Guide to procurement of consulting services

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1 Guide to procurement of consulting services Last updated: April 2014 Table of contents Preliminary remarks 4 1. Implementation of German contribution to an international cooperation measure by consulting firms with an order value exceeding EUR 500,000 (implementation project) Deciding on the placement of an order with consulting firms or implementation with GIZ staff Formulating the terms of reference for appraising a project/programme Drafting the terms of reference for appraising a project/programme Approving the offer design Conducting the launch meeting for a contract for consulting services: agreement and preparation Submitting expressions of interest//announcing order placement/issuing invitations to tender Submitting expressions of interest Announcing order placement pursuant to the Regulations on Contract Awards for Public Supplies and Services Part A (VOL/A-EC) Annex I - invitation to tender Conducting competitive tendering Updating the order placement sheet Using the assessment grid and weighting for the technical assessment of bids from consulting firms Preparing invitations to tender, documents Sending out tender documents, monitoring deadlines and drawing up a bid opening record for the technical bids Conducting a technical assessment of the bids Determining the technical ranking Opening and assessing commercial aspects of the price bids Determining overall ranking Deciding on order placement 13 OE

2 Presenting information on the personnel to be assigned (contract negotiations) Sending out letters of rejection Processing period Dealing with special cases in the procedure Drawing up the contract Negotiating the contract Drawing up the technical part of the contract Clarifying open issues, drawing up the complete contract Signing the contract Documenting, dispatching and checking the contract's return, notifying EU of order placement Opening the contract file, giving instructions for advance payment Implementing the project Conducting an internal briefing for consultant staff at GIZ Defining the working relationship and performance Measuring performance, managing performance delays, modifying the contract Defining the consulting firm's responsibility for implementation Processing quarterly statements of account Accepting overall performance, drawing up the final report Issuing the final invoice Follow-on contracts General information Procedure for follow-on contracts Drawing up the order placement sheet/preparing to draw up the contract Drawing up the contract New contracts with consulting firms with an order placement value between the threshold value (currently EUR 207,000) and EUR 500, New contracts with consulting firms with an order placement value under the threshold value (currently EUR 207,000) Individual measures with an anticipated order value under EUR 20, OE

3 6. Service contracts with local and regional consulting firms Service contracts and subsidy agreements with other subcontractors Integrity agreement 22 Abbreviations 23 OE

4 Preliminary remarks The German Government established GIZ as a legal entity under private law to ensure that its commissions are implemented effectively and cost-efficiently by a flexibly operating private company. This status was also intended to enable GIZ to work on behalf of other commissioning parties, allowing the experience and methods of German technical cooperation to be disseminated in the best possible way, and allowing GIZ to share experiences with and learn from third parties. Since GIZ, as a federal enterprise, essentially acts on behalf of the Federal German Government, commissions granted to GIZ by German ministries are subject to the in-house order placement principles established by the European Court of Justice. This means that the German ministries are entitled to commission GIZ directly without tendering. In accordance with Section 98 no. 2 of the German Act against Restraints of Competition (GWB), GIZ is itself a public commissioning party and is therefore legally obliged to apply order placement law to the orders it places with third parties. In addition, pursuant to Article 5 of the General Agreement with BMZ, GIZ is obliged to involve suitable private-sector companies, governmental bodies and specialised institutions in implementing development projects and programmes, to the extent that this appears expedient and economical. The commission received from BMZ or another commissioning party/client forms the basis for a contract to be entered into by GIZ with consulting firms on implementing the German contribution to an international cooperation measure. As GIZ is receiving an increasing number of commissions from third parties and handling more cofinancing arrangements for other donors and third parties, the procedures and requirements of these donors and third parties must also be incorporated into the process insofar as they comply with the regulations stipulated in German order placement law. This applies, for example, to the language of the tendering documents and to additional publication platforms. This guide provides an overview of all of the regulations that apply to the placement of orders with consultants. It also reflects recent developments, in particular the following: standardised procedures introduced following the merger to form GIZ; the greater significance of transparency in international debate; the role played by the presentation of strategies and personnel requirements in the selection process; increased ownership by the partner side; the greater weighting of the price offer, also at the international level. This guide presents the steps involved in the process chain 'Procurement of consulting services' so that all parties involved in Germany and abroad, both at GIZ and at consulting firms, are aware of their role in this process. Any deviations from the provisions outlined in this document must be discussed and agreement with the Contracting, Procurement, Logistics Division or with the Sectoral Department. OE

