J.4 MCC Program Procurement Guidlines.pdf

Program Procurement

Guidelines

Department of Compact Operations

DCO-2008.37.7

February 10, 2021 iProgram Procurement Guidelines | February 2021

TABLE OF CONTENTS

1. PURPOSE AND SCOPE

2. AUTHORITIES

3. EFFECTIVE DATE

4. GUIDELINES

PART 1 Conduct and Administration of Procurement Section 1.A Program Procurement Guidelines: Procurement of Goods, Works, and Non-consulting Services (including Information Systems)

I. Introduction II. Competitive Bidding III. Other Methods of Procurement

Section 1.B Program Procurement Guidelines: Procurement of Consulting Services I. Introduction II. Quality and Cost-Based Selection III. III. Other Methods of Selection IV. Other Provisions

PART 2 PROCUREMENT PLANNING, IMPLEMENTATION, AND REPORTING

P2.1 Procurement Plan P2.2 Procurement Implementation Plan P2.3 Procurement Operations Manual P2.4 Procurement Performance Report P2.5 Contractor Past Performance Reporting System

PART 3. STANDARD BIDDING DOCUMENTS

PART 4. REVIEW AND APPROVAL REQUIREMENTS

PART 5. BID CHALLENGE SYSTEM

PART 6. SUBCONTRACTING

PART 7. AMENDMENTS AND WAIVERS

PART 8. PUBLICATION OF MCC PROGRAM PROCUREMENT

GUIDELINES AND ADDITIONAL INFORMATION

PART 9. LANGUAGE

PART 10. ELIGIBILITY VERIFICATION PROCEDURES

PART 11. CONTRACT TYPES

PART 12. RECORDS, POST REVIEW, AND CONTRACT ADMINISTRATION

PART 13. GOVERNMENT-OWNED ENTERPRISES

PART 14. COMBATING TRAFFICKING IN PERSONS

ATTACHMENT A. PPG APPROVAL MATRIX

ATTACHMENT B. GLOSSARY OF TERMS

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ACTION: APPROVER: DATE:

APPROVAL: DCO-2008.37.6

JONATHAN BROOKS

ACTING VICE PRESIDENT DEPARTMENT OF

COMPACT OPERATIONS

FEBRUARY 10, 2021

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1. PURPOSE AND SCOPE

The principles, rules, and procedures set out in these Program Procurement Guidelines (Guidelines or PPG) shall govern the conduct and administration by the Millennium Challenge Account Entity (MCA Entity) or other entity, excluding Millennium Challenge Corporation (MCC) of the procurement of the goods, works, information technology, consulting, and non-consulting services that need to be acquired to implement the Projects funded by MCC (Project or Projects) under “Millennium Challenge Com-pacts” and “Grant Agreements” entered into pursuant to Section 609(g) of the Millennium Challenge Act (Act), unless MCC specifically agrees to the application of alternative procurement procedures. These Guidelines do not apply to purchases defined in the MCC Procurement Guidance Note: MCA Non-PPG Covered (NPC) Purchases that are covered by guidance provided by the Procurement Operations Manual (POM) and Procurement Handbook, which are guidance notes applicable and available to MCA Entities.

Unless stipulated otherwise in the relevant Threshold Program Grant Agreement, these Guidelines will apply to MCC threshold programs funded pursuant to Section 616 of the Act.

These Guidelines do not apply to Grants, which include all forms of cooperative or cooperation agree-ments and Program Partnership Solicitations (or PPS), issued by MCA Entities, which are covered through a separate Guideline called Program Grants Guidelines or PGG.

2. AUTHORITIES

2.1 Statutory Authority

a) Section 609(b)(1)(I) of the Millennium Challenge Act of 2003, as amended (Public Law [P.L.] No.

108-199, codified at 22 United States Code [U.S.C.] 7701, et seq.)

2.2 Federal Government Regulations, Standards, and Other Guidance

a) Not applicable

2.3 Related MCC Policies and Procedures

a) Guidance on Reporting and Considering Past Performance by Contractors in MCA Entity Program Procurements

b) Cost Principles for Cost-Reimbursement Contracts under MCC-Financed Grants

c) Cost Principles for Government Affiliates

d) Policy on Preventing, Detecting, and Remediating Fraud and Corruption in MCC Operations

e) Guidelines for Accountable Entities and Implementation Structures

3. EFFECTIVE DATE

These Guidelines shall become effective 30 days after publication and shall supersede all previous versions.

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4. GUIDELINES

PART 1 CONDUCT AND ADMINISTRATION OF PROCUREMENT

Section 1.A Program Procurement Guidelines: Procurement of Goods, Works, and Non-consulting Services (including Information Systems)

I. Introduction

Applicability of Section 1.A of these Guidelines

P1.A.1.1 Section 1.A sets forth the principles, rules, and procedures generally applicable to the procure-ment of goods, works, and non-consulting services (including information systems) funded by MCC.

