PROCUREMENT AT CERN

SUMMARY

Structure of Procurement Service

CERN Budget Definition of supplies and services – Country of origin

Expenditure on supplies

CERN Procurement Policy

Procedures for obtaining offers:

- Requirements below 10 000 CHF;

- Price Enquiries (10 000 CHF - 200 000 CHF);

- Market survey & Calls for tenders (> 200 000 CHF) Adjudication Rules Additional Information and Contacts

PROCUREMENT SERVICE

STRUCTURE

A. Unnervik

Head of Procurement

and Industrial Services

D.Gregorio

Head of Section

Accelerators,

Experiments, IT and

KTT contracts

C. Lara

Head of Section

Industrial Services and General

Infrastructure: cooling and

ventilation, mechanical, electrical,

and civil engineering contracts

DEFINITION OF SUPPLIES &

SERVICES

Supply contracts: Contracts for supplies of equipment including

R&D contracts, electricity, telecommunications and insurance

contracts as well as maintenance and leasing contracts covering

data processing, printing and telecommunication equipment.

Country of origin: In accordance with standards defined by EUi.e. the country(ies) where the supplies (including their componentsand sub-assemblies) are manufactured or undergo the last majortransformation by the contactor or his sub-contractor.

Service contracts: Contracts for the provision of services to be

executed on the CERN domain.

Country of origin: The country in which the bidder is established.

PROCUREMENT POLICY

Not less than three competitive tenders to be sought for thepurchase of supplies and services;

Invitation to tenders to be limited to manufacturers andcontractors located within the territories of Member States.

PROCEDURES FOR OBTAINING

OFFERS Requirements not exceeding 1 000 CHF (Fax orders);

Users may request offer or refer to price list in catalogue or on web

Requirements between 1 000 CHF and 5 000 CHF;

Users may request offer directly. A written offer is mandatory

Requirements between 5 000 CHF and 10 000 CHF;

Users may issue enquiries directly provided CERN procurement

rules are followed;

Purchases between 10 000 CHF and 200 000 CHF

Price Enquiries issued by Procurement Service;

Purchases exceeding 200 000 CHF

Market Surveys & Calls for Tenders issued by Procurement Service.

REQUIREMENTS BELOW

10 000 CHF

Users may issue enquiries directly, provided CERN purchasing rules and procedures are followed;

At least three written offers to be sought for requirements above 5 000 CHF;

Offers to be sought from manufacturers or suppliers located in CERN’s Member States;

Orders below 10 000 CHF are handled by the CERN Purchasing Pool.

REQUIREMENTS BETWEEN

10 000 AND 200 000 CHF

Price enquiries:

Drafted and issued by Procurement Service

Documents include:

Cover letter - including enclosures;

Technical specification - including technical annexes and

technical drawings;

Tender form;

Technical questionnaire (not compulsory).

REQUIREMENTS BETWEEN

10 000 AND 200 000 CHF

Price enquiries:

Deadline for bidders to submit bid is at least 4 weeks from

mailing date;

Number of firms to contact should be at least three and as a

general guideline should not exceed five;

Market survey is not needed;

Price enquiries are not published but all enquiries exceeding

50 000 CHF are also sent to Industrial Liaison Officers (ILOs) for

information.

INDUSTRIAL LIAISON OFFICES

Representatives of the CERN Member States in charge of:

- Identifying suitably qualified suppliers to be contacted forCERN requirements;

- Ensuring the proper flow of information between CERNand potential suppliers in the Member States.

ADJUDICATION < 200 000 CHF

Price enquiries:

Lowest offer (Ex-works price) which complies with the technical,

financial and delivery requirements.

REQUIREMENTS EXCEEDING

200 000 CHF

Calls for Tenders:

Announcement in the document “Advance information on

Forthcoming Market surveys and Calls for Tenders expected to

exceed 200 000 Swiss francs”;

Market survey;

Selection of firms to be invited for tender;

Technical auditing.

MARKET SURVEYS

Purpose:

Pass information to industry on future requirements;

Allow delegates, ILOs to propose potential bidders;

Update and improve CERN’s supplier database;

Encourage firms to seek early exchange of technical information

with CERN and vice-versa;

Allow CERN to draw up a final list of qualified bidders;

Allow CERN to draw up a final Technical specification for the call

for tenders.

