GENERAL PROCUREMENT PRINCIPLES AND RULES.
i. Procurement and asset disposal planning.
The accounting officer prepares an annual procurement plan which is realistic in a format set out in the Regulations within the approved budget prior to commencement of each financial year as part of the annual budget preparation process.
All asset disposals are planned by the accounting officer concerned through annual asset disposal plan in a format set out in the Regulations.
Procurement and asset disposal plans are based on indicative or approved budgets which are integrated with applicable budget processes and in the case of a State Department or County Department, such plans are approved by the Cabinet Secretary or the County Executive Committee member responsible for that entity.
All procurement and asset disposal planning reserve a minimum of thirty per cent of the budgetary allocations for enterprises owned by women, youth, persons with disabilities and other disadvantaged groups.
Multi-year procurement plans are prepared in a format set out in the Regulations and are consistent with the medium-term budgetary expenditure framework for projects or contracts that go beyond one year.
The accounting officer should not commence any procurement proceeding until satisfied that sufficient funds to meet the obligations of the resulting contract are reflected in its approved budget estimates.
For greater certainty, the procurement and disposal plans approved should include choice of procurement and disposal methods and certain percentages referred to in the Act.
ii. Procurement pricing and requirement not to split contracts.
No procuring entity may structure procurement as two or more procurements for the purpose of avoiding the use of a procurement procedure.
Any person who contravenes the provisions of this section is guilty of an offence.
Standard goods, services and works with known market prices are procured at the prevailing real market price.
Public officials involved in transactions in which standard goods, services and works are procured at unreasonably inflated prices will, in addition to any other sanctions prescribed in
the Act or the regulations, be required to pay the procuring entity for the loss resulting from their actions.
iii. Registration and prequalification of suppliers.
The head of procurement function maintains and continuously update lists of registered suppliers, contractors and consultants in various specific categories of goods, works or services according to its procurement needs.
An application to be included in the list of the procuring entity may be made at any time, at no cost and contains proof of the following—
a. eligibility criteria as prescribed in the Act; and
b. capability criteria that define necessary qualifications, experience, resources, equipment and facilities to provide what is being procured;
A tenderer may seek clarification from the candidate or relevant government agency on eligibility but not on capability.
iv. Standard procurement and asset disposal documents.
The accounting officer of a procuring entity uses standard procurement and asset disposal documents issued by the PPRA in all procurement and asset disposal proceedings.
The tender documents used by a procuring entity contain sufficient information to allow fairness, equitability, transparency, cost-effectiveness and competition among those who may wish to submit their applications.
The accounting officer of a procuring entity prepares the tender document clearly indicating the technical and financial evaluation criteria to be applied which is quantifiable, measurable and objective in consultation with the user department and other relevant departments.
A procuring entity may charge a fee not exceeding one thousand shillings for hard copies of a tender document or as may be set by the Cabinet Secretary from time to time. The fee should only have regard to the costs related to printing, copying, and distributing.
v. Limitation on contracts with state and public officers.
A State Organ or public entity enters into a contract for a procurement with—
a. a public officer or state officer or a member of a committee or Board of that State organ or public entity; or
b. an officer of that public entity or state organ.
A State officer or a public officer should not award or influence the award of a contract to—
a. himself or herself;
b. the State officer’s or public officer’s spouse or child;
c. a business associate or agent; or
d. a corporation, private company, partnership or other body in which the officer has a substantial or controlling interest.
A state officer or public officer who has an interest in a matter under consideration in a public procurement or asset disposal should disclose in writing, the nature of that interest and shouldn’t participate in any procurement or asset disposal relating to that interest.
vi. Performance bonds and tender securities. Tender security
Tender security is a guarantee required from tenderers by the procuring entity and provided to the procuring entity to secure the fulfilment of any obligation in the tender process.
The accounting officer of a procuring entity may require that tender security be provided with tenders.
The form of tender security will be:
a. In the form of cash, bank guarantee, insurance guarantee or CBK approved financial institution guarantee;
b. stated as an absolute value;
c. an amount of not more than two percent of the tender as valued by the procuring entity.
