Guide to winning Government business
in France, Spain and Italy
Version 2 – September 2015
Contents Minister’s foreword
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France Government procurement market, processes and opportunities French Government procurement processes
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Impact of EU procurement directives 14 Finding contract opportunities
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Spain Government procurement market, processes and opportunities
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Spanish Government procurement processes
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Spanish procurement procedures 30 Finding contract opportunities 34
Italy Government procurement market, processes and opportunities
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Impact of EU procurement directives 46 Italian Government procurement processes
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Italian Government procurement procedures
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Finding contract opportunities
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General tips Are you ready to enter the French, Spanish or Italian market?
– What you need to know
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Serious about winning French, Spanish or Italian Government business?
– What you need to do
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Minister’s foreword New Zealand exporters have so much to offer internationally, and selling to governments as well as the private sector is becoming more important than ever. Governments around the world are looking for the types of products and services New Zealand offers. We’re a country with a strong international reputation for our honesty, integrity, quality of government and reputable business practices and legal systems. This is a great “brand” for New Zealand companies to build from. At present around 80 New Zealand exporters are selling to the international public sector and over the next few years we are confident this will grow to around 300 exporters. To accelerate further growth the New Zealand Government has negotiated a number of agreements in recent years to allow New Zealand companies to sell to foreign governments, as well as developing a support programme through New Zealand Trade and Enterprise (NZTE). New Zealand has joined the World Trade Organization Government Procurement Agreement, which will provide New Zealand companies with guaranteed access to bid for approximately US$1.7 trillion in annual overseas government contracts across 43 WTO member countries including the United Kingdom, the United States, Canada, Korea, Japan and the European Union. While selling to international governments is a large and lucrative opportunity, it is complex and comes with challenges that require new processes and new ways of thinking to overcome. This is where NZTE comes in. This guide covers what you need to know, what you need to do and tips to help you accelerate your entry and growth in the market. New Zealand also has companies that have successfully navigated this path. In particular I would like to thank Fisher & Paykel Healthcare, Orion and Catalyst IT who have contributed what they have learnt to this guide. I encourage you to make the most of these resources so you can take on some of the government procurement processes and win.
STEVEN JOYCE Minister for Economic Development
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France This guide has been created for New Zealand companies looking to do business with French Government departments and agencies. With public sector spending of €350 billion1 (or nearly 14.7 percent of GDP) on goods and services every year, the French Government is a very large potential market for businesses of all sizes. France has the highest number of notices awarded and the second highest value of public contract notices awarded in the European Union (EU).
This guide provides information on: how the market works the rules around government purchases from the private sector where to find business opportunities and how to win government business.
Potential suppliers to the French Government need to know how procurement is undertaken, who to contact, and importantly, how to find opportunities and submit a competitive tender.
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OCED (2013). Government at a Glance: France. Retrieved from www.oecd.org/gov/GAAG2013_CFS_FRA.pdf
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Government procurement market, processes and opportunities French economy France is the world’s leading tourist destination. It has substantial agricultural resources, a large industrial base, a dynamic service sector and a highly skilled workforce. France is a progressive leader in the high-tech and telecommunications industries and has a worldleading transportation infrastructure. With a diversified, advanced industrial base, France is home to Europe’s largest aerospace and nuclear industries. It has the EU’s second largest agrifood and chemical industries, and the third largest information and communications technology (ICT) and pharmaceutical sectors. Thirteen of the world’s 100 largest multinational business groups are French. Decision making is still often centralised in their French headquarters, with offshore regional subsidiaries becoming more influential.
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France is the world’s sixth largest exporter of goods and the fifth largest exporter of services, with external trade contributing to around 50 percent of its gross domestic product. Approximately 70 percent of France’s trade is with its European partners. Ensuring France’s investment climate is attractive to foreign investors is a priority for the French Government, which sees foreign investment as a way to create jobs and stimulate growth. New Zealand and France have a strong relationship based on cultural and historical linkages. France is New Zealand’s 24th largest export market, with exports totaling NZ$371 million in 2012. Key exports include lamb, venison, seafood, medical equipment and recreational boats.