General Considerations

P1.A.1.2 The MCA Entity is responsible for implementing the Projects and therefore for selecting the con-tractors and suppliers and awarding and subsequently administering the contracts. While in practice the specific procurement rules and procedures to be followed in the implementation of a Project depend on the circumstances of the particular case, the following four considerations known as the MCC Program Procurement Principles generally guide the application of these Guidelines:

P1.A.1.2 (a) Open, fair, and competitive procedures shall be used in a transparent manner to solicit, award, and administer contracts to procure goods, works, and non-consulting services (including information systems).

P1.A.1.2 (b) Solicitations for goods, works and non-consulting services (including information systems) shall be based on a clear and accurate description of the goods, works, and non-consulting services to be acquired.

P1.A.1.2 (c) Contracts shall be awarded only to qualified and capable suppliers and contractors that have the capability and willingness to perform the contracts in accordance with the terms and conditions of the applicable contracts and on a cost-effective and timely basis.

P1.A.1.2 (d) Only a commercially reasonable price (as determined, for example, by a comparison of price quotations and market prices) shall be paid to procure goods, works and non-consulting services (includ-ing information systems).

P1.A.1.3 The MCA Entity shall ensure that all the procurements for goods, works, and non-consulting services (including information systems) undertaken in furtherance of the Compact and funded in whole or in part, directly or indirectly, with MCC funding shall comply with these MCC Program Procurement Principles.

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P1.A.1.4 Open competition is the basis for efficient public procurement. In most cases therefore, MCC requires that MCC-funded goods, works and non-consulting services (including information systems) be obtained through an open and competitive bidding process (Competitive Bidding) open to eligible suppli-ers and contractors as set out in Sub-Section II. Competitive Bidding below.

P1.A.1.5 Where Competitive Bidding is not the most appropriate method of procurement, other methods of procurement may be used. Sub-Section III. Other Methods of Procurement below describes these other methods of procurement and the circumstances under which their application would be more appro-priate. The particular methods to be followed for procurements under the Compact shall be set out in Procurement Plans as approved by MCC.

Conflict of Interest

P1.A.1.6 Firms and individuals shall not have any conflicts with other assignments and their own corporate interests. Firms and individuals shall not be hired for any assignment that would be in conflict with their prior or current obligations to other clients, or that may place them in a position of being unable to carry out the assignment in the best interest of the MCA Entity. Without limiting the generality of the forego-ing, firms or individuals shall not be hired under the circumstances set forth below:

Conflict between consultant activities and procurement of goods, works or non-consulting services (including information systems): A firm or individual that has been engaged by MCC, the MCA Entity or another donor to provide goods, works, or non-consulting services (including information systems) for a Project (including the firm’s personnel, subcontractors, and affiliates), shall be disqualified from providing consulting services related to those goods, works or non-consulting services (including information systems). Similarly, a firm or individual hired to provide consulting services for the prepa-ration or implementation of a Project (including the firm’s personnel, subcontractors, and affiliates), shall be disqualified from subsequently providing goods, works, or non-consulting services (including information systems) resulting from or directly related to the firm’s consulting services for such prepa-ration or implementation.

Relationships with the MCA Entity staff: If a firm or individual has been engaged by the MCA Entity to provide goods, works or services (including the firm’s personnel, subcontractors, and affiliates) and are themselves or have a business or family relationship with (i) a member of the MCA Entity board of directors or staff, (ii) the Project-implementing entity’s staff, or (iii) the Procurement Agent or Fiscal Agent hired by the MCA Entity in connection with the Compact, any of whom are directly or indirect-ly involved in any part of the following: (A) the preparation of the solicitation documents related to the procurement, including the contract; (B) the selection process for such procurement; or (C) the super-vision of any contract awarded in the procurement, then this aforementioned firm or individual may not be awarded the contract, unless the conflict stemming from this relationship has been resolved in a manner acceptable to MCC throughout the process of preparing the documents related to the pro-curement, the selection process, and the award and execution of the contract.

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Unfair Competitive Advantage

Bidders (including the bidder’s personnel, sub-contractor and affiliates) competing for a specific as-signment shall not derive an unfair competitive advantage from having provided services related to the assignment in question. To that end, the MCA Entity shall make available to the bidders, together with the Bidding Document, all information that would give a bidder an unfair competitive advantage. If the MCA Entity, in consultation with MCC, determines that it is inappropriate or impractical to release information sufficient to cure a potential unfair advantage, the bidder with the potentially unfair ad-vantage may be disqualified for the purposes of the particular procurement.

Eligibility

P1.A.1.7 MCC does not permit the MCA Entity to deny pre- or post-qualification to a firm for reasons unrelated to its capability and resources to perform the contract successfully; nor does it permit the MCA Entity to disqualify any bidder for such reasons. Consequently, the MCA Entity should carry out due diligence on the legal, technical, and financial qualifications of bidders to be assured of their capabilities in relation to the specific contract.

P1.A.1.8 To foster competition, MCC permits firms and individuals to offer goods, works consulting services and non-consulting services (including information systems) for MCC-funded Projects, except firms and individuals that (i) are declared ineligible by the World Bank for any reason, during the period of time that the firm or individual is sanctioned by the World Bank; (ii) are debarred by the World Bank;

or (iii) are debarred or suspended from participation in procurements funded by the United States Federal Government or otherwise prohibited by applicable United States law or executive order or United States policies, including under any then-existing anti-terrorist policies.

