Doing business with the georgian government


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Doing business with the georgian government

  1. 1. “Doing Business with the Georgian Government” The Supplier Guide
  2. 2. INTRODUCTION The guide provides potential suppliers with simple and practical insights into the necessary supplier qualification criteria. In addition, it provides information about the state procurement’s needs and opportunities as well as how to use theCompetition and State Procurement Agency’s (CSPA) online procurement system. The guide is available through a variety of internet resources [list of main web pages where guide will be available] In multiple languages. It will serve as a useful tool for suppliers to receive a contract from the Georgian Government.
  4. 4. PROCUREMENT SYSTEMOver the past decade, the Georgian procurement system has continuouslyimproved due to progressive legislation, resulting in efficient and transparent procurement policies and practices. The Law on State Procurement has multiple objectives, including:  To ensure rational spending of public funds;  To develop fair and open competition;  To create a fair and non-discriminatory environment for participants in procurement procedures;  To establish a vendor’s responsibility;  To ensure publicity of public procurements;  To establish a uniform system of electronic system of public procurements;  To build trust among civil society for the Georgian procurement process.
  5. 5. PROCUREMENT SYSTEM• Georgia’s state procurement system and its policies work to fulfill the procuring entity’s mission and protect the interests of the state and its taxpayers while promoting fair contractual relationships with the business community.• Competition in the procurement process serves both state agencies and potential suppliers by guaranteeing an optimal solution at a reasonable price. It also provides qualified vendors with an opportunity to obtain business from the Georgian Government.
  6. 6. GEORGIA’S STATE PROCUREMNT PROCESS IS DESIGNED TO: Ensure fair and transparent competition as the process is open and does not require a company’s local presence; Prevent against favoritism, carelessness, over-spending, fraud and corruption; Ensure that the results of the procurement process meet the needs; Provide for checks and balances to regulate and oversee procurement activities; Protect the interests of the state and its taxpayers; Make reasonable efforts to ensure that vendors are aware of opportunities to compete for state business as tender notices are in Georgian and English; Define the process by which the procurement is being conducted; Disclose the general process to potential suppliers; Document the procurement process, including any related information and decisions.
  7. 7. COMPETITION AND STATE PROCUREMENT AGENCY (CSPA)CSPA is a central independent body in publicprocurement system and as such it carries out variety of functions - regulatory, monitoring, training, advisory, informational, operational- development and review.
  8. 8. GEORGIAN ELECTRONIC GOVERNMENT PROCUREMENT (Ge-GP) E-Procurement is a collective term for a range of technologies that can be used to automate the internal and external processes associated with procurement. The two main e-modules embedded in the Georgian E-Procurement system are E-Tendering and E-Auction E-Tendering includes activities such as advertising the requirement for goods or services, registering suppliers, issuing and receiving tender documents via the internet, and automating the evaluation of responses to a tender. E-Auction is the means by which a supplier bids in an open auction via the internet for a contract.  
  9. 9. GEORGIAN ELECTRONIC GOVERNMENT PROCUREMENT (Ge-GP) By using email and internet technology, E-Procurement removes traditional paper processes and provides organizations with the ability to trade electronically. It makes trading simpler and more cost effective for both buyers and suppliers. Since December 1st, 2010 the Georgian Government must trade electronically with suppliers and those companies who desire to trade with the Government must have E-Procurement capabilities. It is not necessary to invest in expensive or complex technology to take advantage of the opportunities offered by E-Procurement. At the most basic level, a business may engage in E-Procurement with just a computer and an internet connection. The means by which E-Procurement is conducted depends on the value of goods, services or works to be procured; respectively minimum time frames are defined for each occasion. 