GUIDE TO WINNING GOVERNMENT BUSINESS IN FRANCE, SPAIN & ITALY
Procurement spending by major French departments Public procurement in France is organised under the supervision of the Ministry of the Economy, Finance and Industry. The French State Procurement Agency, Le Service des Achats de l’Etat (SAE), is responsible for the implementation of EU rules and directives for public procurement in France.
The selection of suppliers, however, remains the responsibility of individual public organisations provided that they comply with the new national Public Procurement Code, which details the procurement procedures in accordance with the national and European law.
The top five French Government departments by expenditure
1
2
Ministry of Social Affairs, Health & Women’s Affairs Ministry of Economy, Finance & Industry
3
Ministry of Defence
4
Ministry of Education
5
Ministry of Transport, Equipment, Tourism & the Sea
While this market is large and transparent, it is cautious and requires local knowledge and language skills. Where possible, the French prefer to deal with other French or European companies.
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THE FRENCH PUBLIC PROCUREMENT SYSTEM
Ministry of Economy, Finance and Industry: regulatory and supervising authority
Central Government: decentralised procedures with independent procuring agencies per Ministry bound to follow the Public Procurement Code
Ministry of Defence
Ministry of Transport, Equipment, Tourism and Sea
Procurement of military and space equipment
Procurement of equipment
Regional/Local Authorities: decentralised procedures and rules
Other Ministries
Decentralised/ independent procurements
All public procurement regulation, specific guidelines, schemes, form and FAQ are available – in French – on the Ministry of Economy, Finance and Industry website: www.economie.gouv.fr
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Major national level procurement organisations: Ministry of Social Affairs, Health and Women’s Affairs www.sante.gouv.fr The health portfolio oversees the public health care services and the health insurance side of the French Social Security system.
Procurement takes place though the General Directorate for Armaments (Direction Générale de l’Armement, DGA), which manages an annual budget of around €10 billion for the purchasing of military equipment. The DGA’s portal, the IXARM informs interested parties of the main developments in the national and international defence sector: www.ixarm.com
Ministry of Economy, Finance and Industry (MINEFI)
IXARM offers a list of targeted announcements and links to the Ministry’s electronic market place:
www.economie.gouv.fr
www.achats.defense.gouv.fr
The MINEFI is responsible for the establishment of the framework conditions governing the public procurement system. The MINEFI also executes its own procurement programme, which reaches €1.9 billion annually and covers five main areas: real estate, IT, postal expenditure, provision of services, and general supply.
Ministry of Transports, Equipment, Tourism and the Sea
The French State Procurement Agency, Le Service des Achats de l’Etat (SAE) is the agency responsible for public procurement. www.economie.gouv.fr/sae Ministry of Defence www.defense.gouv.fr/sites/defense The Ministry of Defence has the largest public procurement budget, which includes technology and innovation-intensive equipment and goods. It is the only ministry that makes extensive use of innovation-related criteria in its procurements and systematically invests in research.
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www.equipement.gouv.fr This Ministry is responsible for the implementation of public works projects and procurements in the areas of transports, equipment, tourism and maritime systems. Regional and Local authorities Local authorities follow independent procuring codes but these are based on the same consistent EU rules. Procurement at sub-central level is significant in France, and regional and local authorities award two-thirds of public purchasing contracts. Utilities There is significant public procurement expenditure in utilities such as electricity, gas and telecommunications.