P1.A.1.9 Furthermore:

a) Firms of a country or goods manufactured in a country may be excluded if (i) as a matter of law or official regulation, the country of the MCA Entity prohibits commercial relations with that country, provided that MCC is satisfied with such exclusion; or (ii) by an act of compliance with a decision of the United Nations Security Council taken under Chapter VII of the Charter of the United Nations, the country of the MCA Entity prohibits any import of goods from or payments to a particular country, person, or entity.

b) As stated in A.1.6.(b), a firm or individual that has been engaged to provide consulting services for the preparation or implementation of a Project (including the firm’s personnel, subcontractors, and affiliates), shall be disqualified from subsequently providing goods, works, or non-consulting services (including information systems) resulting from or directly related to the firm’s consulting services for such preparation or implementation. This provision does not apply to the various firms (consultants, contractors, or suppliers), which together, are performing the contractor’s obligations under a turnkey or design and build contract. See paragraph P1.A.2.5 for discussion of the use of turnkey or design and build contracts.

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c) The eligibility of Government-Owned Enterprises to offer goods and works for MCC-funded Projects will be determined in accordance with Part 13. Government-Owned Enterprises of these Guidelines.

d) A firm or individual declared ineligible in accordance with Part 10. Eligibility Verification Proce-dures1 shall be ineligible to be awarded an MCC-funded contract. This would also remove from el-igibility any bid from a country or from a firm or individual that is organized in or has its principal place of business or a significant portion of its operations in any country that is subject to sanction or restriction by law or policy of the United States.

e) Government officials and civil servants may only be hired by a Bidder of goods, works or non-con-sulting services if they: (i) are on leave of absence without pay, (ii) are not being hired by the agen-cy they were working for immediately before going on leave, and (iii) their employment would not create a conflict of interest (see paragraph P1.A.1.6). In addition, no current employee of any MCC-funded accountable entity (or a former employee that has left the MCA Entity within a period of less than twelve (12) months) that is (or has been) responsible for managing or administering any contract, grant, or other agreement between the Bidder and such other MCC-funded accountable entity shall be proposed or work as, or on behalf of, any Bidder. In the case where a Bidder seeks to engage the services of any person who may have left the MCA Entity (or such other MCC-funded accountable entity, as the case may be) within a period of less than twelve (12) months, it must ob-tain a “no-objection” from the MCA Entity for the inclusion of such a person, prior to the Bidder’s submission of its Bid. The MCA Entity must also obtain a “no-objection’ from MCC before replying to the Bidder.

Funding Availability for Planned Procurements

P1.A.1.10 In exceptional circumstances, the MCA Entity may, with the approval of MCC, initiate the procurement of goods, works, or non-consulting services (including information systems) before the obligation of Compact funds that are budgeted for such procurement. In requesting this approval, each MCA Entity should consider and mitigate the risks associated with such action and the potential for it not resulting in a successful contract award. These risks include but are not limited to the risk associated with whether contract pricing could be affected by additional uncertainty as well as negative market reactions and impact on future procurements if the approach results in a failure to award a contract in a timely manner. MCC’s approval determination will consider these factors, the level of uncertainty involved, and the MCA Entity’s proposed mitigating actions. In such cases, the procurement procedures, including advertisement, shall be in accordance with these Guidelines, and MCC shall review the process used by the MCA Entity according to this PPG’s approval matrix. The MCA Entity undertakes such procurement action at its own risk, and any concurrence by MCC with the procedures, documentation, or proposal for award does not commit MCC to fund the contract in question. While such procurement can be initiated, a contract or any portion of a contract utilizing MCC funds cannot be signed until MCC grant funds have been obligated by MCC and all applicable conditions necessary for the MCA Entity to commit the intend-ed funds have been met. Particular care in this regard must be taken in cases where procurements may be initiated prior to a Compact’s “Entry into Force” (EIF) due to the statutory requirement that Compacts have a term of only five years after EIF. Under no circumstances will MCC reimburse the MCA Entity 1 Eligibility Verification Form can be modified or amended from time to time by the MCC Program Procurement Practice Group

6 February 2021 | Program Procurement Guidelines for any contract costs incurred prior to EIF from the Compact funds, or if any action was taken without MCC’s approval. If the contract is signed, reimbursement by MCC of any payments made by the MCA Entity under the contract prior to obligation of the related Compact funds would be considered as retro-active financing, which is prohibited.

Joint Ventures

P1.A.1.11 Any firm may bid independently or in joint venture (as long as all firms participating in the joint venture are jointly and severally liable) with domestic firms or with foreign firms, but MCC does not ac-cept conditions of bidding that require mandatory joint ventures or other forms of mandatory association between firms.

MCC Review

P1.A.1.12 MCC shall review the MCA Entity procurement procedures, documents, bid evaluations, award recommendations, and contracts to ensure that the procurement process is carried out in accordance with the agreed procedures. These review procedures are described in Attachment A of these Guidelines.

