Yangon November 24 2015 OUTREACH SEMINAR FOR

Yangon – November 24, 2015 OUTREACH SEMINAR FOR NEP Business Opportunities in World Bank funded Projects World Bank

Objective of the Presentation What should I know about WB funded project & procurement activities? Who are the key players involved? How to participate in Bank funded projects? How to prepare a responsive bid (key bid requirements and common pitfalls in bidding) National Electric Project Specific information. Where to find more information? November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 2

PART I OVERALL CONTEXT November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 3

Key Players Country (Implementing Agency) Financing Agreement (Contractual relationships) World Bank Bidding Documents/Contracts (Contractual relationships) Complaints Queries Investigations Sanctions Supplier Contractor Consultant (Non Contractual relationships) November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 4

Roles in Bank-funded Project Government of Union of Myanmar • • • Identify project/program Design, prepare and plan the project/program Apply for the loan/credit Implement project/program Ensure compliance with Agreements Identify project/program Appraise project/program and assess risk Approves loan/Credit Share knowledge and information Supervise project/program Monitor compliance with Agreements November 24, 2015 World Bank BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 5

Roles in Procurement WORLD BANK Assess country procurement system, capacity of implementing agency, and procurement risks Assist in procurement planning Training, knowledge/best practice sharing Monitor compliance with Financing Agreement and Procurement Plan Review bid documents and evaluation reports prior to issuance and award of contract Investigate fraud and corruption allegations November 24, 2015 DRD (IMPLEMENTING AGENCY) Prepare Procurement Plans Advertise bidding opportunities Prepare/issue bidding documents Receive/evaluate bids/proposals Award /Implement contracts Ensure compliance with Financing Agreement and Procurement Plan Arrange for project/program audit BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 6

Steps and actors in bidding process Step Government Role Bank Role Private sector Prepare procurement plan and cost estimates Prepares Reviews No involvement Prepare bidding documents Prepares Reviews No involvement Issue bidding documents Advertise and issue None Buys or collects Clarification on bidding documents issue clarifications Reviews Seek clarifications Submission of bids Receives, records None in public Submit Evaluate bids Evaluates Review recommenda tion No involvement Award of contract Award None Accepts BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 7

Key Documents to Guide Procurement under the Project Financing Agreement signed between Government and World Bank Project Appraisal Document (PAD) World Bank Procurement and Consultant Guidelines Project Operations Manual Government internal processes and procedures agreed with the Bank for the implementation of the project Agreed Procurement Plan November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 8

Bank Policy objectives in Procurement NEED FOR ECONOMY AND EFFICIENCY ◦ Value for money and method should commensurate with speed and value GIVE ELIGIBLE BIDDERS OPPORTUNITY TO BID ◦ Advertise widely locally in at least two newspapers of wide national circulation and UNDB website ENCOURAGE DEVELOPMENT OF LOCAL INDUSTRY ◦ Provide domestic preference of 15% in evaluation to local manufacturers and 7. 5% for local contractors under International Competitive Bidding TRANSPARENCY ◦ Evaluation by committee, advertise widely and publish award results. Bidders free to complain, prepare and publish procurement plan November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 9

World Bank Procurement Guidelines GUIDELINES Procurement of goods, works and non-consulting services Under IBRD Loans and IDA Credits & Grants by World Bank Borrowers January 2011 Revised July 2014 November 24, 2015 GUIDELINES Selection and Employment of Consultants Under IBRD Loans and IDA Credits & Grants By World Bank Borrowers January 2011 Revised July 2014 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 10

The Bidding Document Bidding documents include draft contract. In contrast to the procurement guidelines, SBDs set out the rules for a particular tender. Obtain and Read carefully the Bidding Document issued by the Implementing Agency November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 11

Structure of the Standard Bidding Documents (SBD) TO BE USED UNCHANGED Section I. Instructions to Bidders (ITB) TO BE CUSTOMIZED BY PURCHASER Section II. Bid Data Sheet (BDS) Section III. Evaluation and Qualification Criteria Section V. Eligible Countries Section VI. Purchaser's Requirements Section VII. General Section VIII. Special Conditions of Contract (GCC) Contract (SCC) November 24, 2015 TO BE FILLED OUT BY BIDDERS BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR Section IV. Bidding Forms Section IX. Contract Forms 12