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French public sector websites
Other useful public sector sites:
Ministry of Economy, Finance and Industry: www.economie.gouv.fr
Portal to French administration
Ministry of Foreign Affairs:
www.service-public.fr (in French & English) Portal to the French legal system
www.diplomatie.gouv.fr/en (in English)
www.legifrance.gouv.fr (in French)
Ministry of Education:
www.education.gouv.fr/ (in French) Ministry of Culture and Communication:
www.culture.fr (in French) Ministry of Employment, Labour and Social Cohesion:
http://travail-emploi.gouv.fr Ministry of Social Affairs, Health and Women’s Affairs: www.sante.gouv.fr Ministry of Civil Service and State Reform:
www.fonction-publique.gouv.fr (in French) Ministry of Ecology and Sustainable Development:
www.ecologie.gouv.fr (in French, English, German, Spanish) Ministry of Agriculture, Food, Fisheries and Rurality:
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www.agriculture.gouv.fr (in French)
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The structure of spending In France, 35 percent of Government procurement is at the national level, with 65 percent at a regional or municipal level. Many significant opportunities exist for New Zealand SME’s for mid-sized projects at regional and municipal levels.
SHARE OF GENERAL GOVERNMENT PROCUREMENT BY LEVEL OF GOVERNMENT EXCLUDING SOCIAL SECURITY FUNDS 2011
Sub-central government
Central government
100% 90%
35%
80%
45%
70%
79%
60% 50% 40%
65% 55%
30% 20%
21%
10%
Canada Spain Belgium Italy Germany Switzerland Finland Austria Sweden Denmark Japan Mexico United States France Netherlands Poland Czech Republic OECD Korea Slovak Republic Norway Hungary Iceland United Kingdom Slovenia Luxembourg Estonia Turkey Ireland Portugal Greece New Zealand Israel
0%
Source: OECD 2014
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Government includes national, regional, departmental and municipal France is regionally quite different, the south is informal and relationship driven whereas the north business is more by the book. Regional agencies are all quite open and proactive but be prepared they are highly educated buyers.
Business opportunities in France There are growing opportunities in many sectors in France. In order to maximise these, New Zealand companies are advised to have a local presence (an agent, a distributor, an integrator, a registered local office) to build relationships and to show a clear commitment to the market. New Zealand exporters should also be aware that most products will have to be labelled in French. EU regulations and import tariffs apply in France, but some manufacturing standards and claims are specific to France.
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Key sectors of opportunity for New Zealand companies Health
Specialised manufacturing
The French health system is under huge financial pressure. Improving efficiency and cutting costs is a government priority. Consequently, the French are very receptive to new approaches and technologies that can help drive a more efficient healthcare service.
New Zealand manufacturing companies are exploring export opportunities and growth in agricultural technology, clean technology, aviation, specialist interiors, timber products and food technologies. Particular opportunities exist for New Zealand exporters with the French Ministry of Defence, port authorities, the police and transport, where budgets are significant.
Information and communication technology (ICT) France is a tech-savvy, tech-consuming nation that offers plenty of opportunities for foreign companies in the ICT sector. In particular, growth is expected in the sectors of e-health, industrial programmes, internet and mobile solutions and Green Information Technology (carbon emissions reduction, and intelligent control of electricity and other resources).
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Marine New Zealand is recognised as a potential supplier of marine equipment. There are significant opportunities with port authorities, the coastguard and the naval military.
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French Government procurement processes How the French Government buys – procurement principles
French Public Procurement Code (CMP) The CMP is the law governing public procurement. It promotes the following:
The French State Procurement Agency, Le Service des Achats de l’Etat (SAE), aims to raise the involvement of small to medium-sized businesses in public procurement to 25 percent. It is also working to increase the proportion of innovative small to medium-sized businesses, and include social and environmental clauses in contracts. The main principles applicable to public procurement procedures are: free access to public procurement contracts equal treatment of bids and offers submitted by companies transparency of procedures effectiveness of public procurement best value for public money.
