POLICIES AND PROCEDURES ENGINEERING SERVICES DEPARTMENT

POLICIES AND PROCEDURES ENGINEERING SERVICES DEPARTMENT

VOLTA RIVER AUTHORITY Procurement (Goods, Works and Services) Engineering Services Department

ENGINEERING SERVICES DEPARTMENT POLICIES INTRODUCTION A. IDENTIFICATION DATA Policy No.: ESD/007 Document ID: PROJECT MANAGEMENT SECTION i. Subject: Procurement (Goods, Works and Services) ii. iii. Subject Area: Generation expansion and civil engineering projects Functional Responsibility: Director, ESD/Manager, Projects iv. Approval Date: [Date of Policy is Approved] B. BROAD DIRECTIVE PRINCIPLES i. POLICY STATEMENT: To undertake the procurement of Goods, Works and Services for the Authority for generation expansion and civil engineering projects. ii. POLICY RATIONALE/OBJECTIVES: To adopt a procurement process which is transparent, open and fair to all competitors and also ensures that the Authority obtains the most competitive offer for contract to be executed and is in compliance with the Public Procurement Act 663 and procurement guidelines of funding agencies and such other relevant statutes and rules. iii. SCOPE OF APPLICATION: Generation expansion and civil engineering projects C. IMPLEMENTATION PROCEDURES: ESD/007/001 Seek executive approval of the type of Tendering process to be adopted in accordance with the VRA practice and in compliance with the Public Procurement Act 663 which may be one of these (3) options: Open/Competitive Restricted/Selected Negotiated

Open/Competitive bidding shall as far as possible be adopted on international or national competitive basis and all interested eligible parties allowed to submit tenders. Notices advertising the works shall be placed in two (2) circulated newspapers in at least two (2) insertions and in the National Procurement Bulletin. Restricted/Selective bidding shall be adopted based on nature of the works/goods i.e. if works/goods are of a specialised nature and time constraints and only those parties invited may submit tenders. These parties may have also done similar specialised jobs for the authority and their competence and performance adequately tested. Except for the mode of the Invitation, the other requirements shall be as for competitive bidding. In Negotiated Contracts, VRA contracts parties of its choice and negotiate the terms of the contract with one or more of them. The works procurement process or the tendering procedure to be adopted has to be approved by the VRA Management even for an extension/or another phase of an on-going contract. Preparation of Bidding Documents The appropriate bidding document shall be prepared to invite bids from eligible prospective bidders. The bidding document shall be based on an approved standard bidding format and shall contain (as applicable): Invitation to bid, Instructions to bidders, General Conditions of Contract, Conditions of Particular Applications Technical Specifications Form of Tender and Appendix to Form of Tender Price Schedules /Bill of Quantities Sample Contract Forms Drawings Invitation to Bid The Invitation to Bid or Specific Procurement Notice shall include a brief adequate description and scope of the procurement required, price and place of purchase of bidding document, value and type of bid security, bid submission date and place of submission. Other information on site visit, close of sale of bidding documents, where appropriate shall be included. Instructions to Tenderers

Instructions to Tenderers shall have sufficient description of the requirements of the project, its location, the funding agency or financing arrangement, the address where bidding documents can be obtained and the estimated period of completion. It should also cover the eligibility and qualification criteria, the information and documentation to be provided by the Bidder, how to prepare the bid, format, conditions and amount of bid security required and the date, time, place for submission of the bids as well as the criteria for the evaluation of bids and the award of contract. Pre/Post Qualification Prequalification may be done to shortlist prospective bidders from those who respond to prequalification notification and were issued with prequalification documents. The documents shall request for adequate information in order to determine the technical and financial capabilities of the prospective bidders to undertake the project. The actual bidding shall then be confined to only the prequalified firms. With the enactment of the Procurement Act 663 (2003), for procurements beyond specified thresholds, prequalification may have to be undertaken. Bidders may still be requested to re-state or update their qualification information, even if already pre-qualified. Post qualification should be done if prequalification has not been done and the information required shall be same as for prequalification. Bid Security and Validity The period for the bid validity shall be adequate to allow for the evaluation and approval process. The period shall be such that bidders may not have to be requested to extend the validity of their bids and revalidate the respective bid securities. The value of the bid security and the bid validity period are determined by: - Nature and complexity of the works - Stakeholder requirements - Value of the works - Expected duration of the evaluation of the bids The value of the bid security ranges from a minimum of one to five percent (1-5%) of the estimated contract value and though not exorbitant the amount should be adequate to prevent frivolous bids but not as to deter potential bidders. The period of the validity shall be thirty (30) days to a maximum period of one hundred and eighty-two (182) days. For major works and goods, the maximum

