PRAG 2020

Overview

Dolores Dominguez Perez

Nicolas Provençal
European Commission
DG International Cooperation and Development
DEVCO Unit R.3 Legal Affairs
Brussels 26 November 2020
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Introduction

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What is the PRAG?
Practical Guide to procurement and grant award
procedures for European Union external actions

It explains the contracting procedures applying to all EU

external actions financed by the EU budget and the European
Development Fund (EDF).

Which DGs in the Commission use the PRAG?

DG DEVCO, DG NEAR, FPI, DG REFORM (for Turkish
Cypriot community aid programme)
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Sources of funding EU external
actions: MFF 2014-2020
• Union budget: DCI, ENI, IPA II, EIDHR, EINS,
IcSP.
•
• European Development Fund: ACP countries and
Overseas Countries and Territories

• Different set of rules. Regulatory convergence.

Sources of funding EU external
actions: MFF 2021-2027
• European Development Fund: “budgetisation”
•
• Union budget: NDICI, IPA III, EINS, ODA-
Greenland

• Off budget: European Peace Facility

 Where do I find the PRAG?

Public document, available at:

• http://ec.europa.eu/europeaid/prag

Financial Regulation 02/08/2018

https://myintracomm.ec.europa.eu/budgweb/EN/leg/finrules/Pages
/financial-regulation.aspx

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The PRAG and all related contractual annexes are available for
consultation and download. Previous versions are also accessible.
Core principles of procurement
- Transparency

- Proportionality
- Sound financial management
- Equal treatment and non-discrimination
- Avoidance of any conflict of interests
- Non-retroactivity

Why?
2 interests:
- Contracting Authority: gets a good deal
- Contractors: get a fair chance to compete for the contract 8
Which procedure for which amount?

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Procurement procedures with publication
1. Open tender
Any operator can send a bid/proposal. It is a one phase
procedure.

2. Restricted tender
Any interested applicants may apply to participate, but only
selected ones will be invited to submit an offer following the
results of the selection phase (selection criteria). There are
therefore two phases in the restricted procedure.
International => OJEU, DEVCO website, any appropriate media
Local => National gazette, DEVCO website, any appropriate media
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 Funding and tender opportunities

On the website of DG International Cooperation and Development – soon to

be renamed DG International Partnerships – at:
https://ec.europa.eu/international-partnerships/home_en
the funding tab or the right box below will direct you to the funding and
tenders opportunities hosted on the F&T portal
 Searching for procurement notices
All Commission published tender opportunities can be
found on the F&T portal; when selecting tenders related to
external actions you will access a search engine
 Searching for procurement notices
Search engine for tenders launched by DG International
Cooperation and Development

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 Searching for procurement notices
Alternatively, tenders above the thresholds for international tender
procedures are also published on TED which is a supplement to the OJEU
Procurement procedures without publication
1. Simplified procedure (ex competitive negotiated procedure)
/Single tender procedure
The contracting authority invites at least three/one candidate(s)
of its choice to submit tenders. Shorter deadline for tendering.

2. Negotiated procedure
The contract is awarded directly to a company/consortium
following a negotiation. It is used in defined cases, such as:
• Following an unsuccessful tender
• Extreme urgency or operations carried out in crisis situations
• For the repetition of similar supplies/services/works
• Secret contracts, cases of monopoly, etc.
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Other important rules

- Nationality/Establishment (annex a2a PRAG)

- Origin (annex a2a PRAG)

- Exclusion criteria

- Code of conduct and respect of ethical clauses

(art.8 GC for service contracts, SEA explicitly referred to in art.8.2)

- Administrative and financial sanctions (art. 10 GC

for service contracts: grave professional misconduct, fraud, corruption (…);

financial penalties up to 10% of contract value)
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 Exclusion and selection Criteria
1. Exclusion criteria (Art. 136 FR)
See full list of cases in PRAG 2.6.10.1.1
Purpose: to determine if the operator is allowed to participate.
Operators will be excluded if (non exhaustive list !):
• Bankruptcy, affairs administered by court, arrangement
with creditors, suspension of business activities
• Guilty of grave professional misconduct
• Not in compliance with social security contributions or
payment of taxes
• Fraud, corruption, money laundering, involvement in a
criminal organisation/terrorist offences, child labour
• Subject to penalty under the EU Financial regulation or the
contract
• Committed an irregularity
• Empty Shell Company 17
Exclusion criteria

• Evidence to be provided: PRAG 2.6.10.1.3

• A) Declaration on honour (PRAG annex a14)
• Candidates, tenderers and applicants must sign a
declaration together with their applications, certifying that
they do not fall into any of the exclusion situations cited
under Sections 2.6.10.1.1 and 2.6.10.1.2 and, where
applicable, that they has taken adequate measures to
remedy the situation.
• Where the candidate or tenderer intends to rely on capacity
providing entities or subcontractor(s), he shall provide the
same declaration signed by this/these entity(ies).

