By Paul Emanuelli

This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.

Like many other regions, the Caribbean has seen a series of recent reforms in the area of government procurement. This discussion surveys the following procurement-related statutory developments across the Caribbean:

  1. Guyana – Procurement Act (2003) and Procurement Regulations (2004)
  2. Turks and Caicos Islands – Public Procurement Ordinance (2014)
  3. Jamaica – The Public Procurement Act, 2015
  4. Trinidad and Tobago – The Public Procurement and Disposal of Public Property Act, 2015
  5. Cayman Islands – The Procurement Law, 2016
  6. Bermuda – Code of Practice for Project Management and Procurement (2017)
  7. CARICOM – The Public Procurement (Caribbean Community) Act, 2017

1. Guyana Procurement Act (2003) and Procurement Regulations (2004)

Guyana’s 2003 Procurement Act represents an early example of procurement reforms in the Caribbean and contains a series of procurement modernization provisions, including rules regulating the following areas:

  1. Rules for supplier qualifications, with criteria relating to technical competence, financial resources, and managerial capability, as well as screening criteria relating to bankruptcy, the non-payment of taxes, misrepresentations, and criminal offences.
  2. Protocols governing the transparency of evaluation criteria and procedures for bidding and pre-qualifications.
  3. Provisions requiring the maintenance of proper procurement records.
  4. Rules regarding the description of requirements, including prohibitions against restrictive specifications.
  5. Provisions for the creation of a central procurement authority and national oversight board responsible for adjudicating debarment proceedings and establishing common, central standards, regulations, documents, and training programs.
  6. Provisions for the creation of regional tender boards responsible for administering the preparation of solicitation documents and overseeing the appointment of evaluators for bid evaluation processes.
  7. Rules governing the recognized methods of procurement, including the use of three quote request for quotation formats.
  8. Rules regulating sole-source procurements, procedures for using the invitation to tender format, clarification and modification processes, and pre-bid meetings.
  9. Protocols for bid submissions and tender openings, for bid withdrawals, for bid evaluations, and bid rejections.
  10. Local preference protocols.
  11. Rules for using negotiated RFP formats for procuring consulting services.
  12. Provisions relating to an administrative review process for bid disputes involving a three-member bid protest committee, as well as a Cabinet review committee for larger value procurements.

Guyana’s 2004 Procurement Regulations provide further statutory rules for the procurement system, including authority to create a website for bid opportunities, as well as the detailed enumeration of the powers of the bid protest committee.

2. Turks and Caicos Islands – Public Procurement Ordinance (2014)

The Turks and Caicos Islands 2014 Public Procurement Ordinance sets out a statutory framework regulating public procurement in the United Kingdom overseas territory, including provisions relating to the following areas:

  1. Principles relating to value-for-money and efficiency in government procurement, as well as rules regarding transparency and confidentiality.
  2. Powers established for a procurement review board to oversee government procurement practices, including the oversight of procurement-related proceedings.
  3. Rules regulating pre-procurement planning.
  4. Protocols setting out different types of procurement methods and procedures, along with rules regarding evaluations, awards, and debriefings.
  5. Rules relating to the administration of contracts and framework agreements, including contract termination and contract disputes.

3. Jamaica – The Public Procurement Act, 2015

Jamaica’s The Public Procurement Act, 2015 contains a series of governance measures, including the creation of the Office of Public Procurement Authority and Chief Public Procurement Officer, who are responsible for, amongst other things, the following functions:

  1. The creation of procurement policy and the provision of training and advice to procurement staff.
  2. Monitoring and compliance.
  3. Reviews of procurement methods, along with recommendations for improvements.
  4. The creation of directives, guidelines, a code of conduct, and standard forms and contracts.
  5. The creation of an electronic procurement system and a database of public procurement statistics.
  6. Research for policy development, as well as the creation of training programs for procurement staff.
  7. Communications with civil society, as well as annual reports on the functioning of the procurement system.