Splitting of contracts The contracting authority must split the contract into different lots whenever possible. Global aggregated tenders can only be admitted when the object of the contract makes it difficult to split the contract. Applications and bids are evaluated separately for each lot. SME’s participation is highly encouraged The contracting authority can ask the applicants to specify which part of the contract they intend to give to a subcontractor and, more specifically, to an small to medium-sized businesses. For restricted procedure and competitive dialogue, the contracting authority can fix a minimum number of small to medium-sized businesses entitled to bid. Electronic auctions Electronic auctions are only allowed in France for supply contracts over €135,000 for the state and €210,000 territorial authorities. Advance payments/deposits (Articles 86 to 91 of CMP). An advance payment is given to the contractor when the overall contract value is above €50,000 and for contracts carried over more than two months. Services/works where the contract has started result in an entitlement for payment.
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Impact of EU procurement directives
As members of the European Union (EU) community, France, Spain and Italy adopt procurement directives developed by the European Parliament. The EU's public procurement directives: make the 'most economically advantageous tender' the contract award criteria. This criteria encourages government agencies to take into account whole-of-life costing
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encourage government agencies to do e-procurement. E-procurement is using electronic communications when buying supplies and services or tendering public works. E-procurement can facilitate access to public procurement contracts by small and medium-sized businesses.
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People you need to know when entering the market
Set up your local resources in-market
Connect with local partners in your ecosystem
To be in a position to win these important contracts, you need local people who can research and help you understand the market. This information will help you to select, prioritise and focus on appropriate opportunities. Before committing to a tender, make sure you complete a robust bid/no bid analysis.
Joining forces with local partners that complement your offering and have a track record in French public procurement may help you win work.
Find local consultants and lawyers Finding local consultants or legal advisors to help you through the bidding and contract phase may be critical to compliance and eventual profitable delivery on the contract. It takes significant time and resources to win a tender, and there is a certain level of risk involved, so obtain good advice early on in the process. Legal aspects can be complex and are binding. One implication is that you may have to adjust your insurance to manage this and it is good to get advice early.
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A local partner will help you understand the market, find opportunities and knock on doors. They can also provide representation and help reassure government buyers that you will be able to successfully deliver locally. To find the correct partner, think about your supply chain and who you need to position yourself with. Promote yourself to these complementary partners and form the right local partnerships to be positioned to win. This is especially important as often delivery will be in the French language.
Get to know the government buyers Connecting and forming a relationship with the buyer early in the process is crucial to understanding what the buyer really wants. You can do this by getting to know the government bodies who will be issuing tenders in your field in the future. Seek them out, make yourself visible, introduce yourself, visit them, understand what they need, and get on their Approved Supplier lists.
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You could offer a product trial to make yourself visible and to increase awareness of your product or service well before the tender specification. Alternatively, you can enhance your credibility with key opinion leaders by sharing publications in the correct places and references of who else is using your product or service with government buyers.
Cooperate with other French entities These may include industry bodies and associations for your sector, Chamber of Commerce and various other private and public procurement entities.
‘We have a European office in Paris with fifty people. Eighty percent of our revenue in France comes from public contracts. Italy and Spain are also public tender intensive. Often the value of contract is low as many are for local – municipal, town and regional – hospital entities in France, Spain and Italy.' Patrick McSweeny – General Manager Europe, Fisher & Paykel Healthcare
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Finding contract opportunities Procurement websites in France A number of useful services exist at EU level to help you with the tendering procedure: Tenders Electronic Daily (TED): This is the online version of the ‘Supplement to the Official Journal of the European Union’, where tenders falling under EU rules are published. TED provides free access to business opportunities, and is updated five times a week with approximately 1500 public procurement notices. French public procurement portal: Access to BOAMP and forms www.journal-officiel.gouv.fr The French State Procurement Agency, Le Service des Achats de l’Etat - SAE: www.economie.gouv.fr/sae French Ministry in charge of Public Procurement: www.economie.gouv.fr French laws, public procurement code can be found here: www.legifrance.org You can also find out about opportunities by contacting your local Enterprise Europe Network on the Enterprise Europe Network website or by looking for contract notices in industry and trade magazines.
