Failure to plan and allow sufficient time for a competitive procurement process will not constitute a single sourcing unforeseeable situation.

Transcription

1 Title: Non-Competitive, Single and Sole Sourcing Processes Policy Procedure SOP Category: Corporate Services & Operations Dept/Prog/Service: Purchasing Approved: Exec. VP, Corporate Services & Operations Signature: No. Distribution: Organization Wide Approval Date: Dec, 2010 Reviewed/Revised Date: Oct. 7, 2014 Next Review Date: Oct, 2017 CROSS REFERENCES: ADMIN-04 Hospital Wide Record Retention, ADMIN-21 Approval Authority, PUR- 09 Purchasing Procedures and Contract Management and PUR-10 Competitive Procurement Processes 1. PURPOSE The purpose of this policy is to inform management of the processes and limited circumstances under which non-competitive procurement is allowed. 2. POLICY STATEMENT TBRHSC management and staff will only enter into non-competitive procurement processes when an Agreement on Internal Trade (AIT) or other trade agreement qualifying exemption, exclusion, or nonapplication clause, or single or sole source situation exists. The General Manager, Northwest Supply Chain (GM NSC) or designate and Executive Vice President, Corporate Services and Operations (EVP CSO) will review and verify that a qualifying exemption, exclusion or situation exists and make any final determination, prior to seeking approval for the commencement of any non-competitive procurement. For purposes of this policy the GM NSC must designate a Purchasing representative and/or an internal expert in supply chain to act as his designate for determining non-competitive situations in his absence in consultation with the EVP CSO. Due to the craft knowledge requirements in making the determination, the next level of authority must not override unless both parties mutually agree. Failure to plan and allow sufficient time for a competitive procurement process will not constitute a single sourcing unforeseeable situation. Prior to the commencement of any non-competitive non-consulting procurement there will be written approval by the approval authority one level higher than indicated for the total value of the procurement on the supporting documentation for the non-competitive procurement. For information on approval authority thresholds refer to ADMIN-21 Approval Authority. Prior to the commencement of any non-competitive procurement for Consulting Services there will be written approval on the supporting documentation for the non-competitive procurement by the President and CEO for procurement values less than $1,000,000 and by the Board of Directors for procurement values of $1,000,000 or more. The signed non-competitive supporting documentation and all other related procurement documents will be retained by Purchasing in a referenced, retrievable, file for a minimum period of seven (7) years. For more information on record retention refer to ADMIN-04 Hospital Wide Record Retention. 3. SCOPE Management or department manager refers to the most responsible administrator, whether manager or director or vice-president, for the department or area the supply or service is intended and compliant with functional centre mandates and accountability. Goods or services/goods and services means any goods, equipment, construction, and services, including but not limited to Information Technology and Consulting Services. This material has been prepared solely for use at Thunder Bay Regional Health Sciences Centre (TBRHSC). TBRHSC accepts no responsibility for use of this material by any person or organization not associated with TBRHSC. No part of this document may be reproduced in any form for publication without permission of TBRHSC. A printed copy of this document may not reflect the current electronic version on the TBRHSC intranet. Page 1 of 5

2 Non-Competitive, Single and Sole Sourcing Processes Page 2 of 5 4. DEFINITIONS Agreement on Internal Trade (AIT) is an intergovernmental agreement that came into force in 1995 to foster improved interprovincial trade by addressing obstacles to the free movement of persons, goods, services and investments within Canada. Competitive Procurement is a set of formal procedures for developing a procurement contract through an invitational, bidding or proposal process. The intent is to solicit fair, impartial competitive bids. Consulting Services is the provision of expertise or strategic advice, thinking, guidance, assessment without implementation or plans that is presented for consideration and decision-making, by person or entity under an agreement, other than an employment agreement. "Management" refers to all management positions including members of the Board of Directors, Senior Management Council, Executives, Officers, Medical Directors, Administrative Directors, Managers and all positions with delegated authority and/or involved with procurement, business transactions or contractual obligations. Procurement means acquisition by any means, including by purchase, rental, lease or conditional sale, of goods and services. Requisition A formal request to obtain goods or services made within an organization, generally from the end user to the procurement department. Requisitioner The most responsible administrator or designate making a formal request to obtain goods or services within an organization and representative of the end user. Single Sourcing A non-competitive method of procurement of goods or services from a supplier in situations where there is or may be another supplier or suppliers capable of delivering these goods or services. Sole Source The use of a non-competitive procurement process to acquire goods or services where there is only one available supplier for the source of the goods or service. 5. PROCEDURE Process Steps Typical non-competitive procurement consists of the following steps: 1. Purchase Need Identified 2. Planning (Determining procurement scope, method and timelines) 3. Requirements (Defining specifications and signing off) 4. Internal Compliance (Confirming processes and all steps comply with TBRHSC policy, procedure and BPS Procurement Directives) 5. Quote (Obtain documented quote and other details, only after internal and BPS compliance has been confirmed) 6. Evaluation 7. Agreement 8. Award Notification 9. Document Retention Planning Procurement planning is an integral part of the procurement process and management must allow sufficient time for annual planning of procurement activities as well as for individual procurements. Management will plan and sufficiently consider the goods and services necessary to meet business requirements, opportunities to aggregate purchases, potential supply sources, procurement methods, necessary approvals and overall time required to complete the procurement process.