Jamaica’s The Public Procurement Act, 2015 also contains provisions that:

  1. Authorize a Public Procurement Commission to maintain a registry of approved suppliers by category.
  2. Create a series of sector committees to assist the Commission with its responsibilities under the Act.
  3. Confirm that the head of each institution is responsible for statutory compliance, which includes the creation of annual procurement plans, the development of procurement units staffed with competent persons, and the creation of procurement committees responsible for reviewing bid evaluation reports, making contract award recommendations, and maintaining procurement records.
  4. Establish distinct rules for international competitive bidding open to all suppliers and national competitive bidding opportunities limited to national suppliers, while recognizing non-discrimination within those categories.
  5. Establish rules regulating the sole-sourcing of government contracts according to specified exceptions.
  6. Establish rules regulating the use of pre-qualification processes.
  7. Prescribe the minimum information required in a solicitation document, including a statement of requirements, process rules, timelines, and evaluation criteria.
  8. Establish rules regarding the evaluation of bids based on pre-established and disclosed criteria.
  9. Set standards for assessing bid compliance.
  10. Establish contract approval levels, based on contract value, to the head of the organization, the Commission, and Cabinet.
  11. Establish contract award protocols that include a notice to unsuccessful suppliers, as well as a standstill period protocol based on the period set out in the solicitation document.
  12. Establish confidentiality rules to protect sensitive supplier information.
  13. Establish bid protest rules that include a reconsideration process with prescribed timelines at the institutional level, along with formal escalation measures leading up to Procurement Review Board proceedings.
  14. Establish civil offences for breaches of the statute with corresponding monetary penalties, along with criminal offences for breaches relating to unlawful influence, corruption, interference, deceit, fraud, and document falsification, with corresponding fines of up to $1 million (JMD) and imprisonment for up to six months.

Jamaica’s governance framework also includes procurement regulations and a procurement policy promulgated under the prior legislative framework, as well as a detailed four-volume set of procurement handbooks covering a broad range of general operational details and category-specific procurement rules. Some, but not all, of the oversight functions contemplated under the new legislation were previously covered by the Office of the Contractor General, which performed compliance investigations and issued general reports regarding the state of government procurement practices, and has since been absorbed within the new administrative structures contemplated in the new statutory regime.

4. Trinidad and Tobago – The Public Procurement and Disposal of Public Property Act, 2015

Trinidad and Tobago’s Public Procurement and Disposal of Public Property Act, 2015 contains detailed statutory provisions, including the creation of the Office of Procurement Regulation, presided over by a Board, along with the position of the Procurement Regulator. The responsibilities of this central office include responsibility for the following functions:

  1. Establishing a comprehensive database of information on public procurement, including information on tenders received and the award and value of contracts.
  2. Establishing training standards, competence levels, and certification requirements to promote best practices in procurement.
  3. Issuing guidelines in relation to public procurement, as well as model handbooks incorporating standardized bidding documents and procedural forms.
  4. Promoting the use of technology in procurement, including electronic transactions, and providing best practice advice for procurement activities.
  5. Auditing and reviewing the procurement system to ensure statutory compliance, harmonizing policies, systems, and practices, and reviewing systems on an annual basis to identify best practices.
  6. Developing and maintaining system-wide databases and technology.
  7. Promoting awareness to public bodies and the public regarding issues relating to public procurement.
  8. Undertaking research and surveys with respect to public procurement.
  9. Investigating alleged or suspected breaches of the Act.
  10. Creating and publishing standard form contracts.
  11. Preparing and maintaining a database of pre-qualified contractors, suppliers, mediators, arbitrators, and alternative dispute resolution experts.
  12. Providing best practice advice for aggregating procurement and obtaining value-for-money.

The statute also creates a summary offence for breaches of the statute with a fine of up to $100,000.

The statute also requires that the Regulator submit annual reports to the legislature providing a detailed transaction summary of public procurements, as well as a summary of implemented best practice changes, statutory non-compliance by public institutions, related recommendations for compliance, and an update on outstanding issues.

