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Exclusion in Turkish Public Procurement System. By Kadir Akın GÖZEL Public Procurement Authority of The Turkish Republic 16-19 May Tblisi - GEORGIA. EXCLUSION in PUBLIC PROCUREMENT. Governments want to do business with economically sound and, technically eligible

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Exclusion in Turkish Public Procurement System

By Kadir Akın GÖZEL

Public Procurement Authority of TheTurkishRepublic

16-19 May

Tblisi- GEORGIA


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EXCLUSION in PUBLIC PROCUREMENT

Governments want to do business with

  • economically sound and,

  • technically eligible

    economic operators which can be relied on. Public procurement systems are designed to achieve these ends through transparent and competitive processes.

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EXCLUSION in PUBLIC PROCUREMENT

Objective criteria and evaluation based on equal treatment are also crucial in a modern public procurement system design.

Another important aspect is to introduce necessary measures to prevent the corrupt acts and if any misdoing is detected to make sure that economic operators committed to such acts and behaviours are not allowed to do business with government at least for a while.

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EXCLUSION in PUBLIC PROCUREMENT

Thus public procurement systems need some security valves. These are;

  • Exclusion ,

  • Declaring Ineligible and,

  • Debarment.

    The main differences between these are the time periods, the authority implementing this measure and regulating legislation.

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EXCLUSION in PUBLIC PROCUREMENT

Decisions to exclude or debar can be taken by ;

  • administrative units (contacting authority itself or the relevant Ministry) or,

  • Courts.

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EXCLUSION in PUBLIC PROCUREMENT

Based on the period of the Exclusion or Debarment decisions these measures can be grouped as;

  • Interim, and

  • life time.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Rules on exclusion from participation to procurement proceedings are shattered around in the Turkish Public Procurement Legislation. These are as following:

  • Public Procurement Law (PPL) no:4734,

  • Public Procurement Contracts Law (PPCL) no:4735,

  • State Procurement Law (SPL)no:2886,

  • Turkish Criminal Code (TCC)

  • Other laws containing rules on prohibition to participate in the public contract award procedures.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

The practice is designed in different articles in the PPL and under the headings of;

  • Exclusion,

  • Ineligibility, and

  • Prohibited acts and conducts.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Exclusion is regulated in the article 10 of the PPL .

Any tenderer shall be excluded from the procurement proceedings who, inter alia,;

  • has been convicted of an offence concerning his professional conduct by a judgment of a competent court within the five years preceding the date of the procurement proceedings.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

  • are established, to be involved in misconducts by appropriate means of proof by the contracting entity that are against the work ethics or professional ethics during a work he carried out for the contracting entity, within the five years preceding the date of the tender

  • has been prohibited from professional activity by the chamber where he is registered in accordance with the relevant legislation, as of the date of the tender,

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

  • fails to submit the information and documents specified in this article or it is established that he/she has submitted misleading information and/or false documents, 

  • has been participated in procurement proceedings in spite of prohibition according to Article 11,

  • are established to be involved in prohibited conducts and actions laid down in Article 17.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

INELIGIBILITY

According to article 11 of the PPL the following persons or entities cannot participate in any procurement, directly or indirectly or as a sub-contractor, either on their own account or on behalf of others:

  • Those who have been temporarily or permanently prohibited from participating in public procurements pursuant to provisions of this Law or other laws,

  • those who have been convicted of the crimes under the scope of Prevention of Terrorism Law No:3713 or of organized crimes, or of bribing crimes in their own country or in a foreign country,

  • those whom the relevant authorities have been decided that they have been involved in fraudulent bankruptcy,

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Article 11 also states that some certain degree relatives of government employees who take part in tender process and any type of companies owned or shared by the contracting entities or the foundations, associations, unions, funds and other entities included within the body of the contracting entity and companies owned by these and the contractors providing consultancy services for the subject matter of the procurement cannot participate in the procurement of such work.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

There is another case of ineligibility which is possible for the foreign participants only. This is where, in accordance with the article 53/b-8 of the PPL,economic operators of countries who are declared ineligible by the Cabinet of Ministers.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

PROHIBITON

The heart of the system is the article 17 of the PPL. The article states that : “The following acts or conducts are prohibited in tender proceedings:

  • to conduct or attempt to conduct procurement fraud by means of fraudulent and corrupt acts, promises, threats, unlawful influence, undue interest, agreement, malversation, bribery or other actions,

  • to cause confusion among tenderers, to prevent participation, to offer agreement to tenderers or to encourage tenderers to accept such offers, to conduct actions which may influence competition or tender decision,

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

  • to forge documents or securities, to use forged documents or securities or to attempt these.

  • to submit more than one tender by a tenderer on his own account or on behalf of others, directly or indirectly, as the principal person or as representative of others, apart from where submitting alternative tenders is allowed.

  • to participate in procurement proceedings although prohibited pursuant to Article 11.

    Relevant punishment is regulated in Chapter 4 of the PPL

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Prohibition practice can be grouped as “an administrative measure” and “a judicial punishment” in Turkish public procurement system.