5 1. Implementation of the German contribution to an international cooperation measure by consulting firms where the order value exceeds EUR 500,000 (implementation project) 1.1 Deciding on the placement of an order with consulting firms or implementation with GIZ staff Formulating the terms of reference for appraising a project/programme The process of deciding whether an international cooperation measure will be subcontracted to a consulting firm or implemented by GIZ staff starts by drafting the terms of reference for the project/programme appraisal Drafting the terms of reference for appraising a project/programme The most appropriate intervention mode for the project/programme in question (e.g. financial contribution, local experts, short-term assignments, seconded experts, development workers, integrated experts) is determined in the terms of reference, based on the principle of minimum interference. In this context, the Sectoral Department is responsible for examining whether a project/programme will be implemented by GIZ or whether implementation will be outsourced, based on the principle of subsidiarity. Any consulting firm that is subcontracted to prepare a measure may be excluded from the invitation to tender for subsequent implementation if it cannot be ruled out that any findings it established during the preparatory phase could distort the competitive tendering process. This is the case, for example, if a consulting firm heads up the appraisal team or makes a significant contribution to the appraisal and the offer drafted on this basis. Sectoral Dept., regional departments; cf. Article 5.1 of the General Agreement Approving the offer design After completion of the appraisal/preparatory phase, the officer responsible for the commission arranges for the data to be entered in the Project Processing System (PBS) within the scope of documenting the decision to subcontract or implement using GIZ staff. (Please refer to the department-specific regulations on the approval of the offer design (ZAK) procedure). These data must be documented for all offers (new international cooperation measures or follow-on phases) to BMZ or other German federal ministries in accordance with the General Agreement and for cofinancing arrangements where: Sectoral Dept. regional departments; cf. range of services of the consulting industry in the handout on using documentation international and/or national experts are being assigned for longer than 12 expert months and/or short-term staff is to be assigned where the order value exceeds EUR 500,000 (the amount earmarked for external personnel, costing line 2). The director of the sectoral division is responsible for documentation. It is countersigned by the director of the regional division. In the event of disagreement, the directors general of the relevant organisational units make the decision. OE

6 1.1.4 Conducting the launch meeting for a contract for consulting services: agreement and preparation The sectoral division, the regional division and contract management meet to discuss responsibilities and other details for preparing the subsequent invitation to tender. This is known as the launch meeting. At this meeting: 1. the order placement procedure is determined; 2. the contents of the tender and the order are clarified along with any reasons for exclusion and the assignment of GIZ staff; 3. the anticipated contract value is estimated; 4. the partner side is involved in order placement decisions; 5. the team leaders of all bidders are introduced following a provisional technical assessment (paper format) for international cooperation measures that exceed a value of EUR 2 million; 6. responsibilities are agreed and the deadlines for implementing the tender are discussed and agreed; 7. the code of conduct for the current invitation to tender (equal treatment, confidentiality) is discussed; 8. participants in the process sign a declaration of neutrality and secrecy. commission (can be delegated to the director of the regional division), planning officer, contract manager 1.2 Submitting expressions of interest//announcing order placement/issuing invitations to tender Submitting expressions of interest GIZ enables consulting firms to submit expressions of interest in submitting tenders on the GIZ website under 'Procurement' ( 'Bidding Opportunities'. An expression of interest is generally required if a tender exceeds the EU threshold (currently EUR 207,000) or the term is longer than 12 months. The planning officer arranges for the order placement sheet to be drawn up. It should include the following data: processing number or cost centre, project/programme title, country of assignment/contract content, category under order placement rules for the award of public freelance service contracts, (proposed) order placement procedure, type of contract, specialist area allocation, maximum contract value, and anticipated start of the contract. Signatures are entered on the left of the sheet. The planning officer drafts the brief description of the project/programme as a basis for the call for expressions of interest. The following standard grid is used as a basis for assessing expressions of interest. OE

7 Grid for assessing the commercial and technical suitability of consulting firms within the scope of competitive tendering/expressions of interest Standard weighting in % I. Commercial assessment Yes/No 1. List of reference projects (no more than 10 projects over the past 5 years) 2. For expressions of interest: commercial assessment based on turnover data and information provided by the firm 3. For competitive tendering: Declaration from an international commercial bank of willingness to provide a performance guarantee 4. For competitive tendering: Evidence of entry in the professional register in accordance with the legal provisions that apply in the country in which the bidder is based, e.g. extract from the commercial register II Technical assessment 1. Firm s technical/regional experience 1.1 Technical suitability (specify up to three relevant sectors, overall weighting of 25 %) Documents submitted Documents submitted Documents submitted Documents submitted (25) 1.2 Regional expertise of the firm 20 Total for section International experience of the firm Human resources (general information on the firm) 3.1 Technical backstopping in the relevant areas Technical backstopping in relevant 10 cross-cutting themes such as Total for section 3 25 Grand total 100 The planning officer sends the documents to the contract manager. He/she reviews them and publishes the call for the expression of interest on the internet. Within the framework of the assessment process, the contract manager decides on the firms' commercial eligibility and organises a credit check if necessary For international cooperation measures that exceed the threshold value (currently EUR 207,000), the expressions of interest are published on Projects/programmes that are cofinanced by other donors: Publication on another international platform (such as or in other media is to be considered and organised where necessary. This could help broaden the scope of the expressions of interest received. A deadline of 14 days usually applies for publication. Evaluating expressions of interest Once this deadline has expired, the contract manager reviews commercial aspects and the planning officer reviews technical aspects, planning officer OE