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Spain This guide has been created for New Zealand companies looking to do business with Spanish Government departments and agencies that are required to apply EU directives for public sector procurement. With public sector spending of €1942 billion the Spanish Government is a very large potential market for businesses of all sizes. Spain has the third highest value of public procurement contract notices awarded in the EU. Spain is in a period of recovery, driven by exports, cost reduction and growth in consumption. Of all EU countries, Spain has the highest predicted growth (2.9 percent) for 2015. In quantitative terms, public procurement in Spain accounts for approximately 18.5 percent of Gross Domestic Product (GDP).
Potential suppliers to the Spanish Government need to know how procurement is undertaken, who to contact and, importantly, how to find opportunities and submit a competitive tender. This guide provides information on: how the government market works the rules around government purchases from the private sector where to find business opportunities how to win government business.
Comisión Nacional De los Mercados y la Competencia (2015). Analysis of Public Procurement in Spain: opportunities for Improvement from the perspective of competition. www.cnmc.es
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Government procurement market, processes and opportunities Spanish economy Spain is the fifth largest economy in the European Union (EU) and the twelfth largest in the world. Although farming and agriculture continue to be important, manufacturing and services are its pillars. Key industries include automobile manufacturing, ICT, clean technologies, construction and infrastructure development, food and beverage products, leather goods and tourism. Around three-quarters of the country’s total exports are sent to the EU, with France the single largest export destination, followed by Germany, Portugal, and Italy. As with exports, the primary sources of Spanish imports are the EU nations, mainly Germany, France and Italy. Spain is New Zealand’s 29th largest trading partner. Total two-way trade with Spain was NZ$429.8 million in 2012. New Zealand’s top exports to Spain are fruit, seafood, meat, yachts, and marine equipment and timber. In the past few years, Spanish companies have won several high-value infrastructure contracts in New Zealand. public procurement in Spain is worth €194 billion, equivalent to 18.5 percent of GDP the services sector accounts for 65.6 percent of GDP, with tourism being an important industry. Spain is the world’s third largest recipient of foreign tourists the Spanish economy is expected to rebound and to achieve predicted growth of 2.9 percent in 2015 – the highest of any EU country Spain has a population of 46 million people.
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The top five Spanish Government departments by expenditure
1
2
Ministry of Employment and Social Security Ministry of Health, Social Services and Equality
3
Ministry of Defence
4
Ministry of Education, Culture and Sport
5
Ministry of Public Works
Note that some of the autonomous community budget is higher than that of the ministries mentioned here. For example, the healthcare budget is mostly managed by the regions. New Zealand businesses need to target the central, regional or local government institutions most relevant to their business. Public procurement in Spain is complex but the law applies to all public sector organisations, and processes are similar across all levels.
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No single government procurement agency
Spain (Central)
There is no single government procurement agency in Spain, but each Ministry is responsible for procurement. The Ministry of Finance and Public Administration manages a centralised catalogue of products and services based on a framework agreement defined in the law. There is a recent trend to use centralised procurement agreements in different areas, such as drugs, supplies, etc. This means that New Zealand businesses need to monitor several different sites to participate in government procurement in Spain.
Structure of the Spanish public procurement system Public procurement is harmonised through a unitary national legislation, but it is operated in a decentralised way at different levels. The current authorities involved in public procurement are:
Legislation: The LCSP (de contratos del sector público) ensures competition between bidders to bring the best price and quality results for contracting authorities for the public interest. It defines the situations in which public entities are required to apply the rules on public procurement, ensuring submission to the principles of publicity, competition, transparency, confidentiality, equal treatment, non-discrimination and the safeguarding of free competition.
Spain – autonomous communities Autonomous communities and local entities may also join the centralised procurement system, to benefit from the provisions, services and works included by this. Each autonomous community has an online public procurement portal or platform.
the general state administration autonomous communities administrations local administrations entities (Municipalities).
