OVERVIEW OF THE UN SYSTEM & PROCUREMENT PROCEDURES Presented by: Isabelle Dupuy Team Leader, and Lukasz Trzebinski Management Services Team United Nations Secretariat Procurement Division November 2016 Brief introduction: My name is …. I’m here on behalf of the UN Procurement Division (New York); [Introduce colleague – if applicable]. Thank the organizers for the opportunity of giving this presentation on ‘How to do business with the United Nations’; In 2008, the total procurement volume of the UN system was more than thirteen (13) billion US dollars. The procurement volume of the UN Procurement Division last year was over three (3) billion US dollars. The objective if this presentation is to provide you with some background information of the UN Organization and the UN procurement process, which will allow you to: Register as a vendor Take part in the solicitation process, and If successful, win contracts with the UN OVERVIEW OF THE UN SYSTEM & PROCUREMENT PROCEDURES 1

OVERVIEW OF THE UN SYSTEM & PROCUREMENT PROCEDURES A. Overview of the United Nations Procurement System UN Procurement System UN Procurement Division Statistics B. Overview of the UN Procurement Procedures C. Questions Briefly explain the agenda of the presentation: In the next … minutes I will explain the following topics: An overview of the UN Organization Procurement Statistics – an overview of the market volume How to identify Business Opportunities for your company The UN Procurement process and procedures Some practical tips for doing business with the UN More detail on the UN Procurement Division, which represents UN Headquarters and Peacekeeping Missions The UN Global Compact – the UN values companies who honor human rights, the environment, and anti-corruption norms After the presentation there will be time to ask questions. Note: time management is important! Make sure that you know how much time you have for this presentation and that you know how long it will take to go through it. 2

First, an overview of the UN system of organizations A. Overview

A.1 UN System of Organisations

Overview The United Nations is not a single organisation, it is made up of a variety of organizational entities: Funds & Programmes Specialised Agencies, Secretariat: UNHQs, Offices Away From Headquarters, commissions, tribunals and field peacekeeping missions. Each organization has a distinct and separate mandate covering the political, economic, social, scientific, humanitarian, and technical fields. Each organisation is a market in itself - different functions, characteristics and requirements The UN is not a single organization, but in fact a large number of organizations. This is very important to recognize if you wish to do business with the UN. It is a market in itself, made up of a variety of organizational entities, each with its separate function and mandate. Because each organization has a different function, each entity also has its own characteristics and requirements. Although we try to harmonize our processes, each entity has its own procurement organization, and processes and procedures may be different per organization.

UN Funds & Programmes United Nations Development Programme (UNDP) Major goods/services: Telecommunications, electrical, laboratory and agricultural equipment, Medical supplies and equipment, Water supply systems, Pharmaceuticals, Educational, training and social services United Nations Children’s Fund (UNICEF) Major goods/services: Vaccines/biologicals, Pharmaceuticals, Educational supplies Medical supplies and equipment, Water and sanitation, Bed nets Here are two examples of the UN Funds & Programmes. You will notice the differences in the types of commodities procured. Many UN agencies have delegated authority to their respective country offices to undertake procurement up to a certain financial limit. UNDP – is the UN’s global development network, advocating for change and connecting countries to knowledge. UNICEF – advocates and works for the protection of children’s rights. Specializes in the procurement of supplies for children. WFP – is the world’s largest international food aid organization, which handles 70% of all global food relief. World Food Programme (WFP) Major goods/services: Food, Transport, Warehousing and Logistics, Vehicles, IT Equipment, Communication Equipment UN Funds & Programmes

UN Specialized Agencies Food and Agriculture Organization (FAO) Major goods and services: Chemicals, Grain mill products, starches & starch products, Agricultural produce, Machinery, special purpose, Transport equipment, Animals and animal products World Health Organization (WHO) Major goods and services: Pharmaceutical products & Vaccines, X-ray/Radiological apparatus, Administrative supplies, office furniture, Laboratory supplies, equipment and instruments, Medical and surgical equipment, Transport ,HIV Test Kits, Dental instruments and appliances Here we present two examples of UN Specialized Agencies: FAO and WHO. It is important to note that each UN agency may have a different registration process and/or criteria. FAO – is the leading international body in food and agriculture. It provides direct technical assistance through its Field Programmes. WHO – is the leading agency in international health. UN Specialized Agencies

Useful General Addresses www.iaea.org International Atomic Energy Agency www.ilo.org International Labour Organisation www.intracen.org International Trade Centre www.unesco.org UN Educational, Scientific and Cultural Organization www.unfpa.org UN Populations Fund www.unhcr.ch UN High Commissioner for Refugees www.unicef.org UN Children’s Fund www.unido.org UN Industrial Development Organisation www.unops.org UN Office for Project Services www.undp.org UN Development Program www.un.org UN Secretariat www.unrwa.org UN Relief and Works Agency www.wfp.org World Food Programme www.wipo.int World Intellectual Property Organisation www.fao.org Food and Agricultural Organization www.itu.int International Telecommunications Union www.ifad.org International Fund for Agricultural Development www.uneca.org United Nations Economic Commission for Africa In order to familiarize yourself with the UN system and all its different organizations, we recommend you to go to the different websites of the entities. Most of the organizations have their own website, and this slide gives just an example of some of them. All websites can be accessed through the www.un.org internet portal, highlighted in red.