8 of the expressions of interest received using the assessment grid (see section 1.2.1). Both parties draft a proposed shortlist. Together, the planning officer and contract manager compile a shortly joint shortlist, which usually comprises no more than between five and eight firms. Consulting firms that are not shortlisted are sent a letter of rejection., planning officer Evaluation of the expressions of interest normally takes two to three weeks Announcing order placement pursuant to the Regulations on Contract Awards for Public Supplies and Services Part A (VOL/A- EC) Annex I - invitation to tender Announcements of order placement must be made if the services to be provided fall under the following categories specified in Annex I Part A of VOL/A-EC: Category: Name 1 Maintenance and repair services 2 Land transport, including armoured car services, courier services, except transport of mail 3 Air transport services of passengers and freight, except transport of mail 4 Transport of mail by land and by air 5 Telecommunications services 6 Financial services a) Insurance services b) Banking and investment services 7 Computer and related services 8 Research and development services 9 Accounting, auditing and book-keeping services 10 Market research and public opinion polling services 11 Management consulting services and related services 12 Architectural services, engineering services and integrated engineering services, urban planning and landscape architectural services, related scientific and technical consulting services, technical testing and analysis services 13 Advertising services OE

9 Category: Name 14 Building-cleaning services and property management services 15 Publishing and printing services on a fee or contract basis 16 Sewage and refuse disposal services, sanitation and similar services The implementation of development cooperation or international cooperation measures in partner countries usually falls under Annex I Part B (primarily 'Other services' in accordance with CPV code: 'Technical assistance to developing countries'. Announcements are published in the EU Official Journal and on For projects and programmes that are cofinanced by other donors, publication on another international platform (such as or in other media) is to be considered and organised where necessary. This could help broaden the scope of the expressions of interest received. The planning officer arranges for the order placement sheet to be drawn up. It must include the following data: processing number or cost centre, project/programme title, country of assignment/contract content, announcement of order placement or participation in tender, category in accordance with the Regulations on Contract Awards for Independent Professional Services (VOF), CPC reference, VOL/A category, (proposed) order placement procedure with rationale, type of contract, technical allocation, maximum contract value, and anticipated start of the contract. Signatures are entered on the left of the order placement sheet. The planning officer drafts the technical part of the announcement text and sends it to the contract manager, who adds the commercial and administrative information. For European invitations to tender, a processing period of at least 37 days is required for consulting firms, from the date the announcement is sent to Tenders Electronic Daily the European public procurement journal to the date of receipt at GIZ. Under certain circumstances, this period can be reduced to at least 15 days, provided that GIZ is not responsible for these circumstances. The assessment grid and weighting for the technical evaluation of applications are drawn up by the planning officer in accordance with the provisions of section The contract manager reviews the assessment grid and the weighting. The contract manager submits the text to be published to Tenders Electronic Daily the European public procurement journal. He/she also follows up on deadlines and registers the receipt of applications. The Submission Team opens and records receipt of the applications once the submission deadline has passed, in accordance with VOL/A or VOF. The contract manager reviews the commercial eligibility of applications and forwards them to the planning officer, who checks their technical eligibility., contract manager, contract manager Processing period for the consulting firm: at least 37 days, contract manager ; cf. VOL/A, VOF OE

10 The planning officer assesses the technical eligibility of applications within two weeks and compiles a proposed shortlist. He/she then returns the applications to the contract manager. The contract manager checks the technical assessment and the proposed shortlist for plausibility. The contract manager also notifies consulting firms immediately in writing if they are not eligible to take part in the invitation to tender. The planning officer enters shortlisted firms on the order placement sheet in ESPRIT. The planning officer and the contract manager both sign the order placement sheet and shortlist in accordance with the internal regulation on authority to sign. duration: approx. two weeks Duration: one week It usually takes 10 weeks to process the step 'Announcement of the order placement/invitation to tender (for categories specified in Annex I Part A). 1.3 Conducting competitive tendering Updating the order placement sheet After the expressions of interest or the announcement of order placement/invitation to tender phase has been completed, the shortlisted names and signatures are updated in the order placement sheet Using the assessment grid and weighting for the technical assessment of bids from consulting firms The planning officer draws up the assessment grid and the weighting for the technical assessment of bids at the latest in this step, in accordance with the provisions agreed by the planning officer in section , cf. evaluation grid for the technical assessment of grids and the relevant guidelines The following standard weighting is generally used: Weighting 1 Appropriateness of suggested concept and of the work plan 2 Technical backstopping 3 Consideration of local resources* 4 Qualifications of proposed staff * where relevant Standard weighting in % Min/max weighting in % The contract manager checks the assessment grid and the weighting for plausibility. OE