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Exclusion criteria
• B) Documentary evidence
• In the case of restricted procedures for services, the
supporting documents must be sent by all shortlisted
candidates together with the tender and verified by the
contracting authority before signature of the contract with
the successful tenderer(s).
• In restricted procedures for works, these supporting
documents must be sent by all candidates together with the
application. Evidence of non-exclusion must be verified for
all candidates invited to tender. In addition, the tenderers
and candidates must certify that the situation has not
altered since the date of issue of the evidence.
• See PRAG 2.6.10.1.3 for satisfactory evidence to be
provided. 19
 Documentary evidence
Please indicate on each document the name of the exclusion criteria they refer
to

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Selection criteria

Purpose: to determine if the operator has the necessary

capacity to perform the contract. 3 types:

• Economic and financial capacity (in the last 3 years)

Financial standing: the awarded tenderer is not living of the EU-funded
project.

• Professional capacity (in the last 3 years)

Available resources, qualifications.

• Technical capacity (in the last 3(service) -5 (works) years)

Past experience in similar activities.

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 Selection criteria
Example: service contract worth 600 000 € of 2-year duration
for automated customs systems

• Economic and financial capacity

tenderer's average annual turnover between 300 000 € < 600 000 €
(FR, Annex I, point 19: minimum yearly turnover shall not exceed two
times the estimated annual contract value)

• Professional capacity

- at least 5 permanent staff currently work in fields related to the contract

- the tenderer has an ISO 9000 certificate

• Technical capacity
at least 1 contract of at least 500 000 € in the fields of automated customs
systems and/or computerised transit system
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Award criteria

• Lowest price: in supplies and works tender procedures

The contract is awarded to the cheapest offer amongst those technically
compliant.

• Best price-quality ratio: in services procedures

Used always in services and sometimes in works and supplies.

The award criterion is a combination of price and quality according to a

fixed weighting: 80% to the technical score and 20% to the financial score.

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• Main steps of procurement procedures
1. Publication*
2. Shortlist**
3. Tender launch***
4. Tenders received
5. Evaluation
6. Contract Award
7. Standstill Period
8. Contract Signature
* Not for competitive negotiated, single tender, negotiated procedures.
** Only international restricted procedures.
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*** Not for open procedure.
• Time Line for Service Contract - international restricted

Procedure takes at least 6-7 months!

Contract
Notice
30 days Tender invitation
50 days Award of
contract

Standstill period
Signature
of contract

Evaluation

Short List

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3 6
 Evaluation

Normally in 5 phases:

• Tender Opening Session

• Administrative compliance
• Technical Evaluation
• Financial Evaluation
• Conclusion
Specificities
of service
contracts

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SERVICES
Service contract:
Contract between a service provider and the Contracting
Authority for the provision of services such as technical
assistance or studies

Technical assistance:
The service provider is called on to play an advisory role, to
manage or supervise a project, or to provide the expertise
specified in the contract (generally a fee-based contract)

Studies:
It includes studies for the identification and preparation of
projects, feasibility studies, economic and market studies,
technical studies and audits (global price contract)
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Types of service contracts

Global Price Fee-based

Specifies an outcome Specifies the means

Final Product Tasks performed

Payment linked to services
actually provided
E.g. Study, audits, training, E.g. Technical Assistance,
conferences Supervision.
Key documents:

Instructions to Tenderers (ITT)

Terms of Reference (ToRs)
o Different templates for global price and fee based
o Requirements: min. quality standard
o Contract objectives
o Tasks
o Logistics & timing
o Expertise required
o Key / non-key experts

Budget for fee based : Fees - Incidental Expenditure – Lump sums -

Expenditure Verification 30
Remember for services…
Technical Score x 0.80
(organisation and methodology, CVs of
Experts)
+
Financial Score x 0.20
(price)
Best value for money wins!
Novelties

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Reminder: novelties for procurement since FR
2018
• Possibility to ask clarifications on the contract notice,
provided the Contracting Authority has indicated a
functional mailbox
• System of submission of applications and offers aligned
to the one in force in internal procedures (sent before
deadline vs arrived before deadline)
• Candidates included in the lists of EU restrictive
measures (see Section 2.4. of the PRAG) at the moment
of the award decision cannot be awarded the contract
(not from FR but Council Decision; see website
sanctionsmap.eu).