Misprocurement

P1.A.1.13 MCC does not fund expenditures for goods, works, or non-consulting services (including infor-mation systems) that have not been procured in accordance with the agreed provisions as detailed in the Compact, any Supplemental Agreement, these Guidelines, and the approved Procurement Plans. In such cases, MCC will declare a misprocurement and may cancel disbursement of that portion of the Compact funds allocated to the goods, works, or non-consulting services (including information systems) that have been misprocured if corrective measures satisfactory to MCC are not taken. MCC may, in addition, exer-cise other remedies provided for under the Compact. Even once the contract is awarded after obtaining an approval from MCC, MCC may still declare a misprocurement if it concludes that the approval was issued on the basis of incomplete, inaccurate, or misleading information furnished by the MCA Entity or that the terms and conditions of the contract had been modified without MCC approval.

References to MCC

P1.A.1.14 The MCA Entity shall use the following language (or similar language acceptable to MCC) when referring to MCC in procurement documents:

The United States of America acting through the Millennium Challenge Corporation (MCC) and [insert country] acting through the government thereof (the Government) have entered into a Millennium Chal-lenge Compact for Millennium Challenge Account assistance to help facilitate poverty reduction through economic growth in [insert country] (the Compact) in the amount of approximately [insert amount of Compact] USD (MCC Funding). The Government, acting through [insert full legal name of the MCA Entity] (MCA-[insert as appropriate]) intends to apply a portion of the MCC Funding to eligible payments under a contract for which this [insert type of Bidding Document] is issued. Any payments made under the Proposed Contract will be subject, in all respects, to the terms and conditions of the Compact and re-

7Program Procurement Guidelines | February 2021 lated documents, including restrictions on the use and distribution of MCC Funding. No party other than the Government and [the MCA Entity] shall derive any rights from the Compact or have any claim to the proceeds of MCC Funding.

Fraud and Corruption

P1.A.1.15 MCC requires that all beneficiaries of MCC funding, including the MCA Entity and any bid-ders, suppliers, contractors, and subcontractors under any MCC-funded contracts, observe the highest standards of ethics during the procurement and execution of such contracts. MCC’s Policy on Preventing, Detecting, and Remediating Fraud and Corruption in MCC Operations is applicable to all procurements involving MCC funding and can be found on the MCC website. In pursuance of this policy, the following provisions shall apply:

P1.A.1.16 (a) For the purposes of these provisions, the terms “coercion”, “collusion”, “corruption”, “fraud”, “obstruction of investigation into allegations of fraud or corruption” and “prohibited practice” have the meaning set forth in MCC’s Policy on Preventing, Detecting, and Remediating Fraud and Corruption in MCC Operations.

P1.A.1.16 (b) The MCA Entity will reject a bid (and MCC will deny approval of a Proposed Contract award) if it determines that the bidder recommended for award has, directly or through an agent, en-gaged in coercion, collusion, corruption, fraud, obstruction of investigation into allegations of fraud or corruption, or prohibited practices in competing for the contract in question.

P1.A.1.16 (c) MCC and the MCA Entity have the right to sanction a bidder, supplier, contractor, or sub-contractor, including declaring such party ineligible, either indefinitely or for a stated period of time, to be awarded an MCC-funded contract if at any time either the MCA Entity or MCC determines that the bidder, supplier, contractor, or subcontractor has, directly or through an agent, engaged in coer-cion, collusion, corruption, fraud, obstruction of investigation into allegations of fraud or corruption, or prohibited practices in competing for, or in executing, such a contract.

P1.A.1.16 (d) MCC and the MCA Entity have the right to require that a bidder, supplier, contractor, or subcontractor to permit the MCA Entity, MCC, or any designee of MCC, to inspect its accounts, records, and other documents relating to the submission of a bid or performance of an MCC-funded contract and to have them audited by auditors appointed by MCC or the MCA Entity with the approv-al of MCC.

P1.A.1.16 (e) MCC has the right to cancel any portion or all of the MCC funding allocated to a con-tract if it determines at any time that representatives of a beneficiary of the MCC funding engaged in coercion, collusion, corruption, fraud, obstruction of investigation into allegations of fraud or corrup-tion, or prohibited practices during the selection process or the execution of an MCC-funded contract, without the MCA Entity having taken timely and appropriate action satisfactory to MCC to remedy the situation.

https://www.mcc.gov/resources/doc/policy-fraud-and-corruption https://www.mcc.gov/resources/doc/policy-fraud-and-corruption https://www.mcc.gov/resources/doc/policy-fraud-and-corruption https://www.mcc.gov/resources/doc/policy-fraud-and-corruption

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P1.A.1.17 With the specific approval of MCC, the MCA Entity may introduce into bid forms for contracts funded by MCC an undertaking of the bidder to observe, in competing for and executing a contract, the country’s laws against fraud and corruption (including bribery), as listed in the solicitation documents.

MCC will accept the introduction of such undertaking at the request of the MCA Entity, provided the arrangements governing such undertaking are satisfactory to MCC.