Tender security is forfeited if the person submitting the tender:
a. withdraws the tender after the deadline for submitting tenders but before the expiry of the period during which tenders remains valid;
b. refuses to enter into a written contract or fails to furnish any required performance
A procuring entity may immediately release any tender security if—
a. the procurement proceedings are terminated;
b. the procuring entity determines that none of the submitted tenders is responsive;
c. a contract for the procurement is entered into; or
d. a bidder declines to extend the tender validity.
Tender securities are not required in procurements reserved for small and micro-enterprises or enterprises owned by women, youth, persons with disabilities and other disadvantaged groups
participating in a procurement proceeding and the target group are required to fill and sign the Tender Securing Declaration Form.
Performance Security is any security provided by a supplier or contractor solely for the protection of the procuring entity, against non-performance for the supply of goods, works or services;
The requirement of the performance security is included in the bid documents and determined by a procuring entity in accordance with value of the orders made.
The threshold for providing performance security for goods, works and non-consultancy services is for contracts above five million shillings.
A performance security is not be required where a professional indemnity cover is provided by the consultant.
Where performance security for goods, works and non-consultancy services for women, youth and persons with disabilities and other disadvantaged groups is required, the performance security should not exceed one per cent of the contract sum.
The head of procurement function is the custodian of the tender security, performance security, and professional indemnity certificate and monitors its application.
vii. Termination of cancellation of procurement and asset disposal proceedings.
The accounting officer of a procuring entity, may, at any time, prior to notification of tender award, terminate or cancel procurement or asset disposal proceedings without entering into a contract where any of the following applies:
a. the subject procurement have been overtaken by—
i. operation of law; or
ii. substantial technological change;
b. inadequate budgetary provision;
c. no tender was received;
d. there is evidence that prices of the bids are above market prices;
e. material governance issues have been detected;
f. all evaluated tenders are non-responsive;
g. force majeure;
h. civil commotion, hostilities or an act of war; or
i. upon receiving subsequent evidence of engagement in fraudulent or corrupt practices by the tenderer.
The accounting officer who terminates procurement or asset disposal proceedings gives the PPRA a written report on the termination within fourteen days that includes the reasons for the termination.
The accounting officer notifies all persons who submitted tenders of the termination within fourteen days of termination and such notice contain the reason for termination.
viii. Form of communications and electronic procurement.
All communications and enquiries between parties on procurement and asset disposal proceedings are to be in writing.
Information and Communication Technologies (ICT) may be used in procurement and asset disposal proceedings as prescribed with respect to—
a. publication of notices;
b. submission and opening of tenders;
c. tender evaluation;
d. requesting for information on the tender or disposal process;
e. dissemination of laws, regulations and directives;
f. digital signatures;
ix. Corruption and Conflicts of interest.
A person to whom the Act applies should not be involved in any corrupt, coercive, obstructive, collusive or fraudulent practice; or conflicts of interest in any procurement or asset disposal proceeding.
A person who contravenes the provisions of that sub-section commits an offence.
The voiding of a contract by the procuring entity does not limit any legal remedy the procuring entity may have.
An employee or agent of the procuring entity or a member of the Board or committee of the procuring entity who has a conflict of interest with respect to a procurement:
a. should not take part in the procurement proceedings;
b. should not, after a procurement contract has been entered into, take part in any decision relating to the procurement or contract;
c. should not be a subcontractor for the bidder to whom was awarded contract, or a member of the group of bidders to whom the contract was awarded.
An employee, agent or member who refrains from doing anything prohibited would have been within his or her duties, discloses the conflict of interest to the procuring entity.
A person has a conflict of interest with respect to a procurement if the person or a relative of the person –
a. seeks, or has a direct or indirect pecuniary interest in another person who seeks, a contract for the procurement; or
b. owns or has a right in any property or has a direct or indirect pecuniary interest that results in the private interest of the person conflicting with his duties with respect to the procurement.
