UNICEF s Procurement Processes and Tendering for Diagnostics Joint UNICEF, UNFPA and WHO Meeting with Manufacturers and Suppliers UN City, Copenhagen Presented by: Lama Suleiman 23 September 2014 Contracts Manager Unicef Supply Division 1
Guiding Principles of UNICEF s procurement process Promotion of objectives of UNICEF (fulfilling the mandate, goals and objectives) Fairness, integrity and transparency through competition (clear & appropriate regulations/rules applied to all suppliers, fair process, equal treatment of suppliers, transparent system, public bid opening, public Notification of awards including pricing, Individual Post award debriefings offered to all bidders) Economy and effectiveness (meet requirement in terms of quantity, quality, timeliness at the right place. Economy=minimize cost, Effectiveness=meet enduser interest) Best value for money (Consider the optimum combination of factors in meeting the end user needs; BVM does not mean lowest cost but best ROI) 2
Regulatory Framework governing UNICEF procurement process Financial Regulations and Rules (FRR), Article XII. Internal Control Financial and Administrative Policy, e.g. Policy 1 Internal Controls Policy 5 Cash Disbursements, Supplement 6 on CRC Executive Directives, e.g. Anti-Fraud Policy, Whistle Blower Policy Supply Directives e.g. Supply Division Commitment Supply Manual: Procurement Guidelines & Procedures Guiding Procurement Principles 3
Examples of Controls and Oversight Internal Oversight UNICEF Financial Rules and Regulations UNICEF Procurement Procedures Ethical Code Contracts Review Committee (independent from contracting staff) Procurement Training and Certification of contracting staff External Oversight Audit UN External Audit UNICEF Internal Audit 4
To Become a UNICEF Supplier Application to become a UNICEF supplier All applications to become a supplier with UNICEF must be made via the United Nations Global Marketplace (UNGM) website http://www.ungm.org UNICEF does not do business with suppliers that have not been accepted in the UNGM. There is no charge for the UNGM service. Financial evaluation of suppliers (SEU) A financial evaluation may be carried out in order to minimise the procurement risk to UNICEF. In this respect, UNICEF may request suppliers to provide a complete copy of their audited financial statements, with comparative figures for the previous year; signed by their company's auditing/accounting firm. (All this documents are treat as a confidential 5
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Procurement Process Procurement Planning Requirement Definition Sourcing/Invitee list (REOI / UNICEF Vendor Roster / UNGM...) Preparation and Issuance of Solicitation Documents Request for Quotation (RFQ) USD 2,500 - USD 30,000 Invitation to Bid (ITB) USD 30,000 and over Request for Proposal (RFP) no threshold Receipt and Opening of Submissions Evaluation (Technical/Quality, Commercial and SEU) Adjudication & Award Recommendation Contract Finalization and Issuance Contract Management 8
Procurement process is governed by UNICEF Financial Rules and Regulations and includes segregation of duties END USER MONITORING NEEDS ASSESSMENT / REQUIREMENT DEFINITION INVOICE CERTIFICATION MARKET ANANLYSIS WHO BULK PROCUREMENT GOODS RECEIPT SOLICITATION PROCESS CONTRACT MANAGEMENT & ADMINISTRATION RECEIPT & OPENING OF OFFERS AWARD & CONTRACT FINALIZATION CONTRACTS REVIEW COMMITTEE TENDER EVALUATION 9
Procurement Workflow Requisition defined need Confirmation of Specifications Choice of solicitation method Sourcing/ Invitee list Issuance of tender Receipt of submissions Evaluation of Submissions (Technical/Financial) Adjudication & Award Recommendation Including CRC Issuing PO, Contract or LTA 10
EVALUATION of THE OFFERS Receipt of offers No Invalidation Bid opening / Bid tabulation Mandatory criteria Does not comply Not recommended Preliminary evaluation Yes Technical requirements Not Acceptable Not recommended Technical evaluation Complies Commercial terms Commercial evaluation Acceptable Adjudication 11
Evaluations have to be according to evaluation criteria and methods stipulated in the original solicitation document Criteria and methods cannot be altered throughout the evaluation process 12
Examples of screening criteria: Financial Viability. Production capacity. Non-involvement in child labour. Non-involvement in landmine production or parts there of. Adherence to Social and Environmental standards. Export experience. Developing country experience. 13
If above a certain threshold Award recommendation based on outcome of the evaluation reports SD - US$100,000 => Contracts Review Committee (CRC) CO US$50,000 14
CONTRACTS REVIEW COMMITTEE As an advisory body to authorized UNICEF officials to provide a competent, independent and unbiased review of the process leading to proposed contract award recommendations 15
What is a Long Term Arrangement (LTA)? LTA is an arrangement entered into with a supplier to secure the supply of a product or service over a period of time; Framework of mutually agreed terms and conditions (product, price, etc.) As a result of a competitive bidding process For procurement of goods, services or works for which the buyer has a repeated need Entered in good faith for a period of time Contractual obligations only commence once a purchase order is issued Could be time bound or with a projected total volume Non-exclusive Long term commercial partnership with selected supplier(s) 16
