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Preference and Reservation Schemes

Government Spend. Major purchaser of goodsTrillions Kwacha spentGreat Benefits

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Preference and Reservation Schemes

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    1. Preference and Reservation Schemes Martin Mulomba

    2. Government Spend Major purchaser of goods Trillions Kwacha spent Great Benefits Creation of wealth through purchases.

    3. Executive Summary The CEEC has developed Pillar 2 which addresses Preferential Procurement This pillar aims at ensuring that targeted citizens, citizens influenced, citizen empowered and citizen owned companies are provided with preferential treatment when undertaking provision of goods and services to both the public and private companies. Preferential Procurement may be used as a tool to empower citizens economically.

    4. Definition of Preferential Procurement Preferential procurement may be viewed as when governments decide to purchase certain types of products or services from domestic suppliers in an effort to create an industry national champions. It may also take the form of market reservation, a policy requiring government to buy certain products or services only from domestic firms, without designating one chosen supplier.

    5. The Process & Goal of Preferential Procurement It is a process by which the Government undertakes to provide guidelines and procedures on how local participation in the tendering of goods, public works and services should be undertaken. The goal of preferential procurement is to ensure that local companies who have not benefited in public procurements can now meaningfully participate in these public procurements.

    6. Draft Preferential Procurement Policy Document Developed by CEEC and ZPPA Draft Preferential Procurement Strategy Policy provides for Preference and Reservation Schemes.

    7. Preference Schemes Preference schemes grant a margin of preference for the benefit of bids by a target group offering goods, works or services manufactured or performed by the target group. They may actually be looked at as a discount that the Government is willing to pay as a premium. Through Preference Schemes the Government is going an extra mile to empower a local bidder.

    8. Preference Schemes in Draft Policy Document Citizen Influenced Company: 4% Citizens Empowerment Company: 8% Citizens Owned Company: 12%

    9. Reservation Schemes Reservation scheme sets aside certain procurement requirements for a target group by restricting bidding to the target group.

    10. Reservation Schemes in Draft Policy Supply of goods up to K3 Billion Construction works estimated up to K20 Billion Civil and Road Works estimated up to K30 Billion (Above these thresholds, the tender will be open to all, including international bidders) Non-consulting services up to K1 Billion In consulting services at least 40% of the key staff should be Zambians.

    11. CEEC Registration of Suppliers Certification will make eligible Suppliers to benefit from the Preference and Reservation Schemes. Certification does not mean automatic award of business, it only means that suppliers will have to compete more favourably.

    12. Registration Process REGISTRATION PROCESS AT CEEC HQ 1. The Supplier/Vendor will approach the CEEC supplier registration Desk which will be manned by a Vendor Desk Officer for supplier registration formalities. 2. The suppliers will be required to pay a K70, 000.00 application fee before accessing the registration form. 3. The supplier will be required to fill in the application form and lodge it with the Vendor Registration officer. 4. Upon receipt of the application form, the application will go through the evaluation process for registration. 5. Once all requirements a certificate will be issued.

    13. Registration Process REGISTRATION PROCESS AT CEEC PROVINCIAL QUARTERS 1. The Supplier/Vendor will approach the CEEC PEC who will act as Vendor Officer for supplier registration formalities. 2. The suppliers will be required to pay a K70, 000.00 application fee before accessing the registration form. (Payment will be done through Barclays Bank Branches) 3. The supplier will be required to fill in the application form and lodge it with the PEC. 4. Upon receipt of the application form, the PEC will examine the document to determine compliance. Applications which are not compliant will be sent back to suppliers before the application is logged in. 5. When the application meets the basic requirements, it will then be submitted to the Procurement Manager for supplier registration. 6. Once approved and certificates issued, the certificates will be sent to the provinces.

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