  10. 10. MEANS OF PROCUREMENT Means of Value (GEL) Published Time frames Remarks Procurement Simplified purchase ≤ 5K - - - Simplified 5K-200K Ge-GP min. 3 days - Electronic Tender Electronic Tender 200K≥ Ge-GP e-Tendering min. 15 Tender notices are days published also in English + e-Auction 5 days Contest - CSPA web page, - Used mainly for architectural www.procurement. and design services Two Stage 5K-200K Ge-GP e-Auction (2nd stage) to Limited to procurement of Simplified be conducted on the 3rd specific services such as: Electronic day from technical and banking and investment, Tender qualitative evaluation (1st legal, accounting, auditing , stage) financial, recruitment, Two Stage 200K≥ training services Electronic Tender Consolidated - CSPA web page - Used for aggregated Tender purchase of commonly used commodities, e.g. fuel*Ge-GP – Georgian Electronic Government Procurement*CSPA – Competition and State Procurement Agency
  11. 11. EVALUATION SYSTEM: LOWEST PRICE + PASS/FAILBidder Final Price Criteria Pass/Fail Status (GEL) C1 pass Disqualified because ofBidder A 90 C2 pass technical non- compliance in C3 fail Criteria 3 C1 passBidder C 100 C2 pass WINNER !!! C3 pass C1 pass Not reviewedBidder B 110 C2 pass because the winner (Bidder C) C3 pass was identified
  12. 12. WHAT, WHEN, HOW MUCH, FROM WHOM ??? Top Procuring Entities Top CSPA-2011 Number of Suppliers Annual e-Tenders Report Savings
  13. 13. TO-DOsThere are several important aspects to be taken into account by the supplier before and throughout the process of participation in public procurement. Make sure you want to do business with the government. Government may be the country’s largest customer, but their business comes with a lot of strings. Educate yourself extremely well on the process Make sure you meet the basic requirements for doing business with the government. Determine the relevant Georgian Governmental entity who will purchases your products or services Identify classification codes for goods or services you provide according to Common Procurement Vocabulary Register with the CSPA Unified Electronic System of State Procurement and subscribe for automated alert system. Detailed walk-through on electronic procurement process is available on the following link
  14. 14. While E-Procurement offers benefits to suppliers, it can also pose challenges such as increased competition and keener prices. As a result of bids being advertised on theinternet, more suppliers have the opportunity to bid. Therefore, it is essential for thewinning bid to be well drafted. The following tips will help a business draft a soundproposal:
  15. 15. NOT-TO-DOsThe most common reasons for losing a tender are as follows: Failure to follow the instructions regarding organization of the proposal. Failure to take evaluation criteria and allocated points into consideration when preparing a response. Failure to understand and demonstrate an understanding of the problem. Failure to follow the necessary deadlines. Failure to include all of the requested information. The price provided is unreasonable (too high or too low) or incomplete. The proposal is unprofessional in appearance and poorly written. For example, information is not presented and organized in a logical manner while the proposal is difficult to follow and uses poor grammar. A substandard proposal reflects poorly upon a company. The proposal does not contain relevant information about a company, its capabilities, and or its management and staff. The proposal does not demonstrate that a company and its personnel have the necessary experience and capabilities to carry out the project.
  16. 16. ATTENTION Act Responsibly in accordance with legislation!!! If you fail to meet deadlines after being selected or fail to sign a contract or meet contractual obligations YOU GET INTO BLACK LIST & LOSE GUARANTEE AMOUNTIf you meet the criteria set by the procurement legislation and you are acknowledged as a qualified vendor YOU GET INTO WHITE LIST
  17. 17. DISPUTE RESOLUTION IN PROCUREMENT If you think that a procuring entity violated the core principles of transparency, free competition and impartiality during the procurement process, the you can always revert to the a variety of legislative tools. Dispute resolution inprocurement is a tri-tier system, which allows a plaintiff to address the procuring entity (T-I), CSPA (T-II) and judiciary (T-III) without needing to address each of them in sequence. Statistics show that the majority of cases are rejected at theT-I stage, resolved in favor of plaintiff at the T-II phase, and rarely get to the T-III level. The Dispute Resolution Board is a T-II mechanism and consists of equal representation from various stakeholders including the CSPA, the public and private sector, and NGO representatives. All claims are submitted electronically and all decisions are published on the CSPA web page, which is the only legitimate place for such publication.If the necessity emerges, a business should use the available legal tools toensure adherence to the core principles that the state procurement system isbased upon.NOTE: If a business believes the procuring entity acted violation of legislation, it should appeal the tender decision.
  18. 18. DISPUTE RESOLUTION SYSTEM Review Claim Claim Claim Claim Number Outcom Body Submissi Submission Processin Submission of e on Format Stage g Timing Fee ClaimsT-I Procuring - Any time prior 10 days Free N/A Entity to signing of the contractT-II CSPA Electronic Any time prior 10 days Free 117 58 to signing of Positive the contractT-III Court Electronic Any time 2 months 3% of claim N/a amount, not less than 100 GEL and not more than 3000 GEL for individuals and 5000 GEL for legal entities