In the PPL’s recital it is stated that “administrative prohibition decisions are measures taken to punish economic operators

  • who commit acts and behaviors listed in article 17,

  • who do not sign the contract upon an invitation to sign the contract and,

  • who infringe the prohibition on disclosing the information and documents”.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

As an administrative measure those who are established to be involved in acts and conducts set forth in Article 17, shall be prohibited from participation in any tender carried out by all public institutions and entities for at least one year and up to two years depending on the nature of the said acts and conducts;

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Those who do not sign a contract in accordance with the procedures, except for force majeure, although the tender has been awarded to them, shall be prohibited likewise from participation in any tender for at least six months and up to one year.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Those who are assigned with the implementation of this Law and those who provide consultancy services cannot disclose any of the confidential information or documents relating to all proceedings about the procurement process or use these information for the benefit of their own or of third persons. Depending on their relevance, the sanctions stipulated under article 58 (for the economic operators this means prohibition) and 60 ( for the government employees this means punishment ) shall apply in case of violation.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Those who are established to be involved in these acts and conducts during or after the tender proceedings shall not be allowed by the contracting entity to participate in the current tender as well the subsequent tenders to be carried out by the same contracting entity until the effective date of the prohibition decision.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Ifthecommittedacts are alsoconsidered as criminalactivitythantheseneedsto be reportedtothe public prosecutors. Followingthecourtprocessalongwiththemainpunishment a prohibitonfromparticipatingto public procurementfor a definiteorindefinite time period can be introducedbythecourtdecision. This is calledjudicalprohibitondecision.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

If a public lawsuit is opened due to infringements of the PPL during the tenders conducted within the scope of the PPL, economic operators who has been sued and their share holders or partners can not participate in the procurement held by public institutions and entities included within the scope of this Law, until the end of judgment proceedings.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

  • Parallel with PPL, PPCL also contains articles on prohition. The main difference is prohibition introduced by the article 26 of the PPCL regulates the prohibiton based on the acts and conducts which are prohibited during the implementation of a signed contract.

  • Again the PPCL also regulates the cases where the acts are also considered a crime and introduces the relevant punishments.

  • PPCL also regulates the transfer of the Contract to the 3rd persons and infringement of the related rules are also punishable by prohibiton for a certain period.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

When analysed in terms of the time periods of the prohibitons;

  • As an administrative measure from 6 months up to 3 years, left to the discretion of the compotent administrative authority,

  • As a judicial punishment;

    - secondary punishment along with the main one,

    - 6 months to 3 years decided by the court,

    - If the same act has been committed and punished before which means reoccurrence , then court may , and only the court, that this has become a habit and decides life time prohibiton.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

At the end of a public lawsuit conducted as a result of acts and behaviours listed in the article 17 of the PPL, in addition to the punishment rendered by the court, relevant economic operators and their shareholders or partners shall be prohibited from participation in the procurement proceedings of all public institutions and entities that are included within the scope of the PPL by decision of court, starting from the ending date of the prohibition decision made by the contracting entity pursuant to Article 58 and for a period of at least one year and up to 3 years.

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EXCLUSION in TURKISH PUBLIC PROCUREMENT SYSTEM

Prohibition decisions shall be taken by the Ministry implementing the contract or by the Ministry which the contracting entity is subordinate to or associated with, by contracting officers of contracting entities which are not considered as subordinate to or associated with any Ministry, and by the Ministry of Internal Affairs in special provincial administrations and in municipalities and in their affiliated associations, institutions and undertakings.

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PROCEDURAL ISSUES

  • The prohibition decisions shall be made within at most forty-five days.

  • The prohibition decision shall be sent for publication in the Official Gazette within at most fifteen days, and shall become effective on the date of its publication.

  • Those who are decided to be subject to a public lawsuit shall be informed to the Public Procurement Authority by the Public Prosecutor’s Office for recording.

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PROCEDURAL ISSUES

  • The decisions shall be followed up by the Public Procurement Authority and those who are prohibited from participation in public procurements shall be recorded.

  • The contracting entities carrying out the tender proceedings shall be responsible for notifying the relevant or related ministry of any event requiring prohibition from participation.

  • Before signing a public contract public entities has to check with the PPA’s database whether the owner of the winning tender is prohibited or not.

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PROHOBITON STATISTICS

Some figures of prohobitions are given below:

Prohibiton decisions reported to the PPA in the year 2010 ;

First Quarter 1253

Second Quarter 1320

Third Quarter 856

Fourth Quarter 1023

In the same period 917 prohibiton cases have ended.

By the end of 2010 there were 7773 active prohibiton cases.

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PROHIBITON STATISTICS (con’d)

Among 7773 active prohibiton cases;

ProhibitonDecison Based On Number of Cases %

STL no:2886 846 10,83

PPL no:4734 2742 35,28

PPCL no:4735 2335 30,04

TCC 1844 23,72

Other Laws 10 0,13

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PROBLEMS of the EXISTING SYSTEM

  • Obtaining up-to-date information about the foreign contractors.

  • Lack of clear rules and links with the international institutions’ databases of the debarred tenderers,

  • No clear boundaries between criminal and faulty actions.

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THANKS FOR LISTENING

KADIR AKIN GOZEL

kadirakingozel@kik.gov.tr

16-19 May Tbilisi