IPA Supply Procurement

1. Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım Technical Assistance on Institutional Building for the Implementation of RCOP in Turkey IPA Supply Procurement This project is co-financed by the European Union and the Republic of Turkey Special Module for RCOP By: H. Cahit Ekiz, Senior Expert cahit.ekiz@gmail.com Ankara, 19th October 2012

2. Content • Overview of preparation and procurement stages • Review of supply tender documents • Supply Evaluation • Relations between Procurement and Implementation Stages

3. Overview of preparation and procurement stages

4. The project cycle

5. Actors of Preperation Period TA EU Developers EU Management and Audit Organisations Manufacturers OIS ERA / End recipient RCP-CID Internet Consultant EUD Suppliers Other know-how Works Supervision

6. Tools (Documentation) PRAG (Practical Guide to contract procedures on EU External Actions) IPA Turkey - RCOP Implementation Manual • ERA Procurement Guidelines • OIS

7. ERA responsibilities set up from Operational Agreement • Responsibilities related to Technical Preparations of projects and procurement (tender dossiers); (Please see OA Article 5.2) • Responsibilities related to Tendering and Contracting (including attendance at tender evaluations); (Please see OA Article 5.3) • Responsibilities related to Implementation of Service, Works and Supply Contracts (see Chapters 4,5,6); (Please see OA Article 5.4) • Responsibilities related to Financial Management (Payments of contracts) and Tax Exemption Implications (see Chapter 7); (Please see OA Article 5.5 and 5.6) • Responsibilities related to Reporting (see Chapters 4,5 and 6 and 8) ; (Please see OA Article 5.7) • Responsibilities related to Monitoring of the operations and Evaluation (Chapter 8), (Please see OA Article 5.8) • Responsibilities related to Publicity of the operations, Controls and Auditing (Chapter 9); (Please see OA Article 5.9 and 11)

8. OIS (1) • Title of the Operation • Operating Structure • Organisation Responsible for the Implementation of the Operation • Compatibility and Coherence with the Operational Programme • Description of the Operation • Implementation Arrangements • Risks and Assumptions • Expected impact of the operation on the target group and multiplier/spill over effects • Sustainability • Equal opportunity, minorities, and vulnerable groups • Links with other IPA Component Measures • Requested financing from the European Commission • Co-Financing • Budget Breakdown • Cash flow requirements by source of funding

9. OIS (2) • Annex 1: Logical Framework • Annex 2: Commitment Letters and / or Letter of Intents • Annex 3: Financial Sustainability Analysis (Brief) • SUPPORTING DOCUMENTS • Indicative Budget For Service Contract • Indicative Budget For Supply Contract • Indicative Budget For Works Contract • INDICATIVE BUDGET FOR SUPERVISION COMPONENT • Documents regarding land ownership/earmarking

10. Procurement Preparation Process Works Technical documents Supervision Technical documents OIS Supply Technical documents TA Technical documents

11. Supply Technical documents • Technical Supporting Documents • Catalogues, brochures, web printouts, datasheets, manuals • Administrative Supporting Documents • Origin • Financial Supporting Documents • Proforma invoice, web printouts • Market Survey • Technical Specifications

12. Which is the type of project you are dealing with ? • Industrial Manufacturing ? • Agricultural product / food Processing ? • Accreditation Laboratory ? • Tourism Investment ? • Business Development Centre ?

13. What is the Product / Item ? • Individual goods ? • Lines ? • Systems ? • Establishment ?

14. How to identify the Product / Item in the market? OIS Title Budget 3 IDENTICAL PRODUCTS Rule of Origin GLOBAL MARKET Functions ? Requirements ? Capacity ? Quality ?

15. Individual goods Output product Input material Process F?, C?, Q? RAW F?, C?, Q? RAW RAW F?, C?, Q? RAW F?, C?, Q? RAW F?, C?, Q? RAW F?, C?, Q? RAW F?, C?, Q? Amount ? Time ? Amount ? Throughput ?

16. Lines Output product Input material Process F?, C?, Q? RAW F?, C?, Q? RAW RAW F?, C?, Q? RAW F?, C?, Q? Performance ? RAW F?, C?, Q? RAW F?, C?, Q? RAW F?, C?, Q? Amount ? Time ? Amount ? Throughput ?

