Two stage tendering, like an auction, involves successive tendering phases, but the Model Law does not give any guidance on how article 33 applies to two stage tendering.

Developing countries are hesitant to open up their markets for GP to international tendering because they fear that foreign suppliers will crowd out local firms and the latter will at the same time be unable to gain access to foreign GP markets because of lack of competitiveness and the complexity of the tendering process.

The study analysed 14 steps in the procurement process from specifications and vendor registration to shipment tracking, invoicing and payments, and found that specifications, supplier registration and requests for information during the tendering process and payments, were the most electronic , while invoicing was the least.

Consequently, as tendering is the general procurement method for goods and construction, the provisions enable an electronic reverse auction procedure that follows the pattern of the standard tendering method, adapted to provide for an electronic reverse auction.

(Those provisions are incorporated by cross reference to chapter III of the Model Law in articles 46 (1) (two stage tendering) and 47 (3) (restricted tendering), and similar provisions are implied in article 48 (6) (request for proposals).

The Working Group may also wish to make an equivalent provision in two stage tendering.

The main arguments for an optional phase approach are (a) flexibility an ERA can be used within more than one procurement method (e.g., open tendering, restricted tendering and two stage tendering) and (b) special regulations have to be drafted only for those aspects of ERA proceedings that are different from normal rules and procedures, as the general aspects of procurement methodology will continue to apply.

(4) Paragraphs 4 (a) and (b) allow for either open tendering principles to be adopted (that is, all qualified suppliers can participate), or limited tendering, such that only those bidders that have the best ranked bids are invited to participate.

(f) Article 30 (2) (requiring entities to extend the tendering deadline when it makes changes to its requirements)

In the interim report submitted in March 2005, the panel reported on the WAMCO contract, signed by the Minister of Lands and Mines Jonathan Mason, giving a monopoly over the purchase of diamonds to WAMCO without following any transparent competitive tendering process.

As electronic reverse auctions may also be appropriate in the circumstances in which the Model Law allows use of restricted tendering under article 20 (in cases in which the time and costs of a tendering procedure would be disproportionate, or in cases of a limited number of suppliers because of highly complex or specialized goods), the materials also include an option to provide for an equivalent to a restricted tendering procedure (see, further, para. 24 below).

(b) The establishment, in advance, of conditions for participation, including selection and award criteria and tendering rules, and their publication

As to its location, the Working Group may consider that the draft article should be presented as part of chapter II ( Methods of procurement and their conditions for use ) and, as a form of tendering, after the current article 19 ( Conditions for use of two stage tendering, requests for proposals or competitive negotiation ).

In tendering procedures, articles 33 (2) and (3) also provide for the opening of tenders in the presence of participants, and the provision of information to suppliers on the identity and price of other tenders, to enable suppliers to monitor the application of the rules, but only once the tendering phase is complete.

The conduct of the auction itself would under the draft text below be governed by the principles and objectives of the rules governing tendering.

insert guidance regarding ranking of initial tenders see paragraph 23 above and guidance on use of open and restricted tendering see paragraph 24 above .

The Working Group may wish to consider whether open tendering should be required, whether limiting the number of participants in the auction should always be permissible, or whether the procuring entity should be entitled to adopt either approach, for example, taking into consideration the conditions for use of restricted tendering set out in article 20 of the text of the current Model Law.

The investigation was initiated in 1997 and concluded that the offending companies agreed to distribute customers amongst themselves while also participating in collusive tendering (bid rigging).

Secondly, they can enhance the efficient allocation of resources (reducing the time required to conduct a procurement, and reducing the administrative costs of the traditional open tendering procedure).

With respect to the proposed revisions to article 25 (Contents of invitation to tender and invitation to prequalify) and article 27 (Contents of solicitation documents) (A CN.9 WG.I WP.40 Add.1, paras. 6 and 7, respectively), the point was made that reference to tendering proceedings might be inappropriate as tendering proceedings had a specific meaning and scope under chapter III of the Model Law, which was considerably more comprehensive than electronic reverse auctions.

(1) The electronic reverse auction is to be conducted as a tendering procedure, and accordingly the provisions of chapter III of the Model Law apply unless they are inconsistent with the nature of an auction procedure.

Other delegations noted that the decision had been taken on the basis that allowing electronic reverse auctions as a phase in other procurement methods would undermine the principle of tendering that was the preferred procurement method under the Model Law.

The decision by the Government of Belgium in July 2005 ensures that social and sustainability criteria are considered in flexible mechanisms, as its tendering strategy involves trade unions in monitoring investments, specifically to ensure compliance with the principles of the relevant ILO conventions.

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At the same time, it was acknowledged that the ultimate drafting of those provisions would depend on resolution of the unsettled issue as to whether electronic reverse auctions should be treated in the Model Law as a separate procurement method or a phase in tendering proceedings.

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It was noted that the draft text enabled the number of participants invited to participate in the auction to be restricted, and that the Guide to Enactment should note that the conditions of use for restricted tendering would normally not apply to procurement suitable for an electronic reverse auction.

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Batch Process

DomXsltStylesheet process

DomXsltStylesheet process

Consultative process

Audit process

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Electoral process

Due process

Review process