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Spanish public sector websites
Ministry of Economic Affairs and Competitiveness www.mineco.gob.es/portal/site/mineco/?lang_ choosen=en Ministry of the Treasury and Public Administrations www.minhap.gob.es/en-GB/Paginas/Home.aspx Ministry of Foreign Affairs and Cooperation www.exteriores.gob.es/Portal/en/Paginas/inicio.aspx Ministry of Justice www.mjusticia.gob.es/cs/Satellite/en/1200666550200/ Tramite_C/1215326258560/Detalle.html Ministry of Defence www.defensa.gob.es/en/ladefensa Ministry of the Interior www.interior.gob.es Ministry of Public Works http://m.fomento.gob.es/mfom/lang_castellano Ministry of Education, Culture and Sport www.mecd.gob.es/portada-mecd/en Ministry of Employment and Social Security www.empleo.gob.es/en Ministry of Agriculture, Food and Environmental Affairs www.magrama.gob.es/en Ministry of Industry, Energy and Tourism www.minetur.gob.es/en-US/Paginas/index.aspx Ministry of Health, Social Services and Equality www.msssi.gob.es/en/home.htm
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Spain has 17 autonomous regions, each of which can run its own contracts. Seventeen percent of government procurement is at a national (central) level, and the remaining 83 percent is at a regional or municipal level.
Business opportunities in Spain Many significant opportunities exist for New Zealand businesses for mid-sized projects at regional and municipal levels. New Zealand companies need to be aware of the following: documentation is generally in Spanish but some regions may require the documentation also in their local, official language – Catalan or Basque most products will have to be labelled in Spanish Spanish officials follow the rules of the tender process by the letter Spain is culturally protectionist, meaning that potential suppliers can be excluded if they make bureaucratic errors EU regulations and import tariffs apply in Spain it is highly recommended to have a local presence (an agent, a distributor, an integrator, a registered local office) to build relationships and to show a clear commitment to the market.
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Key sectors of opportunity for New Zealand companies Information Communications Technology (ICT) Spain’s ICT sector is worth €96 billion and is the fastest growing ICT market in Europe and holds potential opportunities for New Zealand exporters of technology and those seeking partnerships with local ICT providers. The Spanish telco, Telefónica, is the second largest telecommunications company in the world, while technology innovation company Indra controls a third of the market for air traffic control systems. New high-tech centres established by IBM, Sony and Siemens in Spain confirm the growing international relevance of Spain’s ICT sector.
Health The Spanish health system is primarily publicly funded and Spain has an ageing population with the longest life expectancy in Europe. The Government has set priorities to improve efficiency and cut costs. Consequently, the Spanish are very receptive to new approaches and technologies that can drive a new healthcare service.
Clean technology Spain is a worldwide leader in wind and solarenergy production. The environmental sector as a whole is worth US$22 billion, and there is international pressure (Kyoto Protocol) and EU legislation on Spain to comply with environmental directives. Spain’s environmental sector presents opportunity for New Zealand exporters of renewable energy technology, water and waste
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management technology and services. There is also potential to form partnerships with Spanish companies to develop New Zealand capabilities and/or partner in overseas projects.
Specialised manufacturing New Zealand manufacturing companies are seeking opportunities in agricultural technology, clean technology, aviation, marine, specialist
interiors, timber products and food technologies into the Spanish market.
Marine Spain has 4,000 kilometres of coastline and a large boat-building industry that presents good opportunities for New Zealand businesses. There are significant public sector opportunities with port authorities, the coastguard and the naval military.