Price-Reasonableness Analysis

P1.A.1.18 The MCC Program Procurement Principles state “only a commercially reasonable price shall be paid to procure goods, works, and non-consulting services.” To ensure compliance with this principle, the MCA Entity shall conduct a price-reasonableness analysis of the prices offered in a procurement process (both for competitive and Direct Contracting procurements) for goods, works, and non-consulting ser-vices (including information systems). The MCA Entity will not make any award without making a posi-tive determination that the price is reasonable in accordance with the MCC Procurement Guidance Note:

Price-Reasonableness Analysis2.

Best Value for Money

P1.A.1.19 MCC requires the MCA Entity to follow the principle of achieving best value for money through consideration of suitable price and non-price criteria as outlined in the Standard Bidding Documents (SBD) relative to the procurement.

II. Competitive Bidding

A. General

Introduction

P1.A.2.1 The objective of Competitive Bidding, as described in these Guidelines, is to provide all eligible prospective bidders with timely and adequate notification of the MCA Entity’s requirements and an equal opportunity to bid for the required goods, works, and non-consulting services (including information systems).

Type and Size of Contracts

P1.A.2.2 The solicitation documents shall clearly state the type of contract to be entered into and shall contain the Proposed Contract provisions appropriate for the type of contract to be used. The most common types of contracts provide for payments on the basis of a lump sum, unit prices, reimbursable cost-plus fees, or combinations thereof. Requirements contracts, Indefinite Delivery-Indefinite Quantity Contracts, and Blanket Purchase Agreements are also permitted.

P1.A.2.3 The size and scope of individual contracts will depend on the magnitude, nature, and location of the Project. For Projects requiring a variety of goods and works, separate contracts generally are awarded

2 As may be modified from time to time by the MCC Program Procurement Practice Group https://www.mcc.gov/resources/doc/guidance-price-reasonableness https://www.mcc.gov/resources/doc/guidance-price-reasonableness

9Program Procurement Guidelines | February 2021 for the supply and/or installation of different goods and for works. The choice of contract will depend on procurement efficiency, overhead minimization, mobilization costs, contract administration and oversight burden easing, market considerations, and availability of funding.

P1.A.2.4 For a Project requiring similar but separate items of goods or works, bids may be invited under alternative contract options that would attract the interest of both small and large firms, which could be allowed, at their option, to bid for individual lots or for a group of similar lots. All bids and combinations of bids shall be received by the same deadline and opened and evaluated simultaneously, to determine the bid or combination of bids offering the best value to the MCA Entity.

P1.A.2.5 In certain cases, MCC may accept or require a turnkey contract under which the design and engi-neering, the supply and installation of equipment, and the construction of a complete facility or works are provided within one contract. Alternatively, the MCA Entity may remain responsible for the design and engineering and invite bids for a single responsibility contract for the supply and installation of all goods and works required for the Project component. Design and build, and management service contracts, are also acceptable where appropriate.

Two-Stage Bidding

P1.A.2.6 In the case of turnkey contracts or contracts for large complex facilities or works of a special nature, or complex information and communication technology, it may be undesirable or impractical to prepare complete technical specifications in advance. In such a case, a Two-Stage Bidding procedure may be used, under which first unpriced technical proposals on the basis of a conceptual design or perfor-mance specifications are invited, subject to technical clarifications and adjustments, to be followed by the issuance of amended solicitation documents and the submission of final technical proposals and priced bids in the second stage.

Budget

P1.A.2.7 Preparation of a thorough and realistic budget estimate is essential to ensure MCC funding is to be managed properly. This budget should be carefully considered during the preparation of the Procure-ment Plan between the MCA Entity’s Procurement Director, Fiscal Director, and the relevant Sector Di-rector and should correspond to the funds available for that sector and the activity. Based on this budget, the MCA Entity’s Procurement Director will decide the procurement methodology to be used, which will be submitted to MCC during the approval of the Procurement Plan. Any modification of the budget or the procurement methodology after the approval of the Procurement Plan must be approved by MCC (see PART 2 Procurement Planning, Implementation, and Reporting, below, for guidance on developing the Procurement Plan). The budget estimate shall be based on the MCA Entity’s assessment (with input from the implementing entity) of the resources needed to carry out the assignment, including staff time, logisti-cal support, and physical inputs. With MCC approval, the MCA Entity may choose to disclose the budget estimate in the bidding document. In this case, the MCA Entity shall explain that the budget estimate is indicative, and bidders are allowed to propose their own prices that will be assessed to determine price reasonableness.

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Notification and Advertising

P1.A.2.8 Timely notification of procurement opportunities is essential in Competitive Bidding. Every quarter and upon updates to the approved Procurement Plan, the MCA Entity shall publicize the Pro-curement Plan through a General Procurement Notice (GPN)3, which shall include procurements planned for the upcoming period. The GPN shall provide reasonable notice of planned procurements to potential suppliers and contractors.

