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Government Contracts and Tenders (Amendment) Act 2013

REPUBLIC OF VANUATU

GOVERNMENT CONTRACTS AND TENDERS (AMENDMENT) ACT NO. 40 OF 2013

Arrangement of Sections

1 Amendment
2 Commencement

_____________________

REPUBLIC OF VANUATU

Assent: 16/01/2014
Commencement: 31/03/2014

GOVERNMENT CONTRACTS AND TENDERS (AMENDMENT) ACT NO. 40 OF 2013

An Act to amend the Government Contracts and Tenders Act [CAP 245].

Be it enacted by the President and Parliament as follows-

1 Amendment
The Government Contracts and Tenders Act [CAP 245] is amended as set out in the Schedule.

2 Commencement
This Act commences on the day on which it is published in the Gazette.

_______________________

SCHEDULE
AMENDMENTS OF GOVERNMENT CONTRACTS AND TENDERS ACT [CAP 245]

1 Section 2
Insert in their alphabetic positions:

““Chairperson” means the Chairperson of the Central Tenders Board appointed under subsection 11(1) or (9);

“Consultancy services” means activities of a professional, intellectual, and advisory nature;

“goods” means objects of every kind and description, including commodities, raw materials, products and equipment and objects in solid, liquid or gaseous form as well as services incidental to the supply of goods, if the value of these incidental services does not exceed that of the goods themselves;

“Government agency” means:

(a) a Ministry; or

(b) the office of a Government Minister; or

(c) an office or body established by or under the Constitution; or

(d) an office or body established by or under an Act of Parliament; or

(e) a prescribed agency;

“public money” has the same meaning as in the Public Finance and Economic Management Act [CAP 244];

“services” means the supply of physical services, or other labour, time or effort, or stand-alone service type contracts (such as security services, catering services or geological services);

“written” or “in writing” means any expression consisting of words or figures which can be read, reproduced and subsequently communicated and includes information which is transmitted and stored by electronic means but only if such communication is authorised by a contracting agency;”

2 References to Tenders Board or Board
Delete “Tenders Board” or “Board” (wherever occurring in this Act), substitute “Central Tenders Board”

3 Subsection 2A(1)

(a) Delete “subsections”, substitute “subsection”;

(b) Delete “and (4)”

4 Paragraph 2A(1)(b)
After “Government”, insert “, including disposals of land, interests in land, buildings or infrastructure, regardless of value”

5 Subsection 2A(3)
Repeal the subsection.

6 Subsection 2A(4) and (5)
Renumber the subsections as (3) and (4).

7 Subsection 3(2)
After “Contract”, insert “where the consideration in relation to any contract, arrangement, franchise or concession exceeds VT 5,000,000”

8 Paragraph 3(3)(g)
Before “make”, insert “ensure that for contracts with a value exceeding VT 100,000,000 and based on the recommendation of the Central Tenders Board,”

9 At the end of section 3
Add

“(4) Subject to subsection (5), a Director General or his or her authorised delegate, under this or any other Act authorizing him or her to do so, may enter into a Government Contract where the consideration in relation to any contract, arrangement, franchise or concession does not exceed VT 5,000,000.

(5) Prior to entering into a Government Contract with a value of less than VT 5,000,000 a Director General must:

(a) ensure the contract is consistent with Government policy; and

(b) ensure the contract is fiscally responsible, prudent, cost effective, and is a necessary obligation for Government to assume; and

(c) consult with the Director of the Department of Finance and satisfy himself on reasonable grounds that the Government has or is likely to have the financial ability and resources to meet all of the obligations under the contract including future obligations; and

(d) ensure that no conflict of interest exists between a Director General and the other party; and

(e) use a competitive and transparent process when deciding who to award the contract to including where applicable, a request for quotations process as may be prescribed by this or any other Act or regulation; and

(f) obtain the concurrence of the Director of the Department of Finance that the procedures in accordance with this or any other applicable Act have been followed.

(6) A Government Contract must not be awarded to a Public Servant, a Minister or a Member of Parliament or a leader as defined in the Leadership Code Act [CAP 240].”

10 Subsection 3A(1)
Delete “tender process”, substitute “procurement methods”

11 After subsection 3A(1)
Insert

“(1A) This section does not apply to any extension or variation executed in accordance with the terms of the original Government Contract, unless:

(a) such extension is made only once; and

(b) such extension does not have a value exceeding 50% of the original contract; and

(c) such variation complies with subsection 4(2).

12 At the end of section 3A
Add

(3) For the purpose of subsection (2), the invitation is to be made as follows:

(a) the invitation must be made by way of a request for tender if the amount exceeds VT 5,000,000;

(b) the invitation must be made by way of a request for quotations if the amount does not exceed VT 5,000,000;

(c) for the procurement of consultancy services, the invitation must be made by way of a request for proposals.”