SHARE OF GENERAL GOVERNMENT PROCUREMENT BY LEVEL OF GOVERNMENT EXCLUDING SOCIAL SECURITY FUNDS 2011 Sub-central government Sub-central government
Source: OECD 2014
17% 17%
45% 45%
79%
83% 83%
55% 55%
21%
Canada Canada Spain Spain Belgium Belgium Italy Italy Germany Germany Switzerland Switzerland Finland Finland Austria Austria Sweden Sweden Denmark Denmark Japan Japan Mexico Mexico United States United States France France Netherlands Netherlands Poland Poland Czech Republic Czech Republic OECD OECD Korea Korea Slovak Republic Slovak Republic Norway Norway Hungary Hungary Iceland Iceland United Kingdom United Kingdom Slovenia Slovenia Luxembourg Luxembourg Estonia Estonia Turkey Turkey Ireland Ireland Portugal Portugal Greece Greece New Zealand New Zealand Israel Israel
100% 100% 90% 90% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0%
Central government Central government
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Spanish Government procurement processes How the Spanish Government buys – procurement principles
an enterprise classification system exists for the entities to indicate those contracts for which they bid, set out in the Register of Classified Enterprises. It is recommended to register for public contracts above certain budgets
The procurement principles include: common standards for public procurement have been set up to modernise, streamline, and simplify procedures while guaranteeing unjustified restrictions of competition (especially focused on involvement of small and medium enterprises). This is enforced nationally in Spain by the Spanish Public Procurement Act 30/2007 of 30 October 2007 or LCSP Europa – Public Contracts: Spain (2015)
eligibility to bid takes into account creditworthiness such as economic-financial quality and technical professional quality, specific legal structure requirements, territorial discrimination and requirement of quality certifications
the LCSP ensures competition between bidders to bring the best price and quality results for contracting authorities for the public interests. It defines the situations in which public entities are required to apply the rules on public procurement, ensuring submission to the principles of publicity, competition, transparency, confidentiality, equal treatment, non-discrimination and the safeguarding of free competition.
there is a general framework as the law is the same for different kind of contracts (goods, services, public services, infrastructures, etc.); processes are similar in every public sector organisation, however there can be different levels of complexity public procurement can be at a national, regional or local level local language skills are critical to win bids local relationships are important to win bids need to meet EU standards.
There is no single government procurement agency, but each public sector organisation is responsible for procurement: procurement is very fragmented the anti-discrimination principles allow nonSpanish enterprises to participate as long as they comply with requirements by means of demonstrating certificates, registrations and systems established in their own states
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Spanish procurement procedures Spanish public procurement law provides for three different tender procedures to award a European public contract. Spanish public procurement is usually done through the open tender process. Open tender is the most pro-competitive and common procedure. Spain has the third highest value of notices awarded in the EU and the fourth highest number, making it a very important market.
PROCEDURES IN THE EU BY USE AND VALUES 2006-2010
Number 7% 8% 9%
Value 4% 5% 14%
23%
'Using a Spanish main contractor, for example a local systems integrator, has advantages. They take the project risk and you sign a back-to-back agreement for your part. The disadvantage is that you lose access to the end user, revenue and the capability to manage.'
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Competitive dialogue Accelerated negotiated Accelerated restricted Negotiated without publication Negotiated Restricted Open
Source: PWC Public Procurement in Europe - Cost and effectiveness. A study on procurement regulation. Prepared for the European Commission, March 2011.
Luis Javier Bonilla, General Manager – Iberia, Orion Health
30
73%
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1. The open procedure This is a one-phase procedure that involves the publishing of a call for bids to which any economic operator may submit a tender. Any supplier can request a copy of the tender documents and then submit a response by a set date. 2. The restricted procedure This is a two-phase procedure with a public announcement of the planned tender. Any economic operator may request to participate. After pre-qualification, those invited by the contracting authority may submit a tender. In order to pre-qualify, it’s essential to be well prepared. 3. The competitive procedure with negotiation The contracting authority consults the economic operator(s) of its choice and negotiates the terms of contract. In the negotiated procurement the price can be negotiated.
Framework agreements Framework agreements are contracts with one or more buyers. The maximum term of the framework agreement is four years. If you are part of a framework contract you may not need to bid for individual tenders.
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People you need to know when entering the market
Set up your local resources in-market
Connect with local partners in your ecosystem
To be in a position to win these important contracts, you need local people who can research and help you understand the market. This information will help you to select, prioritise and focus on appropriate opportunities. Before committing to a tender, make sure you complete a robust bid/no bid analysis.
