BLACKLISTING OF BIDDERS IN PUBLIC PROCUREMENT

1.    What is Procurement?

The provision of section 3 of the Public Procurement Act [Cap 410 RE 2022] defines “procurement” to mean buying, purchasing, renting, leasing or otherwise acquiring any goods, works or services by a procuring entity and includes all functions that pertain to the obtaining of any goods, works or services, including description of requirements, selection and invitation of tenderers, preparation, award and management of contracts.

Procurement for private entities i.e., business is usually regulated by internal procurement policies set by the companies. While Procurement by governments is regulated by law.

2.    The Laws and Regulations Governing Public Procurement Process

Public Procurement process in Tanzania is governed with the principal legislation being the Public Procurement Act [CAP. 410 R.E. 2022] together with some regulations such as the;

·      Public Procurement Regulations, GN No. 446 of 2013

·      Public Procurement (amendment) Regulations, GN No. 121 of 2016,

·      The Procurement (amendments) Regulations, GN No. 333 of 2016 all these regulations are being made under the provision of section 105 of the principal legislation. [ cap 401 RE 2022]

3.    What is the Regulatory Authority for Public Procurement in Tanzania? 

The authority responsible for public procurement in Tanzania is the Public Procurement Regulatory Authority (PPRA). PPRA is established under PART III of [cap 401 RE 2022] through section 7 of the Act.

The Authority is responsible to ensure the application of fair, competitive, transparent, non-discriminatory and value for, money procurement standards and practices, to set standards for the public procurement systems, to monitor compliance of procuring entities and build, in collaboration with Public Procurement Policy Division and other relevant professional bodies, procurement capacity in Tanzania. (See section 8) and its functions being stipulated under section 9.

4.    Blacklisting

Blacklisting, or debarment, typically refers to the procedure that excludes companies and individuals involved in wrongdoings from participating in tendering projects. A blacklisting register is often consolidated in one place, and can either be made available to the wider public or only to contracting authorities. In order to have an efficient and fair system in place, blacklisting should be based on clear rules and on the principles of fairness and accountability, transparency, good judicial practice, and uniformity.

 In Tanzania blacklisting is through the provision of section 62 (1) of the Public Procurement Act [cap 410 RE 2022] read together with regulation 93-103 of the Public Procurement Regulations 2013 as amended.

The Procurement Law establishes that the Public Procurement Regulatory Authority (PPRA) can blacklist any supplier, contractor or consultant and exclude them from participating in procurement processes in the country for a specified timeframe.

5.    Grounds for Blacklisting.

Reason that might result to blacklisting in public procurement have been stipulated under the provision of section 62(3) & (4) of [cap 401 RE 2022] being;

·      fraud or corrupt practices if established against the tenderer

·      when the tenderer fails to abide with a bid securing declaration

·      when the tenderer breaches a procurement contract

·      if the tenderer makes false representation about his qualifications during tender proceeding.

·      Also, the law gives power to the The Authority to debar and blacklist a tenderer from participating in public procurement on other grounds as may be deemed necessary by the Authority.

6.    Objectives of Blacklisting.

·      As a deterrent to corrupt behavior.

·      As a means to strengthen and promote open and transparent procurement process.

·      A form of administration sanction to tenderer involved in corruption.

7.    Blacklisting In Procurement at Regional and International Levels (The East African Community , Southern Africa Development Community, World Bank, United Nations).

The blacklisting of firms and individuals as punishment for those engaged in corruption and other irregularities in the procurement processes is also entertained at these regional and international organizations.

Under the East African community, the East Africa community procurement unit is the one responsible for coordinating and overseeing the sourcing, selection, and contract execution for the East Africa Community organs (the EALA, EACJ and Secretariat). In the United Nations the United Nations Procurement Division is the one deals with procurement process. The southern African development community regulatory framework is the SADC secretariat.

There also regulations, guidelines and manuals that govern these regional and international organizations in the procurement process.  In SADC, they have the SADC Procurement and Grant Guidelines. In the UN, they have the UN Procurement manual together with some contracts conditions and the Financial Regulations and Rules (FRR) of each UN Organization.

Tanzania is supporting these regional and international organizations on debarment through the provision of section 62(2)(a) & (b) of [Cap 401 RE 2022]. Entities which are barred from taking part in public procurement by a regional, international organisations, and foreign countries are automatically blacklisted and barred from participating in procurement in Tanzania for the same period barred from that foreign country plus for a further period of five to ten years depends on the grounds for debarment (see Section 62(2) of the Public Procurement Act [cap 410 RE 2022]).

8.    Prohibitions after Blacklisting decision.

·      Prohibition to participate in public procurement, contracting or consulting firm during that period by the company or firms along with its directors, partners, agents or officers of a blacklisted entity. (Section 62(8) cap 401 RE 2022) also Regulation 101(1) of the of the Public Procurement Regulation 2013)

·      Procuring entities shall not procure from, contract with or engage a tenderer who has been blacklisted from participating in public procurement proceedings pursuant to this Act. (Section 62(9) cap 401 RE 2022) together with Regulation 101(2) of the of the Public Procurement Regulation 2013)

9.    Can a tenderer challenge the blacklisting decision? And what is the time frame?

Yes, a tenderer is allowed to challenge the blacklisting decision made against him. He can challenge the decision by way of appeal within twenty-one days (21) to the appeals authority (see section 88(5) [ cap 401 RE 2022]) this is stipulated under the provision of section 62(6) of the Public Procurement Act [cap 410 RE 2022] together with Regulation 103(1) & (2) of the Public Procurement Regulation 2013.

The appeals authority under the Public Procurement Act is the Public Procurement Appeals Authority established under section 88(1) of the Public Procurement Act [cap 401 RE 2022].

The appeal process stipulated under CAP. 401 does not apply to entities blacklisted by regional, international or foreign organizations or foreign country. An aggrieved entity has to adhere to remedies provided by that organization/country to challenge the decision. If successful, the entity shall be automatically removed from the blacklist by PPRA.

10. Conclusion:

Debarment is important to ensure equality and fairness in the tendering processes for all participants. However, if a tenderer is not satisfied with the disbarment decision, it is recommended that they quickly seek remedies available to challenge the decision because the right to challenged such decisions is usually very limited for most institutions.

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