The United Nations Secretariat - Area of operation HQ UN Peacekeeping Missions UN Economic and Social Commissions (OAH) International Criminal Tribunal 10

has its own specific requirements for goods and services Overview EACH ORGANISATION…… has its own specific requirements for goods and services may conduct its own procurement activities follows, in general, common principles for procurement rules and regulations constitutes a separate and distinct customer/partner has its own tempo, portfolio, specific characteristics YOU MUST LEARN ABOUT IT …… As mentioned earlier, it is very important to recognize that the UN is not just one organization, but in fact it is a multitude of organization, whereby each organization: … Read bullet points on slide.

A.2 Statistics (UN Procurement Division) Transition: Now we know a little more about the organization, let’s have a look at the procurement volume of the United Nations. A.2 Statistics (UN Procurement Division)

The United Nations Procurement Service Types of Equipment, Goods and Services Procured New York HQs and Field Missions: types of Goods and Services Air Transportation Services Chemical & Petroleum Products Telecommunication Equipment & Services Food Rations & Catering Services Motor Vehicles/Parts & Transportation Equipment Computer Equipment and Services Logistics & Freight Forwarding Prefabricated Buildings Inspection & Related Services Architecture, Engineering & Construction Related Services Electrical Apparatus & electronic component Real Estate Lease & rental Banking & Investment Security Equipment Pharmaceutical products and vaccines Medical Equipment This list provides examples of goods and services required by both the peacekeeping missions around the world and the United Nations Secretariat in New York. These goods and services are sourced and procured by the Procurement Division in New York. In response to the ever changing requirements of the United Nations, especially those in critical UN peacekeeping operations worldwide, the Procurement Division continuously reinvents itself in order to satisfy the needs of our customers in an evolving local market.

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Procurement Trend of UN/PD 2008-2015 UN HQ (New York, Geneva, Vienna) UN Peacekeeping (Haiti, Africa, Middle East, Asia) UN Economic and Social Commissions International Criminal Tribunals It is important to note that although the office in New York the main headquarters, local offices also have delegated procurement authority, up to certain thresholds, therefore each office has a local procurement office, that may conduct business up to their delegation of authority. In addition to registering with the United Nations Secretariat Procurement Division, vendors located in one or more of the operating regions are encouraged to also contact the local UN offices to seek business activities. The office in New York looks after Systems Contracts, special requirements and more complex procurement exercises. 15 15

Business Placed with Polish Suppliers with UNPD, 2011-2015 (in US $)

B. Overview of UN Procurement System Procedures

Common Guidelines for UN Procurement system Procurement activities of the UN system are based on the following principles: The objectives/needs of the UN Organization Fairness, integrity & transparency through international competition Economy & effectiveness Best value for money These Common Guidelines cover procurement stages from sourcing to execution of a procurement contract. Within the UN system, procurement follows a number of main principles that have been agreed upon by all the member states, and which were adopted by the General Assembly in the Financial Regulations and Rules. The principles for procurement activities are based on: (Read the 4 principles.) The UN defines BVM as: Optimization of the whole life costs and quality needed to meet the user’s requirements, while taking into consideration potential risk factors and resources available.

Competitive suppliers of previous procurement exercises UN Vendor Sourcing Competitive suppliers of previous procurement exercises Past performance Suppliers of the required goods or services, found on the UN Global Market (UNGM) Codification (UNSPSC) Automatic tender reference for UN Procurement Division Through calls for Expression of Interest (EOI) Search of World Wide Web Trade Missions, Chambers of Commerce Information exchange with other UN Agencies The UN uses different methods to identify suppliers for its needs. The most important methods are: Database of registered vendors. All vendors in our database are enlisted with commodity codes, which were chosen at the time of registration. - Vendors are selected based on these commodity codes, therefore it is very important that companies select the correct codes when going through the registration process. Expression of Interest. All of our requirements with a value greater than USD30,000 are advertised on the Procurement Division’s website as well on the United Nations Global Marketplace website. It is important to remember that only fully registered companies can be awarded a contract.