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 Novelties in PRAG 2020
• Publication of contract notices and other
procurement related publications:

• As from 1st August 2020, DEVCO, NEAR and FPI have adopted the
same corporate system for publication as all other DGs and
Agencies, namely PPMT (“Public Procurement Management Tool”).
• As a consequence, new Contract Notices (including Prior
Information Notices and Contract Award Notices) and Calls for
Tenders will be published in TED and F&T (and no longer on
EuropeAid).
• The related Tender Dossiers will also be uploaded in PPMT.
• A single set of templates for all procurement related notices is
now used (PRAG annexes A5a to A5g) and replaces the former
notices that were specific to each contract type (ser, sup, wks). 34
 Funding and tender opportunities

On the website of DG International Cooperation and Development – soon to

be renamed DG International Partnerships – at:
https://ec.europa.eu/international-partnerships/home_en
the funding tab or the right box below will direct you to the funding and
tenders opportunities hosted on the F&T portal
 Searching for procurement notices
All Commission published tender opportunities can be
found on the F&T portal; when selecting tenders related to
external actions you will access a search engine
 Searching for procurement notices
Search engine for tenders launched by DG International
Cooperation and Development

37
 Searching for procurement notices
Alternatively, tenders above the thresholds for international tender
procedures are also published on TED which is a supplement to the OJEU
 Novelties in PRAG 2020

• Technical & professional capacity criteria

• The reference period for technical & professional capacity was aligned in the PRAG
2018 with the provisions of point 20.2 (b) (i) and second subparagraph of Annex I to
the FR, which were consistent in that regard since the 2012 rules of application.
• The reference period as reflected in PRAG 2020 is by default set at 3 years, except
where, in order to broaden the access of economic operators to procurement
opportunities, the Contracting Authority wishes to extend this reference period
beyond three years.
• The PRAG has therefore included the possibility to take a longer period into account.
This has been highlighted in the PRAG and in point 18 of the annex complementing
the contract notice, named “additional information about the Contract Notice” (PRAG
Annex A5f).

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 Novelties in PRAG 2020

• New restrictions with the reference period

• for the technical capacity selection criteria
• PRAG 2020 clarifies the period taken into account for the
references to be provided under the technical selection criterion,
by removing the distinction which existed until then between the
references relating to projects in progress and those relating to
projects completed.
•
• This decision has been taken with the aim of a uniform application
of this selection criterion, and in compliance with the principle of
equal treatment.

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 Novelties in PRAG 2020
▪ Declaration on honour: PRAG Annex A14 is
now split into two different annexes: A14a for
procurement and A14b for grants
▪ Capacity providing entities: PRAG 2020 also
further details the obligations of capacity-
providing entities when they provide the technical
or financial capacity for a tenderer to meet the
selection criteria.
▪ Prior information notice (PIN): The
publication of the prior information notice
becomes optional, although still recommended.
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What’s next?

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What’s next

• PRAG 2021

• New MFF funding instruments

• Transition to digital: e-management and e-

submission

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Take part!

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What if my company does not fulfill the
selection criteria?

• A candidate/tenderer may, where appropriate and for a

particular contract, rely on the capacity of other entities,
regardless of the legal nature of the links which it has
with them– PRAG 2.6.11.1.

• Try and gain relevant experience as

consortium partner or subcontractor

• Form a consortium (the consortium as a whole must

meet the criteria, not each individual company)
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Capacity providing entities
• Requirements:
• - The CA cannot impose a legal form but a can ask a written
commitment
• - Compliance with eligibility rules + exclusion criteria + relevant
selection criteria
• Financial/Economic capacity -> joint liability
• Technical/Professional capacity -> subcontractor
• With regard to technical and professional criteria, an economic operator may only
rely on the capacities of other entities where the latter will perform the works or
services for which these capacities are required.
• Where an economic operator relies on the capacities of other entities with regard to
criteria relating to economic and financial capacity, the economic operator and those
entities are jointly liable for the performance of the contract

• 46
Sub-contracting
Subcontracting must be indicated by the main
Contractor to the Contracting Authority:
- At tendering stage: in the tender (if known)
- During the implementation of the contract: for
prior autorisation.