period of one hundred and eighty-two (182) days is recommended to allow for the evaluation and approval processes. The validity date is effective from the day of the submission of the bids and during this period tenderers are not allowed to withdraw their bids. During the period the following activities are undertaken and should be completed as much as possible: - Evaluation or adjudication of the bids to determine lowest evaluated bid, and pertinent issues for clarification and negotiations and recommendation for the award of contract. - Review of Bid Evaluation reports by Management Review Committee, - Board and other relevant approval for Award of Contract as per the Public Procurement Act 663 - Contract Negotiations and award of Contract. It is good practice to ensure that bid securities are valid for a month (28-30 days) longer than the bid validity. This is to allow for the forfeiture of the bid security if necessary. BID SUBMISSION Bids shall be received on the date indicated in the Bidding Document or as amended. No Bids shall be received later than the deadline specified in the Invitation to Tender or amendment. Adequate care should be taken to ensure that all documents submitted before the deadline are received especially those sent by courier. Bid opening shall usually be public in the presence of bidders representatives who choose to attend immediately after the appointed deadline for the reception of the bids. A register of the bidders representative present may be prepared. The bid opening shall involve the preliminary examination of bids, where no bids shall be accepted or rejected. The preliminary examination procedure shall involve:

Examination of the packaging to ensure that they are sealed, addressed and packaged as required in the bidding document. Any correspondences/submission marked Withdrawal and Substitution would be opened first and announced. Bids shall be opened and examined to ensure that they are properly signed. The Bid Document shall be checked to determine whether a bid security has been provided. The Bids would be checked for any unconditional discounts offered. The Bid Price as indicated on the bid form and such other relevant information shall be read out and the information put on a board. It is recommended to print out the results and give copies to bidders representatives present in particular any modifications or relevant comments on the bids shall be noted at the examination. Minutes of the bid opening process and results shall be prepared for record and copied to the Executive. BID EVALUATION A Bid Evaluation Team is appointed by the Executive to undertake the detailed evaluation of the bids to determine the least evaluated bidder and make recommendation for the award of contract including pertinent issues to be resolved prior to the award of contract. The evaluation and findings shall be in accordance with the criteria outlined in the Instructions to Bidders in the bidding document. The report of the bid evaluation committee shall usually be reviewed by a Bid Evaluation Review Committee. The Bid Evaluation Review Committee shall confirm that the evaluation procedure and the findings and recommendation are in accordance with the criteria outlined in the bidding document and standard guidelines on evaluation Board approval is sought. After Executive endorsement and acceptance of the findings and recommendations of the evaluation including pertinent issues for clarification /negotiation usually minor and which would not affect the recommendation for award of contract but are required to firm up various technical and commercial issues, in accordance with the Public Procurement Act 663 of 2003, the approval of the Central Tender Review Board (CTRB) may have to be sought before the award of contract for procurements beyond specific thresholds.

CONTRACT AWARD After successful clarifications, and agreement on any pertinent issues in the bid, the letter of acceptance is issued to notify the successful bidder after meeting the requirements of the Public Procurement Board Act 663, 2003. After the acknowledgment of receipt by the successful bidder of the Letter of acceptance, the unsuccessful bidders are notified and their bid securities returned to them as soon as possible. CONFORMED CONTRACT DOCUMENT (CONTRACT AGREEMENT) The Form of Agreement and relevant supporting documents are then put together and prepared in two (2) identical copies for signature by the Chief Executive and the selected bidders authorized signatories with the appropriate witnesses. The Contractual Contract Document consists of the Form of Agreement, minutes of the negotiation meeting, letter of acceptance, and other post bid correspondences, clarifications, and the bid document, performance security and other relevant sections like conditions of contract, specifications and priced bill of quantities and technical D. IMPLEMENTATION, ENFORCEMENT, AND MONITORING RESPONSIBILITY: Director, ESD/ Manager, Projects E. SPECIFIC CIRCUMSTANCES: Force majeure, cashflow difficulty F. Definitions:[Definition of terms (as needed)] Related policies/references: [Information about related policy guidelines. Attach forms samples if applicable to the policy. If needed additional background discussion should be provided] ENGINEERING SERVICES DEPARTMENT POLICIES Owner Engineering Services Department Approved By: Signature : Effective Date: Origination Date: Revision Date: Version No:

