Ministry of Foreign Affairs, Latvia 1 EC Cooperation with Third Countries Typology of EC Service Contracts prepared by Mauro Napodano Development Strategies The author accepts sole responsibility for this presentation. Its content does not necessarily reflect the views of the EC which funded the project and of the Ministry of Foreign Affairs who organised the seminar.

Ministry of Foreign Affairs, Latvia 2 The web-page of the EuropeAid Cooperation Office is where to obtain information on tenders

Ministry of Foreign Affairs, Latvia 3 Searching database for tenders

Ministry of Foreign Affairs, Latvia 4 Example of results from a search on EC forecast/open tenders in Ukraine

Ministry of Foreign Affairs, Latvia 5 Short-listed companies receive the following tender dossier Instructions to tenderers, including terms of reference Shortlist of candidates Draft contract and annexes Tender submission form Award criteria contained in the dossier should be paid special attention; experience of experts and methodology/approach proposed are key criteria

Ministry of Foreign Affairs, Latvia 6 Example of award criteria in evaluation grid (service contract) Organisation and methodologyMax score Rationale20 Strategy20 Timetable of activities10 Total score for Organisation and methodology 50 Key expertsMax score (Max 25 points) Qualifications and skills5 General professional experience5 Specific professional experience15 (Max 15 points) Qualifications and skills2 General professional experience4 Specific professional experience9 (Max 5 points) Qualifications and skills1 General professional experience1 Specific professional experience3 (Max 5 points) Qualifications and skills1 General professional experience1 Specific professional experience3 Total score for Key experts50 Overall total score100 The division of scores between the two major categories and within each category varies according to the requirements of the specific tender procedure

Ministry of Foreign Affairs, Latvia 7 Structure of Terms of Reference (ToRs) - see example in hands-out Country and Sector Background Description of the assignment Project partner Overall and specific objectives Requested services Expected results Requirements Personnel – 3 categories of experts based on years of working experience (over 20, 10, 5) Qualifications and skills Allocation of working days Location and Duration Duration Project phases (inception, implementation) Location Reporting Content, language, format and number of reports Relation to other EC projects in the field

Ministry of Foreign Affairs, Latvia 8 For all the contractual aspects of a EC contract go to

Ministry of Foreign Affairs, Latvia 9 What to look up in the Contract Specific Conditions 1 Notes 2 3 For decentralised projects it could be denominated in local currency. In this case it would be advisable to hedge against foreign exchange risks Contract value Contract Structure The structure is complex and made of several annexes to be carefully considered Payment Schedule It is based on the cash flow forecast presented by the consultant in the bid Law of the contract Tax and Custom Dispute Settlement Payment Schedule For decentralised projects it is that of the beneficiary country: need to know local legal framework In general the project is tax and custom duty free; there can be some derogations though, e.g. a complex local system of pay first and get reimbursed later For decentralised projects it could be referred to the local jurisdiction. In this case it would be advisable to look for an arbitration body These are derogations from the Contract general Conditions

Ministry of Foreign Affairs, Latvia 10 What to look up in the Contract General Conditions (among other things) 1 Notes 2 3 If the Consultant is a consortium, all members are legally bound to fulfill the contractual terms Obligations of consultant Subcontracting Allowed but needs to be communicated to the Contracting Authority for written approval Indemnity insurance policy It is mandatory, including coverage of employees sickness and accidental death; costs need to be embedded in the project Intellectual proprieties Replacement of personnel Contract amendments Financial guarantee All reports and data, including software developed with project finances, are exclusive propriety of the Contracting Authorities; they cannot be used by consultant in other projects without consent Any amendment of the contract must be set out in writing in an addendum, to be concluded on the same terms as the original contract The Consultant should provide a bank guarantee covering the full amount of the advance payment Allowed under specific circumstance but needs in any case to be communicated to the Contracting Authority for written approval 8 Audit certificate An independent auditor, paid by the Consultant, should examine the projects accounts and certify their correctness before the final payment is authorised.