The statute also requires that public institutions perform the following functions:

  1. Publish their annual procurement plans within six weeks of the approval of the annual budget by the legislature.
  2. Ensure that awarded suppliers have legal capacity, are not insolvent, have not been convicted of criminal offences, are tax-compliant, have the necessary qualifications to perform the work, and are evaluated in accordance with published evaluation criteria.
  3. Disqualify suppliers who make material misrepresentations in their bids.
  4. Comply with guidelines and handbooks promulgated by the Office of Procurement Regulation.
  5. Avoid contract-splitting as a means of avoiding public posting requirements.
  6. Comply with the tendering cancellation and contract award rules established in the statute, including relevant notice of award, standstill, and contract award provisions.
  7. Provide quarterly contract award reports to the Office of Procurement Regulation.
  8. Maintain the confidentiality of sensitive supplier information.

The statute also contains whistleblower protection provisions, along with provisions for reporting suspicions of bid-rigging to the Office of Procurement Regulation, as well as providing that Office with related powers of investigation.

Furthermore, the statute includes bid protest provisions that give suppliers the right to challenge the contract award decisions of public institutions through public hearings overseen by the Office of Procurement Regulation, whose remedial powers include the power to order the following remedies:

  1. Suspend a contract award pending a hearing.
  2. Order the institution to take steps to rectify any non-compliance.
  3. Overturn a contract award decision or terminate a tendering process.
  4. Order financial compensation for supplier bidding costs and complaint costs.

5. Cayman Islands – The Procurement Law, 2016

In December 2016, the Cayman Islands passed The Procurement Law, 2016, which creates a Central Procurement Office and Director of Procurement responsible for:

  1. Establishing a procurement code of conduct that addresses conflict of interest, recordkeeping responsibilities, and general procurement responsibilities.
  2. Providing training, advice, and guidance to all public entities involved in procurement.

The statute of this United Kingdom overseas territory also creates a Public Procurement Committee responsible for external oversight over the public procurement process and mandates the creation of institution-specific procurement committees responsible for statutory compliance of the organization.

The statute also establishes rules in relation to the government procurement process, including prohibitions against contract-splitting and rules regulating the protection of confidential supplier information, as well as a schedule of governing principles and regulatory powers.

The statute also includes detailed schedules that codify fairness and transparency principles, detail the duties of the Director of Procurement and the Public Procurement Committee, and recognize the roles and responsibilities of Cabinet, the Ministry of Finance, Chief Officers, Chief Executive Officers, and Entity Procurement Committees.

The Cayman Islands Procurement Regulations, 2018 set out a series of more detailed statutory protocols governing the procurement process. These included statutory provisions addressing the following areas:

  1. The requirement that each procurement process be initiated through the preparation of a documented business case that includes anticipated benefits and the recommended method of procurement, while also setting out approval levels based on the estimated value of the procurement.
  2. Protocols governing the direct award of contracts, including identified exceptions to open procurement, and related procedural requirements, including the preparation of a business case, approval levels based on contract values, and the public notice for direct awards for contracts exceeding $10,000.
  3. Rules requiring a public posting and competitive bidding process for contracts valued at or over $100,000, with detailed information requirements for those solicitation documents.
  4. Rules requiring that procurements be conducted in accordance with one of the tendering formats recognized by the UN Model Procurement Law, and an enumeration of the range of formats recognized under that model law.
  5. Rules regulating the use of pre-qualification formats and framework agreements, as well as market research initiatives using a Request for Information (RFI) or Invitation for Expression of Interest (EOI).
  6. Provisions governing the preparation of specifications, including regulations regarding the use of branded specifications and avoiding unnecessarily restrictive specifications.
  7. Rules governing the cancellation of a tendering process.
  8. Protocols governing the administration of the tendering process, including the clarification and amendment of any solicitation documents.
  9. Record-keeping protocols detailing the documentation that must be maintained for each procurement, including copies of solicitation documents, received bids, evaluation records, amendments, communications with bidders, debriefing records, and records of any bid protest.
  10. Protocols governing the types of conduct that can result in the exclusion of a supplier from the procurement process, including misrepresentations, bribes, lobbying, and abnormally low bids.
  11. Rules prescribing the level of approvals required for contract awards based on the value of that contract, along with requirements for issuing regret letters and offering debriefings to unsuccessful bidders.
  12. Provisions governing the public posting of information in relation to contract awards.
  13. Protocols governing local economic development preferences.