13 Subsection 4(1)
After “minister” (wherever occurring), insert “or Director General or his or her authorised delegate”

14 Subsection 4(2)
Delete “in the same way.”, insert

“:

(a) by the contracting agency -where such variation does not lead to an increase of more than 10% in the price of the original terms; or

(b) in all other cases- in the same manner as described in subsection (1).

15 After section 7
Insert

“7A. Potentially Excluded Contracts

A Government Contract which is funded by a foreign donor or another organisation is subject to the provisions of this Act or any regulations made under this or any other Act, unless it is inconsistent with any requirements of the funding agency.”

16 Part 3 (heading)
Repeal the heading, substitute “TENDERS, QUOTATIONS AND PROPOSALS”

17 Section 8
Repeal the section, substitute

“8 Requirement to obtain tenders, quotations and proposals

(1) When entering into a Government Contract or a contract for the contracting out of a Government service or the purchasing of goods or services, a Minister, the Director General of a Ministry or any other person authorized by the Minister or the Director General to do so, must comply with the quotation, proposal or tendering process set out in this Act or in any regulation made under this or any other Act.

(2) The Minister, the Director General of the Ministry, or any other person authorized by the Minister or the Director General to do so is responsible for the annual planning of its procurement and for:

(a) the preparation and drafting of its requirements through technical specifications; and

(b) the preparation of tender documents based on the Standard Tender Document issued by the Central Tenders Board; and

(c) the advertising of its procurement and the seeking of any approval from the Central Tenders Board required in accordance with this Act or any other Act.”

18 Section 9

(a) Delete “(where applicable)”;

(b) After “recommending” insert “(where applicable)”

19 Paragraph 10(1)(e)
Repeal the paragraph, substitute

“(e) if the Government Contract is of a value of VT 10,000,000 or more or whenever the standard contract approved by the State Law Office are not used, a person with legal or other qualification or experience relating to contracts appointed by the Minister after consultation with the Chairperson of the Central Tenders Board.”

20 Subsection 10(2)
Delete “and where applicable the”, substitute “, excluding any”

21 Subsection 10(6)
Repeal the subsection, substitute

“(6) A member of the Central Tenders Board who has a direct or indirect personal interest in a matter being considered or to be considered by the Central Tenders Board must, as soon as reasonably practicable after the relevant facts concerning the matter have come to his or her knowledge, disclose the nature of his or her interest to the Central Tenders Board.

(6A) A disclosure of interest in a matter is to be recorded in the minutes of the meeting of the Central Tenders Board and the member must not be present while that matter is being dealt with and he or she must not take part in any deliberations or vote relating to the matter.”

22 Subsection 11(1)
Repeal the subsection, substitute

“(1) The Minister is to appoint a Chairperson of the Central Tenders Board on merit following a fair and transparent selection process.”

23 Paragraph 11(2)(a)
Delete “a wide detailed knowledge”, substitute “qualification”

24 Paragraph 11(2)(d)
Delete “.”, substitute

“;

(e) must not have a criminal record.”

25 Subsection 11(3)
Delete “, but will hold the appointment on a time basis”

26 Subsection 11(4)
Delete “the Prime Minister on the advice of”

27 Subsection 11(5)

(a) Delete “Prime Minister”, substitute “Minister”;

(b) Delete “upon a resolution of Parliament”

28 Subsection 11(6)
Delete “Prime Minister”, substitute “Minister”

29 Subsection 11(9)
Repeal the subsection, substitute

“(9) The Minister may appoint an Acting Chairperson from amongst the members of the Central Tenders Board for a specified period if:

(a) the Chairperson is absent, incapacitated and unable to attend a schedule meeting of the Board; and

(b) the business of the Central Tenders Board cannot be pursued without the Chairperson’s vote.

(10) The Acting Chairperson appointed under subsection (9), in carrying out the functions and powers of the Chairperson, must:

(a) meet the criteria for quorum set out under subsection (2); and

(b) act only during the period of appointment as an Acting Chairperson; and

(c) carry out his or her functions as specified under this Act.”

30 After section 11
Insert

“11A. Functions of the Central Tenders Board

(1) The Central Tenders Board has the following functions:

(a) to prepare and issue Standard Tender Document in consultation with the State Law Office; and

(b) to develop and disseminate standard forms for use by government agencies in the planning of procurement, for recording and reporting on procurement processes, for advertisements to be placed in the appropriate media and procedures and forms to be used in contract management; and

(c) to establish and maintain the Central Tenders Board’s website for the provision of procurement information and the publicity of Government Contracts; and

(d) to develop, introduce and manage electronic information and procurement system for the procurement of works, goods and services in Vanuatu, including:

(i) electronic advertising, convening and receipt of bids; and

(ii) the development of framework agreements and contracts; and

(iii) the use of electronic reverse auctions; and

(iv) any or all procurement modalities leading to the optimal use of public resources; and

(e) to monitor and ensure that any electronic system developed by one of more contracting agencies are done in compliance with this Act or any other Act; and

(f) to develop guidelines and instructions regarding the interpretation and implementation of this Act or any other Act; and

(g) to monitor compliance with this Act or any other Act and proposing any amendment to them regarding public procurement which appear necessary in the light of international practices and experience gained in the course of the public procurement process in Vanuatu; and

(h) to present a quarterly report to the Council regarding contracts approved by the Board; and

(i) to present an annual report to the Government regarding the overall functioning of the public procurement system; and

(j) to develop, promote and support training and professional development of officials and other persons engaged in public procurement, including their adherence to the highest ethical standards; and

(k) any other function imposed by this Act or any other Act.