P1.A.2.8.1 AAdvertisement of the GPN shall include posting in English at the MCA Entity’s website (or such other appropriate website designated by the MCA Entity and approved by MCC), the United Nations Development Business Online (UNDB Online) website at http://www.devbusiness.com/, and any website that MCC may decide from time to time. In addition, MCC may post such notices on https://beta.sam.

gov/ and/or any other U.S. Government publication.. The MCA Entity shall also publish the GPN in a newspaper of wide circulation in the country of the MCA Entity and in such other media outlets as appro-priate or as requested from time to time by MCC. In countries where the official language is other than English, unless otherwise agreed with MCC the GPN may be published in the official local language of the country of the MCA Entity in at least one newspaper of wide circulation in the country and on the MCA Entity’s website or any other website in the country with approval from MCC.

P1.A.2.9 Invitations to pre-qualify or to bid, as the case may be, shall be advertised as Specific Procure-ment Notices (SPN).4 For contracts for goods and non-consulting services with an estimated value at or more than United States Dollars (USD) 200,000 and contracts for works valued at or more than USD1,000,000, such invitations shall be published in at least one newspaper of national circulation in the country of the MCA Entity and posted at the MCA Entity’s website (or such other appropriate website designated by the MCA Entity and approved by MCC), UNDB Online, and any website that MCC may decide from time to time. The PA shall also send the published SPNs to the U.S. Embassy (office desig-nated per MCC) for wider distribution. In addition, MCC may post such notices on https://beta.sam.gov/ and/or any other U.S. government publication. Contracts valued below the respective thresholds can be advertised in the venue of preference of the MCA Entity—local, regional, and/or international. Publication in local print and broadcast and other national and international media is encouraged. If the publication will be done locally and internationally, the MCA Entity shall use its best efforts to publish all postings simultaneously so that the additional posting does not pre-date the required postings. The MCA Entity will publish an SPN in sufficient time to enable prospective bidders to obtain information, or the relevant solicitation documents, and prepare and submit their responses, taking into consideration the estimated value of the contract and period of advance notice given with the GPN. MCC reserves the right to approve the content of an SPN.

Pre-qualification of Bidders

P1.A.2.10 Pre-qualification is not mandatory, but may be conducted for large or complex works, or in any other circumstances in which the high costs of preparing detailed bids could discourage competition, such as custom-designed equipment, industrial plants, specialized services, some complex information and technology, and contracts to be let under turnkey, design and build, or management contracting. This also 3 As it may be modified or amended from time to time by the MCC Program Procurement Practice Group.

4 As it may be modified or amended from time to time by the MCC Program Procurement Practice Group.

https://beta.sam.gov/ https://beta.sam.gov/ https://beta.sam.gov/

11Program Procurement Guidelines | February 2021 ensures that invitations to bid are extended only to those who have adequate capabilities and resources.

Pre-qualification shall be based entirely on the capability and resources of prospective bidders to perform the particular contract satisfactorily.

P1.A.2.11 The invitation to pre-qualify shall be advertised according to the guidance provided in the POM and as agreed with MCC.

B. Solicitation Documents

General

P1.A.2.12 The solicitation documents shall furnish all information necessary for a prospective bidder to prepare a bid for the goods, works, or non-consulting services (including information systems) to be provided. While the details and complexity of these documents may vary with the size and nature of the proposed bid package and contract, they generally include: invitation for bids; instructions to bidders and a bid data sheet; evaluation and qualification criteria, bidding forms; form of contract, including both general and specific conditions; specifications and drawings; relevant technical data (including of geolog-ical and environmental nature); list of goods or bill of quantities; delivery time or schedule of completion;

and necessary appendices, such as formats for various securities. The basis for bid evaluation and selec-tion of the highest combined technical and financial score in procurements using Quality and Price-Based Selection (QPBS) or the lowest evaluated bid in procurements using conventional competitive bidding procedures, as applicable, shall be clearly outlined in the instructions to bidders, evaluation and qualifi-cation criteria or the specifications. If a fee is charged for the bidding documents, it shall be reasonable and reflect only the cost of their printing and delivery to prospective bidders and shall not be so high as to discourage qualified bidders. The MCA Entity may use an electronic system to distribute solicitation documents, provided that MCC is satisfied with the adequacy of such system. If solicitation documents are distributed electronically, the electronic system shall be secure to avoid modifications to the solicita-tion documents and shall not restrict the access of bidders to the bidding documents. Guidance on critical components of the solicitation documents is given in the following paragraphs.

P1.A.2.13 The MCA Entity shall use SBDs made available by MCC pursuant to Part 3. Standard Bidding Documents (SBD), whenever appropriate. In case there is no SBD appropriate to meet specific circum-stance of the MCA Entity, the MCA Entity may use another solicitation document with approval from MCC. The SBDs may be modified to address Project-specific conditions, subject to approval by MCC when the change is material. Such changes shall be introduced only through the Bid Data Sheet (BDS), Appendix to Bid, or through the Special Conditions of Contract (SCC) and not by introducing changes in the Instructions to Bidders (ITB) or General Conditions of Contract (GCC).

Validity of Bids and Bid Security

P1.A.2.14 Bidders shall be required to submit a bid valid for the time period specified in the bidding documents, which shall be sufficient to enable the MCA Entity to complete the evaluation of bids, review the recommendation of award with MCC (if required), and obtain all the necessary approvals, so that the contract can be awarded within that period.

