Information and Tender Procedures
procurement or consultant services procurement
first step in the tender procedure is the identification of the need to
procure. These are referred to as technical specifications. When it comes to
descriptions of consultant services, those are usually referred to as
“Terms of Reference”.
for vehicles and equipment are normally performance-oriented
and should refer specifically to the required:
of consultant services
requires the preparation of terms of reference,
explaining mainly the following:
the preparatory stage of procurement,
public bodies need define, not only their needs in terms of technical
specifications, but also the minimum qualifications that suppliers must have
in order to be eligible for government contracts.
order to participate in public procurement proceedings, suppliers must
demonstrate that they;
capacity to enter into a procurement contract, normally through a trade
have fulfilled their obligations to pay taxes normally through a tax
In order to
demonstrate their formal qualifications, suppliers must file with the
Ministry of Finance, Government
Procurement Unit, an application for registered supplier status in the form
to be supplied by the Unit.
Ministry of Finance will, if necessary consult other appropriate
authorities, and will, upon being satisfied that the application is
complete, issue a registration certificate within 5 days.
must also demonstrate that they possess the necessary substantive
qualifications to perform the contract for which they compete in the
particular case, meaning that they possess the necessary:
and technical competence and experience,
and other physical facilities,
capability and personnel.
Public bodies may
require suppliers to provide appropriate documentary evidence or other
information, as it may deem useful to satisfy itself that the suppliers are
substantively qualified. Any substantive qualification requirement must be
set forth in the bidding documents.
public body shall evaluate the substantive qualifications of suppliers in
accordance with the criteria and procedures set forth in the bidding
documents. This evaluation is distinct from, and carried out separately
from, the evaluation of the tenders submitted.
suppliers who fail to demonstrate the required formal and substantive
qualifications must be rejected.
the public body will invite interested suppliers to demonstrate their
qualifications. The invitation to prequalify shall contain, as a minimum:
of the contract for which prequalification is deemed necessary;
for preparing and submitting prequalification applications;
documentary evidence or other information which must be submitted by
public body shall ensure that invitations to bid are publicised for
sufficient duration and location (at least two times in one consecutive
week). The publicity should clearly state how, where and when the bidding
documents are obtained. This may include:-
number (if any);
items or services to be procured;
price of the bidding documents;
amount of the bid security;
place, final date and time of submission of bids;
date of opening the bid;
procuring agency’s address and other details.
of bidding documents
for bidding documents
documents may be sold to any interested bidder upon the submission of a
written application and a non-refundable fee.
allowed for preparation of bids
shall be afforded at least 20 days from the date of publication of the first
notice for preparation of tenders in the case of domestic purchases; when
foreign bidders are expected to respond to the invitation, the preparation
period shall be at least 45 days.
all tenders public bodies must prepare bid documents that include:
bodies shall ensure invitations to bid are publicised for sufficient
duration and location-invitations should be publicised at least 2 times in 1
consecutive wee in The Ethiopian Herald and/or Addis Zeman or other public
to bidders will vary between different types of procurement contract.
However, every instruction should include:
of evaluating all bids and the criteria for that evaluation;
that the bidders should include in their offer the type of item and the
name of the producer, country of origin, model number and year of
requirement that bidders have a Certificate of Registration in the
requirement bidders shall put their name, signatures and addresses in
indication that the bidders shall not alter or amend and that they shall
not withdraw their tender after the opening ceremony;
indication that bidders who attempt to influence the tender shall be
disqualified from that contract, future Government contracts and shall
forfeit its bid security;
place and the time where any samples will be openly shown to bidders and
an indication that the samples shall be returned to unsuccessful
time and place of delivery;
validity date of the tender;
indication of bid and performance securities required;
date and time of the closing deadline for bids and the opening of those
requirement that bidders shall undertake to observe the country's laws
against fraud and corruption (including bribery) as listed in the
bidding documents during the procurement process.
essential step in procurement is to draw up a clear statement of the user's
requirements. This is
especially important for the procurement of high cost or complex goods or
services. Also referred to as
the functional specification, the user requirement should specify the
desired functional attributes, outputs and end uses of the goods or services
that are to be procured, including those attributes relating to required
technical capabilities, operating characteristics and performance standards.
proposals and price schedules
bodies shall include it in the bid documents, where relevant, detailed
technical proposals and a price schedule for completion by the bidders.
and conditions of contracts
terms and conditions of contract shall be issued to the bidders as part of
the tender documents. A
pro-forma contract that public bodies should use as a template is included
in the Procurement Manual, main clauses must include:
recommended that public bodies include in their invitations to
tender a statement that for each day of delay for the main good or
service and its accessories beyond the delivery date stated in the bid
document, the supplier will be due to pay 1/10th of 1 percent
liquidated damages to the public body of the CIF value of the
undelivered item to a maximum of 10% of the contract price).
If the supplier fails to do so then the public body shall have
the right to terminate the contract;
there are 2 price aspects that public bodies should state in the bid
supplier will indicate unit and total price.
In case of error the unit price shall be accepted and used as
the base for recalculation of the bid price;
price analysis the conversion of any currency to a common currency,
the official rate of exchange on the day of opening the tender shall
the bidder shall state the definite date of delivery or delivery period.
The delivery period shall commence on the opening of the letter of
credit for international purchases, and the date of signing of the
contract for local purchases.
inspection of the good or service shall be made in the presence of a
representative of the supplier at the agreed destination.
All assembly and demonstration costs shall be borne by the
-the supplier shall guarantee that all items included in the good or
service shall be new, of high quality and workmanship.
Suppliers shall give warranty in writing as part of their bid.
the conditions of contract should include provisions dealing with the
applicable law and the forum for the resolution of any disputes relating to
Force Major- neither the
nor the supplier shall be responsible to perform the contract in case of
failure due to force major such as earthquake, flood, epidemic disease,
war or other natural calamities and industrial disruption.
of payment- the bid document shall also include reference to payment
to tender documents
alteration to the content of tender documents shall be effected only through
the public media by which the original invitation to tender was made.
The time for closing and opening the bids may be extended where
modifications in the tender documents are to be announced in the invitation
shall be opened in public at the time and place stated in the invitation to
tender. Bids shall be opened on
the same day as the closing date. Public
bodies shall invite bidders to attend.
Bids shall be opened in the presence of:
the bidders or
authorised representative of the bidder whether or not the bidder has
chosen to be present;
of the Tender Committee, and Internal Audit if possible.
Chairman of the Tender Committee shall open each tender and read out the
name of the tenderer, the price of bid for the contract and any salient
points. The Secretary of the
Tender Committee shall take minutes of the tender opening procedures.
These minutes will include a record of the bidders, price and any
other salient points. This
record and the original tenders will be signed by the Tender Committee
bodies may disqualify any bidder that commits any of the following offences:
any provisions in the Financial Regulations and Directives or any
conditions stipulated in the tender documents;
to fulfil any obligations he has
undertaken in previous Government tenders;
to deposit the required bid bond or performance bond;
or gives gratuities to any official or employee with a view to securing
favourable treatment or to win the tender, if proven beyond all
any fraudulent act in respect of the tender, if proven beyond all
procurement of vehicles is carried out by the consolidation of the
Government's annual requirements. This
procurement is carried out on behalf of all the Government by the National
Committee for bulk purchasing in the Ministry of Transport and communication
(MTC). Public bodies must
notify MTC of their annual vehicle procurement needs by July 30th
prepare detailed specifications, organise and place the tenders for purchase
and evaluate bids that they receive. MTC
then inform public bodies of the recommended suppliers, details of
specifications and prices that they should contract with the suppliers for.
Public bodies are therefore responsible for placing the contracts according
to the recommendations of MTC and paying the invoice.
Where the Head of the public body determines that there is a pressing
need in which delay would create serious problems, the public body may
procure such a vehicle based on the recommendations of MTC.
for works construction contracts
provisions of this Directive apply to procurement for works construction
contracts. However, in certain areas as defined by Proclamation 4/1995
the Ministry of Urban Works and Development (MoWUD) are responsible for
developing and maintaining detailed guidance.
This guidance shall be developed and maintained in consultation with
the MoF, Public bodies should therefore follow MoWUD guidance.
of consultancy services
provisions of this Directive apply to procurement of consultancey services.
However, when public bodies need to procure consultancy services they
should give specifications to the Ministry of Economic Development And
Co-operation (MEDAC) who maintains records of consultants.
Public bodies should negotiate and contract with consultants based on
the recommendations from MEDAC.
of Non-Ethiopian Goods and Services
bodies should undertake the same steps to procure foreign goods and services
as they would for local services. However, there are several additional
steps required to facilitate the purchase and receipt of those goods and
services in addition to these usual steps:-
a Letter of Credit;
and shipping; and
payment of foreign currency for foreign purchases is effected through any
commercial bank in Ethiopia.The procedure will be as detailed in National
Bank Directive No. FXD/07/1998.
a Letter of Credit
Letter of Credit is a document issued from one bank to another that promises
to pay a supplier on receipt of a written document on behalf of the
supplier. The Letter of credit will be based on the agreement between public
bodies and suppliers. The issuing bank will inform the correspondent bank by
opening of the Letter of Credit in the name of the supplier to pay the
supplier on receipt of shipping documents. Consequently, the correspondent
bank will make the payment effective immediately after receiving the
shipping documents from the supplier.
are 2 types of Letters of Credit:-
the issuing bank has the right to cancel or amend the payment
after the opening of the Letter of Credit. This is possible only where
the issuing bank informs the correspondent bank before it has paid the
contract price to the supplier. As this type of Letter of Credit does
not bind the purchaser to fulfil its contractual obligation, it is not
practical for use by public bodies;
where the Letter of Credit cannot be altered after it has been opened.
Furthermore, there are 2 types of irrevocable Letters of Credit -
where the issuing bank is bound by Law to pay the supplier in
question, whereas the advising or correspondent bank is not bound by
Law to pay the supplier. If the correspondent bank does not pay the
contract price to the supplier, the supplier can only sue the
issuing bank for the unpaid amount;
where both parties (Issuing and Advising bank)are obliged to respect
all conditions stated on the Letter of Credit and make the
disbursement effective. In such a case, the advising bank is known
as the confirming bank. The issuing bank informs the confirming bank
about the opening of the confirmed and irrevocable Letter of Credit
and hence to give the supplier a payment guarantee.
the Letter of Credit is opened, if the confirming bank fails to pay the
contract price to the supplier, the supplier has the right to sue both
Letter of Credit should be opened by the purchaser within one working week
after the foreign exchange permit for imports has been received.
purchased from abroad should be transported through Ethiopian Shipping Lines
(ESL) or Ethiopian Airlines (EAL). If ESL or EAL does not call to that
specific port, the goods can be transported to the nearest port that ESL or
EAL calls and the transhipment should be effected by ESL or EAL. If the
goods are shipped by ESL, the Bill of Loading; if shipped by EAL, the Airway
bill should be received by the purchaser.
goods can be transported by sea, air, in land or rail based on the contract
agreement that is signed by both parties. The responsibility for arranging
the insurance depends upon the contract:-
entails the delivery of the goods on a free on board (FOB) basis, the
purchaser is responsible to cover all costs associated with the
transportation and insurance;
the contract entails the delivery of the goods on a cost and freight
(C&F) basis, the supplier is responsible to cover all costs
associated with the transportation up to the port of the purchaser,
whereas the purchaser is responsible to insure the goods;
the contract entails the delivery of the goods on cost, freight and
insurance (CIF) basis, all costs associated with the transportation and
insurance of the goods will be covered by the supplier.
purchaser has the responsibility for the insurance it should insure using
the Ethiopian Insurance Corporation (EIC). Public bodies will require
following documents when they want to make a claim for short-shipment or
original forms - insurance policy, bill of lading/airway bill and the
chamberised invoice as evidence;
the exchange of letters with the relevant Port Authority, Captain of the
ship in connection with the damage or short-shipment of the goods;
short landing certificate of the Maritime and Transit Services
insurance survey report; and
report on the delivery and receipt of the goods.
the international and internal transportation of goods, public bodies will
have to clear the goods through Ethiopian Customs. Public bodies should use
the facilities of a clearing agent to do this.
are number of documents that public bodies will have to give to Customs in
order to clear the goods being imported:-
Public bodies should submit all of the above
documents to Customs with a completed "Declaration".
This form can be bought by public bodies from Customs. The information that
public bodies should insert onto the Declaration are as follows:-
of the supplier and the buyer;
Port of lading;
tax payer number;
year of production of the goods;
Bill of lading/airway bill number;
bank permit number;
currency of purchase;
quantity of goods;
kind, type and weight of the goods;
tariff number or homogenised systems code;;
price of the goods;
rate of tax;
tax amount due;
taxes and charges;
amount of other taxes and charges;
name of the transit agent;
are 6 approved methods of procurement:
as otherwise provided by articles 14 - 20, public bodies engaging in the
procurement of goods and construction shall do so by means of open tendering
procedures. Public bodies may
use a method of procurement other than tendering proceedings only pursuant
to these articles.
bodies should prepare the documents and follow the steps required for open
tendering provided for in articles 22 - 51.
These steps should also be followed when procuring under alternative
methods of procurement, except where specifically provided for.
for Open Tendering
public body should firstly assess its need or demand for the goods or
services to be purchased.
need or demand for the goods or services to be purchased should be requested
and approved by the authorising unit within the public body.
It should also reflect the interests of all concerned units in the
the need assessment is undertaken, the public body should prepare bidding
documents. These documents
should include the following:
and detailed descriptions of the goods and services to be purchased;
of basic terms and conditions of contracts; and
forms for tenders, including the quality and price schedules.
solicitation documents shall call upon suppliers to submit, in the first
stage of the two-stage tendering proceedings, initial tenders containing
their proposals without a tender price.
The solicitation documents may solicit proposal relating to the
technical, quality or other characteristics of the goods, construction or
services as well as to contractual terms and conditions of supply, and,
where relevant, the professional and technical competence and qualifications
of the suppliers.
public body may, in the first stage, engage in negotiations with any
supplier or contractor whose tender has not been rejected pursuant to
articles 12 and 13 concerning any aspect of its tender.
the second stage of the two-stage tendering proceedings, public bodies shall
invite suppliers whose tenders have not been rejected to submit final
tenders with prices with respect to a single set of specifications.
In formulating those specifications, public bodies may delete or
modify any aspect, originally set forth in the solicitation documents, of
the technical or quality characteristics of the goods, construction or
services to be procured, and any criterion originally set forth in those
documents for evaluating and comparing tenders and for ascertaining the
successful tender, and may add new characteristics or criteria that conform
with this Directive. Any such
deletion, modification or addition shall be communicated to suppliers or
contractors in the invitation to submit final tenders.
A supplier not wishing to submit a final tender may withdraw from the
tendering proceedings without forfeiting any tender security that the
supplier may have been required to provide.
The final tenders shall be evaluated and compared in order to
ascertain the successful tender as defined in article 45.
public bodies engage in restricted tendering on the grounds referred to in
article 16(a), it shall solicit tenders from all suppliers from whom the
goods, construction or services to be procured are available.
the public body engages in restricted tendering on the grounds referred to
in article 16 (b), it shall select suppliers from whom to solicit tenders in
a non-discriminatory manner and it shall select a minimum of 3 suppliers
from the approved suppliers list.
Request for proposals
for proposals shall be addressed to as many suppliers as practicable, but to
at least three. These suppliers should be selected from the approved
public body shall publish in a newspaper of wide international circulation
or in a relevant trade publication or technical or professional journal of
wide international circulation a notice seeking expressions of interest in
submitting a proposal, unless for reasons of economy or efficiency the
public body considers it undesirable to publish such a notice; the notice
shall not confer any rights on suppliers or contractors, including any right
to have a proposal evaluate.
bodies shall establish the criteria for evaluating the proposals and
determine the relative weight to be accorded to each such criterion and the
manner in which they are to be applied in the evaluation of the proposals.
The criteria shall concern:
technical and managerial competence of the supplier or contractor;
effectiveness of the proposal submitted by the supplier or contractor in
meeting the needs of the public body;
price submitted by the supplier or contractor for carrying out its
proposal and the cost of operating maintaining and repairing the
proposed goods or construction.
Request for quotations
bodies shall request quotations from as many suppliers as practicable, but
from at least three, if possible. These
shall be selected from the approved suppliers list.
Each supplier from whom a quotation is requested shall be informed
whether any elements other than the charges for the goods or services
themselves, such as any applicable transportation and insurance charges,
customs duties and taxes, are to be included in the price.
supplier is permitted to give only one price quotation and is not permitted
to change its quotation. No
negotiations shall take place between public bodies and a supplier with
respect to a quotation submitted by the suppler.
procurement contract shall be awarded to the supplier that gave the
lowest-price quotation meeting the needs of the public body.
the circumstances set forth in article 19, public bodies may procure goods,
construction or services by soliciting a proposal or price-quotation from a
of Issuance of invitation
for Bids (IFB) number
body) invites sealed bids from registered suppliers for the supply of (brief
description of goods and related services).
Interested registered suppliers may obtain further information from and
inspect the bidding documents at the office of: (public
body's purchasing unit), (mailing
address of appropriate office for enquiry and issuance of bidding documents
and cable/telex numbers).
Where a supplier wishes to bid for this contract but has not yet been
registered, it may obtain an application form for registration from the
office of (relevant
office that sends out the application for approved supplier).
Application for registration shall be filed with the Government Procurement
Unit, Ministry of Finance, which will act promptly upon receipt of the
A complete set of bidding documents may be purchased by any interested
supplier from the above and upon payment of a non-refundable fee of Birr (xx)
fee chargeable should only be enough to defray reproduction and mailing
costs and to ensure that only bona fide bidders will request for bidding
documents. Public bodies should charge between Birr 50 and Birr 200]
and on presentation of license (where
All bids must be accompanied by a security of Birr (Fixed
appropriate information from "Instructions to Bidders", clause 14]
and must be delivered to the above office on or before (hours)
and address of purchaser)
examined the Conditions of Contract and Specifications including Addenda
numbers (Insert numbers), the receipt of which is hereby duly acknowledged,
we, the undersigned, offer to supply and deliver (Description of goods and
services) in conformity with the said drawings, Conditions of Contract and
Specifications for the sum of (Total bid amount in words and figures) or
such other sums as may be ascertained in accordance with the Schedule of
Prices attached herewith and made part of this bid.
undertake, if our bid is accepted, to commence delivery within (Number) of
days and to complete delivery of all the items specified in the Contract
within (Number) of days calculated from the date of receipt of your Letter
of Acceptance/Letter of Credit. If
our bid is accepted we will obtain the guarantee of a bank in the sum not
exceeding (________)% of the Contract sum for the due performance of the
agree to abide by this bid for a period of (___________) days from the date
fixed for bid opening under clause 21 of the Instructions to Bidders and it
shall remain binding upon us and may be accepted at any time before the
expiration of that period. Until a formal contract is prepared and executed, this bid,
together with your written acceptance thereof in your notification of award
shall constitute a binding contract between us.
understand that you are not bound to accept the lowest or any bid you may
this________ day of__________19___________.
(in the capacity of)
authorised to sign bid for and on behalf of
For more details on tenders refer to
Tender and Marketing