Long Term Arrangement(LTA) features 17
Long Term Arrangement(LTA) Highlights Most Favored Customer Clause Unethical Behavior Disclosure of Sanctions or Temporary Suspension Corrupt and Fraudulent Practices Guidelines on Gifts and hospitality Officials not to benefit Liquidated damages clause 18
Create Sales Most Favored ordercustomer Clause By submitting an offer the bidder certifies that UNICEF, for Long Term Arrangements / Purchase Orders / Contracts resulting from this tender, is not being charged more than other clients for similar goods (products) or services and similar quantities and within similar circumstances. 19
Create Sales order Unethical Behavior UNICEF strictly enforces a policy of zero tolerance concerning unethical, unprofessional or fraudulent acts of UNICEF bidders. Accordingly, any registered bidder that is found to have undertaken unethical, unprofessional or fraudulent activities will be suspended or forbidden from continuing business relations with UNICEF. 20
Create Sales Corrupt order and Fraudulent Practices UNICEF requires that all bidders associated with this Invitation to Bid observe the highest standard of ethics during procurement and execution of the work. In pursuance of this policy UNICEF: (a) Defines for the purpose of this provision the terms set forth as follows: (i) corrupt practice means the offering, giving, receiving or soliciting of any thing of value to influence the action of a public official in the procurement process or in the execution of a contract, and (ii) fraudulent practice means a misrepresentation of facts in order to influence a procurement process or the execution of a contract to the detriment of the client, and includes collusive practice among bidders (prior to or after bid submission) designed to establish bid prices at artificial noncompetitive levels and to deprive the client of the benefits of free and open competition; (b) Will reject a proposal for award if it determines that the selected supplier / contractor have engaged in any corrupt or fraudulent practices in competing for the contract in question; (c) Will declare a bidder ineligible, either indefinitely or for a stated period of time, to be awarded a UNICEF-financed contract if at any time it determines that it has engaged in any corrupt or fraudulent practices in competing for, or in executing a UNICEF-financed contract. 21
Create Disclosure Sales of Sanctions orderor Temporary Suspension Only suppliers found to be responsible are eligible to be awarded UNICEF contracts and/or to bid on UNICEF solicitations. To be deemed a responsible supplier with whom UNICEF will conduct business, a supplier should not be suspended, debarred, or otherwise identified as ineligible by any organization within the World Bank Group or any other International or UN Organization.Suppliers are therefore required to disclose to UNICEF whether they are subject to any sanction or temporary suspension imposed by the World Bank Group or any other International or UN Organisation. 22
Create Sales Officials order not to benefit The bidder warrants that no official of UNICEF or the United Nations has received or will be offered by the bidder any direct or indirect benefit arising from this tender or the award thereof. The bidder agrees that breach of this provision is a breach of an essential term of the Invitation to Bid. 23
Create Sales Guidelines order on Gifts and hospitality Bidders shall not offer gifts or hospitality to UNICEF staff members. Recreational trips to sporting or cultural events, theme parks or offers of holidays, transportation, or invitations to extravagant lunches or dinners are also prohibited. 24
Create Sales Liquidated order damages clause For late delivery of items or items which do not meet UNICEFs specifications and therefore rejected by UNICEF UNICEF shall be entitled to claim liquidated damages from the successful Bidder. Deduction of -0.5% of the value of the items pursuant to the Purchase Order per additional day of delay, up to a maximum of 10% of the value of the Purchase Order. 25
Create Offered Sales lead times order & prices have to be realistic FCA deliveries = the manufacturing period + transit for dispatch from the offered FCA location. UNICEF s Freight Forwarders will pick the goods from the designated FCA location. FCA prices to include packing, certifications (e.g. export licenses) and transport to FCA location if applicable 26
Supplier Performance and Monitoring Evaluating and monitoring supplier performance against their contractual obligations To minimize the risks of delivering to our customers poor quality products, of the wrong quantity and not in compliance with the agreed timeframe. Selection of invitees. * We ensure that any construed misinterpretations of data by the supplier are fully explained to them thus facilitating the continual improvement of supplier performance. 27
Inspection and Quality Aspects Pre-delivery inspection From time to time UNICEF will request for Pre delivery inspection to be done at suppliers premises. Inspections of products prior to delivery are generally carried out by UNICEF-contracted third party inspection agencies. Lot testing Prior to shipment, the supplier is requested to provide UNICEF Supply Division with a lot testing certificate from one of the two laboratories under the WHO-FIND Lot Testing Program for Malaria RDTs. For more information please consult www.wpro.who.int/sites/rdt/who_rdt_evaluation/lot_testing.html 28
UNICEF VACCINES Thank you! 29