Public Procurement & Government Contracts 2020

Last Updated April 06, 2020

Congo Brazzaville

Trends and Developments


Author



GOMES LAW FIRM belongs to Mr Alexis Vincent Gomes. The practice has six lawyers and many collaborators. The head office is in Pointe-Noire and it has a branch in Brazzaville. The firm is specialised in business law (seizures, commercial law, civil law, maritime law, financial law, etc). It also deals with other areas such as mining, hydrocarbons and the OHADA. For example, the firm has successfully launched Turkish Airlines in Congo. It has also helped the Russian oil and gas company LUKOIL to get shares in New Age, a company in Congo.

Public Procurement 2020 in the Republic of Congo-Brazzaville

General Context and Current Trends

Changes to public procurement practices have been underway for just over just a decade. The Congolese legislator has introduced many changes which make the Republic of Congo more attractive as a country of major projects.

Since the enactment of Decree No 2009-156 dated 20 May 2009 and its application, the Republic of Congo has started to seriously consider the introduction of a specific regulation on public and private partnership. The aim is to complete its legal arsenal on public procurements. The same consideration has also started regarding the delegation of public services. A new legal framework is emerging under the control of the World Bank. Brazzaville has seen the benefits that such type of partnership can bring to the whole country's economy: public-private partnership (PPP).

The Chamber of Commerce and Industry of Brazzaville regularly receives calls to tender which can be of interest to national and international economic operators.

The calls to tender come from the United Nations Development Program, the African Bank of Development, the Bank of Central African States, and the Agency for public procurement regulation, as well as the Word Bank and the European Investment Bank.

A lot of work has been done since the law of 2009 regarding the regulation of public procurement. Unfortunately, the growing economic crisis in the Congo has made it difficult for the government to pursue its major projects. The Republic of Congo is still in negotiation with the International Monetary Fund, and any positive agreements with the Bretton Woods Institutions will revive and boost the public procurement sector.

The 2009 law is the legal pedestal for public procurement in the Republic of Congo.

The New Legal Framework on Public Procurement

The Republic of the Congo's legal framework implements the rules on public procurement under Decree No 2009-156 of 20 May 2009.

This Decree aims at protecting transparency, equal access to the public market, fighting corruption and increasing transparency in the whole public procurement process. When published, the decree gave the Republic of the Congo a tremendous negotiating tool with the International Monetary Fund and the World Bank.

Developments

The Public Procurement Code (Code des marchés publics) has introduced many changes in order to promote a new culture and approach to public procurement management.

Probity in public procurement

The new rules on public procurement have brought in ethical standards for public authorities by prohibiting fraudulent practices and conflicts of interest.

The new Public Procurement Code has repealed all the previous legal instruments as established by Decree No 82/329 on public procurement regulations, amended by Decree No 89/375 of 31 May 1989.

New powers for local authorities

Article 3 of the new Public Procurement Code has granted local authorities and public services the position of “contracting authority” when conducting and executing public procurement contracts and public service delegations.

Formalising public procurement

Now, public procurement contracts are written documents, which was not the case under the past regulations.

Article 2 of the new Code defines public procurement as “a written contract, passed according to the provisions of the present Decree, by which a contractor, a supplier or a service provider commits to the state, a local authority, a public establishment or a public-sector or partially public company, by providing a contribution or a financial guarantee in order to carry out work, supply goods or services, or intellectual services upon payment with public funds.”

Decentralising public procurement management

Before the law of 2009, the signing, awarding and monitoring of public contracts came under the sole competence of the Central Commission for Public Procurement and Contracts or the Central Management of Public Procurement, depending on the threshold of the contract.

Since 2009, that competence has been given to the Central Manager of Public Procurement and Contracts upon referral by the beneficiary administration (Article 18 of the Decree). That means that all ministries, public establishments, public companies and agencies or offices and even local authorities are contracting authorities.

Separating functions

The Public Procurement Code has brought clarity among all State departments involved in public procurement. The functions of management, monitoring and regulation of public procurement have been reviewed. According to the Article 10, the contracting authorities and the delegated contracting authorities constitute the management body, and the role of monitoring is undertaken by the Directorate General of Public Procurement. The posteriori monitoring is carried out by the authority responsible for regulating public procurement and made up by people from civil society.

The New Public Procurement Procedures

Removal of the adjudication process

The new Public Procurement Code has  removed the former process of public adjudication, which consisted of automatically awarding the contract to the candidate who submitted the best offer.

Over-the-counter procedures

Over-the-counter procedures remain an exception and are only possible in limited cases; they must also be authorised by the Central Management of Public Procurement.

Competitive bidding is compulsory for public procurement, including contracts with a total value inferior to the fixed threshold, in order to guarantee the transparency of procedures and ensure equal access of contractors to public order. It is also possible to use electronic means in public procurement procedures.

