6.1: Execution of the Public Procurement Procedure
A transparent public administration implies the development of skills for conducting projects and investments in the interest of the community. Of all government activities, public procurement is the activity most vulnerable to corruption, having a fundamental role in the economic development of states.
The public procurement process aims to create the framework required for conducting the procurement or investment process in the field of public services (Băşanu & Pârjol, 1998); at the same time, this process ensures the disbursement of the funds distributed to the contracting authorities and public institutions. These authorities and institutions must manage such funds so that, throughout the year, they might properly conduct their activity. The public procurement process is a sequence of stages, and after going through them, the product, service or work is obtained as a result of the awarding of the public procurement contract.
Main Stages of the Procurement Procedure
After elaborating on the procurement plan, the execution of the procurement procedure is initiated. The main stages that need to be run through are the following:
Notice of Intent
The notice of intent is obligatorily submitted for publication when one is trying to benefit from the reduced deadlines and implicitly from the duration of the execution of the process. If the contracting authority does not want to reduce the deadlines, then the publication of the notice of intent is optional. For the products and services agreements, the notice of intent is submitted for publication as soon as possible after the fiscal year starts. For the service agreements or the framework agreement, the notice of intent is submitted for publication as soon as possible after the approval of the public procurement plan where the respective works agreement or framework agreement is provided.
Why publish the notice of intent? To reduce the deadlines for drawing up the tenders when using open tendering and selective tendering (if subject to one or more international trade agreements). Posting is not required if using limited tendering but is still recommended.
When is it published? As soon as possible after the fiscal year starts or as soon as possible after the approval of the program where the service agreement or the framework agreement is provided.
Where is it published? The Official Government of Canada Government Electronic Tendering Service (GETS) and MERX Canadian Public Tenders.
What does it contain? Information provided includes a detailed description of the solicitation, trade agreements, closing date/time, and any specific conditions. Standard Form — Notice of Proposed Procurement Template.
Awarding Method
The awarding methods of the public procurement agreement are traditional methods (open tendering, restricted tendering, competitive dialogue, negotiation with a previous participation notice, negotiation without a previous participation notice, call for tenders, solution bid, direct procurement) and special methods (framework agreement, the dynamic procurement system, electronic tendering).
In terms of the procurement framework for each individual type of solicitation, the detail is presented in Table 1.
| Method of Supply | Requirements |
|---|---|
| Contracts above $25,000 | Over $25,000 for goods and over $40,000 for services and construction can be published on GETS.
Up to $100,000 of services, property consulting, and construction can be published on various databases (such as ProServices and SELECT) |
| Contracts below $25,000 | If below $25,000, procurement officers or buyers may request quotations from suppliers directly.
Suppliers may be selected from the Supplier Registration Information system, where government buyers identify approved suppliers. |
| Standing offers and supply arrangements | Non-binding agreements between the federal government and potential suppliers. Terms and conditions are outlined and apply to any future requirements.
Various types of Standing Offers and Supply Arrangements (SOSA) are posted on CanadaBuys. |
| Non-competitive procurement process |
|
| Advance Contract Award Notice (ACAN) | ACAN is a public notice published on GETS for a minimum of 15 calendar days, indicating to the supplier that a department intends to award a contract for goods/services. It is believed that only one supplier is capable of performing the work. If no other supplier submits a statement of capabilities, the contract is then awarded. |
The Elaboration of the Awarding Documentation
The awarding documentation contains all the requirements including the Statement of Work (SOW), rules, and information regarding the object of the agreement and its awarding procedure, including the tender book or, where appropriate, the descriptive documentation. The awarding documentation contains the formal, technical, and financial requirements that describe the object of the agreement. The financial officer will elaborate on their tender based on this information. The responsibility for the elaboration of the awarding documentation belongs to the internal department of the contracting authority, which specializes in awarding public procurement agreements.
The structure of the awarding documentation must contain the procurement data sheet, the tender book, or, where appropriate, the descriptive documentation, the proposal agreement, forms and examples. The awarding documentation should not contain conflicting information and information that contravenes the stipulations in the participation notice or procurement policy and procedures.
Call for Competition
To ensure transparency in the awarding of the public procurement agreements, the contracting authority, whenever it wishes to award a public procurement agreement or to conclude a framework agreement, has the obligation to publish a tender notice or an invitation to tender, according to the procedure being applied.
Why publish the notice of tender? Where a trade agreement covers a procurement, the procedural obligations of the trade agreement must be followed. Procedural obligations of the trade agreements are aimed at ensuring compliance with the general principles of open, transparent, and competitive tendering.
When is it published? It must be posted for at least 25 calendar days before any bid solicitation(s). If there is a state of urgency, this period may be reduced to no less than 10 days.
Where is it published? It is published on the official Government of Canada sites like the Government Electronic Tendering Service (GETS) and MERX Canadian Public Tenders.
What is the content of the notice? Description of goods or services, condition for participation, methods of procuring, the entity’s contact information, period of validity, and any trade agreements that apply.
For the application of the procedures for restricted tendering, competitive dialogue or negotiation with publication of a notice, the notice of tender for the candidates’ selection/pre-selection stage must contain selection/pre-selection criteria, applicable rules, minimum number of applicants to be selected or pre-selected, maximum number of suppliers to be selected or pre-selected, deadline and location for submission of applications.