SAMPLE OF EXPRESSION OF INTEREST (EOI) FORM

Expression of Interest and Types of Solicitation Expression of Interest (EOI) Request for Quotation (RFQ) Invitation to Bid (ITB) Request for Proposal (RFP) The UN organization uses different types of solicitation for different purposes. To initiate the solicitation process a request for Expression of Interest or EOI is published on the Procurement Division’s website, on the UNGM website and maybe advertised in journals and trade publications. Suppliers interested in participating in a specific solicitation should respond to the EOI. The three (3) types of solicitations are: The Request for Quotation or (RFQ), this is a less formal solicitation used for procurement of goods having a value of less than USD 40,000. The Invitation to Bid or (ITB). The ITB is a formal solicitation method for well defined goods (or services); taking into consideration the best value for money for the United Nations. The ITB is used when the estimated contract award is more than USD40,000. The contract award is typically based on lowest acceptable bid. The Request for Proposal or (RFP). The RFP is a formal solicitation process whereby the Best Value for Money principle is applied. The contract award is based on a combined (weighted) evaluation of both the technical solution and price. The RFP is used when the estimated contract is more than USD40,000.

Thresholds/Award for types of solicitation Up to [40,000 USD] Local, informal, simplified acquisition procedure Requests for Quotation (RFQ) Above [40,000 USD] Invitation to Bid (ITB) and Request for Proposal (RFP) Open and formal: advertised (on the web) generally larger shortlist (minimum 6 potential bidders) Public bid opening Contract award – Contract authority Review and recommendation by independent body for higher value contracts As mentioned earlier, RFQ is used for procurement of up to USD40,000 and ITB and RFP are used for procurement with values greater than USD40,000. In the UN, the procurement authority has been delegated to individuals in the procurement organization. However, in all cases there is a review process in place and for higher value contracts. Proposed contract awards are presented to a special review committee. The committee makes the final recommendation regarding the suggested contract award to the decision makers.

Bid Evaluation Criteria (not exhaustive list) Acceptance of UN payment terms, terms & conditions, contract template, liability, legal capacity, etc. Delivery Terms Delivery Time Technical Requirements Recognized International Standards or similar Supporting Documentation Proven Production Capacity & Financial Strength Warranty Conditions Appropriate After-sales Service Previous Contract References Price (life cycle cost) In order to evaluate vendor submissions, the evaluation criteria is established in advance of launching the solicitation. This slide lists some of the basic criteria that may be applied. However additional criteria may be developed depending on the goods and/or services required. The evaluation criteria are usually mentioned in the solicitation documents.

Common General Terms & Conditions UN General Clauses Conditions of Contracts for Goods, Services, Combination, Construction Most provisions are common within the UN procurement system, however some provisions may vary in text depending on individual agency requirements. Potential suppliers are encouraged to familiarise themselves with the UN Terms & Conditions (UNGCC) Immunity & Privileges Bid and Performance bonds UN Supplier Code of Conduct In general, within the UN system we use common general terms and conditions that cover goods, services or both. Your company is encouraged to become familiar with the UN general Terms and Conditions. Some provisions may differ for different entities within the UN system. It is important to note that some provisions may differ for different entities within the United Nations system. The Terms and Conditions are available on the United Nations Procurement Division website. Generally, the Terms and Conditions are not negotiable, and the acceptance thereof is usually one of the evaluation criteria in the solicitation documents.

Practical Tips General Always respond to bid invitations – if you cannot submit an offer, inform accordingly (Annex A) Bid Preparation Study bid documents, conditions and requirements carefully Ask for clarification if uncertain Ensure that your offer meets ALL bidding requirements Technical specifications – read carefully and meet minimum requirements Quality statements – international/national standards

Practical Tips Submit bid, catalogues etc. in requested language Prepare bid to facilitate work of procurement officer - requested format, use submission forms, indicate page number for the required document Bid Submission Meet deadline Attend public bid openings Remember Learning process At EOI stage – if not fully compliant partner with other companies Check Contract Award Notices

Contract Award Notices www.ungm.org www.un.org/Depts/ptd

Your commitment – Our Support - Your success ! Key Features of the UN Secretariat Generalist procurement organization World wide operation Previous procurement principles apply plus “zero tolerance policy” Additional provisions for internal control, e.g. post employment and risk management Easy registration process (next brief) Detailed general and specific information available at: http://www.un.org/depts/ptd/contact.htm Your commitment – Our Support - Your success ! The website of the United Nations Secretariat Procurement Division provides vendors and interested organizations with valuable information and data for understanding the Division’s activities, policies and procedures and the UN requirements for goods and services.

Senior Vendor Review Committee Bid & Vendor Review The United Nations Secretariat Procurement Division is committed to the continuous improvement of its operations and relationships with the vendor community. Award Review Board Senior Vendor Review Committee Award Review Board – provides an opportunity to unsuccessful bidders who have participated in a high value competitive procurement process, whereby they may file a procurement challenge on a post award basis, against a contract awarded by the United Nations. Senior Vendor Review Committee – provides written independent advice on addressing vendors registered with, or seeking to register with the United Nations who are under investigation, accused, convicted or involved in litigation in which there are allegations or evidence that the vendor engaged in a fraudulent, corrupt or unethical practice. 29

www.un.org/Depts/ptd

Possibility for Question and Answers. Any questions ? 31