ENGINEERING SERVICES DEPARTMENT PROCEDURES INTRODUCTION G. IDENTIFICATION DATA Procedure No.: ESD/007/001 Document ID: Project Management Section i. Subject: Procurement (Goods, Works and Services) ii. iii. Subject Area: Generation expansion and civil engineering projects Functional Responsibility: Director, ESD/Manager, Projects iv. Approval Date: [Date of Procedure is Approved] H. OVERVIEW/PROCEDURE DESCRIPTION i. PROCEDURE OBJECTIVES: To ensure effective procurement of Goods, Works and Services for the Authority for generation expansion and civil engineering projects. I. PROCEDURE DETAILS: Seek executive approval of the type of Tendering process to be adopted in accordance with the VRA practice and in compliance with the Public Procurement Act 663 which may be one of these (3) options: Open/Competitive Restricted/Selected Negotiated Open/Competitive bidding shall as far as possible be adopted on international or national competitive basis and all interested eligible parties allowed to submit tenders. Notices advertising the works shall be placed in two (2) circulated newspapers in at least two (2) insertions and in the National Procurement Bulletin. Restricted/Selective bidding shall be adopted based on nature of the works/goods i.e. if works/goods are of a specialised nature and time constraints and only those parties invited may submit tenders. These parties may have also done similar specialised jobs for the authority and their

competence and performance adequately tested. Except for the mode of the Invitation, the other requirements shall be as for competitive bidding. In Negotiated Contracts, VRA contracts parties of its choice and negotiate the terms of the contract with one or more of them. The works procurement process or the tendering procedure to be adopted has to be approved by the VRA Management even for an extension/or another phase of an on-going contract. Preparation of Bidding Documents The appropriate bidding document shall be prepared to invite bids from eligible prospective bidders. The bidding document shall be based on an approved standard bidding format and shall contain (as applicable): Invitation to bid, Instructions to bidders, General Conditions of Contract, Conditions of Particular Applications Technical Specifications Form of Tender and Appendix to Form of Tender Price Schedules /Bill of Quantities Sample Contract Forms Drawings Invitation to Bid The Invitation to Bid or Specific Procurement Notice shall include a brief adequate description and scope of the procurement required, price and place of purchase of bidding document, value and type of bid security, bid submission date and place of submission. Other information on site visit, close of sale of bidding documents, where appropriate shall be included. Instructions to Tenderers Instructions to Tenderers shall have sufficient description of the requirements of the project, its location, the funding agency or financing arrangement, the address where bidding documents can be obtained and the estimated period of completion. It should also cover the eligibility and qualification criteria, the information and documentation to be provided by the Bidder, how to prepare the bid, format, conditions and amount of bid security required and the date, time, place for submission of the bids as well as the criteria for the evaluation of bids and the award of contract.

Pre/Post Qualification Prequalification may be done to shortlist prospective bidders from those who respond to prequalification notification and were issued with prequalification documents. The documents shall request for adequate information in order to determine the technical and financial capabilities of the prospective bidders to undertake the project. The actual bidding shall then be confined to only the prequalified firms. With the enactment of the Procurement Act 663 (2003), for procurements beyond specified thresholds, prequalification may have to be undertaken. Bidders may still be requested to re-state or update their qualification information, even if already pre-qualified. Post qualification should be done if prequalification has not been done and the information required shall be same as for prequalification. Bid Security and Validity The period for the bid validity shall be adequate to allow for the evaluation and approval process. The period shall be such that bidders may not have to be requested to extend the validity of their bids and revalidate the respective bid securities. The value of the bid security and the bid validity period are determined by: - Nature and complexity of the works - Stakeholder requirements - Value of the works - Expected duration of the evaluation of the bids The value of the bid security ranges from a minimum of one to five percent (1-5%) of the estimated contract value and though not exorbitant the amount should be adequate to prevent frivolous bids but not as to deter potential bidders. The period of the validity shall be thirty (30) days to a maximum period of one hundred and eighty-two (182) days. For major works and goods, the maximum period of one hundred and eighty-two (182) days is recommended to allow for the evaluation and approval processes. The validity date is effective from the day of the submission of the bids and during this period tenderers are not allowed to withdraw their bids. During the period the following activities are undertaken and should be completed as much as possible:

