Business Procurement and Contractual Practice Assignment Sample
Introduction
Green public procurement (GPP), according to the European Commission, is “a process by which public authorities seek to procure goods, services, and construction works that have a lower environmental impact throughout their life-cycle when compared to similar-primary-function goods, services, and construction works that would be procured in any other way.” In general, green procurement is defined as “a process by which public bodies seek to acquire commodities, services, and works that have a lower environmental impact throughout their life-cycle when compared to goods, services, and works that use the same fundamental raw materials as the commodities, services, and works under consideration.” 1 A detailed discussion of the Procurement Directives of 2014 is provided throughout the guidebook as a way of accomplishing GPP objectives via the application of procurement legislation. 2
In general, GPP may be used to contracts that are both above and below the threshold for procurement instructions, depending on the specific circumstances.
Procurement Analysis
It is now feasible for public bodies to consider environmental factors when making purchasing choices, according to the introduction of the 2014 procurement guidelines. Pre-purchase, procurement, and contract performance are all included in the phrase “contract performance,” which encompasses all parts of the purchasing process, including the phases of pre-purchase, procurement, and contract performance. Contracting companies and subcontractors are expected to comply with a minimum degree of environmental law compliance under the requirements of regulatory laws controlling the exclusion and selection of contractors and subcontractors on federally funded construction projects. The use of strategies such as life-cycle pricing, the development of sustainable manufacturing practises, and the use of environmental award criteria may make it possible to identify bids that are more environmentally friendly than the competition (Czarnezki2019).
To be more specific, this paper is concerned with the rules and laws that govern government acquisition (GPP). A practical approach to implementing EU regulations, as well as simple and effective approaches for greening contracts, are discussed in detail in the following article. The procurement process is organised in the same manner, and this guide has been written to reflect that structure. Also included in the book are a number of real-world examples of green purchases made by EU public agencies in the real world, which are described in further detail. 3 It was designed with government agencies in mind, but a great number of the concepts and practises it includes are as applicable to buyers in the private sector as they are to buyers in the public sector. A deeper grasp of the environmental factors that are becoming more important in public procurement would be beneficial for suppliers and service providers, particularly small and medium-sized enterprises (SMEs) (Khan,2021).
Sustainable public procurement
Sustainable public procurement (SPP), which is a kind of government-to-government procurement, ensures that environmental and social issues are taken into account throughout the procurement process (GPP). Specifically, the goal of this lesson is to explore the bidding process in terms of how it affects the environment. There are a variety of different possibilities for socially responsible procurement available in addition to the options offered by the 2014 guidelines, which are not covered in this list.
The Global Partnership for Progress (GPP) has been authorised by a number of EU programmes and projects because of its well-known potential to encourage more sustainable use of natural resources, produce social changes toward more sustainable consumption and production, and stimulate technological innovation. The GPP was established to encourage more sustainable use of natural resources, produce social changes toward more sustainable consumption and production, and stimulate technological innovation. According to the Circular Economy Action Plan, which was introduced in December 2015, there is a strong emphasis on GPP as a technique of ensuring that resources are used more effectively and efficiently.
These are the items that have been developed by the European Union in order to promote global public goods and are included inside the box. This document’s annexe contains a comprehensive list of policies, programmes, and pieces of legislation relevant to global public goods (GPG).
An effort is being made at the local and national levels to combat this problem.
There are a number of initiatives and support measures for green or sustainable public procurement that are described in national action plans (NAPs), which are implemented in the vast majority of EU Member States. Nationwide action plans (NAPs) for environmentally friendly or environmentally sustainable public procurement are being implemented in the vast majority of EU Member States.
10 Many organisations have specified objectives for GPP or SPP as part of their overall procurement strategy, both in terms of total procurement as well as for specific product and service groups, as part of their overall procurement strategy (Czarnezki,2019).
A number of different countries and regions throughout the world, with the most recent being the United States, have developed GPP and SPP criteria sets for use in a range of various situations. Even while they are often relatively similar to EU GPP standards, this does not stop them from being modified to better suit the unique circumstances or goals of individuals who are producing them. A large number of criteria sets depend on LCA data and eco-labels as the foundation for their selection and application when the data and labels are publicly available, as is the case when the evidence on which they are founded is publicly available.