6. Bermuda – Code of Practice for Project Management and Procurement (2017)

While technically not part of the Caribbean, Bermuda is another United Kingdom overseas territory that has updated its procurement practices in recent years. Bermuda’s 2017 Code of Practice for Project Management and Procurement contains a series of rules governing the public procurement process, including rules in the following areas:

  1. Protocols regulating the quantification of procurement value and prohibiting contract-splitting, as well as rules governing the use of specifications that create unnecessarily restrictive requirements and regulating the use of branding.
  2. Rules regulating unsolicited proposals.
  3. Detailed protocols regarding the use of the full range of tendering format options established by the UN Model Procurement Law (except for electronic auctions).
  4. Protocols governing the minimum content requirements for solicitation documents based on broadly recognized international standards, including disclosure standards pertaining to requirements and specifications, tendering process rules, and evaluation criteria.
  5. Rules regulating the submission and opening of bids, the protection of confidential bidder information, the evaluation of bids, the award of contracts, the debriefing of unsuccessful bidders, and the maintenance of contract records.
  6. Protocols regulating the use of approved contractor lists and framework agreements.
  7. Rules regulating post-award contract administration, including amendments and extensions, disputes and termination, and related record-keeping.

7. CARICOM – The Public Procurement (Caribbean Community) Act, 2017

In 2017, the Caribbean Community (CARICOM), an organization comprising 20 Caribbean countries, including 15 member states and five associate members, released The Public Procurement (Caribbean Community) Act, which is a model bill created to provide for the liberalisation and integration of national public procurement markets into a single, unified, and open market for purchases at or over $150,000 for goods and services and $3,000,000 for works.

The model bill includes standard setting provisions in the following areas:

  1. Contract value quantification rules that include the value of extension options.
  2. Reciprocal non-discrimination provisions for suppliers, goods, and services from member states.
  3. Confidentiality provisions to protect sensitive supplier information.
  4. Requirements for the public posting of bidding opportunities on a regional posting platform.
  5. Fair supplier treatment rules and conflict of interest provisions aimed at avoiding unfair treatment of suppliers or the distortion of competition.
  6. The requirement that each procurement entity publishes an annual procurement plan setting out its intended procurements for the year.
  7. Provisions governing the minimum disclosure obligations for procurement documents, including requirements and specifications, evaluation criteria, and process rules.
  8. Rules regarding the use of restrictive specifications.
  9. Provisions regulating the use of qualification requirements, ensuring transparent criteria, and avoiding unnecessarily restrictive requirements.
  10. Rules relating to the use of open tendering, including regulations on the use of restrictive bidding and single-source procurements, as well as rules governing the cancellation of bid opportunities.
  11. Protocols for using CARICOM-prescribed bidding documents and procedures, together with standards for minimum disclosure requirements for solicitations, as well as rules regarding the clarification and amendment of solicitations.
  12. Protocols for posting intended award notices, along with related standstill provisions and contract award publication requirements.
  13. Standstill period debriefing obligations for unsuccessful bidders, along with provisions for foregoing standstill periods in situations of urgent public interest.
  14. Obligations for maintaining adequate procurement records, including minimum content requirements for those records.
  15. Provisions for bid protest challenges, including recourse to a prescribed independent adjudicative body, as well as the right to reconsideration requests at the institutional level, along with appeal rights flowing out of any such reconsideration decisions.
  16. Powers allowing the independent adjudicative body to issue interim suspension orders, along with final remedial orders that include the overturning of contract award decisions, as well as rights of appeal to a court.
  17. Powers to create and maintain supplier registries, along with applicable qualification and revocation protocols.
  18. Statutory offences for breaches of the procurement rules, including penalties for collusion, bribery, unlawful influence, and tampering with procurement records.

As these standard-setting reforms across the Caribbean illustrate, jurisdictions around the world are responding to the due diligence challenges of an increasingly interconnected global marketplace. While reforms at the jurisdictional level help to build a statutory spine for an overall operating system, the challenge remains at the institutional level for public bodies operating within those jurisdictions to adapt their local practices to these statutory reforms and to broader global due diligence standards.