During or after procurement proceedings, no procuring entity and no employee or agent of the procuring entity or member of a board or committee of the procuring entity discloses the following:
a. information relating to a procurement whose disclosure would impede law enforcement or whose disclosure would not be in the public interest;
b. information relating to a procurement whose disclosure would prejudice legitimate commercial interests or inhibit fair competition;
c. information relating to the evaluation, comparison or clarification of tenders, proposals or quotations;
d. The contents of tenders, proposals or quotations.
This section does not prevent the disclosure of information if any of the following apply:
a. the disclosure is to an authorized employee or agent of the procuring entity or a member of a board or committee of the procuring entity involved in the procurement proceedings;
b. the disclosure is for the purpose of law enforcement;
c. the disclosure is for the purpose of a review under Part XV (administrative review of procurement and disposal proceedings) or requirements under Part IV (powers to ensure compliance) of the Act;
d. the disclosure is pursuant to a court order; or
e. the disclosure is made to the PPRA or Review Board under the Act.
Any person who contravenes the provisions of this section is guilty of an offence and are debarred for working for the government for a period of 10 years.
xi. Procurement records.
The accounting officer of a procuring entity keeps records for each procurement for at least six years after the resulting contract has been completed or, if no contract resulted, after the procurement proceedings were terminated.
The records for a procurement include –
a. a brief description of the goods, works or services being procured;
b. if a procedure other than open tendering was used, the reasons for doing so;
c. if, as part of the procurement procedure, anything was advertised in a newspaper or other publication, a copy of that advertisement as it appeared in that newspaper or publication;
d. for each tender, proposal or quotation that was submitted:
i. the name and address of the person making the submission;
ii. the price, or basis of determining the price, and a summary of the other principal terms and conditions of the tender, proposal or quotation; and
iii. a summary of the proceedings of the opening of tenders, evaluation and comparison of the tenders, proposals or quotations, including the evaluation criteria used;
e. if the procurement proceedings were terminated without resulting in a contract, an explanation of why they were terminated;
f. a copy of every document that the Act requires the procuring entity to prepare; and
g. such other information or documents as are prescribed.
xii. Procurement approvals.
All approvals relating to any procedures in procurement are to be in writing and properly dated, documented and filed.
No procurement approval is to be made to operate retrospectively to any date earlier than the date on which it is made except on procurements in response to an urgent need where the accounting officer is furnished with adequate evidence to verify the emergency.
No procurement approval is made by a person exercising delegated PPRA as an accounting officer or head of the procurement function unless such delegation has been approved in writing by the accounting officer or the head of the procurement unit, respectively.
General procurement rules.
i. Initiation of procurement process.
The head of the user department initiates the procurement process through a requisition as per the approved procurement plan. The user department submits the requisition to the head of the procurement function for processing which is accompanied by the following as applicable:
a. feasibility studies or surveys and reports;
b. specifications, bills of quantities, technical drawings, or terms of reference;
c. environmental and social impact assessment reports;
d. reasonable expected date of delivery; and
e. any other necessary information pertaining to the procurement.
When estimating the value of the goods, works or services, the accounting officer ensures that the estimate is realistic and based on up-to-date information on economic and market conditions.
ii. Invitation of tender.
The accounting officer ensures the preparation of an invitation to tender that sets out the following –
a. the name and address of the procuring entity;
b. the tender number assigned to the procurement proceedings by the procuring entity;
c. a brief description of the goods, works or services being procured including the time limit for delivery or completion;
d. an explanation of how to obtain the tender documents, including the amount of any fee, if any;
e. an explanation of where and when tenders will be submitted and where and when the tenders will be opened;
f. a statement that those submitting tenders or their representatives may attend the opening of tenders;
g. applicable preferences and reservations pursuant to the Act;
h. a declaration that the tender is only open to those who meet the requirements for eligibility;
i. requirement of serialisation of pages by the bidder for each bid submitted; and
All tender documents sent out to eligible bidders should be done so by recorded delivery.
iii. Modifications to tender documents and bids. Modifications to tender documents
A procuring entity may amend the tender documents at any time before the deadline for submitting tenders by issuing an addendum without materially altering the substance of the original tender.