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P1.A.2.15 The MCA Entity may require a bid security per the SBD used. When used, the bid security shall be in the amount and form specified in the solicitation documents and shall remain valid for a sufficient time beyond the validity period of the bids, to provide reasonable time for the MCA Entity to act if the security is to be called. The format of the bid security shall be in accordance with the solicitation document and shall be issued by a reputable bank or financial institution selected by the bidder. If the institution issuing the security is located outside the country of the MCA Entity, it shall have a corresponding financial institution located in the country of the MCA Entity. Except under certain circumstances (e.g., where a bid-der withdraws its bid during the period of bid validity, where a bidder does not accept certain corrections to its bid, or where an otherwise successful bidder fails to sign the contract or provide the performance security within the time specified) that are to be clearly stated in the bidding documents, bid security shall be released to unsuccessful bidders once the contract has been signed with the winning bidder.

Language

P1.A.2.16 All advertisements for contracts and notices of contract awards for contracts valued at or above USD100,000, whether posted at the MCA Entity’s website, UNDB Online, or any website that MCC may decide from time to time, shall be posted in English, and, at the discretion of the MCA Entity, may also be published in the local newspaper and the MCA Entity’s website in the official language of the country of the MCA Entity (if different from English). Advertisements for contracts and notices of contract awards for contracts valued at less than USD100,000 may be published in English or the official local language of the country of the MCA Entity (if different from English) or in both languages at the discretion of the MCA Entity. The English version will govern in the event of discrepancies between the English version and a local language version.

P1.A.2.17 For all contracts at or above USD100,000, the solicitation documents, the documents respond-ing to these solicitations (including the bids), and the contracts themselves shall be prepared in English, and English shall govern contractual relations between the MCA Entity and the supplier or contractor.

At the discretion of the MCA Entity, the solicitation documents also may be prepared in the local offi-cial language of the country of the MCA Entity (if different from English). For contracts valued at less than USD100,000, any solicitation document, responding documents, and contracts may be prepared in English or the local official language of the country of the MCA Entity (if different from English) or both at the discretion of the MCA Entity; if the documents are prepared in both languages, the English version will govern. However, contractors and suppliers shall not be permitted or required to sign contracts in two languages.

P1.A.2.17.1 The MCA Entity may seek a limited waiver from the language requirements of paragraphs P1.A.2.16 and P1.A.2.17 as described below in Part 9. Language.

Clarity of Solicitation Documents

P1.A.2.18 Solicitation documents shall be so worded as to permit and encourage international competition and shall set forth clearly and precisely the work to be carried out, the location of the work, the goods to be supplied, the place of delivery or installation, the schedule for delivery or completion, minimum performance requirements, and the warranty and maintenance requirements, as well as any other perti-

13Program Procurement Guidelines | February 2021 nent terms and conditions. In addition, the bidding documents, where appropriate, shall define the tests, standards, and methods that will be employed to judge the conformity of items as delivered, or works as performed with the specifications. Drawings shall be consistent with the text of the specifications, and an order of precedence between the two shall be specified.

P1.A.2.19 The solicitation documents shall specify any factors, in addition to price, which will be taken into account in evaluating bids, and how such factors will be quantified or otherwise evaluated. If bids based on alternative designs, materials, completion schedules, etc., are permitted, conditions for their acceptability and the method of their evaluation shall be expressly stated.

P1.A.2.20 All prospective bidders shall be provided the same information and shall be assured of equal opportunities to obtain additional information on a timely basis. The MCA Entity shall provide reasonable access to Project sites for visits by prospective bidders. For works or complex supply contracts, particu-larly for those requiring refurbishing existing works or equipment, a pre-bid conference may be arranged whereby potential bidders may meet with representatives of the MCA Entity to seek clarifications (in person or online). Minutes of the conference shall be provided to all prospective bidders and posted on the MCA Entity website (when one exists), with a copy included in the record of the procurement. Any additional information, clarification, correction of errors, or modifications of solicitation documents shall be sent to each recipient of the original solicitation documents with sufficient time before the bid deadline to enable bidders to take appropriate action. If necessary, the deadline shall be extended. For any solici-tation documents originally approved by MCC, MCC will provide final approval for modifications made after initial approval through the issuance of addenda, and before being sent by the MCA Entity to the prospective bidders.

Standards and Technical Specification

P1.A.2.21 Standards and technical specifications quoted in solicitation documents shall promote the broadest possible competition, while assuring the critical performance or other requirements for the goods, works, or non-consulting services (including information systems) under procurement. The MCA Entity shall specify internationally accepted standards, with which the equipment or materials or work-manship shall comply. References to specific standards developers or catalogue numbers should be avoid-ed and determination on which standards the MCA Entity will use should not be based on location of the standards developer or their status as a non-governmental or inter-governmental standards developing body. When such references are unavoidable, specifications should not preclude acceptance of interna-tional standards which promise equal performance. Where such international standards are unavailable or are inappropriate, national standards may be specified. In all cases, the solicitation documents shall state that equipment, material, or workmanship meeting the industry standards, which substantially demon-strates similar or better performance, will also be accepted.