It is vital to evaluate the following elements in order to make an educated decision on the most effective strategy and how to include environmental issues into the sections stated above: It is beneficial to be aware of the availability of environmentally friendly alternatives, their price, and the practical repercussions of these options, for example.
It is feasible to get some essential information by doing simple online market research. Additionally, pre-tender meetings with possible suppliers may be valuable in assisting you in gaining a more thorough understanding of the industry as a whole. If you’re seeking for unique solutions that aren’t already widely accessible, the following list may be an excellent place to start your research.
Purchasing regulations permit preliminary market engagement with suppliers as part of the planning process in order to get recommendations. This is acceptable according to procurement regulations. The process must be transparent and non-discriminatory, and it must adhere to all applicable regulations and laws (Sönnichsen2020).
Precautions
As a precaution, you should ensure that all potential applicants or tenderers have access to the results of the consultation and that they have the time to prepare their bids in order to avoid any unfair advantages in the competition.
When filing a tender that contains environmental criteria, it is preferable to notify the market of the requirements as soon as possible after submitting the tender. As a consequence, merchants will have the opportunity to customise their products to match your requirements.
The employment of a Prior Information Notification is one method of accomplishing this goal (PIN). Additional options include posting information on your company’s website or hosting an open house for prospective suppliers to learn more about your organization.
Most customers make their purchasing decisions based on the purchase price rather than other factors such as quality or durability. This is because most consumers do not consider the long-term cost of ownership when making their purchasing decisions. However, the expenses spent during the use and disposal of various goods and activities may be quite high – for example, energy consumption, maintenance, and hazardous waste disposal are just a few examples of the costs incurred. When acquiring a car, it is generally advisable to consider the total cost of ownership before making a decision. It may be necessary to employ cross-authority coordination in order to implement LCC in procurement operations due to the fact that numerous departments within a single authority may be responsible for the payment of the purchase price, energy bills, and maintenance charges. The EU GPP website, which may be located at the following address: http://ec.europa.eu/environment/gpp/lcc.htm, has further information on the LCC standard.
When purchasing from a single source, it is possible to save money by consolidating purchases, lowering administrative expenses, and pooling environmental, technical, and commercial information. By consolidating the procurement processes of a number of public agencies, it is also possible to save time by consolidating the procurement processes of a number of public agencies as well as save money. As a result of this kind of procurement, GPP may reap significant benefits since it allows for the sharing of environmental experience as well as market information for environmentally friendly goods and services, all of which are advantageous. When it comes to procuring goods and services on behalf of public agencies, central purchasing authorities at regional or national levels, for example, may participate in collaborative procurement to procure products and services on behalf of public agencies, according to the Federal Acquisition Regulations.
Procurement Phases
- When initiating a procurement, the partners will analyse the subject matter of the contract and identify any non-commercial concerns that are relevant and suitable to be taken into account before proceeding with the procurement. Examples of non-commercial concerns that should be taken into account during the scoping of a project include choosing packaging, creating specifications, considering sustainability and life-cycle needs, and determining the contract structure. Unlike the technical requirements, which must be relevant to the subject matter of the contract in issue, the contractual criteria must be specific.
- It is possible to make a contract more sustainable by incorporating social and environmental needs into the contract terms, as well as any “special” conditions that may apply. Consider, however, the expenditures associated with including such terms, as well as whether or not they are really required and cost-effective.
- Candidate rejection should be considered during the selection process, and relevant convictions should be taken into consideration. Is it required to possess a specific level of technical expertise in order to successfully finish the contract? Will the contractor be required to adhere to particular standards, such as those regulating environmental management, or will he be able to choose whether or not to comply? Regulations require that selection criteria be non-discriminatory, proportionate, and connected to the subject matter of the contract. In order to comply with these requirements, In addition, they must be compliant with the requirements established by the Regulations.
- If social and environmental issues are relevant to the subject matter of the contract and are specifically mentioned in the OJEU contract notice and/or the tender documents, they may be considered as part of the selection criteria for selecting the most economically advantageous tender during the awarding stage. Consider the process via which such concerns will be taken into account, as well as any weighting that may be assigned.
- Was there any expectation placed on the vendors in terms of the contract’s completion after it was awarded? How will we keep track of any non-contractual responsibilities and reap any benefits, such as training, secondment, and apprenticeship opportunities, if any are available, if any are available?