MARKET SURVEYS

Drafted and issued by Procurement Service

Documents include: cover letter (including on which basis the call for tenders will be

adjudicated); brief technical description (1-2 pages); qualification criteria (financial and technical); qualifyinq questionnaire.

minimum 4 weeks for suppliers to reply; a market survey is valid up to 12 months from the date of issue (or

up to 18 months for prototypes).

Current Market Surveys available on Procurement Service home page

PRELIMINARY LIST OF FIRMS

Firms proposed by ILOs and Delegations;

Firms from the Member States which have expressed aninterest in a Market Survey or a similar requirement;

Other firms proposed by users;

Firms selected from CERN’s supplier database by theProcurement Service.

FINAL SELECTION OF FIRMS

Only companies which have fulfilled the qualification criteria of

the market survey concerned shall be considered;

As a general guideline, the final list of firms to be invited to

tender shall not exceed:

- 10 firms for contracts between 200 000 and 750 000 CHF;

- 15 firms for contracts exceeding 750 000 CHF.

FINAL SELECTION OF FIRMS

Likelihood that the selected firm will submit a bid;

CERN’s previous experience with particular firms;

The number of firms selected from each Member State

takes into account the Member State’s contribution and its

industrial return coefficient.

CALLS FOR TENDER

At least an English version of all documents including technical

annexes and technical drawings;

Technical auditing to be carried out to ensure that the tendering

documents are objective and unambiguous (e.g. technical

specifications are based on international rather than local

standards and concentrate on processes involved rather than on

technical details).

CALLS FOR TENDER

Contains:

Cover letter - including enclosures;

Technical specification - including technical annexes and technical drawings;

Tender form; Technical questionnaire (not compulsory).

Deadline for bidders to submit a bid is at least 4 weeks from mailing date (with a longer period for more complex requirements);

In certain cases (e.g. CPU servers and disk servers), bidders are requested to include a test system for evaluation purposes with their bid.

ADJUDICATION > 200 000 CHF

Contracts are awarded on the basis of one of the following:

- Supplies - Lowest Compliant Bid:

To the firm whose bid complies with the technical, financial anddelivery requirements and is the lowest, subject to the rulesaimed at achieving well balanced industrial return coefficients forthe Member States;

- Industrial Services - Best Value for Money:

To the firm whose bid is the most economically advantageous,but not subject to the rules aimed at achieving well balancedindustrial return coefficients for the Member States. Theadjudication is based on both price and quality criteria.

INDUSTRIAL RETURN

COEFFICIENT

The return coefficient of a Member State for supply contracts fora given twelve-month period starting on 1st March is defined as:

The ratio between that Member State's percentage share of allpurchases of supplies (excluding purchases funded by non-Member States) during the preceding four calendar years andthat State's percentage contribution to the Budget over the sameperiod.

BALANCED MEMBER STATES

For 2009, a CERN Member State is considered to be poorlybalanced if its Industrial Return Coefficient is:

< 0.92 for supply contracts;

< 0.40 for service contracts.

Otherwise, it is considered to be well balanced.

THE ALIGNMENT RULE

1. LOWEST BIDDER FROM PB MS:

CONTRACT

THE ALIGNMENT RULE

2. LOWEST BIDDER FROM WB MS:

NEGOTIATIONS (DIFFERENCE < 20%)

A. 1st BIDDER FROM PB MS ALIGNS:

B. IF NOT - 2ND BIDDER FROM PB ALIGNS:

C. IF NOT - CONTRACT TO LOWEST BIDDER

CONTRACT

CONTRACT

BIDS MADE BY A CONSORTIUM

When a bidder submits a tender offering supplies originatingfrom several Member States, or when bidders jointly submit atender, the tender shall be treated as that from a poorlybalanced Member State provided that the value of suppliesoriginating in one or more poorly balanced Member State(s) isnot less than 51% of the total amount of the contract.

PROCUREMENT SERVICE

HOME PAGE

ADDITIONAL INFORMATION ON WWW:

http://fp-procurement.web.cern.ch/fp-procurement/default.htm