(2) In addition to subsection (1), the functions of the Central Tenders Board in respect of a tender process include:

(a) the approval of all tender documents which do not conform to the Standard Tender Documents issued by the Central Tenders Board; and

(b) the approval of other tender processes not based on an open and competitive tender process; and

(c) the appointment of the tender evaluation committee; and

(d) the receipt and opening of tenders; and

(e) the assessment of tenders in compliance with the tender process under this Act or any other Act;

(f) the recommendation of an award to the Minister for submission to Council of all Government Contracts with a value exceeding VT 100,000,000;

(g) the notification of an award to the successful and unsuccessful tenderers;

(h) the management of complaints from tenderers;

(3) If a function is imposed on the Chairperson under this Act or any other Act, such function may be exercised by the Central Tenders Board or by a person delegated in accordance with the provisions of subsection 11(9).”

31 Subsection 12(2)
Repeal the subsection, substitute

“(2) The Central Tenders Board must not consider a tender or make a recommendation to the Council in respect of a tender:

(a) that has not complied with this Act or any other Act; or

(b) from a person, body corporate, company or entity who has not submitted the tender in accordance with, and followed the procedure prescribed under this Act or any other Act; or

(c) which has not been the subject of a report by the evaluation committee.

(2A) In this subsection, evaluation committee means evaluation committee appointed by the Central Tenders Board under the regulation.”

32 Subsection 12(6)

(a) Delete “is” (first occurring);

(b) After “Tenders Board” (first occurring), insert “, together with the Minister referred to under subsection 3(2), are”

33 Section 13A
Repeal the section, substitute

“13A. Contract splitting

(1) A government agency or the Central Tenders Board must not split a single procurement requirement into separate packages or award more than one contract or arrangement in relation to the same or substantially similar subject matter for the purpose of avoiding the requirements of the tender process provided for by this Act or any regulation made under this Act.

(2) Despite subsection (1), a government agency may divide a procurement requirement, which could be procured as a single contract into a package consisting of several lots which are to be bid together, where it is anticipated that the award of several separate contracts may result in the best overall value for the government agency.

(3) The provisions of section 13B apply if a single requirement is divided into lots .”

34 Paragraph 13B(1)(c)
Delete “.”, substitute

“;

(d) a requirement is divided into lots in accordance with subsection 13A(2).”

35 At the end of section 13B
Add

“(4) A person who fails to comply with this section commits an offence under this Act.”

36 Paragraph 13C(1)(a)
Repeal the paragraph, substitute

“(a) the Chairperson of the Central Tenders Board;”

37 Paragraph 13C(1)(b)
Repeal the paragraph, substitute

“(b) the Director of the Department of Finance; or

(c) any other senior official within the Department of Finance or the Ministry of Finance and Economic Management; or

(d) any senior official within the Office of, the Auditor-General, the Commissioner of Police or the Public Prosecutor.”

38 Subsection 13C(2)
Repeal the subsection, substitute

“(2) If a person referred to under subsection (1) is a public servant, such person must make such a report.”

39 Subsection 13C(3)
Repeal the subsection, substitute

“(3) A person referred to under subsections (1) and (2) may make such report under conditions of anonymity.”

40 After section 13C
Insert

“13D. Complaints Review Mechanism

(1) A tenderer may lodge a complaint with the Central Tenders Board if the tenderer believes that a person has breached a provision of this Act.

(2) Any complaint lodged in accordance with subsection (1) is to be heard by an independent expert in accordance with the procedures prescribed by the regulation.”

41 Subsection 14(1)
Delete “sections 3, 4, 8, 10(2), (3), (4), (7) or 12”, substitute “subsections 10(2), (3), (4), (7) or 13A(1), or sections 3, 4, 8, 12 or 13B”

42 Subsection 14(2)
Repeal the subsection, substitute

“(2) The offences committed under subsection (1) may be mitigated in any proceedings if a person can satisfy the Court that the offence was not intentional, did not result in any personal gain for the offender and that the breach was minor, trivial, or technical.”

43 Section 18
Repeal the section, substitute

“18. Audit

The records, minutes and decisions of the Central Tenders Board are to be:

(a) audited in accordance with the Audit Act [CAP 241]; and

(b) reviewed at any time by the Public Accounts Committee and that Committee has the same powers and functions in a review under this Act as it has under any other enactment.

19. Act to prevail
If any provision of this Act or of any regulation made under this Act conflicts with a provision of any enactment other than the Constitution, the provision of this Act or of any regulations made under this Act prevails.”