3 Non-Competitive, Single and Sole Sourcing Processes Page 3 of 5 Failure to plan and allow sufficient time for a competitive procurement process will not constitute a single sourcing unforeseeable situation. Internal Compliance For all Consulting Services and potential non-competitive procurements Management will work with a Purchasing representative to complete form NSC-46: Procurements Contracts > $100,000 and all Consulting Services Approval Authority. For clinically sensitive goods, the completed form will contain documented risks and/or other criteria attested to by the Medical Director or delegated Physician lead and submitted to GM NSC. The completed form NSC-46 will indicate the potential allowable exception(s) to competitive procurement for consideration by the GM NSC. The GM NSC, or designate, must formally establish applicability of the exception or exemption clause in conjunction with the EVP CSO. Once the GM NSC or designate and EVP CSO verifies a non-competitive procurement situation, the NSC-46 form must be authorized by one level higher than the approval authority for the total procurement value. Where the non-competitive procurement is for Consulting Services the approval must be President and CEO for values less than $1,000,000 and Board of Directors if $1,000,000 or more. At all times the approval level must be higher than the Requisitioner. Careful consideration must be made of who the Requisitioner is and the function or mandate served, benefiting, by the specified goods or services. Refer also to ADMIN-21 Approval Authority. Single Sourcing A single source situation may exist: Where an unforeseeable situation of urgency exists and the goods or services cannot be obtained in time by means of open procurement. An example of an unforeseeable situation is an unanticipated equipment failure. Failure to plan and allow sufficient time for a competitive procurement process does not constitute an unforeseeable situation of urgency. In the absence of a receipt of any bids in response to a call for proposals or tenders made in accordance with policy. Where construction materials are to be purchased and it can be demonstrated that transportation costs or technical considerations impose geographical limits on the available supply base, specifically in the case of material used in the construction or repair of roads; Where a contract is to be awarded under a cooperative agreement that is financed, in whole or in part, by an international cooperative organization to the extent that the agreement between TBRHSC and the organization includes rules for awarding contracts that differ from those in the Broader Public Sector (BPS) Procurement Directive; Where compliance with the open tendering provision set out in BPS would interfere with TBRHSC s ability to maintain security or order or to protect human, animal or plant life or health; Where goods or services regarding matters of a confidential or privileged nature are to be purchased and the disclosure of those matters through an open tendering process could reasonably be expected to compromise TBRHSC or government confidentiality, cause economic disruption or otherwise be contrary to the public interest. Sole Sourcing The GM NSC, or designate and EVP CSO may verify a sole sourcing situation where only one supplier is able to meet the requirements of a procurement in the circumstances listed below provided that they do not do so for the purposes of avoiding competition between suppliers or to discriminate against suppliers:

4 Non-Competitive, Single and Sole Sourcing Processes Page 4 of 5 To ensure compatibility with existing products, to recognize exclusive rights, such as exclusive licences, copyright and patent rights, or to maintain specialized products that must be maintained by the manufacture or its representative; Where there is an absence of competition for technical reasons and the goods or services can be supplied only by a particular supplier and no alternative or substitute exists; For the procurement of goods or services the supply of which is controlled by a supplier that is statutory monopoly; For the purchase of goods on a commodity market; For work to be performed on or about a leased building or portions thereof that may be performed only by the lessor; For work to be performed on property by a contractor according to provisions of a warranty or guarantee held in respect of the property or original work; For a contract to be awarded to the winner of a design contest; For the procurement of a prototype of a first good or service to be developed in the course of and for a particular contract for research, experiment, study or original development, but not for any subsequent purchases; For the purchase of goods under exceptionally advantageous circumstances such as bankruptcy or receivership, but not for routine purchases; For the procurement of original works of art; For the procurement of subscriptions to newspapers, magazines or other periodicals; and For the procurement of real property. Non-Application of Trade Agreements The GM NSC, or designate and EVP CSO may verify a non-competitive situation where a nonapplication clause exists under the AIT or other trade agreement. Considerable craft knowledge is required in making this judgment and the GM NSC or designate and EVP CSO must formally establish applicability of the clause with the most current amendments to the trade agreements. Examples of non-application clauses (subject to change) include: Procurement of goods intended for resale to the public; Procurement from philanthropic institutions, prison labour or persons with disabilities; Procurement of goods and services related to cultural or artistic fields Procurement of services that in Ontario may, by legislation or regulation, be provided only by specified licenses professionals Evaluation and Agreement Even in non-competitive procurement an appropriate evaluation must take place prior to establishing an agreement. Ensure specifications are met, evaluate price/cost, evaluate other details such as delivery, product evaluation and conduct reference checks. Similar to other procurement methods, all staff involved must sign a non-disclosure agreement and conflict of interest disclosure. The resulting agreement must include appropriate cancellation and/or termination clauses, term, any options for extensions and a signed contract must be in place before the provision of the goods or services commences. For more information refer to PUR-09 Purchasing Procedures and Contract Management and PUR-10 Competitive Procurement Procedures. Document Retention The signed non-competitive supporting documentation, the agreement and all other related procurement documents will be retained by Purchasing in a referenced, retrievable, file for a minimum period of seven (7) years. For more information on record retention refer to ADMIN-04 Hospital Wide Record Retention. 6. RELATED PRACTICES AND/OR LEGISLATIONS The Agreement on Internal Trade (AIT) July 1995 with protocols of amendment to 2012 Broader Public Sector Accountability Act, 2010 Broader Public Sector Procurement Directive, July 2011

5 Non-Competitive, Single and Sole Sourcing Processes Page 5 of 5 7. REFERENCES Broader Public Sector Accountability Act, Broader Public Sector Expenses Directive Part IV Expense Claims Allowable Expenses Broader Public Sector Procurement Directive, July 2011 Mandatory requirements 2, 3, 21, 23 and definitions