In February, EBRD UNCITRAL Initiative carried out a mission in Ulaanbaatar, Mongolia, to assess the current status of the eProcurement platform and deliver technical capacity for the framework agreements.
Our representatives met with representatives of the Mongolian Government Procurement Agency (GPA) to discuss the gaps and shortcomings in the current legal framework as well as in the eShopping mall module, and how these could create problems for the successful piloting of the framework agreements.
The identified gaps and shortcomings include lack of decisions regarding various aspects of the framework agreement's design, lack of clarity over beneficiaries of performance guarantees, price limitations for single purchase orders, the need to redesign the standard bidding documents so they are suitable for digital use, and missing call-off and contract management modules for the Shopping mall. A draft plan for the next activities still needs to be adopted by the GPA, which would further support the development of the regulatory framework.
At our meeting, the GPA representatives told us the eProcurement system will be able to carry out the entire procurement process and will include eBidding, eCatalogue and eShopping mall modules. At present, the eShopping mall provides only very basic functions for e-ordering; important options such as electronic invoicing, electronic payment, delivery tracking, etc. are still missing. Despite these limited functions, the module can still host the framework agreements as procuring entities can search within the manually uploaded products and issue purchase orders for particular products or services.
General provisions for the framework agreements are written into the public procurement law, while the detailed regulation is provided in the Conclusion Procedure of the General Agreement. Some of the provisions may negatively affect successful implementation of the agreements and this issue needs to be addressed before the pilot phase.
Following our meetings, we made a number of recommendations as follows. The Conclusion Procedure of the General Agreement should be amended to include detailed provisions for the framework agreements, including awarding criteria, design of the technical specifications, definition of suppliers, assessment of suppliers, content and extent of public consultations. We suggest removing the requirement for the mandatory use of the performance guarantees, in line with countries with modern procurement laws such as Portugal and Georgia, which use only non-performance clauses. We also recommended amending provisions relating to the termination of framework agreements as they currently appear to discriminate against suppliers and give too much discretion to the procuring entity when terminating the contract.
During our mission, we also held a half-day workshop for the SME Department, in which we presented public procurement fundamentals to participants and demonstrated some practical experiences from Portugal and Georgia. The session was attended by the head and employees from the SME Department within the Ministry of Labour and by representatives from the Chamber of Commerce. A Q&A followed with interaction and relevant comments about the implementation of eProcurement, change management processes and the business environment for SMEs in the public procurement context.
Lastly, we had a meeting with Bikash Dash, consultant at the Asian Development Bank, which is conducting an institutional capacity assessment. We wanted to understand its scope and major findings. The assessment covers five areas: institutional and structural issues, planning, budgeting and financial management, human resources, monitoring and reporting, and communication, coordination and implementation. We expect the bank's assessment to highlight major gaps – it has already discovered major failures in terms of the organisational structure for public procurement planning and the approval process, some overlapping and governance issues in eProcurement, and HR and staff capacity deficits due to the GPA's short lifespan and lack of in-built knowledge. The bank is expected to propose a strategy, recommendations and an action plan.