Use of Brand Names

P1.A.2.22 Specifications shall be based on relevant characteristics and/or performance requirements.

References to brand names, catalog numbers, or similar classifications shall be avoided. If it is necessary to quote a brand name or catalog number of a particular manufacturer to clarify an otherwise incomplete

14 February 2021 | Program Procurement Guidelines specification, the words “or equivalent” shall be added after such reference. The specification shall permit the acceptance of offers for goods that have similar characteristics and that provide performance at least substantially equivalent to those specified.

Over-Specification Definition

P1.A.2.23 Over-specification occurs when a specification exceeds the minimum standards necessary to complete the intended task.

Procedures for Verifying Proper Specification

P1.A.2.24 MCA Entities must propose specifications for the procurement of goods that meet the mini-mum requirements necessary to complete the intended task. Goods that meet the minimum standards do not have to be goods of the lowest possible quality but must have the minimum physical, functional, and/or performance characteristics required to complete the intended work in an effective and efficient manner. The Procurement Agent of the MCA Entity is responsible for verifying the specifications and questioning any instances where it believes over-specification may have occurred. Extraordinary circum-stances that may require specifications above minimum requirements must be documented and noted when submitted for MCC approval.

Consequences of Over-Specification

P1.A.2.25 In all instances of over-specification, the primary consequences are restriction of competition and the potential for excessive and inefficient expenditure of funds. Competition is restricted because over-specification excludes viable alternatives that could meet the minimum standards of the intended use without inhibiting program efficiency. This not only limits the number of bids that could be received and considered but also represents the potential for intentional manipulation and fraud. There is also the potential for waste of funds because over-specification can result in unnecessary price increases.

Pricing

P1.A.2.26 Unless otherwise specified in the solicitation documents, bids for goods shall be invited on the basis of (a) Carriage and Insurance Paid (CIP) for all goods manufactured abroad, including those pre-viously imported, and (b) Ex Works (EXW) for goods manufactured or assembled in the country of the MCA Entity, plus the cost of inland transportation and insurance to the place of destination (or other International Commercial Terms [INCOTERMS] as indicated in the solicitation document). Bidders shall be allowed to arrange for ocean and other transportation and related insurance from any eligible source.

Where installation, commissioning, or other similar services are required to be performed by the bidder, as in the case of “supply and installation” contracts, the bidder shall be required to quote for these ser-vices, in addition.

P1.A.2.27 In the case of turnkey contracts, the bidder shall be required to quote the price of the installed plant at site, including all costs for supply of equipment, marine and local transportation, and insurance, 15Program Procurement Guidelines | February 2021 installation, and commissioning, as well as associated works and all other services included in the scope of contract such as design, maintenance, operation, etc.

P1.A.2.28 Bidders for works contracts shall be required to quote unit prices or lump sum prices for the performance of the works. Bidders shall be allowed to obtain all inputs from any eligible source so that they may offer their most competitive bids.

Price Adjustment

P1.A.2.29 Solicitation documents shall state either (a) that bid prices will be fixed or (b) that price adjust-ments will be made to reflect any changes (upward or downward) in major cost components of the con-tract, such as labor, equipment, materials, and fuel. Price adjustment provisions are usually not necessary in simple contracts involving delivery of goods or non-consulting services, or completion of works within 18 months but might be included in contracts that extend beyond 18 months with the approval of MCC.

P1.A.2.30 Prices may be adjusted by the use of a prescribed formula (or formulae), which breaks down the total price into components that are adjusted by price indices specified for each component or, al-ternatively, on the basis of documentary evidence (including actual invoices) provided by the supplier or contractor. The use of the formula method of price adjustment is preferable to that of documentary evi-dence. The method to be used, the formula (if applicable), and the base date for application shall be clearly defined in the bidding documents. If the payment currency is different from the source of the input and corresponding index, a correction factor shall be applied in the formula, to avoid incorrect adjustment.

Transportation and Insurance

P1.A.2.31 Solicitation documents shall permit suppliers and contractors to arrange transportation and insurance from any eligible source. Solicitation documents shall state the types and terms of insurance to be provided by the bidder. The indemnity payable under transportation insurance shall be at least 110 percent of the contract amount denominated in USD or local currency of the country of the MCA Entity, depending on the currency of the contract. For works, a contractor’s all-risk form of policy usually shall be specified. For large Projects with several contractors on a site, a wrap-up or total Project insurance ar-rangement may be obtained by the MCA Entity, in which case the MCA Entity shall seek competition for such insurance.

Allowable Currencies for Bids

P1.A.2.32 Solicitation documents shall state the currency or currencies in which bidders are to state their prices. Bidders must comply with the currency restrictions as set out in the solicitation documents. Any bid or proposal that deviates from the currency requirement as stated in the solicitation documents may be rejected as non-responsive.

P1.A.2.33 In stating the currency or currencies:

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a) The MCA Entity may allow bidders to submit bids using USD, the local currency of the country of the MCA Entity, or, if justified by sound business reasons, a combination of the two.