Procurement Process at ESS

Supply, Procurement and Logistics Division

www.europeanspallationsource.se

September 4, 2014

Legal basis and Policy for ESS Procurement

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ESS procurement is guided by European Procurement Directive 2004/18/EC on public procurement, implemented through the Swedish Public Procurement Act (LOU), and the following principles:

• Open competition, accessibility to Industry, accountability, transparency and equal treatment

• Efficient, effective and ethical use of resources, sustainability

• Objectivity and clarity in ESS procurement business process

• All tenders over EUR207K published on OJEU website

• EU competitive procedures - open, restricted, competitive dialogue, negotiated

• Use of up-to-date e-tools (ERP, E-commerce, etc.)

EU Award Procedures

ESS is guided by:

European Procurement Directive 2004/18/EC

implemented through the Swedish Public Procurement Act (LOU)

OPEN

RESTRICTED

COMPETITIVE DIALOGUE

NEGOTIATED PROCEDURE

PREPARE SPECIFICATIONS / SOW / TOR

OJEU NOTICE (€207K and higher)

Response PQQs Expressions of Interest - 3 bidders invited

INVITATION TO TENDER –SUBMISSION PERIOD

RECEIPT OF TENDERS

EVALUATE TENDERS AGAINST AWARD CRITERIA

AWARD CONTRACT ALLOWING FOR 10 DAY STANDSTILL PERIOD

SUBMIT OJEU AWARD NOTICE WITHIN 48 DAYS

INVITE AND CONDUCT DIALOGUE

Issue ITT to Supplier

Receive tenders and negotiate 1

00

-25

0 D

AYS

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Legal basis for ESS Procurement below EU threshold

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ESS procurement below the EU threshold (<EUR207K) follows the Swedish Public Procurement Act (LOU), chapter 15 with the following award procedures:

• Direct award of contracts (new threshold since 1 July 2014 = SEK 505,800. ESS is using EUR50K)

• Simplified procedure

• Selection procedure

• Competitive dialogue

Comparison of ESS process for EU open procedure vs. LOU procedure

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Systems and processes in support of the ESS procurement process

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• Procurement plan for duration of the project (construction phase until 2018-2019) under preparation -> public version will be communicated

• Tenders published on ESS website + OJEU, as appropriate

• E-tendering platform tool under development (currently in pilot phase). Introduction planned for early 2015

Optimisation and improvement of procurement systems is ongoing:

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0

50

100

150

200

250

300

350

400

450

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

M€

In-kind potential

Cash

Assumptions Host states pay cash Partner countries pay

• cash (~30%) • in-kind (~70%)

In-kind is 35-40% of the project value!

May contribute “component” or “work”

Project Schedule Spend Profile

Construction: € 1,84 Billion

In-kind: € 750 Million

The ESS Strategy is to maximise in-kind contributions

WBS

WPs/WUs

1. Verify LOI from host country 2. Start negotiation and detailed investigation Potential or

planned

Not IKC potential

EOI response received

No EOI response

More responses: Evaluation of all (complex process)

Project has recommended partner

NO IKC partner identified by project

ASK for EOI response

Procurement

Other ?

One response: Preliminary evaluation

+ In-kind frees up cash

+ In-kind brings expertise to the project + In-kind allows for more work in parallel

- There is less direct control - There is more uncertainty (risk) - Resources and time must be applied to relationships

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Procurement under the ERIC framework

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An ERIC has legal personality based on EU law (Article 171 of the EC Treaty). Its main tasks are to establish and operate a research infrastructure.

The ERIC is an “easy-to-use” legal instrument providing: • A truly European venture (also allowing the participation of non-European

countries) • A legal personality recognised in all EU Member States • Flexibility to adapt to the specific requirements of each infrastructure some

privileges/exemptions allowed for intergovernmental organisations • An ERIC can benefit from exemptions from VAT and excise duty in all EU

Member States and it may adopt its own procurement rules, which have to respect the principles of transparency, non-discrimination and competition but are not subject to the EU directive as such.

• ESS ERIC statutes including procurement rules are under development

The Industrial Liaison Officer (ILO) Network

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The ILO Network is not a decision making body for ESS, but a privileged channel of information for the organisation and for maturing business opportunities related to ESS.

Each partner will cover the respective personnel, infrastructure, travels and other expenses.

It is a long-term activity covering the construction and the operational phases.

Thanks for your attention!

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