Calls to tender

In simple terms, the call to tender is a process of inviting bidders. It ensures transparency in public procurement. The awarding of public procurement contracts is done within the framework of calls to tender, which is the rule in many countries around the world. The assignment of the execution of public services can be transferred from a public person to a private person. The new Public Procurement Code provides a criteria for evaluating the submissions and awarding contracts, which must be applied by the contracting authority in order to ensure equality between bidders. In light of the Code, the authority must choose the cheapest offer or the one which best protects public funds.

The new Code provides transparency in the call to tender process for public contracts with an estimated value superior or equal to the threshold fixed by Articles 11 to 13 of Decree No 2009-162 of 20 May 2009. That Decree sets the thresholds for awarding, controlling and  approving public procurement.

Technical aspects of calls to tender

Competitive bidding is now compulsory for all public procurement contracts. This new obligation is different from the contract allotment described in Article 6. According to that article, excessive division of public procurement related activities is prohibited.

Article 10 of the Decree establishing the legal framework on public procurement states that the call to tender is only allowed for public procurement contracts for works and goods with a total value over or equal to XAF50 million and for intellectual services with a total value of XAF10 million or above.

Article 11 of the Decree of 20 May 2009 sets the thresholds for international calls for tender, namely public procurement contracts with a total value of XAF2 billion or above and those with a total value of XAF500 million or above for supplying goods and services.

Concerning restrictive calls for tender, Article 12 of the Decree of 20 May 2009 states that the threshold is XAF25 million for public procurement contracts likely to require the publication of manifestations of interest in order to select qualified consultants.

When dealing with public procurement contracts with a total value of XAF250 million or over, all contracting authorities are obliged to entrust their decision making to the General Delegation of Major Works. All public procurements of that size are carried out, through calls to tender, by the General Delegation of Major Works, except those concluded over the counter or by special public procurement procedures.

The call to tender procedure under Article 29 of the Public Procurement Code is concluded without negotiation, upon objective evaluation of criteria which are known by the candidates in advance of their applications.

Documents required from bidders

Applications for calls to tender are made up of the following documents:

  • invitation to tender;
  • book of special and technical specifications;
  • unit price schedule;
  • book of general and administrative specifications; and
  • specific tender regulations, etc.

Article 42 states that the invitation to tender should also include the funding, the type of call to tender, the place, the date and deadline for submitting applications.

The book of special and technical specifications determines the conditions of execution of public procurement tenders.

Article 75 provides that specific deals can be agreed for public procurement projects in national defence, security and strategic interests of the state. A Government Decree  has established the rules for awarding, controlling and executing this type of public procurement.

The criteria of awarding public procurement contracts includes evaluating the economic, financial and technical abilities as stated in the tender application in order to determine the best bidder.

Finally, the public procurement award must be documented in a report. The decision must be notified in writing and published, including the type of procurement.

The Different Types of Public Procurement and Delegation of Public Services

Public procurement

The different types of public procurement are presented in Article 7 of the new Code, namely: the supply of works, goods, services and intellectual services. The public procurement awards are based on the economic, financial and technical abilities as stated in the tender applications from which the best bidder is selected.

Delegation of public services

The delegation of public services was introduced into Congolese law in Articles 2 and 6 of the 2009 Code. A delegation is a contract by which a public law corporation confides the management of a public service falling under his competence to a delegate who receives remuneration from profits generated by the exploitation of such service.

In Congo, there is a General Delegation of Major Works, which is affiliated to the presidency of the Republic. It was created under Decree No 2002-371 of 3 December 2002, amended by Decree No 2003-62 of 7 May 2003. It is an administrative and technical body in charge of awarding and executing public service delegation contracts.

There are three types of delegation of public services: concession, leasing and interested-owned state companies. Here, we will focus on  concession.

Concession of public services

The public procurements are contracts and reflects the will of all contacting parties who are equipped of juridical personality; they are different from unilateral juridical acts.

Public procurement is different from subventions and delegations of public services because in this case the remuneration of the concessionary mainly comes from the exploitation of the service. A typical example of concession in Congo is the company AERCO (Airports of Congo) which manages all major airports in Republic of Congo.

Article 2 of the Public Procurement Code defines the delegation of public services as follows:

”[A] contract by which one of the corporations of public or private law designated in Article 3 of the present Decree confides the management of a public service falling under its competence to the delegate who will be remunerated by the profits generated by the exploitation of that service: according to the present Decree, the delegations of service are made up of interested state-owned companies, leasing, as well as concessions of public services, even if the contract is not executed.”

The New Execution of Public Procurement

The Public Procurement Code has implemented many provisions in order to reinforce monitoring and promote equality between bidders.

The grouping of call offers

In order to avoid excessive division of the public procurement market aiming at avoiding the control and the approval, the new Code requires the approval of global procurements.

Equal access to call offers

To help the small and medium-sized enterprises to easily access the public order, the division of public contracts by lots is regulated and provided for by law.