Contracts
In the grand scheme of things, you have total discretion over the manner in which the contract’s subject matter is described. To the extent that it is concerned with how procurement agencies receive their products and services rather than with what procurement agencies purchase, the law controlling public procurement has a greater significance. It is as a result of this that procurement standards do not place any restrictions on the scope of work that may be covered by a contract.
When it comes to public procurement, it is conceivable that picking a certain product, service, or job may result in the level playing field for businesses around the EU being disturbed. People’s safety must be preserved in this scenario, and it is vital that suitable protections be put in place. Even in cases where there is a distinctive cross-border interest in a contract that is below the thresholds or that is not entirely covered by the directives, the principles of non-discrimination, free movement of goods, and freedom to provide services apply in all cases where there is a distinctive cross-border interest in a contract.
Simply stated, you must make certain that your contract specification does not obstruct the participation of other EU or international operators in a procurement.
Identification of what it is that you truly need
In the context of public procurement, a second indication of safety is the need that technical constraints not be utilised to unduly hinder competitive bidding processes. 34 Furthermore, in circumstances when a specific standard is given, it is permissible to substitute an alternative standard for that particular standard. Additionally, offers additional guidance on how to fulfil this goal while still complying with environmental requirements.
Before a contract can be awarded, it must be examined for the possibility of having an adverse environmental impact, and this assessment must be completed before any work can be started. Keeping in touch with internal and external consumers in a timely manner may make it possible to save resources or make more environmentally friendly choices. Certain situations may need the purchase of absolutely nothing, and this is a possibility. For example, you may be able to do this.
Establishing widespread consensus on the breadth of criteria may aid buyers in making environmentally responsible selections throughout the duration of their procurement process. It is much easier to implement environmentally friendly cleaning, catering, and printing contracts since the consumers who use these services and products are already aware of the expectations placed on them and the reasons for the changes being implemented. For retrofitting or facilities management contracts, it is possible that previous agreement on the permitted temperature inside a facility would aid in the achievement of higher energy-efficiency requirements, and, therefore, in the realisation of significant cost savings.
When it comes to the environmental effect of a contract, you may not have enough information to make an educated choice prior to starting the procurement process. As a result, you should seek further information before moving forward with the procurement process. You should look at the GPP criteria that apply to a product or service early in the development process if you want to get a feel of how it will impact the environment (see Section 3.5). Further study before making a purchase may aid in the discovery of viable alternatives that may be utilised to mitigate the impact of the purchase on the environment.
Prior to developing technical requirements for the procurement papers, you must first establish what is meant by the subject matter of the contract in order to accurately depict it in the technical requirements for the procurement papers. When taken as a whole, this is the equivalent of taking a rough sketch and developing it into a completed painting. Technical specifications provide two basic functions. The first is to define what is being specified.
Companies may then decide whether or not they are interested in signing the contract after learning about it from the marketplace. • This results in the establishment of quantitative criteria against which bids can be evaluated, which is important in determining the level of competition. These are the very bare minimal criteria for satisfying the requirements of the rules and regulations. It is likely that they will provide suggestions for remedies that are entirely inappropriate for the situation in question. In the absence of legal authorization to reject an offer, you are required to accept all proposals, regardless of whether or not they fit the standards.
Recommendation
In technical requirements, it is not permissible to make broad statements about an operator’s talents and traits; rather, these statements should be related directly to particular features of the labour, product, or service that is being purchased.
36
Also important is that they are easy to understand by all operators and that you are able to verify that they are being followed when reviewing bids and proposals (see Section 3.6). As a result of the necessity to be genuine and honest, it is necessary to include specific technical needs in contract documents. 37
A product’s performance or usefulness may be described or measured in terms of European, international, and/or national standards, which may be referred to in the production of technical specifications or when characterising the product’s performance or usefulness.
38 In addition, it is likely that they are tied to appropriate labelling regulations, which would be beneficial. Procurement guidelines provide the necessary information to aid in the preparation of technical bids, and they are available online.
Luxembourg’s environmental policy requires that cleaning products be made using ecologically friendly chemicals, which is a requirement of the country.
