Para 2.5.2 — GOODS_MANUAL

Risk Mitigation 1. Packaging, bundling, and slicing of requirements are done to avoid open competition or reduce competition. Or it is too large to make it difficult for MSEs to participate. Possible clubbing/collaboration Lay down a clear policy for packaging and bundling of requirements. In large packages, the affordability of EMD and resultant restriction on competition may be kept in view, and bidders may be allowed to

2.5.2 Procurement Planning - Risks and Mitigations

Chapter 2: Need assessment, Formulation of Specifications and Procurement Planning

Risk Mitigation among different units having the same needs has not been explored. bid for slices of the package by depositing proportional EMD.

3.2. Code of Integrity for Public Procurement (CIPP) Public procurement is perceived to be prone to corruption and ethical risks. To mitigate this, the officials of Procuring Entities involved in procurement and the bidders/ suppliers must abide by the following Code of Integrity for Public Procurement (CIPP). All Procuring officials may be asked to sign declarations to this effect periodically and in various Procurement decisions (including Need Assessment). The bidders/ suppliers should be asked to sign a declaration about abiding by a Code of Integrity for Public Procurement in registration applications and in tender documents, with a warning that, in case of any transgression of this code, it would be liable for punitive actions as detailed in sub-para 3) below.

1. Ensuring compliance of suppliers to the Code of Integrity for Public Procurement and Integrity Pact (CIPP) if stipulated in Tender Documents; 2. Removal from the list of registered suppliers and debarment of firms; 3. Development of new sources and registration of suppliers.

(Rule 175 of GFR 2017) 1. Code of Integrity for Public Procurement: Procuring authorities, as well as bidders, suppliers, contractors, and consultants, should observe the highest standard of ethics and should:

a) not indulge in the following prohibited practices, either directly or indirectly, at any stage during the procurement process or the execution of resultant contracts:

Chapter 3: Supplier Relationship Management 3.1. Supplier Relationship Management Supplier Relationship Management comprises the following functions:

i) “Corrupt practice”: making offers, solicitation or acceptance of a bribe, rewards or gifts or any material benefit, either directly or indirectly, in exchange for an unfair advantage in the procurement process or to otherwise influence the procurement process or contract execution; ii) “Fraudulent practice”: any omission or misrepresentation that may mislead or attempt to mislead so that financial or other benefits may be obtained, or an obligation avoided. This includes making false declarations or providing false information for participation in a procurement process or to secure a contract or in the execution of the contract; iii) “Anti-competitive practice”: any collusion, bid rigging or anti-competitive arrangement, or any other practice coming under the purview of The Competition Act, 2002, between two or more bidders, with or without the knowledge of the procuring entity, that may impair the transparency, fairness, and the progress of the procurement process or to establish bid prices at artificial, non-competitive levels; iv) “Coercive practice”: any coercion or any threat to impair or harm, directly or indirectly, any party or its property to influence the procurement process or affect the execution of a contract; v) “Conflict of interest” (COI): any personal, financial, or business relationship between the bidder and any personnel of the procuring entity who are directly or indirectly related to the procurement or execution process of the contract, which can affect the decision of the procuring entity directly or indirectly.

vi) “Undue Advantage”: improper use of information obtained by the bidder from the procuring entity with an intent to gain an unfair advantage in the procurement process or for personal gain. This also includes if the bidder (or his allied firm43) provided services for the need assessment/ procurement planning44 of the tender process in which he is participating; vii) “Obstructive practice”: materially impede the procuring entity’s investigation of a procurement process either by deliberately destroying, falsifying, altering; or by concealing evidence material; or by making false statements or by threatening, harassing, or intimidating any party to prevent it from disclosing its knowledge of matters relevant to such investigation or from pursuing the investigation; or by impeding the procuring entity’s rights of audit or access to information;

b) proactively disclose45, whether asked or not, in a tender document: i) Procuring authorities46 , as well as bidders, suppliers, contractors, and consultants, should suo-moto proactively declare any Conflict of Interest as per sub-para-a)-v) above – pre-existing or as soon as these arise at any stage in any procurement process or execution of a contract. Please also refer to para 5.2.2-3 below) ii) Bidders must declare any previous transgressions with respect to the provisions of subclause a) above with any entity in any country during the last three years or of being debarred by any other procuring entity. iii) The bidder/contractor must disclose any commissions or fees that may have been paid or are to be paid to agents, representatives, or commission agents concerning the selection process or execution of the Contract. The information disclosed must include the name and address of the agent, representative, or commission agent, the amount and currency, and the purpose of the commission or fee in a format given in the Tender Document.

2. Punitive Provisions: Without prejudice to and in addition to the rights of the procuring entity to other penal provisions as per the tender documents or contract, if the procuring entity concludes that a (prospective) bidder/supplier, directly or through an agent, has violated this code of integrity in competing for the contract or in executing a contract, the procuring entity may take appropriate measures including one or more of the following:

a) if his bids are under consideration in any procurement i) Forfeiture and/ or encashment of bid security ii) calling off any pre-contract negotiations and; iii) rejection and exclusion of the bidder from the procurement process a) if a contract has already been awarded 43 Please see definition in ‘Procurement Glossary” section 44 inter-alia need assessment, preparation of - feasibility/ cost estimates/ Detailed Project Report (DPR), design/ technical specifications, terms of reference (ToR)/ Activity Schedule/ schedule of requirements or the Tender Document etc. 45 To encourage voluntary disclosures, such declarations would not mean automatic disqualification for the bidder making such declarations. The declared conflict of interest may be evaluated, and mitigation steps, if possible, may be taken by the procuring entity. Similarly, voluntary reporting of previous transgressions of the Code of Integrity elsewhere may be evaluated, and barring cases of debarment, an alert watch may be kept on the bidder’s actions in the tender and subsequent contract. 46 Please refer to example in para 3.5-5 for clarification of COI relating to personnel of procuring Entity.

i) Cancellation of the relevant contract and recovery of compensation for loss incurred by the procuring entity; ii) Forfeiture and/ or encashment of any other security or bond relating to the procurement; iii) Recovery of payments, including advance payments, if any, made by the procuring entity along with interest thereon at the prevailing rate;

b) Provisions in addition to the above: i) Removal from the list of registered suppliers and/ or debarment of the bidder from participation in future procurements of the procuring entity for a period not less than six months; ii) In case of anti-competitive practices, information for further processing may be filed under a signature of the Joint Secretary level officer with the Competition Commission of India; iii) Initiation of suitable disciplinary or criminal proceedings against any individual or staff found responsible.