The rule of national preference

The Decree makes provision for the rule of national preference for international calls to tender. Another change is that the new Code favours joint venture and subcontracting. This provision facilitates the promotion of small and medium-sized companies and industries.

The consolidation of financial and technical guarantees

The guarantees required from the counterparty are reinforced, which means a supplier must show that it has serious and sufficient bank funds. The departments in charge of awarding and controlling the public procurement market must make sure that the contractors are technically and financially able to execute their contracts.

The payment period

There is a possibility to lengthen the payment period. The Code determines that the payment period is from 60 to 90 days, while it is regular practice to shorten the payment period to 30 days for public procurement contracts and 45 days for local collectives and authorities.

Obligations of the contract holder

In the execution of public procurement contracts, there are mutual obligations between the contracting authority and the contractor. The contract clearly states the contents of the public procurement, the market regulations, especially the the costs and the payments scheme. Payments can be made by installments or by advances. The subcontractors can be paid directly.

The contract holder has many obligations related to the accounting and the presentation of guarantees of the proper execution of the contract within the competition rules.

The joint venture and subcontractors have not stayed on the sidelines of the new Public Procurement Code. Article 118 of the Code regulates the intervention of a subcontractor for works and services and allows the holder of a public procurement contract to subcontract. In fact, Article 119 regulates the subcontract in these terms: ”the contractors, suppliers and service providers can submit their application or their offer as a solidarity group or a joint group.”

The introduction of subcontracting is by way of the provisions established by the Congolese legislator in the law of 1 February 2000 inherent to the conditions on subcontracting in all economic sectors in Congo.

Adequate publicity of the public procurement must be provided in order for the project requirements to be made known: the publicity is done by all means (display, newspapers or billposting).

Remedies and Legal Procedures of Litigation

The Public Procurement Code has provided for ways to solve litigation. In fact, the Code distinguishes the litigation concerning public procurement awards according to Article 141 from others. The legal action taken by a bidder who feels he or she has been unfairly excluded from the competitive bidding process or delegation of public services can be managed by the contracting authority, responsible for the procurement.

Legal action before the regulating authority

It is important to note that the old regulation on public procurement allowed for the possibility of taking legal action based on private law before the administrative court. Of course, such legal action could be preceded by equitable relief before the commission of public procurement.

The Dispute Settlement Committee

The Code has created a new body within the regulating authority entitled the Dispute Settlement Committee, which has the power to make decisions. Some of the Committee's responsibilities are to settle disputes based on the following issues: the conditions of publication of calls to tender, the rules related to the approval of candidates and their capacities and the required guarantees under the regulation, the mode of award and the selection procedure, the conformity of tender documents, the required technical specifications, the evaluation criteria, and the award or refusal of the public procurement or delegation.

The Committee is also responsible for ruling on disputes between a contracting authority or a delegated contracting authority and the Central Management of Public Procurement, the candidates or bidders.

The litigation related to contract execution is managed by hierarchical appeal or by legal action before the competent jurisdiction, ie, the Administrative Tribunal as a court of first instance, and then the Court of Appeal. Litigation related to cancellation of a public procurement contract is brought before the Supreme Court. The subcontracting contracts are part of private law, and therefore their litigation belongs to common law.

In addition to these new developments, since 2009 we have seen an increase in the number of economic operators who want to work in public procurement: ministries, public establishments, public procurement departments, public procurement award committees, executive management bodies for the monitoring of public procurement processes, and the public procurement regulating authority.

Sources

  • Decree No 2009-156 of 20 May 2009 relating to the Code of Public Procurement;
  • Decree No 2009-162 of 20 May 2009 fixing the thresholds for awarding, controlling and approving public procurement;
  • Decree No 2009-160 of 20 May 2009 setting out terms and conditions for approving public procurement;
  • Decree No 2009-157 of 20 May 2009 on awarding, organising and running of the regulating authority of public procurement contracts;
  • Decree No 2009-158 of 20 May 2009 on organising the General Delegation of Major Works;
  • Decree No 2009-159 of 20 May 2009 on awarding, organising and running of the Directorate General of Public Procurement; and
  • Decree No 2009-161 of 20 May 2009 on organising and running the  Public Procurement Department.
GOMES LAW FIRM

5 rue Denis Loemba
Pointe-Noire
Brazzaville
Congo

00242057491517

00242066886279

rolandbembelly@yahoo.fr www.avocat-congo.com

Trends and Development

Author



GOMES LAW FIRM belongs to Mr Alexis Vincent Gomes. The practice has six lawyers and many collaborators. The head office is in Pointe-Noire and it has a branch in Brazzaville. The firm is specialised in business law (seizures, commercial law, civil law, maritime law, financial law, etc). It also deals with other areas such as mining, hydrocarbons and the OHADA. For example, the firm has successfully launched Turkish Airlines in Congo. It has also helped the Russian oil and gas company LUKOIL to get shares in New Age, a company in Congo.

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