11 1.3.3 Preparing invitations to tender, documents The planning officer prepares the invitation to tender by compiling the relevant documents and information for the bidding process and agreeing the final deadlines for the process with the officer responsible for the commission and the contract manager. In this context, please note that consulting firms must usually be given a period of about six weeks to prepare bids. The planning officer must usually conduct the technical assessment within two weeks; the contract manager must usually conduct the commercial assessment within five working days. If GIZ staff is proposed to the consulting firms for tendered assignments ('assignment of GIZ staff'), the planning officer must obtain a signed salary agreement from the staff member in question and a declaration of equal treatment of the consulting firm. These are sent to the consulting firms together with the invitation to tender and the CV of the GIZ staff member. Any materials and equipment required are usually procured by GIZ. The planning officer agrees exceptions to this rule with the Division Contracting, Procurement, Logistics if the value of the materials and equipment to be procured exceeds EUR 20,000. The planning officer drafts a brief project description for the invitation to tender and the terms of reference. He/she then submits the complete tendering documents to the contract manager. Duration: consulting firm (usually) approx. 6 weeks approx. 2 weeks; contract manager approx. five working days, cf Guidelines on assigning GIZ staff members within the context of competitive tenders submitted by consulting firms', contract manager Sending out tender documents, monitoring deadlines and drawing up a bid opening record for the technical bids The contract manager checks the tender documents (text of tender, terms of reference, invitation to tender letter, etc.) and usually sends an access code to the consulting firm by . This enables the consulting firm to access the bidding documents on GIZ's website ( ; cf. VOL/A The consulting firm submits paper copies of its technical and price bids in separate envelopes along with a CD copy of its technical bid to the address stated in the invitation to tender. The consulting firm should submit signed standard CVs for the experts and offer mixed rates for the short-term experts, who are to be named, and broken down into international and local short-term experts. Queries about the tendering process from consulting firms must be sent solely in writing or by to the responsible contract manager. He/she consults the planning officer and replies to these queries in writing or by . These replies and any additional information are sent to all consulting firms. Queries received in any other format may lead to the bid not being considered. The submission team in the Contracting, Procurement, Logistics Division opens and marks the technical bids after the deadline for submission and records receipt of bids in accordance with VOL/A, VOF. The contract manager then forwards the technical bids to the planning officer. Consulting firm Specimen CV in the conditions of tender Consulting firm to contract manager Submission Team and contract manager cf. VOL/A, VOF OE

12 1.3.5 Conducting a technical assessment of the bids The planning officer evaluates technical aspects of the bids (awarding points to the consulting firm in accordance with the assessment grid). If a bid exceeds the current threshold (currently EUR 207,000), the technical evaluation consist of two separate evaluations, conducted either by another planning officer, the officer responsible for the commission or an appraiser. The results of both of these technical assessments are combined into one overall evaluation., possibly director of division in Sectoral Department cf. 'Notes on the evaluation grid for the technical assessment of bids' Determining the technical ranking The planning officer(s) inform(s) the officer responsible for the commission about the result of the technical assessment, i.e. the technical ranking, and discusses and agrees the outcome with him/her. The result of the technical assessment and the technical recommendation for order placement are documented in writing and are to be signed off by the director of the responsible division in the Sectoral Department. The explanation of the assessment of the technical bid should include the following for bids that exceed the threshold value (currently EUR 207,000): - a summary of the evaluation of the points awarded in both assessments together with the overall technical assessment and a proposal for the technical eligibility and opening of the price bids. - Appraisal of the bids based on the individual assessment criteria. If each assessor draws a different conclusion, this is to be highlighted. The contract manager checks the plausibility of the technical assessment. Bids awarded 500 points or less are eliminated from tendering. commission Opening and assessing commercial aspects of the price bids The Submission Team in the Contracting, Procurement, Logistics Division opens and documents the price bids for the technically most eligible bids in the presence of the contract manager. (The unopened price bid is returned to the consulting firms that have been eliminated on technical grounds, together with a letter of rejection. These firms are notified of the successful bidder in accordance with section ) Submission team and contract manager cf. VOL/A, VOF The contract manager evaluates commercial aspects of the technically eligible bids and determines the commercial ranking Determining overall ranking The contract manager determines the overall ranking based on the weighting awarded to the result of the assessment of the technical bid and the price bid: the technical bid usually has a weighting of 70% and the price bid a weighting of 30%. He/she then informs the planning officer and the officer responsible for the commission of the overall ranking and the recommendation for order placement., officer responsible for the commission, contract manager OE

