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Reforming Public Procurement -- Syquia 4. Inadequate competition, creating opportunities for collusion; 5. Lack of transparency; and 6. Inadequate procurement audit and control. In Vietnam, the decision to develop a new omnibus procurement law was seen as an important step toward eliminating this legal confusion. x The justification for reforming the legal framework was similar in the Philippines. xi 4.3 Guidelines for a Good Omnibus Procurement Law An omnibus public procurement law should be enacted by the highest law-making body of the State, such as its National Assembly or Congress, and should be supported by implementing regulations issued at the appropriate level. Some of the more important elements of an omnibus law are that it: 1. Provides for open, competitive bidding as the preferred mode of procurement; 2. Requires publication of bid opportunities and awards in media that are easily and nationally accessible; 3. Provides appropriate procedures for special types of procurements and situations, such as highly specialized or technical projects; 4. Provides for the minimum content of the tender documents, requires that the content be relevant and sufficient for bidders to be able to respond to the requirement, and requires the development of standard bidding documents and a procurement manual; 5. Provides participants with the right to have decisions in a procurement process reviewed, has provisions to respond to a request for review at the procuring entity level, with administrative review by another body independent from the procuring entity that has the authority to grant remedies, including the right for judicial review; 6. Institutes a regular planning exercise that starts with the preparation of multiyear plans for government agencies, from which annual operating plans are derived, followed by annual procurement plans and estimation of the associated expenditures, and culminates in the annual budget formulation; 7. Establishes a normative, regulatory or oversight body at an adequate level in government and secures it in terms of financing, or at least provides functions that are clearly assigned to various units within the government, without gaps or overlaps; 8. Establishes an integrated information system that provides, at a minimum, up-to-date information on procurement plans, specific advertisements or notices of procurement opportunities, publication of contract awards, and rules/regulations on procurement, and is easily accessible to all interested parties at no or minimum cost – supported by a requirement for agencies to create sufficient records management systems; 9. Provides for public monitoring of the procurement process and the implementation of awarded contracts, guaranteeing that these contracts are awarded pursuant to the provisions of the law, and that they are performed strictly according to specifications; 10. Requires the development of a training and capacity building strategy that provides substantive permanent training programs for the needs of the procurement system; 11. Has clearly defined procedures for contract administration responsibilities, including inspection and acceptance procedures, quality control procedures, and procedures for Fiscal Reform and Economic Governance Project 7
Reforming Public Procurement -- Syquia reviewing and issuing contract amendments in a timely manner, and provides for dispute settlement; and 12. Has measures that promote integrity and accountability within the procurement system, such as blacklisting, administrative penalties, and even criminal sanctions. 4.4 Resources to Assist with Legal Drafting Drafters are encouraged to make reference to several documents, all publicly available, that provide guidance on international best practices in public procurement law. These documents include: 1. The United Nations Commission on International Trade Law (UNCITRAL) Model Law on Procurement of Goods, Construction and Services (the “UNCITRAL Model Law on Procurement”), adopted by the UNCITRAL at its twenty-sixth session in Vienna, July 5 to 23, 1993; 2. The World Trade Organization (WTO) Agreement on Government Procurement (the “WTO GPA”), which is a multilateral agreement that took effect on January 1, 1996; and 3. The World Bank Guidelines on Procurement under IBRD Loans and IDA Credits (May 2004) and on Selection and Employment of Consultants by World Bank Borrowers (May 2004) (the “World Bank Procurement Guidelines”). Together, these provide for the following general principles of public procurement that may be incorporated in drafting a country’s omnibus procurement law: 1. Transparency in the procurement process and in the implementation of procurement contracts; 2. Competitiveness by extending equal opportunity to enable private contracting parties who are eligible and qualified to participate in public bidding, complemented by a fair and equitable treatment of all suppliers and contractors; 3. A maximization of economy and efficiency in public procurement, supported by a streamlined procurement process that will uniformly apply to all government procurement; 4. Adaptability to advances in modern technology in order to ensure an effective and efficient method; and 5. Mechanisms for ensuring integrity and accountability within the public procurement system, thus fostering public confidence in the system. The UNCITRAL Model Law on Procurement in particular has influenced legislation in a large number of jurisdictions, and its use has contributed to increasing harmonization of procurement rules and procedures worldwide. However, these documents all have their shortcomings as well. The UNCITRAL law, for example, focuses narrowly on review procedures, and does not address contract performance and implementation issues, such as contract administration, resolution of performance disputes or contract termination. xii The World Bank Procurement Guidelines provide excellent guidance on public bidding and evaluation procedures, alternative methods of procurement, and international best practices in public and private procurement. However, these are still crafted in light of World Bank’s own institutional Fiscal Reform and Economic Governance Project 8
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