Procurement Policy of the Public Organization “Foundation for Democracy Assistance”

APPROVED
Protocol No. 2/7-23 of 07.04.2022
Board of the NGO “Democracy Assistance Foundation”

Procurement policy
Public organization “Foundation for Promotion of Democracy”
EDRPOU code 43134930

1. General provisions

1.1. This Procurement Policy defines the mechanism of procurement of goods, works and services by the Public Organization “Foundation for Promotion of Democracy” (hereinafter referred to as the Organization), the procedures for procurement, tender, open bidding and request for quotations, as well as the procedure for conducting negotiations.

2. Basic principles of procurement of goods, works and services

2.1. Procurement of goods, works and services is based on the following principles:

2.1.1. procurement must be economical (the best possible combination of quality and price);
2.1.2. the procurement process must be efficient (completeness of rules, simplicity and speed of procedures);
2.1.3. non-discriminatory access to the procurement procedure and fairness of conditions must be ensured;
2.1.4. competition between the participants of the procedure;
2.1.5. the procurement process should be public (information should be available, bidding should be public, all decisions should be registered);
2.1.6. compliance with the rules of environmentally sound and responsible consumption when planning the procurement of goods and services (including logistics).

The implementation of the efficiency principle implies that the procurement system operates efficiently, with minimal bureaucratic procedures and maintenance costs, which leads to the basis of efficiency – achieving the stated result at minimal cost. In other words, such a system ensures the purchase of the necessary products with the best price-quality ratio for a particular task.

The principle of economy in procurement implies that in addition to using the minimum necessary resources to conclude a procurement contract and monitor its implementation, procurement also focuses on economic criteria, among which the most important is the price.

3. Procurement terms and conditions

3.1. Procurement is carried out on the basis of a decision of the Chairman of the Board of the Organization.

3.2. The main procurement procedures for goods, works and services are:

– simplified procurement procedure means a procurement of up to USD 1,000 in the hryvnia equivalent at the NBU exchange rate as of the date of the decision on such procurement, which does not require additional collection of information about suppliers.

– based on the Analysis of Price Proposals – a procurement in the amount of USD 1000.01 to 8000.00 in the hryvnia equivalent at the NBU exchange rate as of the date of the decision on such procurement. The decision on procurement is made on the basis of a competition of commercial proposals (invoices, price lists, resumes, etc.).

– on the basis of Full Competitive Selection (tender) – such procurement takes place if the amount of goods, works and services procured is USD 8,000.01 or more in the hryvnia equivalent at the NBU exchange rate as of the date of the decision on such procurement and is carried out on the basis of full competitive selection.

– procurement from a supplier included in the Register of Regular Suppliers is a procurement method where an agreement is concluded with a selected supplier (contractor) without conducting regular competitive procurement procedures within one calendar year.

3.2.1. If the Organization makes periodic purchases of goods/works or services from one seller, the procedure that corresponds to the limit of each purchase shall be applied to each such purchase, regardless of the total amount of all purchases.

3.2.2. The only source. Circumstances where competition is not possible/necessary are the exception, not the rule. If a decision is made to make a sole-source procurement and the expected transaction value exceeds USD 1,000 at the exchange rate of the National Bank of Ukraine on the date of the procurement, the responsible person must fill out the Sole Source Procurement Justification Form.

The sole source procurement exception may be applied in the following situations:

