Procurement Procedures for the Programme "Support to the Chinese County and District Hospital of Western and Middle Provinces"

Introduction

This section is addressed to end-users in charge of carrying out projects in the health sector financed through soft loan by the Italian Government. The main purpose of this section is to describe procurement principles contained in the Memorandum of Understanding (MOU) of the Programme “Support to the Chinese County and District Hospital of Western and Middle Provinces” signed by the Italian Ministry of Affairs/Directorate-General for Development Cooperation (DGCS) and the Chinese Ministry of Finance (MOF) in 2004. This section is applicable only to procurement of goods and services. Works, according to MOU, are not eligible.

Procurement and Tendering

The basic principle governing the award of contracts is International Competitive Tendering. According to MOU, the procurement procedures to be followed are those of the European Union or the ones applied for World Bank financed projects in China.

Standard Bidding Documents

Goods: In case of procurement of goods, end-users and procurement agents will be provided with a Standard Model of Bidding Documents approved by DGCS and MOF. These documents are based on the Standard Bidding Documents for goods of the World Bank applied for China, adapted to be in compliance with MOU.
Services: For services, the standard bidding documents to be adopted will be those utilised by the European Union for cooperation projects, adapted for the Sino-Italian development projects financed through soft loan.

PIU Assistance

PIU procurement specialists will provide assistance and training to end-users and procurement agents in the preparation and utilization of the bidding documents for projects to be carried out in the health sector. PIU's support will focus on verifying the compliance of the bidding documents with MOU and with the principles of transparency, efficiency and economy generally accepted for International Competitive Bidding.

Bidders Eligibility

Biddings are open only to Italian companies or consortia of Italian companies. To avoid any conflict of interest, any expert or firm, including firms within the same legal group, members of consortia and sub-contractors, involved in the preparation of a project must be excluded from participation in tenders or from submitting offers finalised to the implementation of the same project. Bidders will be also requested to comply with the “Anti-mafia” regulations in force in Italy.According to each particular project, bidders will be requested to comply with minimum qualification requirements (i.e. economic, financial, professional and technical capacity) in order to assure their successful performance of contracts.
Bidders are not entitled to bid if they do not comply with the Ethic Clauses of the European Union or if they fall into any Ground for Exclusion (i.e. bankruptcy, res judicata, conflict of interest, fraud, corruption, illegal activity, etc).

Goods and Services Eligibility

The Soft Loan shall be used only for purchasing goods and services related to the Programme, which must be of Italian origin; no more than 30% (thirty per cent) of the Soft Loan may be used to purchase local equipment and services. “Origin” means the place where the goods were mined, grown, or produced, or from which the services are supplied. Goods are produced when, through manufacturing, processing, or substantial and major assembly of components, a commercially recognized new product results that is substantially different in basic characteristics or in purpose or utility from its components.

Procurement Agent Selection

According to MOU:

1. End-users will be in charge of selecting the Procurement Agent;
2. The selected Procurement Agent must have experience in international bidding;
3. Joint Committee must give its “no-objection” to Procurement Agent selection;
4. End-users will bear the costs of the Procurement Agent and by no means shall such costs be paid through the Italian funds.

The duty of the selected Procurement Agent will be:

1. Collaborating with end-users in the preparation of the Bidding Documents with the support of the PIU Procurement Experts;
2. Carrying out the bidding;
3. Managing, if needed and so requested, the Contract on behalf of end-users;

Launch of Bidding and Advertising

According to DGCS standard procedures, end-users must submit the Invitation for Bids (IFB) for publication to DGCS at least 60 days before the intended date of publication. The finalised Bidding Documents must also be submitted to DGCS either at this time or in advance to demonstrate that the proposed IFB corresponds to the objectives of the contract. IFB will be published by DGCS at its own expenses.

IFB will be published in Italy on:

1. DGCS official bulletin (DIPCO);
2. DGCS website;
3. Italian newspapers;
4. Any other appropriate Italian media if necessary.

The Invitation for Bids may be published in China by end-users at its own expenses. If published in China, IFB must be in English and must be identical to the IFB published by DGCS.

Language

Bidding documents, bids prepared by bidders, as well as all correspondence, documents and reports relating to the bidding exchanged by bidders and the Procurement Agent shall be written in English. The Contract and all documents pertaining to the Contract shall all be written in English.

Bid and Contract Currency

Bidders shall quote all the prices in Euro. Contract currency shall be expressed in Euro. Payment to Suppliers under the Contract will be made in Euro.

DGCS “no-objection”

After contracts are awarded, end-users shall submit each contract to DGCS for “no-objection”. Contracts will enter into force only upon DGCS “no-objection”.

Control Procedures by DGCS

All authorizations/approvals by DGCS relevant to the procurement activities to be carried out by the End-User and the Procurement Agent will be limited to verify that all procedures and provisions are conducted transparently and efficiently in conformity with the tendering laws and guidelines indicated in the MOU.

The Evaluation Committee will be responsible to select the suppliers according to the agreed procedures and provisions.

After the preparation of the Bidding Documents and during the bidding DGCS holds the right to:

1. Designate observer(s) to attend opening session and evaluation sessions. The observer(s) will have no voting rights.
2. Approve the proposal for award and the signed contract.
3. Request, if necessary, a copy of all submitted bids;

During Contract implementation, DGCS will carry out the following controls:

1. Request, if necessary, all supporting documents relating to the contract;
2. Carry out any necessary checks in case of suspected unusual commercial expenses not mentioned in the main Contract.

Technical Specifications

End-users are responsible for the preparation of the Technical Specifications according to the indications prescribed in the bidding documents and the procurement principles indicated in the MOU. PIU procurement experts will support end-users during the preparation and inclusion of the Technical Specifications in the Bidding Documents.