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The procurement process outlines the steps taken to acquire goods or services, from identifying the need to making the final purchase while saving cost, reducing time, and building win-win supplier relationships.
Public procurement refers to the process by which public authorities, such as government departments or local authorities, purchase work, goods or services from companies. The public procurement process is the sequence of activities starting with the assessment of needs through awards to contract management and final payment.
The purpose of public procurement is to award contracts in a timely and cost-effective manner to qualified contractors, suppliers and service providers. Contracts are awarded for goods, services and works, to support government operations and provide public goods and services in accordance with the procurement rules. These rules covers all EEA countries, EU countries and WTO countries subject to bilateral general public procurement agreements.
The public procurement process is governed by the Public Procurement Rules. These rules are composed of the legal and regulatory frameworks that must be followed. The Public Procurement Rules are derived from International Treaties and EU Directives/Regulations. Upon transposition, the regime typically includes a procurement act, regulations, guidelines, manuals, standard tendering document (bidding/tender) documents and contract forms. These provide guidance on everything from determining, planning and scheduling what to buy, when and where to buy, in addition to contract implementation and management.
Public procurement principles are the foundation of public procurement and should be the basis for the public procurement rules. Principles govern the management of public procurement and set the framework for a code of conduct for public procurement practitioners and others directly or indirectly involved in the public procurement process.
Any organisation that is funded to the tune of 50% or more of their income by the State is deemed to be a body governed by public law and must be fully compliant with procurement regulations. Bodies owned by the state are also subject to the rules, even if state funding is less than 50% (e.g. state owned companies). Finally, the State can insist recipients of state funding follow public procurement rules when spending state funding.