13 1.3.9 Deciding on order placement The decision on order placement is made by the director of the relevant division in the Sectoral Department and depending on the power of signature by the officer responsible in the Contracting, Procurement, Logistics Division. In the event of disagreement, the order placement committee makes the decision. If the tendering process is delayed, the contract manager notifies the bidding consulting firms of the new schedule and requests that the binding period be extended. Director of the relevant division in the Sectoral Department Director of the Contracting, Procurement, Logistics Division Order placement committee Presenting information on the personnel to be assigned (contract negotiations) The leading bidder can be asked within the scope of the contract negotiations to present information on the key personnel it intends on assigning. In this context, the bidder must demonstrate that the strategy and the long-term experts to be assigned are sufficient to ensure the successful implementation of the project or programme and the achievement of the targeted results. GIZ reserves the right to terminate negotiations with the leading bidder if, based on the presentation, there is reason to believe that either of these factors is in serious doubt. If there are serious doubts, the next bidder in the overall ranking is proposed for the revised order placement decision., officer responsible for the commission, contract manager Sending out letters of rejection Unsuccessful firms are notified once the order placement decision has been made. These firms then have 14 days to object Processing period The competitive tendering procedure normally takes between 16 and 20 weeks from beginning to end Dealing with special cases in the procedure 1. Assigning GIZ staff in project/programmes implemented by consulting firms In exceptional cases, GIZ can recommend that consulting firms assign GIZ staff members within the framework of competitive tendering bids. In such cases, the planning officer must obtain a declaration (standard GIZ template) from each staff member that the consulting firm will receive equal treatment. The Human Resources Department determines the salary of these staff members. In principle: a) only staff with unlimited-term contracts may be recommended; b) only staff with limited-term GIZ contracts who are assigned to the project in question may be recommended for follow-on phases where previous phases were implemented by GIZ. The regional divisions, the officer responsible for the commission, the planning officer or the contract manager have the right to make such recommendations. A decision on whether to assign GIZ staff is made at the launch meeting. commission, planning officer, contract manager The salary requested by a GIZ staff member from all consulting firms is based on the salary band to which the Human Resources Department OE

14 assigns the staff member for the assignment in question and in accordance with GIZ's collective bargaining agreement. GIZ informs the consulting firm about this salary band assignment when GIZ provides it with the tender documents and once the relevant staff member has accepted the offer. 2. Presenting the strategy and the team leader as part of the technical assessment When awarding commissions for consulting services that exceed an estimated value of EUR 2 million, the team leaders described in the bid present the strategy for delivering the services to be tendered. Where applicable, it does this with the backstoppers from the consulting firms deemed eligible from a technical point of view. In this case, the technical assessment is carried out in two stages. The first (provisional assessment) corresponds to the technical assessment described in sections and The second stage involves a presentation which provides the basis for the final technical assessment. The bidders whose bid received more than 500 points in the first stage are invited to the presentation stage. The presentation is included in the technical assessment. Here, the planning officers use the presentation to verify the content of the relevant technical bid in line with the criteria included in the technical assessment grid (Strategy and personnel). No new criteria are introduced. The assessments made on the paper copies of the bids are adjusted where necessary. All other steps correspond to the standard procedure outlined in section ff. 1.4 Drawing up the contract Negotiating the contract The planning officer handles technical aspects of the contract negotiations and the contract manager handles commercial aspects. To this end, the planning officer gives the contract manager the terms of reference and a draft version of sections 1 to 6 of the contract. The contract manager and the planning officer conduct the contract negotiations with the consulting firm., contract manager, officer responsible for the commission, staff members/team leader from the consulting firm, planning officer, consulting firm Drawing up the technical part of the contract The planning officer draws up the terms of reference and final technical part of the contract (sections 1 to 6). The consulting firm's technical bid may be incorporated into the contract, whereby any commercial or price-related information contained in the bid are irrelevant Clarifying open issues, drawing up the complete contract The contract manager draws up the commercial part of the contract (from section 7 onwards) and checks the complete contract for coherence, completeness and the contractual basis. The planning officer bears the responsibility for technical aspects of the contract, the contract manager bears responsibility for commercial aspects. OE