Bidding and Contract forms Bidding Forms ◦ Letter of Bid ◦ Schedules of Rates and Prices ◦ Technical Proposal ◦ Bidder Information Sheet ◦ Party to JVA Information Sheet ◦ Historical Contract Non-Performance Contract Forms Once completed, will form part of the Contract. ◦ Performance Security ◦ Advance Payment Security ◦ Current Contract Commitments/Works in Progress ◦ Financial Situation ◦ Experience – General & Specific ◦ Forms of Bid Security (Bank Guarantee) ◦ Manufacturer’s Authorization November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 13

PART II Play by the rules November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 14

Important Provisions Eligibility (ITB 4)- You are not allowed to participate if ◦ You are in a Conflict of Interest situation with regards to this particular tender ◦ Your are a State Owned Enterprise that is not legally, financially autonomous and does not operate under commercial law ◦ By compliance with a UN Security Council Sanctions, Borrower’s country prohibits any import of goods from, or payments to, your country, person, or entity and/or prohibits payments to your firm or for goods your are offering ◦ You are under sanction by the Bank or other MDBs relating to fraud and corruption ◦ If you are not fulfilling legal requirements as required by the country e. g. paying taxes November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 15

What circumstances would be regarded as conflict of interest - Providing goods resulting from consulting services provided by yourself or affiliate - Submitting more than one bid as individual or JV. Does not include subcontractors - Close family or business relationship with staff of implementing agency - Directly or indirectly controls or is controlled by another bidder - Receives or has received subsidy from another bidder - Has the same legal representative as another bidder November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 16

State owned enterprise may participate under following circumstances - Can demonstrate that they are legally, financial and managerially autonomous (Submit all legal documents and Bank will assess) - Not bidding for a contract under its supervising ministry - In agreement with the Bank if works are scattered and remote such that it is not feasible to obtain competitive bids - In areas of conflict or strife where it is not practical for private sector to operate effectively November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 17

Documents Comprising the Bid (a) Letter of Bid (h) Documentary evidence that the Plant & Installation Services offered conform to the (b) Completed schedules Bidding Document (substantial responsiveness of proposal (c) Bid Security or Bid Securing Declaration; of work requirements and completion time); (d) Alternative bids, if permissible; (i) In the case of a bid submitted by a Joint Venture, (e) Written confirmation authorizing the signatory of the Bid to commit the Bidder; ◦ JV agreement, or letter of intent to enter into a JVA including (f) Documentary evidence that the Plant ◦ a draft agreement, indicating at least the parts of the and Installation Services offered are Plant to be executed by the respective partners; eligible (country of origin declaration form); (j) List name and nationality of the (g) Documentary evidence establishing proposed subcontractors, including Bidder’s eligibility & qualifications to manufacturers; and perform the contract; (k) November 24, 2015 any other document required in the BDS BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 18

Some Important Provisions (1) Bid Security (BS) ðYou are killing your bid if Validity of Bid Security ◦ Important to show bidder is serious ð ◦ Normally between 0. 5 -2% of bid price ð ◦ Shall be valid for twenty-eight days (28) beyond the original validity period of the bid. ð ◦ Any bid not accompanied by a substantially responsive bid security shall be rejected as non responsive. ◦ Bid security should be in name of bidder NOT agent. ◦ The bid security may be forfeited if: ◦ the Bid is withdrawn during the period of bid validity or ◦ the successful Bidder fails to (i) sign the Contract; or (ii) furnish a performance security. November 24, 2015 ð w w The bid security is not included in the bid The BS is not for the full amount The BS is not for the entire bid validity period The BS refers to: The wrong bidder (in joint ventures, all partners must be listed); The wrong Employer; The wrong contract; Only one lot (when the bid is for several lots) BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 19

Some Important Provisions (2) Technical Responsiveness ◦ The bid that does not meet minimum acceptable standards of completeness, consistency and detail, and the specified minimum (or maximum, as the case may be) requirements for specified functional requirements, will be rejected for non responsiveness ◦ Read requirements carefully and provide quality goods ◦ Provide data and bronchures to confirm the stated specifications ◦ Just writing “we comply “ against specifications is not enough ◦ Attach quality assurance certificates if required ◦ If you did not manufacture goods have manufacturer authroisation certificate and warranty guarantee from manufacturer November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 20