• securities forms and strict reporting documents;
• bank services for current accounts and cash and settlement services;
• administrative services provided exclusively by executive authorities in accordance with the law;
• rail and air transportation services;
• postal services, postage stamps and labeled envelopes;
• goods and services related to the development of design, production of security paper, their storage, transportation and accounting;
• fuel for motor vehicles purchased at retail directly from gas stations;
• services that are entrusted to public authorities or local governments, public or charitable organizations to provide assistance in the social sphere;
• goods, services, works that are provided/delivered/performed exclusively by holders of state licenses or patents.
• Valid offers for goods and services are available: if a procurement procedure resulted in the selection of a supplier that turned out to be unable to fulfill the terms of the contract, a new procurement procedure may not be conducted if there are other offers under the original procurement procedure. It is possible to select the next supplier that meets the tender conditions.
• Pre-existing arrangements for project implementation: if potential suppliers have been identified at the stage of preparing the project proposal as part of the proposal itself and included in the project budget.
• Utilities: Standard procurement procedures may not be possible for the procurement of utilities (e.g., water, sewerage, electricity, gas, waste collection) due to natural monopolies on services. If there is only one utility provider, procurement procedures are not required.
• Patented or copyrighted materials or services: The required goods or services can only be produced by one supplier because they are protected by a patent, copyright or data rights provision. The responsible officer must document that the specific protected goods or services are required and that there is no general alternative.
• Purchase of software that is reasonably best suited to fulfill the project objectives or achieve the Organization’s goals. The Responsible Officer must document that the software has no reasonable alternative and that not purchasing it does not create a conflict of interest;
• Certain procurements under martial law, in the absence of objective competitive alternatives. The responsible officer must document that under the existing conditions this procurement has no alternative and its implementation does not create a conflict of interest;
• Specific technical requirements: Due to the technical specification of the services or goods, there may be only one supplier capable of fully meeting the requirements. This situation can be determined by the responsible person by conducting a preliminary analysis of suppliers in the relevant market and, if necessary, initial consultations with prospective suppliers to determine whether the technical requirements can be met. Procurements exceeding USD 4,000 at the exchange rate of the National Bank of Ukraine on the date of procurement do not qualify for this exception.

4. 4. Tender committee

4.1. The Tender Committee is a group of specialists appointed by the Chairman of the Board of the Organization to be responsible for conducting procurement procedures. The Tender Committee for the procurement of goods, works and services (hereinafter referred to as the Tender Committee) is entrusted with the simplified procedure and the Open Tender Procedure.

4.2. The composition of the Tender Committee and the procedure for its activities shall be determined by this Policy.

4.3. The composition of the Tender Committee shall be appointed by the order of the Chairman of the Board of the Organization. The Tender Committee shall be competent when it consists of at least 3 persons.

4.4. The Chairman of the Tender Committee shall be appointed by the Chairman of the Management Board of the Organization from the Tender Committee. The Chairman of the Tender Committee shall organize its work.

4.5. The form of work of the Tender Committee is a meeting with personal presence or via Internet communication, which is held if necessary.

4.6. Resolutions on issues considered at the Tender Committee meetings shall be adopted by a simple majority of votes in the presence of at least two-thirds of the committee members. In the event of an equal distribution of votes, the vote of the Chairman of the Committee shall be decisive.

4.7. The decision of the committee is formalized in a protocol signed by all members of the tender committee who participated in the voting.

4.8. To resolve specific issues, if such a need arises, in particular in the case of procurement of goods, works or services of a complex or specialized nature, independent qualified (technical) experts and consultants may be involved in the work of the tender committee in accordance with the law.

Experts and consultants involved in the work of the tender committee on a contractual basis in accordance with the law may not be its members and shall not be liable for decisions, actions or inaction of the tender committee, tenderer or other persons, for the execution (non-execution) of procurement contracts, as well as for the consequences caused by such decisions, actions or inaction.

5. Procedure for conducting the negotiation procedure

5.1. The head of the organization appoints a person responsible for the simplified procurement procedure. The organization carries out direct procurement, determining the seller of goods and/or services at its own discretion. Options for consideration may be selected by the organization based on previous experience or experience of partners, recommendations, other proposals, etc. For this procedure, service providers do not have to send bids to the organization.

5.2. Based on the results of the consideration of service providers, the responsible person shall draw up a protocol (or an internal memo) that should contain answers to the following questions:

• how the bidders were selected,
• compliance of participants with the selection criteria,
• how the price was determined, the grounds for the decision to select the participant.

6. Procedure for the simplified procedure

6.1. The organization analyzes the proposals and identifies the best value for money. The organization is not obliged to give preference to the lowest-priced offer.

6.2. When using the simplified procedure, the procuring entity shall submit a request for price quotations to at least three tenderers. To obtain price quotations, an authorized employee of the Organization sends a request to at least three tenderers and on the day of sending the request, it is published on the Organization’s website https://fpdi.org.ua.

6.3. During the simplified procedure, all interested parties are entitled to submit price offers.

The request must include the following information:

• name and location of the NGO “Foundation for Promotion of Democracy”;
• description of the subject matter of procurement or its parts (if the procuring entity provides for submission of price offers by parts), including their required technical and other parameters;
• website address of the NGO “Foundation for Promotion of Democracy”;
• the term of delivery of goods or provision of services;
• place and deadline for submitting price offers;
• place, date and time of disclosure of price offers;
• validity of price offers;
• basic terms of the procurement contract;
• full name, surname, position and address of one or more officials of the NGO “Democracy Assistance Foundation” authorized to communicate with the participants.