When the City of Luxembourg published an open tender for cleaning materials and services in 2013, it invited the general public to submit bids for the opportunity to win the contract. The Luxembourg Environmental Protection Office was actively involved in the development of technical standards from the beginning. Approximately 15% of previously used items were found to be free of potentially dangerous substances, according to the results of an examination conducted by a government agency. Technical requirements for the new offer contained a list of medications that were not allowed to be used in the final product, as well as award criteria that barred any further chemicals from being included in the final product. As a consequence of the swift response from the market, four corporations submitted bids for the company to purchase. Through the implementation of this approach, the City was able to significantly enhance the quality of life for its citizens and employees.
Several of these standards include environmental factors such as material use, durability, and energy or water use, in addition to the rules that govern products and processes. For the purpose of accurately characterizing the subject matter, it is possible that you may include direct references in your specification to technical standards that contain environmental characteristics such as those described above. As viable methods of developing specifications for a wide range of goods and applications in accordance with the procurement criteria, technical reference systems such as European, global, or national standards, as well as other technical reference systems, are all covered. 41 It is necessary to include the phrase “or a comparable standard” before each standard that is stated. 42
It is essential for evidence of conformity to meet a set of criteria that is equivalent to those used for approval in order to be considered valid. For example, test reports or certificates from a conformity assessment body are examples of evidence that may be presented. It is possible to substitute the manufacturer’s technical dossier for third-party verification if a tenderer is not able to get third-party verification within the time limits that apply to the particular tendering case. Considering the circumstances of the case, the contracting authority must determine whether or not this is adequate evidence of compliance with the terms and conditions of the contract.
Conclusion
Products’ environmental effect may be significantly influenced by a variety of factors, including the materials used in the product, the production process, or even just the service or activity itself. The use of technical criteria in the production or provision of a service may still be appropriate in cases where the materials and manufacturing techniques used in its production or provision do not “form part of the material substance” of the item being purchased (for example, renewable energy or food derived from organic farming).
It is preferable to include only requirements that are particular to the manufacture of the things, providing services, or acquiring labour, rather than general practises or laws. You are not permitted to add requirements that are generic in nature. As a result, all technical requirements should be tied to the subject matter of the contract rather than general practises or rules, as opposed to generic practises or regulations. Contracting authorities must specify materials and manufacturing procedures in strict line with the non-discrimination, equality of treatment, openness, and proportionality principles; they must be followed to the letter of the law.
References
Bucea-Manea-Țoniș, R., Dourado Martins, O.M., Ilic, D., Belous, M., Bucea-Manea-Țoniș, R., Braicu, C. and Simion, V.E., 2020. Green and sustainable public procurement—an instrument for nudging consumer behavior. A case study on romanian green public agriculture across different sectors of activity. Sustainability, 13(1), p.12.
Busu, C. and Busu, M., 2020. Research on the factors of competition in the green procurement processes: A case study for the conditions of romania using pls-sem methodology. Mathematics, 9(1), p.16.
Czarnezki, J.J., 2019. Green Public Procurement: Legal Instruments for Promoting Environmental Interests in the United States and European Union. Available at SSRN 3504676.
Khan, N., 2018. Public procurement fundamentals: lessons from and for the field. Emerald Group Publishing.
Khan, S.A.R., Razzaq, A., Yu, Z. and Miller, S., 2021. Industry 4.0 and circular economy practices: A new era business strategies for environmental sustainability. Business Strategy and the Environment, 30(8), pp.4001-4014.
Manu, P., Mahamadu, A.M., Booth, C., Olomolaiye, P., Ibrahim, A.D. and Coker, A., 2018. Assessment of procurement capacity challenges inhibiting public infrastructure procurement: A Nigerian inquiry. Built Environment Project and Asset Management.
Pouikli, K., 2021, January. Towards mandatory Green Public Procurement (GPP) requirements under the EU Green Deal: reconsidering the role of public procurement as an environmental policy tool. In ERA Forum (Vol. 21, No. 4, pp. 699-721). Springer Berlin Heidelberg.
Sandiuk, H., Lushpiienko, Y., Trushkina, N., Tkachenko, I. and Kurganskaya, E., 2019. Special procedures for electronic public procurement. Journal of Legal, Ethical and Regulatory Issues, 22, pp.1-6.
Sönnichsen, S.D. and Clement, J., 2020. Review of green and sustainable public procurement: Towards circular public procurement. Journal of Cleaner Production, 245, p.118901.
Vluggen, R., Gelderman, C.J., Semeijn, J. and Van Pelt, M., 2019. Sustainable public procurement—External forces and accountability. Sustainability, 11(20), p.5696.
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