Important Provisions (3) Fraudulent and Corrupt Practices Types of F&C Practices ◦ Corrupt practice ◦ Fraudulent practice ◦ Collusive practice ◦ Coercive practice ◦ Obstructive practice Bank Sanctions ◦ Reject the proposal for award ◦ Declare misprocurement and cancel the portion of the loan allocated to a contract if a representative of the Borrower is involved without the Borrower taking timely and appropriate action ◦ Declare firm or individual ineligible, indefinitely or for a stated period of time ◦ (i) to be awarded a Bank-financed contract; and ◦ (ii) to be a nominated sub-contractor, consultant, supplier, or service provider in a Bank-financed contract LIST OF DEBARRED FIRMS & INDIVIDUALS http: //www. worldbank. org/debarr November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 21

Anti-corruption Hotline • Department of Institutional Integrity (INT) Toll-free: 1 -800 -831 -0463 (24 hours/day) Collect call: 704 -556 -7046 BY MAIL: PMB 3767 13950 BALLANTYNE CORPORATE PLACE CHARLOTTE, NC 28277, USA Phone: 202 -458 -7677 Fax: 202 -522 -7140 E-mail: investigationshotline@worldbank. org Website: www. worldbank. org/integrity Click on "Online Complaint Form" Anonymous calls are accepted. Please be as specific as possible. November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR

Critical and Important Provisions Evaluation and Qualification Criteria (Section III) Three types of criteria used in evaluation of bids 1. Exclusion/Eligibility Criteria as defined above 2. Financial Capacity 3. Technical Capacity November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 23

Qualification Criteria- Financial Capacity ◦ Bidders should be financially sound to take on contracts ◦ Documentary evidence to be provided to include audited financial statements, balance sheets and letters from Banks November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 24

Qualification Criteria- Technical Capacity ◦ Directly related to the subject matter of contract ◦ Bidder should have technical and logistical capacity to deliver within contract time ◦ Documentary evidence may include evidence of similar contracts, ownership or plans to own/hire specialized equipment, key staff qualifications (for installation) November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 25

How can bidders enhance their qualification (1) ◦ Joint venture (JV) with other bidders. This can be for specific contract or period of time ◦ Experience of all JV members will be taken into account during evaluation ◦ JV to nominate leader and leader has to meet specified minimum qualification ◦ All documents –letter of submission, bid security etc- to be in name of JV ◦ JV is bound to the Employer/Purchaser November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 26

How can bidders enhance their qualification (2) ◦ Enter into subcontractor or association type relationships with other bidders ◦ Loose arrangement for specific tender or period of time ◦ Only qualification of main bidder will be taken into account ◦ In specific circumstances where scope is varied, subcontractor experience may be taken into account ◦ Subcontractor is not bound to the Employer/Purchaser ◦ Bid security to be in the name of the main contractor not subcontractor or agent November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 27

Typical qualification criteria that may be used under specific tenders: ◦ Meet exclusion/eligibility criteria ◦ Have turnover of at least equal to the estimated contract amount (Your estimate) ◦ Cash flow requirements ◦ Must have successfully completed 1 -2 similar contracts in the past 3 -5 years or cumulatively supplied the equivalent quantities within relative period ◦ Must have logistical capacity to deliver the goods or provide plans to acquire the logistical capacity to deliver goods on time. Delivery plan may be required ◦ Qualified key staff to be in charge of installation ◦ After sales services – Help desk availability November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 28

Part III NEP SPECIFIC INFORMATION November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 29

Off-grid Activities (Phase I) : Responsibilities of PMO-DRD Set up within the DRD under MLFRD, the PMO will be responsible for: ◦ Defining contract packages of goods and services ◦ Preparing procurement plan and updates thereof ◦ Preparing bidding documents ◦ Coordinating bid evaluation ◦ Requesting approval of evaluation reports from Government internal approval bodies as necessary ◦ Seeking No Objection from the Bank ◦ Contract implementation and ensuring goods received are of required quality as per contract. ◦ Engaging local governments at State/Region, District and Township level in selecting priority villages November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 30