Sub-contractors need to meet same non-exclusion

and eligibility criteria as main contractors.

No direct link with the Contracting Authority. 47

Consortium (1)
• A grouping of eligible natural and legal persons or
public entities which submits jointly a tender
under a tender procedure.
• It may be a permanent, legally-established
grouping, or a grouping which has been
constituted for a specific call for tenders,
formalised by the statement signed by the Lead
applicant on behalf of consortium members.
• All members of a consortium (i.e., the leader and
all other partners) are jointly and severally liable
to the Contracting Authority.
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Consortium (2)
Exclusion criteria apply separately to each
member of the consortium
Eligibility rules

apply to the tenderer

Selection criteria (consortium) as a whole, with
exceptions (financial ratios)

Being part of a consortium, is therefore a

solution when a company does not meet the
selection criteria on its own.
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Example

Selection Member A Member B Member C Result

criterion
Economic/
Financial
Annual turnover X √ X √
Liquidity ratio √ √ √ √
Professional
No. of staff √ √ X √
Cert. ISO √ X X √
Technical
Projects of same
√ √ X √
size
Projects in a
X X √ √
certain region
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Practical
advice

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• Common mistakes made by tenderers and
applicants (1)
Administrative reasons

• Late dispatch
• Tender guarantee missing or not in right format
• Incomplete documentation
• Not in accordance with templates
• Tenderer/applicant/member of consortium/sub-contractor
not eligible
• Offer not signed (tender submission form)
• Offer not in the currency/language required
• Selection criteria not fulfilled
• Financial offer not in a separate envelope or visible in the
technical offer (service contracts) Not a reason for rejection since PRAG 201852
• Common mistakes made by tenderers and
applicants (2)
Technical reasons

In Services:
• Experts do not have the required experience/qualifications
• Copy and paste of terms of reference
• Experts not available during required dates
• Unclear methodology

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Some recommendations and
Suggestions (1)

1. Define your strategy!

Calls for tenders:
Will you be a tenderer / member of a consortium / sub-
contractor ?

2. Use the clarification period to ask whatever is not clear

in the contract notice or tender dossier

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Some recommendations and
Suggestions (2)

3. Pay attention to all the instructions in the Call for

tenders
Pay extra attention to what is asked in:
- Terms of reference (services)
- Technical specifications (supplies)
- Bill of quantities (works)

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Some recommendations and
Suggestions (3)

4. The consortium leader must check carefully:

• Eligibility: nationality (all members of consortium,
capacity providing entities and sub-contractors)
Origin of goods (for supplies and works)

• Selection criteria on Contract notice

• Evaluation Grids (services)

• Respect of formal submission requirements

5. Ask for an extension if it is a complex tender or if there

are many clarifications 56
Useful tips (1)
• Stay informed! Check the tenders published frequently!

• Make yourself known in the business community

• Select staff with writing skills (services) to draft offers

• Choose carefully your partners

• Check carefully all the elements of your offer prior to

submission

• Capitalise on lessons learnt and strenghts/weaknesses of

earlier applications/tenders
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Useful tips (2)
• Check your prices. Try to be competitive.

DON'T:
• Contact the Contracting Authority / EU DEL concerning a
Call for Tenders outside the communication channel opened
for this purpose
• Try to influence the outcome of the procedure

• Ask for a prior opinion to the CA / EU of your bid

• Forget to ask for a reference letter to the CA for contracts

successfully implemented
• Desperate if you don't get contracts in your first attempts!58
Useful tips (3)
LinkedIn groups for Consultancies (not endorsed by EC/EU):

1. EC-EuropeAid-Framework-Contracts-Projects
https://www.linkedin.com/groups/2953810

2. Technical Assistance Consultancy Network; EU, Worldbank, Calls,

Grants, International Development
https://www.linkedin.com/groups/82619/profile

Platforma (European local and regional authorities in development):

http://www.platforma-dev.eu/

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Questions?

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