The deadline for submission of price proposals by the participants may not be less than 5 working days from the date of publication of the request for price proposals on the website of the NGO “Democracy Assistance Foundation”.

Each Tenderer shall be entitled to submit only one price offer, which may not be subsequently amended. The price offer shall be submitted in electronic form by sending an e-mail.

6.4. The winner of the simplified procedure for requesting quotations shall be determined by the Tender Committee.

6.5. The decision of the Tender Committee must be recorded in the minutes for any variant of the tender.

7. Procedure for conducting open bidding

7.1. The transparency of the procurement procedure and open access of suppliers of relevant goods, works, services to this procedure is ensured through the announcement of tenders with the Terms of Reference and the Letter of Conformity on the Organization’s website – https://fpdi.org.ua, as well as on the websites https://gurt.org.ua/, https://www.prostir.ua/, and in the media.

7.2. When a tender is announced, the Terms of Reference and the Letter of Compliance are attached.

7.2.3. The tender announcement consists of:

– deadline for submission of the proposal;
– deadline for the Tender;
– contact details of the Organization with indication of the responsible person;
– detailed technical specifications or special requirements for participants;
– Letter of Compliance.

7.3. Participants of the open bidding

7.3.1. When conducting open bidding, the Organization shall consider at least 3 offers.

In the absence of alternative suppliers in the market, one offer may be considered. If there are two or fewer offers, the Tender Committee shall indicate in the minutes the possibility of conducting an open bidding procedure with one participant.

7.3.2. If the goods, works and services are common in the market, but the Organization has not received 3 offers, the Tender Committee shall decide to conduct another procurement procedure or re-announce the Tender.

In case the number of offers is less than 3 during the repeated announcement of the Tender, the Tender Committee shall conduct a simplified procedure.

7.3.3. If the agreement with the Organization’s Donor provides for a different procedure in case of insufficient number of proposals, the procedure specified in such agreement shall apply.

7.4. Selection based on quality and cost

7.4.1. Preference is given to offers with the best price-quality ratio.

7.4.2. The winner of the tender does not necessarily have to be the supplier who offered the lowest price for the provision of goods, works, and services. The supplier is selected from among the submitted proposals based on the quality to price ratio.

7.4.3. When making a decision on the supplier of goods, works, and services, the Tender Committee shall take into account the experience, education, knowledge, professionalism, authority in the service market, efficiency, compliance with applicable law, reasonable price-quality ratio, potential ability of the service provider to successfully perform the contract, and other circumstances that the Tender Committee considers important.

7.5. Notification of the winner of the tender

7.5.1. The winner of the tender shall be notified within three days from the date of the Tender Committee meeting by any means (in writing, by e-mail or by telephone).

7.5.2. At the same time, the Organization does not undertake to notify other tenderers that they have not won.

7.6. Based on the results of the review of tender proposals, the tender committee draws up a protocol.

8. Restrictions on participation in procurement procedures

8.1. An individual or legal entity that is related to any member of the tender committee may not participate in and/or perform the procurement procedure for goods, works, services within the framework of the event.

8.2. In the course of the procurement procedure, it is prohibited to impose requirements on participants that do not relate to their professional qualities, experience and assets necessary for the proper performance of the procurement contract.

8.3. Residents of the affected states may not participate in the procurement procedure for goods, works, and services:

8.3.1. Ukrainian legislation establishes a ban (embargo) on trade;
8.3.2. Ukrainian legislation adopted pursuant to a UN Security Council resolution approved under Chapter VII of the UN Charter prohibits the import of goods and services, as well as payments to persons who are residents of such a state.

9. 9. Special conditions

9.1. This Policy applies to all procurements carried out by the Organization both for its own funds and for borrowed funds, except as provided for in clause 2. 9.2. of this Policy.

9.2. If the contractual document with the Organization’s Donor provides for other limits, or other conditions and/or procedure for appointing and holding tenders and procurement than those established by this Policy, the activities related to the implementation of such contractual document shall be subject to the rules established by the Organization’s Donor.