15 The planning officer must make any changes that are required to the technical part of the contract or to the terms of reference (also possible under of the terms of reference). For sections 1 to 6, changes can be made by the contract manager., possibly the contract manager Signing the contract The contract manager forwards the contract to the Sectoral Department for signature in accordance with the internal regulation on authority to sign. The Sectoral Department signs the contract on the right and returns it to the contract manager, who signs it on the left Documenting, dispatching and checking the contract's return, notifying EU of order placement The contract data are entered in the IT system in the Contracting, Procurement, Logistics Division and the contract document is sent to the consulting firm, which signs and returns it to GIZ within a week where possible. Once the contract has been returned, the contract manager checks it for completeness and amendments and initials it. If the consulting firm has made amendments to the contract, the contract manager clarifies any issues with the consulting firm together with the planning officer where necessary, and concludes the contract. The contract manager forwards the contract (including documentation of the award of subcontracts and of negotiations) to the responsible Competence Centre for Finance and forwards a scanned copy of the contract (with any amendments) to the officer responsible for the commission as notification of conclusion of the contract. For contracts with an order placement value that exceeds the threshold value (currently EUR 207,000), the contract manager notifies the EU of order placement in accordance with VOF or VOL/A., Sectoral Department (based on the standard delegation of tasks by the officer responsible for the commission to the Sectoral Department) Contracting, Procurement, Logistics Division Duration (consulting firm): one week * cf. VOF or VOL Opening the contract file, giving instructions for advance payment The Competence Centre for Finance opens the contract file and, on receipt of a request from the consulting firm, gives instructions for advance payment in accordance with the contractual provisions. Competence Centre for Finance Consulting firm /invoice verification 1.5 Implementing the project Conducting an internal briefing for consulting staff at GIZ Every effort is made to involve experts from the consulting firm implementing international cooperation measures (team leader or other key personnel) in preparing new field staff (cf. 'Drawing up briefing modules'). The officer responsible for the commission and the consulting firm agree on the modules that the consulting firm's staff will attend (cf. section 1.4.1). commission, consulting firm OE

16 The staff to be assigned within the scope of a contract for consulting services will introduce themselves in the divisions before their departure Defining the working relationship and performance Consultants are part of the entire project team. They take part in team meetings and in planning and monitoring workshops. In order to involve the consulting firm in the project or programme, the officers responsible for the commission ensure that there is a consistent line of communication with the partner side. This guarantees that the international cooperation project/programme presents a uniform image on behalf of the respective commissioning party or client. GIZ and the consulting firm ensure that consultants can take part in GIZ sectoral events (especially sector networks, expert meetings). Consultants make their own contributions to product development and knowledge management in the relevant sector. The consulting firm sends any reports or statements that are stipulated in the contract to the officer responsible for the commission Measuring performance, managing performance delays, modifying the contract Consultants meet regularly with the officer responsible for the commission to exchange information on project progress. In this context, the officer responsible for the commission manages the performance of services and deals with any disruptions together with the consultants. The officer responsible for the commission and the consultants clarify and decide on any technical issues that do not have a direct impact on the contract. Large-scale technical issues should be clarified through a job order issued to the Sectoral Department. If the officer responsible for the commission identifies any disruptions, he/she should involve the contract manager in good time, in order to assess and, where necessary, enforce any claims. The officer responsible for the commission must inform the contract manager about any changes to implementation that impact on the contract in good time before they are made. He/she is to submit to the contract manager a proposal for modifying or supplementing the contract. The contract manager acts in an advisory capacity before any changes are made. The contract manager clarifies any need to act on commercial aspects with the officer responsible for the commission, and agrees any contractual changes with the consulting firm in writing. The modification to the contract is to be signed by the regional division and the Contracting, Procurement, Logistics Division (in accordance with the internal regulation on authority to sign). The Contracting, Procurement, Logistics Division is responsible for electronic recording and dispatch of the modification to the contract. commission, staff members/team leader from the consulting firm commission, Sectoral Department commission, contract manager, Contract consulting manager, firm consulting firm Defining the consulting firm's responsibility for implementation The consulting firm's staff can call for services such as the assignment of short-term experts under the contract without involving the officer responsible for the commission, in line with project progress. Drawing up the terms of reference, selecting short-term experts and accepting services provided by the short-term experts fall under the consulting Staff members/team leader from the consulting firm Consulting firm OE

17 firm's responsibility for implementation. The consulting firm is responsible vis-à-vis GIZ for the results achieved Processing quarterly statements of account The officer responsible for the commission checks technical aspects of quarterly statements of account issued by the consulting firm and confirms the performance of services. The responsible Competence Centre for Finance verifies the invoice and then issues instructions for payment. commission Competence Centre for Finance Accepting overall performance, drawing up the final report On completion of an international cooperation measure, the officer responsible for the commission accepts overall performance within four weeks. The officer responsible for the commission issues a job order to arrange for the planning officer to comment on the consulting firm's final report. The officer responsible for the commission documents disruptions or reduced performance and notifies the responsible Competence Centre for Finance accordingly, so that they can be taken into account in the final invoice. The officer responsible for the commission is responsible for the final report to BMZ or another commissioning party/client. To this end, he/she can involve the Sectoral Department and/or the regional division. commission commission -> planning officer commission commission -> Sectoral Department, regional director Issuing the final invoice The officer responsible for the commission checks the consulting firm's final invoice for the international cooperation measure. The responsible Competence Centre for Finance then settles the final invoice. commission Competence Centre for Finance OE