17. Systems Output product Input material Process S1 RAW Performance ? RAW RAW RAW Process RAW Process RAW S2 S3 RAW Performance ? Performance ? Amount ? Time ? Amount ? Throughput ?

18. Establishment Output product Input material Process S1 RAW Performance ? RAW RAW RAW Process RAW Process RAW S2 S3 RAW Performance ? Performance ? Amount ? Time ? Amount ? Throughput ?

19. What is the Type of Product / Item ? • Operational Unit ? • Supporting Unit ? • Infrastructure Unit ? • Secondary Unit ?

20. Operational Unit Samples • Process machinery and equipment • Assembly line workflow connectors ?

21. Supporting Unit Samples • Dust collection equipment ? • Packaging equipment • Ticketing (labelling) equipment

22. Infrastructure Unit Samples • Electricty / power ? • Air / pressure ? • Vapour ? • Water / hot water ? • Air cleaner ? • Refining / treatment ?

23. Secondary Unit Samples • Fix crane ? • Scale ? • Vehicles (Mobile crane, forklift, truck) • Laboratory equipment • IT, electronic and office equipment • Security and control equipment • Furniture • Decoration ?

24. What else ? • Automation • Process control and resource planning (ERP) • Administrative and financial software • Management and decision support

25. Distribution of Products / Items ? • Between components • Supply • Works • TA • Between supply lots • Operational lot(s) • Supporting lot(s) • Infrastructure lot(s) ? • Secondary lot(s)

26. Resulting supply documents • Market Survey • 3 x Brand & model • 3 x Origin • 3 x Price • Delivery at site • Installation and start-up • Technical Specifications • Requirements • Function(s) • Capacity • Quality

27. Secondary specifications of the Products / Items • Infrastructure requirements • Phisical dimensions • Work area requirements • Weight

28. Review of supply tender documents

29. Procurement Notice • 6-Description of the contract • 7-Number and titles of lots • 8-Eligibility and rules of origin • 11-Tender guarantee • 12-Performance guarantee • 13-Information meeting and/or site visit • 14-Tender validity • 15-Period of implementation of tasks

30. Procurement Notice • 16- Selection criteria • Economic and financial capacity • The average annual turnover in the last xxx financial years of the tenderer must exceed the financial proposal of the tenderer. • Professional capacity • At least 1 permanent staff currently works for the tenderer in fields related to this contract. • Technical capacity • The tenderer should have completed (provisional or final acceptance must be certified) at least xxx project relating to delivery of ................................... equipment with a minimum value of the financial proposal of the tenderer for the relevant lot, in the last three years prior to the submission deadline of this application (from xx of Month 2009 to xx of Month 2012).

31. Procurement Notice • 16- Selection criteria • An economic operator may, where appropriate and for a particular contract, rely on the capacities of other entities, regardless of the legal nature of the links which it has with them. Some examples of when it may not be considered appropriate by the Contracting Authority are when the tender rely in majority on the capacities of other entities or when they rely on key criteria. If the tender rely on other entities it must prove to the Contracting Authority that it will have at its disposal the resources necessary for performance of the contract, for example by producing an undertaking on the part of those entities to place those resources at its disposal. Such entities, for instance the parent company of the economic operator, must respect the same rules of eligibility and notably that of nationality, as the economic operator. Furthermore, the data for this third entity for the relevant selection criterion should be included in the tender in a separate document. Proof of the capacity will also have to be furnished when requested by the Contracting Authority.