An amendment may be made on the procuring entity’s own initiative or in response to an inquiry by a candidate or tenderer.
A procuring entity promptly provides a copy of the addendum to each person to whom the procuring entity provided copies of the tender documents.
The addendum is deemed to be part of the tender documents.
If the tender documents are amended when the time remaining before the deadline for submitting tenders is less than one third of the time allowed for the preparation of tenders, or the time remaining is less than the period indicated in instructions to tenderers, the accounting officer of a procuring entity extends the deadline as necessary to allow the amendment of the tender documents to be taken into account in the preparation or amendment of tenders.
Modification of bids
Before the deadline for submitting tenders, a person who submitted a tender may only change or withdraw it in accordance with the following:
a. the change or withdrawal is in writing; and
b. the change or withdrawal is submitted before the deadline for submitting tenders and in accordance with the procedures for submitting tenders.
After the deadline for submitting tenders, a person who submitted a tender is not allowed to change, or offer to change the terms of that tender.
iv. Submission and receipt of tenders.
Submission of tender documents whether in electronic or manual form, is to be in writing, signed and in the case of manual submission, they are sealed in an envelope. The procuring entity indicates the mode of submission of tenders by specifying whether the submission are done electronically or manually.
A tender document and the envelope, in which it is sealed in, bears the tender number assigned to the procurement or asset disposal proceedings by the procuring entity.
A tender is submitted before the deadline for submitting tenders and any tender submitted after the deadline are not accepted by the procuring entity.
The procuring entity ensures that the place or site where tenders are to be submitted is open and accessible and provides, in that place or site, a tender box including an electronic tender box that complies with the prescribed requirements in regulations.
Each tender that is delivered is placed unopened in the tender box –
a. if the tender is delivered by post, by the staff of the procuring entity immediately upon receipt; or
b. if the tender is delivered otherwise than by post, by the person delivering the tender.
If a tender that is delivered by post is inadvertently opened, the fact of that opening is recorded on the envelope by the person who opened the tender and the tender is then placed in the tender box.
If a tender or part of a tender cannot fit in the tender box it is received in the manner set out in the tender documents or the invitation to tender or, if no such manner is set out, in the manner determined by the procuring entity and the procuring entity acknowledges receipt of the tender documents.
v. Opening of tenders.
The accounting officer of a procuring entity appoints a tender opening committee specifically for the procurement in accordance with the following requirements: –
a. the committee is to have at least three members; and
b. at least one of the members should not be directly involved in the processing or evaluation of the tenders.
Any bid withdrawn in writing is not be eligible for evaluation or consideration in the tender process.
Immediately after the deadline for submitting tenders, the tender opening committee opens all tenders received before that deadline.
Those submitting tenders or their representatives may attend the opening of tenders.
The tender opening committee assigns an identification number to each tender and record the number of pages received.
As each tender is opened, the following is read out loud and recorded in a document to be called the tender opening register –
a. the name of the person submitting the tender;
b. the total price, where applicable including any modifications or discounts received before the deadline for submitting tenders; and
c. if applicable, what has been given as tender security.
No tenderer is disqualified by the procuring entity during opening of tenders.
The accounting officer of a procuring entity, on request, provide a copy of the tender opening register to a person submitting a tender.
Each member of the tender opening committee –
a. signs each tender on one or more pages as determined by the tender opening committee; and
b. initials, in each tender, against the quotation of the price and any modifications or discounts, where applicable.
The tender opening committee prepare tender opening minutes which set out –
a. a record of the procedure followed in opening the tenders; and
b. the particulars of those persons submitting tenders, or their representatives, who attended the opening of the tenders.
To acknowledge that the minutes are true reflection of the proceedings held, each member of the tender opening committee –
a. initials each page of the minutes;
b. appends his or her signature as well as initial to the final page of the minutes indicating their full name and designation.