18 2. Follow-on contracts 2.1 General information A follow-on contract is the award of a further phase in a measure to the consulting firm that carried out the previous phase without conducting competitive tendering. A follow-on contract is only permitted if competitive tendering was carried out for the first phase and the following conditions are fulfilled: a) For national tenders (competitive tenders) the service to be subcontracted has been classified in accordance with Annex I Part B of VOF or the conditions for applying VOL/A have not been met; the previous performance was satisfactory; the same staff will be assigned; there are no significant conceptional changes from the original concept outlined in the invitation to tender; the price adjustment clause under the previous contract applies. b) For European tenders the service to be subcontracted has been classified in accordance with Annex I Part A of VOL/A-EC and the service to be subcontracted corresponds to basic design for the previous phase; this was put out for European tender; the invitation to tender included the possibility that the contract for the follow-on phase could be awarded as a follow-on contract within the scope of negotiations without invitation to tender and the contract for the previous phase was concluded within the past three years; the previous performance was satisfactory; the same staff will be assigned; there are no significant conceptional changes from the original concept outlined in the invitation to tender; the price adjustment clause under the previous contract applies. The applicable order placement procedure must be determined no later than six months before the start of the follow-on phase. To this end, the officer responsible for the commission, a representative of the consulting firm and the contract manager should meet between six and nine months before conclusion of the current phase to clarify the following issues: commission or his/her representative; consulting firm, contract manager (occasionally) Does the partner and BMZ generally want the measure to be continued? proposed funding (partner and BMZ); Was the previous performance satisfactory? Can the consulting firm ensure that the same staff will be assigned? deadlines for possible project progress reviews; deadlines for approval of the offer design (ZAK)/offer to BMZ deadline for consulting firm's offer The contract manager decides whether the contract can be awarded directly as a follow-on contract without competitive tendering or whether competitive tendering must be carried out. OE

19 The technical and price offer for the follow-on phase which is to be submitted by the consulting firm currently contracted under section 6 of the existing contract for consulting services forms the basis for the order placement decision. This offer is to be submitted six months before completion of the current phase without the explicit request of GIZ. The consulting firm currently contracted takes the results of the preceding project progress reviews into account in this context. The following order placement decisions can be made following a review of the situation: a) No follow-on contract is concluded: aa) Contract value exceeding EUR 500,000 The procedure outlined in sections applies. ab) Contract value between the threshold value (currently EUR 207,000) and EUR 500,000 The procedure outlined in sections applies; the checklist for examining whether the project/programme will be implemented by GIZ or outsourced (section 1.1.3) does not apply. ac) Contract value under the threshold (currently EUR 207,000) The procedure outlined in sections applies; the checklist for examining whether the project/programme will be implemented by GIZ or outsourced (section 1.1.3) does not apply. A launch meeting (see sections and 1.3.6) and the submission of expressions of interest (see section 1.2.1) are optional. b) Follow-on contract: for more information, see section Procedure for follow-on contracts Drawing up the order placement sheet/preparing to draw up the contract The officer responsible for the commission draws up the order placement sheet (cf. comments in sections and 1.2.2). The officer responsible for the commission sends the relevant documents for drawing up the follow-on contract (offer from the consulting firm and related correspondence, the terms of reference, information for sections 1 to 6 of the contract) to the regional division, taking into account any arrangements that have already been agreed. The regional division forwards the draft contract to the responsible contract manager together with the order placement sheet and all documents. commission Regional division Drawing up the contract See section 1.4. commission OE

20 The officer responsible for the commission may need to delegate his/her tasks as regards drawing up and concluding the contract to the regional division or Sectoral Department. 3. New contracts with consulting firms with an order placement value between the threshold value (currently EUR 207,000) and EUR 500,000 The procedure outlined in sections applies; the checklist for examining whether the project/programme will be implemented by GIZ or outsourced (section 1.1.3) does not apply. 4. New contracts with consulting firms with an order placement value under the threshold value (currently EUR 207,000) The procedure outlined in sections applies; the checklist for examining whether the project/programme will be implemented by GIZ or outsourced (section 1.1.3) does not apply. A launch meeting (see sections and 1.3.6) and the submission of expressions of interest (see section 1.2.1) are optional. The officer responsible for the commission or his/her representative clarifies with the contract manager whether a launch meeting will be held. If competitive tendering is to be carried out at the national level, note that the consulting firms must be given a reasonable period (at least two weeks) to compile their applications. The rest of the procedure is the same as for European invitations to tender (see section ). If there is no competitive tendering, the planning officer arranges for an order placement sheet to be drawn up (see section or section and the description of the proposed shortlist in section 1.1.4). In addition to qualified firms that are registered with GIZ, at least one consulting firm that is registered but has not yet received regular contracts or inquiries should be included in this context. The shortlist should include between five and eight firms. The reasons for selecting the firms should be set out in writing. Competitive tendering is to be carried out in accordance with VOL/A, unless there are sufficient grounds for waiving competitive tendering procedures. These grounds are to be documented on the order placement sheet and approved by the contract manager. The contract manager is to record the procedure to be applied on the order placement sheet along with the corresponding reasons. commission or his/her representative; contract manager Processing period for the consulting firm: approx. 2 weeks cf. VOL/A The contract manager is to be involved well in advance so that the procedure for awarding contracts can be implemented. The deadlines for the submission of bids and the period for internal processing at GIZ may be reduced as appropriate. OE