32. Instructions to Tenderers • 2-Timetable • 5-Type of contract • 11-Content of tenders • Part 1: Technical offer • a detailed description of the supplies tendered • a training proposal • an ancillary services proposal • Part 2: Financial offer • A financial offer calculated on a basis of DDP • financial proposal for training • financial proposal for ancillary services • Part 3: Documentation • To be supplied following templates in annex • Tender Form for a Supply Contract • Financial identification form • Legal entity file • To be supplied on free formats • A description of the warranty conditions • A description of the organisation of the commercial warrantytendered • A statement by the tenderer attesting the origin of the supplies tendered • Duly authorised signature

33. Instructions to Tenderers • 12-Taxes and other charges • 20- Evaluation of tenders • Administrative • Technical • PN Selection Criteria • Technical Proposal • Financial • Variant solutions • Award criteria • The sole award criterion will be the price • 21- Signature of the contract and performance guarantee • documentary proof • Performance guarantee • modifications

34. Modifications • Before the contract signature • Tender Dossier (Instructions to Tenderers) • Article 21_Signature of the contract and performance guarantee (Sub Article 21.4) • Contract (Special Conditions) • Article 22_Variations • The Contracting Authority reserves the right to vary the quantities specified for the following items at the time of contracting and during the validity of the contract within a range given in below table; • The total value of the supplies may not rise or fall as a result of the variation in the quantities by more than 25%of the tender price. The unit prices used in the tendershall be applicable to the quantities procured under the variation.

35. Supply Evaluation

36. Evaluation Committee • Chairman • Secretary • Evaluators • Observers ?

37. Opening • Public • Receive date & time • Tenderer’s structure • Price & discount • Tender Guarantee

38. PN Selection Criteria • Evaluation Committee all together • Tender Submission Form sections • Clarifications

39. Administrative Compliance • Evaluation Committee all together • Part 3: Documentation • Clarifications • In practice informal responsibility of Chairman and Secretary

40. Technical Evaluation • Evaluators (& observers) • Part 1: Technical Proposal • Yes / no bases • Clarifications • Finalisation by a wrap-up session

41. Financial Check • Evaluation Committee all together • Part 2: Financial Offer • Cross check of financial figures • Clarifications (may or may not)

42. Relations between Procurement and Implementation Stages

43. Basic Stages of a Supply Contract • Commencement • Delivery • Installation • Put into Operation • Training • Inspection and Testing • Warranty

44. Special Stages for a Supply Contract • Ancillary services • Special design and production • Development • Customization • Assembly at the site

45. Financial Milestones for a Supply Contract • Pre-financing(60%) • Provisional Acceptance (40%) • Final Acceptance (Releasing Performance Guarantee)

46. Commencement • Special conditions Article 18, gives the commencement date, the starting date of implementation of a supply contract • - When the contract is signed • - On a definite and indicated further date • - Depending to an other event or condition • - Due to an administrative order issued by the OS/CA in a declared period

47. Commencement • Kick-off meeting (optional) • introduction of the contracting parties and their personnel who will be involved in the contract • reviewing the scope of contract • contract schedule and milestones • any changes of the delivery address(es) • any issues relating to proposed products’ availability by the Contractor • any issues relating to restrictions and special permissions regarding the products • any information or other assistance to be provided by the CA or ERA/End recipient to the Contractor, in accordance with the TS, field/place, current conditions and the time • other issues related with the specifics of the contract

48. Commencement • Site visit • Phisical conditions • Meteorological and geological conditions • Additional structural and infrastructural works • Transport, unloading and storage conditions • Reviewing the layout plan

49. Implementation Programme • Special Conditions_Article 13Programme of implementation of the tasks (timetable) • Supply, delivery, unloading, installation, commissioning inspection and testing, and training must be completed withinxxcalendar days from the commencement date. • The Contractor shall be responsible for unpacking of the goods at Delivery Addressand shall be ready for inspection and testing after completion of the delivery of supplies. • Inspection and testing shall be completed withinxxcalendar days after the tendered supplies have been physically delivered, installed and put into operation. • Provisional acceptance shall take place withinxxcalendar days after the request of Contractor following completion of delivery, installation, putting into operation, training, inspection and testing. • Final acceptance shall take place after formal request of Contractor following expiration of 12 months warranty period. After this Contractor’s warranty expires, the Contractor shall provide one year commercial warranty service as well.

50. Modifications • Within implementation period (Before &after commencement) • Administrative and financial issues • Technical issues • Product end of life • Proof and documentary evidence • Has same or advantageous rule of origin conditions • Has same price of the replaced item and under the condition given in the contract • Same technical specifications and quality or better • Compatible with the overall system