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Revised ECHO Procurement Guidelines

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  1. Revised ECHO Procurement Guidelines (Annex IV) IAPG Donor Working Group 7th December 2007

  2. Disclaimer This is only an “interpretation” of the revised ECHO Procurement Guidelines and you should seek confirmation and clarification prior to any procurement IAPG Donor Working Group 7th December 2007

  3. Changes as a consequence of ECHO FPA (Framework Partnership Agreement) review • Effective from Jan. 1st 2008 (for new contracts) • Contracts concluded prior to Jan. 1st 2008 – Old FPA applies until Sept. 2008 IAPG Donor Working Group 7th December 2007

  4. All FPA partners should have been audited • Based on partners’ financial strength, internal risk and procurement rules • Subsequent to audit partners designated one of two categories • A-Control Mechanism (‘Action’ related monitoring) • P-Control Mechanism (‘Prior’ assessment and own ‘Procedures’) IAPG Donor Working Group 7th December 2007

  5. A-Control Mechanism • For partners with weak financial strength, internal risk management and procurement procedures • Partner must comply with all ECHO procurement procedures (over €60,000) • Higher level of monitoring • Maximum funding limit • More information during proposal and reporting phase IAPG Donor Working Group 7th December 2007

  6. P-Control Mechanism • Partners with strong financial capacities and internal control procedures • May apply their own procurement procedures • Fewer details during proposal and reporting phase • No funding limit • More flexibility (eg. use of own depreciation rates) IAPG Donor Working Group 7th December 2007

  7. Annual Audit of ECHO Partners • Annual assessment of all partners • In-depth assessment at least every 3 years • Resulting in partnership confirmation and revised control mechanisms if applicable IAPG Donor Working Group 7th December 2007

  8. Structure of Annex IV • Chapter 1 defines key concepts • Chapter 2 sets out mandatory principles • Chapter 3 establishes general rules and procedures • Chapter 4 defines special rules • Chapter 5 sets out the final provisions Chapter 2 is applicable & mandatory to both A and P control partners Chapter 4 is also relevant and applicable to both IAPG Donor Working Group 7th December 2007

  9. Chapter 2 • Insists in compliance with principles of ; • Ethical Procurement • Transparency of process • Proportionality of processes followed • Equal treatment of contractors Also states; • Partners must develop written procurement procedures • Contracts awarded on basis of ‘price-quality’ ratio • The award criteria should be weighted • Rules re dealing with bankrupts etc (via Financial Regulation ref) IAPG Donor Working Group 7th December 2007

  10. Rules of Origin and Nationality no longer apply • EC is not bound by contracts concluded by partners • EC has right to audit partner and ‘contractors/suppliers’ IAPG Donor Working Group 7th December 2007

  11. Chapter 3 (General Rules and Procurement Procedures) • For A-Control Mechanism • Straight forward but general in nature • New thresholds • More detailed guidelines to be developed IAPG Donor Working Group 7th December 2007

  12. Chapter 4 (Special Rules) • For A and P-Control Mechanisms • Procurement of Pharmaceuticaland medical devices • Now very difficult – strict quality guidelines • Food Aid procurement • Sets outs minimum standard • Local or regional priority sourcing • Use of Monitoring agent (above €300,00) IAPG Donor Working Group 7th December 2007

  13. Pre-established Stocks • Allowed as long as standard procedures and mandatory principles in chapter 2 followed • Framework Contracts • Allowed with above stipulation • Humanitarian Procurement Centres • Used on the basis of a single tender • Likely will have to be used for pharmaceutical purchases for many organisations IAPG Donor Working Group 7th December 2007

  14. Useful Sources of Information • European Commission Financial Regulations http://ec.europa.eu/europeaid/work/procedures/legislation/financial_regulation/index_en.htm • European Commission Humanitarian Aid http://ec.europa.eu/echo/index_en.htm • Punto Sud www.puntasud.org • Review of Quality Assurance (QA) Mechanisms for Medicines and Medical Supplies in Humanitarian Aid (See ECHO website) IAPG Donor Working Group 7th December 2007