Scope of goods and accessories to be procured under NEP Off-Grid ◦ Solar PV Systems for households, public institutions and street lights ◦ 456, 500 devices over 5 years ◦ First year requirements – 165, 000 devices ◦ Mini-Grid System November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 31

What do we know about local suppliers q More than 100 suppliers operating across the country in many regions q. They have been in operation for a periods ranging from 1 year to over 20 years with average of 5 years q. Self reported capacity varies from 500 to 38, 000 units installed per year q. Majority of the suppliers have installed capacity of around 1, 500 units q. Total Units installed by all suppliers were 49, 000 in 2013/14, 192, 000 in 2014/15 and in 2015/16 , 112, 000 have been installed to date q. Any manufacturers? We do not have complete date q. Firms financial turnover and financial standing – No information November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 32

What will be the approach to procure these goods? (1) ◦ Supply and installation of goods and accessories to defined locations ◦ Preliminary divided into nine (9) geographical lots (State based) ◦ Lot size by number of devices ranges from 16, 000 to 39, 000 units ◦ A firm will be hired to monitor installation and its standards November 24, 2015 BUSINESS OUTREACH SEMINAR IN NAY PYI TAW, REPUBLIC OF THE UNION OF MYANMAR 33

What will be the approach to procure these goods? (2) ◦ Quantities required and value of goods is huge and would require international competition to deliver within project time ◦ International competitive bidding (ICB) will be used to solicit bids. Adverts will be made globally in English ◦ ICB approach is expected to drive unit costs down, raise the quality bar and facilitate partnership between foreign and local firms ◦ Domestic preference of locally manufactured (not traded) goods of 15% will be given at choice of purchaser and stated in bidding documents ◦ Bidders will be given adequate time of not less than 4 weeks to prepare bids and form any association of their choice November 24, 2015 BUSINESS OUTREACH SEMINAR IN NAY PYI TAW, REPUBLIC OF THE UNION OF MYANMAR 34

How will these goods be procured? (3) ◦ Bidders will be post qualified. All qualification documents should be in the bid. No prequalification will be done under the project. ◦ Award will be based on Lowest Evaluated Bid (LEB). LEB takes into account price and qualification of bidders. ◦ Bidders may be awarded a Lot or combination of Lots subject to fulfilling qualification criteria for multiple lots November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 35

Building Blocks of a Successful Bid 1 Know the Context 2 Track Pro-active Opportunities 3 Zero Know activity the Rules November 24, 2015 4 Play by the Rules BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 36

Specific Project Procurement Information UN Development Business – Adverts for all large value tenders (above US$200, 000 for goods, US$300, 000 for works and US$100, 000 for consultancies) Bank external website: http: //documents. worldbank. org then search for procurement plans for MM projects OR Procurement plans can be search from : http: //documents. worldbank. org/curated/en/docadvancesearch or http: //worldbank. org, then go to 'Publication', select 'Documents and Reports', 'Advance Search', select country and document type Project appraisal Document contains first approved procurement plan Adverts in local newspapers Borrower implementing agency stated in Project Appraisal Document November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 37

When In Doubt § Ask up front, do NOT guess or assume § Contact the client in writing and seek clarification § Ask for more time if necessary. § If bidding documents have excessive requirements or other unacceptable conditions (restrictions, brand names, etc. ), contact the client in writing before the bid closing date, asking for corrections. § § § Copy the World Bank (TTL , Regional Procurement Manager) Remember, the WB does not provide clarification on behalf of the client. Refer to appendix 3 “Guidance to Bidders” of Procurement Guidelines. November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 38

Complaints ◦ Address all queries or complaints to the Implementing Agency ◦ Copy the Bank (TTL + Regional Procurement Manager) or write to the Bank directly when borrowers do not respond promptly, or if the communication is a complaint against the Borrower. ◦ Bidders may request a debriefing about his bid November 24, 2015 BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 39

Ssirijaratwong@worldbank. org BUSINESS OUTREACH SEMINAR IN YANGON, REPUBLIC OF THE UNION OF MYANMAR 40