- Evaluation or adjudication of the bids to determine lowest evaluated bid, and pertinent issues for clarification and negotiations and recommendation for the award of contract. - Review of Bid Evaluation reports by Management Review Committee, - Board and other relevant approval for Award of Contract as per the Public Procurement Act 663 - Contract Negotiations and award of Contract. It is good practice to ensure that bid securities are valid for a month (28-30 days) longer than the bid validity. This is to allow for the forfeiture of the bid security if necessary. BID SUBMISSION Bids shall be received on the date indicated in the Bidding Document or as amended. No Bids shall be received later than the deadline specified in the Invitation to Tender or amendment. Adequate care should be taken to ensure that all documents submitted before the deadline are received especially those sent by courier. Bid opening shall usually be public in the presence of bidders representatives who choose to attend immediately after the appointed deadline for the reception of the bids. A register of the bidders representative present may be prepared. The bid opening shall involve the preliminary examination of bids, where no bids shall be accepted or rejected. The preliminary examination procedure shall involve: Examination of the packaging to ensure that they are sealed, addressed and packaged as required in the bidding document. Any correspondences/submission marked Withdrawal and Substitution would be opened first and announced. Bids shall be opened and examined to ensure that they are properly signed. The Bid Document shall be checked to determine whether a bid security has been provided.

The Bids would be checked for any unconditional discounts offered. The Bid Price as indicated on the bid form and such other relevant information shall be read out and the information put on a board. It is recommended to print out the results and give copies to bidders representatives present in particular any modifications or relevant comments on the bids shall be noted at the examination. Minutes of the bid opening process and results shall be prepared for record and copied to the Executive. BID EVALUATION A Bid Evaluation Team is appointed by the Executive to undertake the detailed evaluation of the bids to determine the least evaluated bidder and make recommendation for the award of contract including pertinent issues to be resolved prior to the award of contract. The evaluation and findings shall be in accordance with the criteria outlined in the Instructions to Bidders in the bidding document. The report of the bid evaluation committee shall usually be reviewed by a Bid Evaluation Review Committee. The Bid Evaluation Review Committee shall confirm that the evaluation procedure and the findings and recommendation are in accordance with the criteria outlined in the bidding document and standard guidelines on evaluation Board approval is sought. After Executive endorsement and acceptance of the findings and recommendations of the evaluation including pertinent issues for clarification /negotiation usually minor and which would not affect the recommendation for award of contract but are required to firm up various technical and commercial issues, in accordance with the Public Procurement Act 663 of 2003, the approval of the Central Tender Review Board (CTRB) may have to be sought before the award of contract for procurements beyond specific thresholds. CONTRACT AWARD After successful clarifications, and agreement on any pertinent issues in the bid, the letter of acceptance is issued to notify the successful bidder after meeting the requirements of the Public Procurement Board Act 663, 2003. After the acknowledgment of receipt by the successful bidder of the Letter of acceptance, the unsuccessful bidders are notified and their bid securities returned to them as soon as possible. CONFORMED CONTRACT DOCUMENT (CONTRACT AGREEMENT) The Form of Agreement and relevant supporting documents are then put together and prepared in two (2) identical copies for signature by the Chief Executive and

the selected bidders authorized signatories with the appropriate witnesses. The Contractual Contract Document consists of the Form of Agreement, minutes of the negotiation meeting, letter of acceptance, and other post bid correspondences, clarifications, and the bid document, performance security and other relevant sections like conditions of contract, specifications and priced bill of quantities and technical J. IMPLEMENTATION, ENFORCEMENT AND MONITORING RESPONSIBILITY: Director, ESD/Manager, Projects K. SPECIFIC CIRCUMSTANCES: Force majeure, cashflow difficulty L. Definitions: N/A Related policies/references: [Information about related policies or procedures, guidelines. Attach forms samples if applicable to the procedure. If needed additional background discussion should be provided] ENGINEERING SERVICES DEPARTMENT PROCEDURES Owner Approved By: Signature : Effective Date: Origination Date: Revision Date: Version No: