Publication
ABC’s of Public Procurement
From Office of Government Procurement
Published on
Last updated on
From Office of Government Procurement
Published on
Last updated on
The terms below are defined for informational purposes only and do not constitute legal definitions.
Award Criteria – The 2016 Regulations provide that a contract should be awarded on the basis of MEAT (most economically advantageous tender). This typically means a combination of price and quality where quality might include factors such as delivery date or period of completion, delivery process, running costs, aesthetic and functional characteristics, accessibility, technical merit or environmental and social aspects. Award criteria must be linked to the subject matter of the contract. The contracting authority decides the relative weightings in relation to price and quality.
Bid - An offer made by a supplier to compete for a contract where they will supply a good, service or work.
Bid Rigging - A serious form of anti-competitive behaviour. It happens when a number of suppliers come together and agree not to bid against one-another for a tender or contract. The Competition and Consumer Protection Commission has published a Guide for Businesses on Bid Rigging.
Bidder/Tenderer - The economic operator that is submitting a bid (offer) to supply the good, service or works.
Buyer - Another term for a contracting authority buying the good, service or work.
Capital Works Management Framework - This is the separate policy and guidance relating to works and works related services that is published on the Construction Procurement website. It consists of a suite of best practice guidance, standard contracts and generic template documents.
Central Arrangement - A framework agreement or Dynamic Purchasing System (DPS) established by one of the central purchasing bodies. Further information can be found here.
Central Purchasing Body (CPB) - A contracting authority that provides centralised purchasing activities and which may also provide ancillary purchasing activities. CPBs may purchase for or put in place central arrangements on behalf of other contracting authorities. In Ireland, there are five CPBs: Office of Government Procurement (OGP), Education Procurement Service (EPS), Health Service Executive (HSE), Local Government Operational Procurement Centre (LGOPC) and the Department of Defence.
Circulars - Documents developed by departments to offer direction and alert to measures that contacting authorities should or can include in their procurement plans. Further information on circulars pertaining to public procurement can be found here.
Circular Economy - The circular economy aims to keep materials, components, and products in use in the economy for as long as possible.
Circular Public Procurement - Circular public procurement is the process by which contracting authorities purchase goods, services or works that seek to contribute to closed energy and material loops within supply chains, whilst minimising, and in the best case avoiding, negative environmental impacts and waste creation across their whole lifecycle.
Clarifications - When potential suppliers wish to clarify or explain certain elements of the tender documents or competition. When publishing a tender, contracting authorities set a deadline for the receipt of clarifications.
Common Procurement Vocabulary (CPV) Code - The code given to certain areas of industry which allows for relevant notifications to be sent to potential suppliers.
Competition – The process where a contracting authority receives bids from suppliers and carries out an evaluation on each bid before choosing a successful supplier.
Competitive Dialogue Procedure - This procedure allows contracting authorities to discuss different options with tenderers before deciding on a solution. This procedure is designed for certain particularly complex contracts e.g. technical solutions are difficult to define or where a discussion of the best legal or financial structure is needed.
Competitive Procedure with Negotiation - A new process introduced by the 2016 Regulations which allows Contracting Authorities to negotiate with more than one supplier in order to identify a preferred tenderer and to award a contract.
Concession Contract – Concessions involve a contractual arrangement between a public body and an economic operator (the concession holder). The latter provides services or carries out works and is remunerated by being permitted to exploit the work or service. Further information can be found here.
Conflict of Interest - Involves a conflict between the public duty and private interests of a public official, in which the public official has private-capacity interests which could improperly influence the performance of their official duties and responsibilities. Any conflict of interest or potential conflict of interest on the part of a Tenderer, Subcontractor or individual employee(s) or agent(s) of a Tenderer or Subcontractor(s) must be fully disclosed to the contracting authority as soon as the conflict or potential conflict is or becomes apparent.
Consortium - Refers to two or more economic operators that have come together specifically for the purpose of tendering for a specific public procurement opportunity. This may occur when economic operators are not of sufficient scale to tender in their own right.
Contract - The terms of the agreement to supply the good, service or works.
Contract award – When the preferred tender is given the contract to supply the goods, services or works, and then the contract award notice will be given to the supplier.
Contract Award Notice (CAN) – A public announcement of the outcome of the procurement competition. For contracts valued over the EU threshold, contracting authorities are obliged to send CANs to the Official Journal of the European Union via eTenders within 30 days of the award of the contract.
Contract Award Value - The total value of the contract as input into eTenders upon the award of the contract. This figure is exclusive of VAT.
Contract Notice – A standard notice is used as the means of calling for competition. It is placed in the OJEU via eTenders and indicates that a Central Purchasing Body or a contracting authority is intending to procure goods, services or works.
Contracting Authority - The public body that is awarding a contract for goods, services or works. Governance Global Practice. This may include individual Government Departments or Offices; local or regional authority; any public body, commercial and non-commercial State bodies, and private entities which are subsidised 50% or more by a public body, when awarding contracts for goods, services or works.
Directives - EU laws which govern the way public authorities and certain utility operators purchase goods, services and works. To create a level playing field for all businesses across Europe, EU law sets out minimum harmonised public procurement rules. The rules are set out in three principal EU Directives which are transposed into national legislation and apply to tenders for public contracts whose monetary value exceeds the EU threshold. Further information can be found here.
Discretionary Exclusion Grounds - Reasons a contracting authority may not consider a tender and is up to each individual contracting authority.
Dynamic Purchasing System (DPS) - A DPS is a completely electronic system which can be used to procure commonly used goods, services or works. It is typically used by contracting authorities to procure lower value goods. Unlike a Framework Agreement, which restricts tenderers joining, tenderers can be added to a DPS at any time subject to the published eligibility criteria.
eCertis - An online platform provided by the EU that helps users identify and recognise the certificates and proofs most commonly requested in relation to procurement procedures in different Member States. For example, a European company wishing to participate in a public procurement procedure, or a contracting authority that has to evaluate bids received from other Member States, can use eCertis to help understand what evidence is requested or provided by the other party. Contracting authorities in Ireland have had recourse to eCertis since 2018. Member States are obliged to keep the information provided on eCertis up-to-date.
Economic and Financial Standing - A contracting authority uses information provided by a tenderer regarding its company’s economic and financial standing as a measure in deciding whether a business has the financial capacity and strength to deliver the proposed contract. Turnover levels are often used by contracting authorities as a means of assessing the financial capacity of a tenderer to deliver the contract.
eForms – Digital public procurement notices used by contracting authorities to publish notices on eTenders and Tender Electronics Daily (TED). The introduction of the new version of eForms will mean that new and existing types of public procurement data is captured.
eTenders - The national tendering website. The site is designed to be a central facility for all public sector contracting authorities to advertise procurement opportunities and award notices. eTenders can be found here.
Estimated Value - The estimated value of the contract input into eTenders by the contracting authority when advertising the tender. This figure is exclusive of VAT.
EU Threshold - European directives set detailed mandatory procedures for contracts whose value equals or exceeds various financial thresholds. The EU revises the thresholds every two years.
European Single Procurement Document (ESPD) - The ESPD is a self-declaration used as preliminary evidence confirming that a supplier meets the Exclusion Grounds/Selection Criteria at the time of submitting a request to participate or tender.
Evaluation - The process of examining the tender responses to identify a preferred supplier. This stage takes place after the tender response deadline has passed. Responses are assessed by a dedicated evaluation team based on conformity with the specification and against evaluation criteria set out by the contracting authority.
Expression of Interest (EOI) – An overview of requirements set out by a contracting authority and sent to any potential tenderers. This allows contracting authorities to gauge interest from the market.
Framework Agreement - An aggregated procurement arrangement put in place by a CPB or contracting authority which establishes the terms governing contracts to be awarded under the framework within a specified value and period of time (generally no more than 4 years in the public sector). Only suppliers who were successful during the first stage of process and were awarded a place on the Framework Agreement can take part in the second stage of the process.
Green Public Procurement (GPP) - Defined as a process whereby public and semi-public authorities meet their needs for goods, services, works and utilities by choosing solutions that have a reduced impact on the environment throughout their lifecycle, as compared to alternative products/solutions. Further information can be found here.
GPP Criteria Search Tool - An online tool which allows users to rapidly find, select and download Green Public Procurement (GPP) criteria. The GPP Criteria Search Tool can be found here.
Guidelines (Public Procurement Guidelines for Goods and Services) – Guidelines are published by the Office of Government Procurement (OGP) and promote best practice and consistency of application of the public procurement rules in relation to the purchase of goods and services. Further information along with the guidelines can be found here.
In the Market – A term used for a tender that is currently open for bids (on eTenders, for example).
Innovation Partnership - A new process under 2016 Regulations that can be used by contracting authorities where there is no existing good or service currently available on the market that meets its needs. The aim of an innovation partnership is the development of an innovative good, service or works and its subsequent purchase provided it corresponds to the performance levels and maximum costs agreed between the contracting authority and the participants. A record of clear reasons for selecting this approach is required.
Innovation Procurement - The European Commission defines Innovation Procurement as any procurement that has one or both of the following aspects:
Further information on innovation procurement can be found here.
Joint procurement - A Procurement process undertaken by two or more contracting authorities. A Joint Procurement involves the publication of one tender on behalf of multiple contracting authorities.
Life-Cycle Costing - This allows a contracting authority to calculate all of the costs that will be incurred during the lifetime of a good, service or works. In addition to the purchase price and the associated costs of delivery, installation etc., it also includes the operating costs, i.e. energy, fuel, spares and maintenance and the end-of-life costs i.e. decommissioning and disposal. The 2016 Regulations specifically permit use of this approach, however, the method of calculating such costs must be objectively verifiable and transparent.
Lot - A public procurement contract can be sub-divided into a number of separate lots. The sub-division of a contract into lots can be based on geography, i.e. a lot can be for a particular region; or specialism, i.e. legal expertise; or value, i.e. low and/or high value lots. The use of lots in public procurement is intended to increase the potential for multiple providers to be appointed following one procurement process.
Mandatory Exclusion Grounds – Reasons that a tender must not be considered by law. At the selection stage, contracting authorities are required to exclude from further consideration any tenderers who have been convicted of specified offences.
Mini-Competition - A method used to drawdown contracts from a Framework Agreement or DPS. Only suppliers who have been successful during an initial procurement process and have been awarded a place on the framework or DPS will be invited to compete in the mini-competition. Awards are made based on a further competition, inviting all members on a framework or DPS to participate. This option can be used where not all terms governing supply are laid down in the framework agreement. The competition can be on price only or on a more precise specification.
Most Economically Advantageous Tender (MEAT) - The criterion used to select the winning tender. The most economically advantageous tender (MEAT) is the tender which, following assessment of the award criteria, is the most beneficial to the contracting authority and represents value for money. It may include the best price-quality ratio, or instead may use lowest price alone.
National Advertising Threshold - The estimated value of a contract (exclusive of VAT) that must be advertised on eTenders. Please note there are different threshold amount for goods & services and works.
Needs Assessment - Needs assessment is a key part of the procurement cycle. It can help to define the subject matter of the contract. Needs assessment also helps the choice of most appropriate specifications. Needs assessment is particularly useful when considering implementing a sustainable public procurement approach. Needs assessment should include consultation with end-users, to ensure that purchases are appropriate to their needs.
Negotiated Procedure Without Prior Publication - Under certain circumstances this procedure can be chosen without publication of a notice in the (OJEU). This is only permitted in extremely limited circumstances under Regulation 32 of S.I. No. 284 of 2016 “European Union (Award of Public Authority Contracts) Regulations 2016”. The absence of a call for competition is a departure from the core principles of openness, transparency and competition and as such is a very exceptional procedure. It should be noted that circumstances set out in Regulation 32 are strictly interpreted by the Commission and the Courts. Where one of these exemptions is invoked, the contracting authority must be able to justify the use of the exemption. If a competitive process is not used, DOF Circular 40/02 requires Government Departments to send an Annual Report signed by the Accounting Officer to the Comptroller and Auditor General explaining why this was the case.
NUTS Code - The Nomenclature of Territorial Units for Statistic (NUTS) is a geographical system to subdivide the economic territory of the EU. NUTS codes are used in public procurement to define the location of the good, service or work being procured.
Office of Government Procurement (OGP) – A Division office of the Department of Public Expenditure NDP Delivery and Reform (DPENDPDR) playing a central role in helping the State to achieve value for money when buying goods and services and is one of the Central Purchasing Bodies (CPBs).
Official Journal of the European Union (OJEU) and Tender Electronics Daily (TED) - The Official Journal of the European Union (OJEU) is the publication in which all contracts from the public sector that are valued above a certain threshold must be published. The OJEU is published in all official languages of the European Union every working day. Invitations to tender can be found on the EU online portal Tenders Electronic Daily (TED). The OJEU can be found here. TED can be found here.
Open Procedure - A single stage procurement process which allows a tenderer to simultaneously submit suitability assessment material and a tender for evaluation in a tender competition; but only those who pass the suitability test progress to the tender evaluation. The procedure ends when an award is made.
Outcome Letter - A communication sent to all tenderers informing them of the award decision and which commences the standstill period. Formally called an Award Decision Notice. The OGP publishes template outcome letters which are available for public bodies to use for tenders above and below the EU threshold.
Preliminary Market Consultation (PMC) - A pre-tender process undertaken by a contracting authority to communicate with the market or relevant experts to gain more information and understanding of what is available on the market prior to publishing a tender. Further information on PMC can be found here. This may also be referred to as pretender engagement.
Pre-Qualification Questionnaire (PQQ) - A PQQ allows a contracting authority to assess a potential supplier’s suitability in relation to their technical knowledge and experience, capacity, and financial and economic standing in relation to a particular contract. PQQs can be used as a means of selecting the candidates to go forward to the next stage of the procurement process in a Restricted Procedure; Competitive with Negotiation Procedure or Competitive Dialogue Procedure.
Price Variation Clause – The capacity for the contract sum/price may be adjusted for fluctuations in the price of materials, fuel, or labour in relation to construction. Further information can be found here.
Principles - The legal basis for the Public Procurement Directives is based on the principle of free movement and the internal market. The five general principles of EU law that stem from the free movement articles and which apply under the system of public procurement are: equal treatment, non- discrimination, transparency, proportionality and mutual recognition. Even in the case of procurement which might not be subject to the full scope of the Directives, these five principles must be observed.
Prior Information Notice (PIN) – Contracting authorities can publish a PIN in (OJEU) informing potential tenderers of possible upcoming tenders. When the tender referred to in the PIN is subsequently published, the time limit to submit and receive tenders can be reduced.
Procedure – The procurement process which has been decided to follow such as Open Procedures, Restricted Procedure, Competitive Dialogue Procedure, Competitive Procedure with Negotiation, Innovation Partnership, and Negotiated Procedure without Prior Publication.
Procurement Strategy – The aims, goals and direction that guides the contracting authority with their procurement plans.
Professional or Technical Capacity - One of the permitted criteria for selecting suppliers at the Selection Stage of a Restricted/Competitive with Negotiation/Competitive Dialogue procedure. Contracting authorities assess a tenderer’s technical or professional capacity using information submitted by the tenderer.
Public Procurement - Public procurement refers to the process by which public bodies purchase works, goods or services from suppliers which they have selected for this purpose. It ranges from the purchase of routine goods and services to large scale contracts for infrastructural projects and involves a wide and diverse range of contracting authorities.
Post Clarification Question – The contracting authority can ask potential suppliers to clarify any information they have submitted after the tender response deadline has passed.
Quality – The standard of a particular good, service or works which may include but is not limited to; running costs, cost effectiveness, aesthetic and functional characteristics, technical merit, and organisation such as qualification and experience of staff assigned to performing the contract.
Quick Quotes (electronic requests for quotations) - A function on eTenders which allows contracting authorities to seek quotations for lower value purchases (under the national advertising threshold), and are based on the CPV codes chosen.
Request for Information (RFI) – A contracting authority will publish a document requesting information from any potential supplier in order to get more information before drafting the tender documents. Request for information, which are published as PMCs on eTenders, will include CPV codes to reach the relevant suppliers.
Request for Tender (RFT) or Call for Tender (CFT) or Invitation to Tender (ITT) - A request which comes from the contracting authority to invite the market to tender for a contract.
Reserved Contract - A reserved contract allows for a public body to ‘reserve’ a contract, or elements thereof, to certain types of suppliers. The contract must still be open to competition in accordance with national procurement guidelines but entry to participation is limited to certain suppliers. The decision to reserve a contract, and the basis on which it is being reserved, must be called out in the invitation to tender. Further information can be found here.
Restricted Procedure – This is a two stage procurement process and can be used for any procurement. During the first stage, expressions of interest to compete in the tender competition will be considered by the contracting authority. Only those who meet the criteria set out in the Selection Criteria will be invited to submit a tender i.e. second stage.
Risk Assessment – A review and assessment of the risk relating to a particular procurement project. Contracting authorities should engage in a risk assessment and management in procurement for a number of reasons including; the value of the purchase is high, the procurement process is complex, adverse consequences could significantly affect the operation of a contracting authority, and delivering the contracting authorities core services to the community is significantly affected.
Selection Criteria - Imposed on suppliers as requirements for participation in a procurement procedure. The criteria may relate to a candidates professional conduct and standing, professional or technical expertise, financial or economic standing, general capacity and competency, i.e. criteria which relate to a candidate’s character and capability to perform a particular contract. All requirements for participation in a procurement procedure shall be related, and proportionate, to the subject matter of the contract.
Service Level Agreement – The section of a contract which outlines the services and quality of services which will need to be delivered.
Small Medium Enterprises (SMEs) – Defined in EU Recommendation 2003/361, are enterprises which employ less than 250 persons with an annual turnover not exceeding €50 million, and/or an annual balance sheet total not exceeding €43 million. Further information on SMEs can be found here.
Socially Responsible Public Procurement – Involves including social consideration in public procurement to help in tackling social challenges and issues. Further information can be found here.
Specification - The specification outlines the needs of the contracting authority. It provides a detailed description of what is required for the goods, services of works being procured.
Standstill Period - The day after the contract decision notice has been issued the “standstill period” will begin. The standstill period is 14 days where the notice is sent electronically or 16 days where the letter is sent by post. The standstill period will not commence until all relevant letters have been despatched. This period is designed to ensure that the procedures which have been followed are open to review before the conclusion of a contract.
Statutory Instruments (SIs) – An order, regulation, rule, scheme or bye-law made in exercise of a power conferred by statute. SIs relating to public procurement can be found here.
Supplementary Request for Tender - A document inviting prechosen economic operators to bid for a contract to be awarded under a framework agreement or DPS.
Supplier - The economic operator supplying the good, service or works.
Sustainable Public Procurement - The United Nations (UN) defines Sustainable Public Procurement (SPP) as a ‘process whereby public organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life-cycle basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst significantly reducing negative impacts on the environment’. Thus, both environmental and social considerations are included in the term ‘sustainable public procurement’. Further information can be found here.
Tender Advisory Service (TAS) – An informal outlet, provided free of charge, to suppliers in order to raise concerns in relation to a live tender process carried out by the OGP or other public sector contracting bodies. Further information can be found here.
Tender Response Document – The submission document which must be completed by the supplier as part of their tender submission.
Tenders - The process by which a contracting authority invites suppliers to bid for goods, services or works.
Variants – Variants are alternative and often innovative suggestions that will fulfil the procurement needs but may not be the obvious solution. Contracting authorities may allow or require tenderers to submit variants but must outline in the tender documents the minimum standards to be met by the variants and ensure that the chosen award criteria can be applied to variants.
2016 Regulations – Regulations which give effect to Directive 2014/24/EU of European Parliament by way of transposing into Irish Law. Further information can be found here.