother issues of this nature prior to thedeadline for submission of requests forclarifications, if any, specified in the ITT, toassure submission of a fully responsive andcompliant tender, supported by all thenecessary documents. Non-compliance withcritical technical and/or commercialrequirements will result in rejection of thetender.16 Therefore, if a tenderer wishes todeviate from a non-critical requirement orpropose an alternative solution, and nospecific guidance is provided in the ITT inthis regard, in order to be consideredresponsive it must submit a tender that isfully compliant with the tender documents inevery respect, and separately indicate theadjustment in price associated withacceptance of the deviation or alternativesolution. Once tenders are received andpublicly opened, a tenderer will not berequired or permitted to change the price orsubstance of its tender.

Confidentiality

9. As stated earlier, the process of tenderevaluation shall be confidential until thenotification of award is made. This is

16 In its review of client evaluation reports (see Annex 1), the Bank will, among other things, before giving its no objection, examinethe grounds for any rejection related to “substantial non-compliance” or “material” or “critical” deviations.


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essential to enable the reviewers of the clientand Bank to carry out their work withoutimproper interference, and in recognition ofthe negative impact that release of certaintender information might have in the market.If at this stage, a tenderer wishes to bringadditional information to the notice of theclient, of the Bank, or both, it should do so inwriting. As pointed out in the last sentence ofParagraph 8 of this Annex, however, noassurance can be given that such additionalinformation will be considered in theevaluation.

Procurement queries and complaints(procurement by client)

10. As recommended above, tenderers areinvited to send to the Bank copies ofcorrespondence with the client on issues andquestions relating to the tendering process, orto write to the Bank directly when the clientdoes not respond promptly or when tendererswish to complain about the client’s or theBank’s handling of the procurement process.All such communications should beaddressed to the Director of the BankingDepartment Team responsible for the projectand copied to the Director of the Procurementand Technical Services Unit (PTSU).Correspondence received by the Bank priorto the closing date for submission of tenderswill normally be referred to the client foraction or response, along with comments asappropriate.

11. Communications received after theopening of tenders will be handled as follows.In the case of contracts not subject to priorreview by the Bank, the communication willbe sent to the client for due considerationand appropriate action, if any. These will be

reviewed during subsequent monitoring of theproject by Bank staff. In the case of contractssubject to prior review, the Bank willexamine the issue in consultation with theclient before the evaluation is completed.If additional information is required, it willbe obtained from the client. If information orclarifications are required from the tenderer,the Bank will ask the client to obtain it andtake it into account, as appropriate, in theevaluation report. The Bank will not completeits review until the issues raised in thecommunication are fully examined andconsidered.

12. Except for acknowledgement of receipt,the Bank will not enter into discussions orcorrespondence with any tenderer relating tothe details of an ongoing evaluation duringthe actual evaluation and review process ofthe tender, until notification of award hasbeen made.

Procurement queries and complaints(procurement by the Bank)

13. Requests for clarification concerningdocuments issued by the Bank in connectionwith consultant contracts procured by itself inaccordance with Section 5 should beaddressed to the staff member named for thecontract in the Procurement opportunitiessection of the Bank’s Web site. Complaintsabout the procurement process for suchcontracts should be addressed in writing tothe Director of the PTSU.

Debriefings

14. If, after notification of award, a tendererwishes to ascertain the grounds on which itstender was not selected, it should address itsrequest to the client, with a copy to the Bank.


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If the client refuses the request, or if thetenderer is not satisfied with the explanationgiven and wishes to discuss the matter withthe Bank, it may ask the Director of thePTSU to arrange a formal debriefing, copyingthe request to the Director of the BankingDepartment Team responsible for the project.In the case of consultant contracts procuredby the Bank, the request should be addressedto the Operation Leader for the contract, withcopies to the Head of the ConsultantsServices Unit and the Director of the PTSU.The Bank will arrange a meeting at theappropriate level and with the relevant staff.In this discussion, the relative strengths andweaknesses of the tender submitted and anyother appropriate information necessary forthe tenderer to better understand how it canimprove its future chances of success will bediscussed.


In May 2007, the Bank’s Board of Directors approved amendments to paragraph 2.9 of the Bank’s Procurement Policies and Rules. The amendments reflect the IFI’s “Uniform Framework for Preventing and combating Fraud and Corruption” and provides a set of definitions for corrupt, fraudulent, coercive and collusive practices.

Paragraph 2.9 (page 3) in the Bank’s Procurement Policies and Rules, published August 2000, is therefore obsolete (deleted in the internet version) and is replaced by the following:

Fraud and corruption

2.9 It is the Bank’s policy to require that clients (including beneficiaries of Bank loans), as well as tenderers, suppliers, contractors, concessionaires and consultants under Bank-financed contracts, observe the highest standard of ethics during the procurement and execution of such contracts.

In pursuance of this policy, the Bank defines, for the purposes of this provision, the terms set forth below as follows:

“corrupt practice”i) means the offering, giving, receiving, or soliciting, directly or indirectly, anything of value to influence improperly the actions of another party.

“fr audulent practice”ii) means any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a party to obtain a financial or other benefit or to avoid an obligation.

“coercive practice”iii) means impairing or harming, or threatening to impair or harm, directly or indirectly, any party or the property of the party to influence improperly the actions of a party.

“collusive practice”iv) means an arrangement between two or more parties designed to achieve an improper purpose, including influencing improperly the actions of another party

The Bank, in respect of the procurement of goods, works and services governed by Section 3, the selection of concessionaires pursuant to Paragraph 4.4, and the selection of consultants governed by Section 5:

will reject a proposal for award if it a) determines that the supplier, contractor, concessionaire or consultant recommended for award has engaged in corrupt, fraudulent, coercive or collusive practices in competing for the contract in question;

will cancel the portion of the Bank financing b) allocated to a contract for goods, works, services or concessions if it at any time determines that corrupt, fraudulent, coercive or collusive practices were engaged in by representatives of the client or of a beneficiary of the Bank financing during the procurement or the execution of that contract, without the client having taken timely and appropriate action satisfactory to the Bank to remedy the situation;

will declare a firm ineligible, either c) indefinitely or for a stated period of time, to be awarded a Bank-financed contract if it at any time determines that the firm has engaged in corrupt, fraudulent, coercive or collusive practices in competing for, or in executing, a Bank-financed contract;

reserves the right, where a client or a firm d) has been found by a judicial process or other official enquiry to have engaged in corrupt, fraudulent, coercive or collusive practices,

to cancel all or part of the Bank financing v) for such client; and

to declare that such a firm is ineligible, vi) either indefinitely or for a stated period of time, to be awarded a Bank-financed contract; and

e) will have the right to require that, in contracts financed by the Bank, a provision be included requiring suppliers, contractors, concessionaires and consultants to permit the Bank to inspect their accounts and records relating to the performance of the contract and to have them audited by auditors appointed by the Bank.

Amendment to Paragraph 2.9 of the EBRD’s Procurement Policies and Rules