21 5. Individual measures with an anticipated order value under EUR 20,000 An invitation to tender in accordance with section 1.3 can be waived for financial reasons. The officer responsible for the commission may obtain an offer directly from a suitable consulting firm based on the terms of reference and agree the technical details directly with the firm. The officer responsible for the commission is to document the reasons for waiving the invitation to tender and for selecting the consulting firm (rationale for placing the order). The officer responsible for the commission arranges for the order placement sheet to be drawn up (cf. the information provided in section 1.2.1). commission, consulting firm commission The officer responsible for the commission involves the contract manager in order to negotiate commercial issues and draw up the contract and provides him/her with a copy of the terms of reference. Within the framework of the assessment process, the contract manager decides on the firms' commercial eligibility and organises a credit check if necessary The officer responsible for the commission sends the documents required to draw up the contract for consulting services (the offer from the consulting firm and related correspondence, the terms of reference, information for sections 1 to 6 of the contract) to the regional division. The draft contract is prepared here and is drawn up together with all the required documents and forwarded to the responsible contract manager. The officer responsible for the commission provides the contract manager with the specified documents at least three weeks before the start of the contract. Regional division, planning officer commission, contract manager 6. Service contracts with local and regional consulting firms Contracts with local and regional consulting firms up to an order value of EUR 50,000 may be entered into based on the specimen contracts provided by the Contracting, Procurement, Logistics Division and the procedural aids provided by the local GIZ office. For contracts concluded with local and regional consulting firms with a value in excess of EUR 50,000, the local GIZ office immediately contacts the responsible contract manager in order to agree on the contract award procedure and where necessary to carry out competitive tendering by international consulting firms. Local GIZ office 7. Service contracts and subsidy agreements with other subcontractors Other subcontractors in Germany and abroad are institutions such as universities, societies, non-governmental organisations (NGOs) and individual appraisers. OE

22 Service contracts with institutions other than consulting firms are also concluded centrally by the Contracting, Procurement, Logistics Division. The procedures for these service contracts differ from those described in sections 1 to 4. The officer responsible for the commission is to consult with the responsible contract manager if possible before submitting an offer to BMZ. Contracting, Procurement, Logistics Division commission Section 6 'Service contracts with local and regional consulting firms' shall apply accordingly to subsidy agreements with local or regional subcontractors in this context. Contracts with individual appraisers are concluded by Head Office (by the organisational unit of the officer responsible for the commission) or by the responsible GIZ office, if it is connected to the ESPRIT system. Approval must be obtained from the contract manager for contracts in excess of EUR 50,000. Section 6 'Service contracts with local and regional consulting firms' shall apply accordingly to contracts with local or regional individual appraisers. 8. Integrity agreement GIZ attaches a lot of importance to integrity and the prevention of corruption. GIZ's values and integrity system as well as the processes for placing orders with firms of consultants, suppliers, construction companies and the recipients of financial contributions involve a lot of obligations for GIZ, its staff, subcontractors and partners. The integrity agreement aims to: present this values and integrity system to GIZ's subcontractors in a condensed format with references to original texts; oblige GIZ's subcontractors to observe the contents of this integrity agreement and take organisational measures that allow it to communicate and monitor compliance with these codes of conduct by staff and subcontractors, and in this way ensure that the order placement process is fair and that the programme/project is implemented in a manner that is compliant with GIZ's Code of Conduct and fosters mutual trust and confidence. On submission of an offer, the bidding consulting firm undertakes that it is familiar with and respects GIZ's principles of integrity. On conclusion of the contract, GIZ's Code of Conduct shall form an integral part of the contractual provisions. OE

23 Abbreviations BMZ CPV ESPRIT EU EC PBS TED VOF VOL/A ZAK German Federal Ministry for Economic Cooperation and Development Common Procurement Vocabulary, EU classification system for standardising public procurement Computerised contract processing and settlement system used at GIZ European Union European Community Project Processing System Tenders Electronic Daily the European public procurement journal Regulations on Contract Awards for Independent Professional Services Regulations on Contract Awards for Public Supplies and Services Part A (VOL/A-EC) Approval of the offer design 23

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