Presentation of the Application and Tender
Application includes the documents by means of which the supplier demonstrates their current state of business, competency to conduct their professional activity, economic and financial situation, and technical and professional competency. The application is required to obtain the invitation to tender for the subsequent submission of the tender for cases where a restricted tendering, negotiation, or competitive dialogue procedure is applied.
The tender represents the document by means of which the supplier expresses their willingness to legally commit to a public procurement agreement. Any tender can be amended before the deadline for the submission of tenders. The definitive elements of the tender are the financial proposal, the technical proposal and the qualification documentation. The tender is elaborated in accordance with the provisions in the awarding documentation and must be complete, decisive, real and serious. A variation of the tender is represented by the alternative tender, the tender that can deflect to a certain extent from the tender book requirements. This can be submitted along with the main tender only in cases where the awarding criterion is “the most economically advantageous tender” and only if the contracting authority allows this by the instrumentality of notice of tender (Fundătură et al., 1992). The alternative tender must meet the minimum requirements provided in the tender book in terms of quality solutions and requirements. The alternative tenders can deflect from the provisions of the tender book if they meet the minimum provided requirements and offer more favourable conditions for the contracting authority.
Regarding the presentation of the tender and application, they are submitted in original and in a number of copies if the Procurement data sheet requires this. Copies of applications/tenders are necessary for the committee members for the evaluation process. In the event of a discrepancy between the original and the copies, the original prevails.
The documents issued by official institutions/bodies empowered to that effect must be signed and sealed according to the legal provisions. Any deletion, addition, underlining or superposed writing is valid only if approved by the person/persons authorized to sign the tender. Generally, supplier questions must be submitted in writing prior to the tender’s due date. In some cases this information is included in the tender schedule as the question submission date. Failure to comply with these requirements may result in a bid being declared non-responsive or disqualified.
The Awarding Procedure
The application selection is performed by applying selection criteria. The suppliers are selected using objective and non-discriminatory criteria relating only to technical, economic, and financial competency. The supplier can submit the tender using the preferred method either electronically, by mail, or directly at the specified address; or a combination of these methods as outlined in the tender instructions.
The evaluation committee has the obligation to perform the examination and evaluation activities only at the contracting authority’s headquarters (the buyer’s facility) (Taylor & Smidt, 1970). The evaluation committee has the obligation to establish the winning tender between the admissible tenders based on applying the criterion for awarding the public procurement agreement.
Signing the Agreement
The awarding procedure of the agreement is completed by signing the agreement. The provisions in the tender regarding the technical and financial proposals, the agreement performance chart, the payments chart, and the bank guarantee execution, where appropriate, become an integral part of the agreement to the extent that they do not affect the mandatory provisions. If parts of the public procurement agreement are to be performed by one or more subcontractors, then the contracting authority must solicit, upon the conclusion of the agreement, the submission of agreements concluded between the future contractor and the designated subcontractors.
Execution of the Agreement
The agreement becomes effective either subsequent to the constitution of the performance bond, if it was requested, or at the deadline agreed by the Parties.
The execution of the agreement must be performed so that the Parties fulfill their obligations in good faith, both quantitatively and qualitatively, at the deadline established in the contract (Delaney et al., 1998). Throughout the execution of the agreement, various activities can be undertaken: announcing the vendor or contractor on the startup of the activity; monitoring the contained activities for compliance with stipulations in the agreement (verifying the quality standards, the quantities, the objectives and the established period); documentation for the acceptance of deliveries; monitoring the expenditure, ensuring the availability of funds; verifying the accuracy of invoices and approving the invoices for payments; verifying amendment requests and/or the agreement renewal in time; verifying if all activities are completed and accepted by the direct beneficiaries before the agreement’s expiry date; announcing the specialized department in case of disputes/litigations; performing termination of the agreement; performing an updated audit report on the agreement administration.
Completion of the Agreement
The partial and/or final reception means the operation whereby the contracting authority expresses its consent on the products, services and works resulting from a public procurement agreement and based on which the payment is performed. Usually, after the final reception, the last payment or the final release of the agreement performance bond is performed. Reception is performed by a reception committee. The reception committee has the obligation to determine the stage and fulfilment of the obligations under the agreement (Basanu & Pricop, 2001).
For the reception of works agreements, the contractor shall ensure that on the reception date, the performed work will present the qualities declared by them in the agreement, will comply with the technical regulations in force and will not be affected by flaws which would decrease or cancel its value of usability according to the normal conditions of use or to those specified in the agreement.
Checkpoint 6.1
Attributions
“6.1: Execution of the Public Procurement Procedure” is adapted from “Execution of the Public Procurement Procedure” (2011) by Eduard Armeanu from the International Journal of Business and Management and is used under a Creative Commons Attribution 4.0 License.
The multiple choice questions in the Checkpoint boxes were created using the output from the Arizona State University Question Generator tool and are shared under the Creative Commons – CC0 1.0 Universal License.
A legal, written paper that warns you that if you do not take a certain action by a certain time, the person or agency who wrote the letter will take action against you legally.
The act of offering, or attempting to purchase, goods and/or services.
The stage in the procurement plan where the execution of the procurement procedure is initiated.