A person who causes the physical loss of tender documents provided for under this section commits an offence.
vi. Evaluation of tenders.
The evaluation committee appointed by the accounting officer evaluates and compare the responsive tenders other than tenders rejected.
The evaluation and comparison is done using the procedures and criteria set out in the tender documents and, in the tender for professional services, having regard to the provisions of the Act and statutory instruments issued by the relevant professional associations regarding regulation of fees chargeable for services rendered.
The following requirements apply with respect to the procedures and criteria –
a. the criteria is, to the extent possible, be objective and quantifiable;
b. each criterion is expressed so that it is applied, in accordance with the procedures, taking into consideration price, quality, time and service for the purpose of evaluation;
The evaluation committee prepares an evaluation report containing a summary of the evaluation and comparison of tenders and submits the report to the person responsible for procurement for his or her review and recommendation.
The person responsible for procurement, upon receipt of the evaluation report prepared, submits such report to the accounting officer for approval. The evaluation is carried out within a maximum period of thirty days.
The evaluation report is signed by each member of evaluation committee.
vii. Post-qualification and due diligence.
An evaluation committee may, after tender evaluation, but prior to the award of the tender, conduct due diligence and present the report in writing to confirm and verify the qualifications of the tenderer who submitted the lowest evaluated responsive tender to be awarded the contract in accordance with the Act.
The conduct of due diligence may include obtaining confidential references from persons with whom the tenderer has had prior engagement.
To acknowledge that the report is a true reflection of the proceedings held, each member who was part of the due diligence by the evaluation committee—
a. initials each page of the report; and
b. appends his or her signature as well as their full name and designation.
If the bidder is determined to be non-compliant with the post-qualification evaluation, the tender is rejected and a similar confirmation of qualifications conducted on the tenderer—
a. who submitted the next responsive bid for goods, works or services as recommended by the evaluation committee; or
b. who emerges as the lowest evaluated bidder after recomputing financial and combined score for consultancy services under the Quality Cost Based Selection method.
viii. Development of professional opinion.
The head of procurement function of a procuring entity, alongside the report to the evaluation committee as secretariat comments, reviews the tender evaluation report and provides a signed professional opinion to the accounting officer on the procurement or asset disposal proceedings.
The professional opinion may provide guidance on the procurement proceeding in the event of dissenting opinions between tender evaluation and award recommendations.
In making a decision to award a tender, the accounting officer takes into account the views of the head of procurement in the signed professional opinion.
ix. Recommendation for contract awards.
Subject to prescribed thresholds, all tenders are evaluated by the evaluation committee of the procuring entity for the purpose of making recommendations to the accounting officer through the head of procurement to inform the decision of the award of contract to the successful tenderers.
x. Extension of tender validity period.
Before the expiry of the period during which tenders remain valid, the accounting officer of a procuring entity may extend that period.
The accounting officer of a procuring entity gives in writing a notice of an extension to each person who submitted a tender.
An extension is restricted to not more than thirty days and may only be done once.
For greater certainty, tender security is forfeited if a tender is withdrawn after a bidder has accepted the extension of biding period.
xi. International tendering and competition.
If there will not be effective competition for a procurement unless foreign tenderers participate, the following applies—
a. the invitation to tender and the tender documents are to be in English;
b. if the procuring entity is required to advertise the invitation to tender, the procuring entity, also advertises the invitation to tender in Kenya’s dedicated tenders’ portal or one or more English-language newspapers or other publications that, together, have sufficient circulation outside Kenya to allow effective competition for the procurement;
c. the period of time between the advertisement and the deadline for submitting tenders should not to be less than the 7 days;
d. the technical requirements are, to the extent compatible with requirements under Kenyan law, to be based on international standards or standards widely used in international trade;
e. a tenderer submitting a tender may, in quoting prices or providing security, use a currency that is widely used in international trade and that the tender documents specifically allow to be used; and
f. where local or citizen contractors participate, they are entitled to preferences and reservations as set out in the Act.
g. any other conditions as may be prescribed.