Joining forces with local partners that complement your offering and have a track record in Spanish public procurement may help you win work.
Find local consultants and lawyers Finding local consultants or legal advisors to help you through the bidding and contract phase may be critical to your compliance and eventual profitable delivery of the contract. It takes significant time and resources to win a tender, and there is a certain level of risk involved, so obtain good advice early on in the process. Legal aspects can be complex and are binding. One implication is that you may have to adjust your insurance to manage this and it is good to get advice early.
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A local partner will help you understand the market, find opportunities and knock on doors. They can also provide representation and help reassure government buyers that you will be able to successfully deliver locally. To find suitable partners, search the sites by theme, consultancy, technology etc. Promote yourself to these complementary partners and form the right local partnerships to be positioned to win.
Local prime contractors in your ecosystem Developing relationships with prime contractors will be important to help secure contracts and develop experience. To help you develop the most effective relationships, time spent researching potential prime contractors, how they are perceived by customers and their capabilities will be time well spent.
GUIDE TO WINNING GOVERNMENT BUSINESS IN FRANCE, SPAIN & ITALY
Get to know the government buyers Connecting and forming a relationship with the buyer early in the process is crucial to understanding what the buyer really wants and to potentially becoming a trusted advisor. You can do this by getting to know the government bodies who will be issuing tenders in your field in the future. Seek them out, make yourself visible, introduce yourself, visit them, understand what they need, and get on their Approved Supplier lists. You could offer a product trial to make yourself visible and to increase awareness of your product or service well before the tender specification. Alternatively, you can enhance your credibility with key opinion leaders by sharing publications in the correct places and references of who else is using your product or service with government buyers.
'Tenders are often fragmented in terms of needs – lots and sub lots. We only answer a few specific bids and partner with other equipment manufacturers, for example, on a platform with a main contactor or with those that distribute complementary products/accessories.' Luis Javier Bonilla, General Manager – Iberia, Orion Health
Cooperate with other Spanish entities These may include sector industry bodies and associations, Chamber of Commerce and various other private and public procurement entities.
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Finding contract opportunities Procurement websites in Spain Research information links with procurement portals The first place for research is through Tenders Electronic Daily (TED) which is the pan European portal where all European public procurement tenders are published. You should familiarise yourself with tenders in your field: www.ted.europa.eu/TED/main/HomePage.do The main platform to search for public sector contracts is via the Ministry of Public Administration: www.contrataciondelestado.es/wps/portal/ plataforma The Ministry of President manages the BOE the Official State Gazette, and BORME Official Gazette of the Commercial Registry. Visit: www.boe.es/index.php?lang=en The Official Bulletin of the Canary Islands is where all local public tenders can be found by visiting: www.gobcan.es/boc You can also find out about opportunities by contacting your local Enterprise Europe Network on the Enterprise Europe Network website or looking for contract notices in industry and trade magazines.
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Italy This guide has been created for New Zealand companies looking to do business with Italian Government departments and agencies that are required to apply European Union (EU) directives for public sector procurement. The Italian Government is a very large potential market for New Zealand businesses of all sizes. Public sector spending on goods and services totals around €157 billion4 a year, equivalent to nearly 15 percent of Italian GDP. Italy has the fourth highest number of public procurement contract notices awarded and the third highest value of awards in the EU. Potential suppliers to the Italian Government need to know how procurement is undertaken, who to contact and, importantly, how to find opportunities and submit a competitive tender.
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This guide provides information on: how the government market works the rules around government purchases from the private sector where to find business opportunities how to win government business.
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Government procurement market, processes and opportunities Italian economy With a population of 61 million, Italy is Europe’s fourth largest economy and the second largest manufacturing economy in Europe. Italy’s economic strength is based on the processing and manufacturing of goods, primarily driven by small to medium sized enterprises, most of which are family owned and focused both on domestic and export markets. The major industrial sectors are fashion and luxury goods, food, mechanical, precision machinery, motor vehicles, pharmaceuticals, chemicals and life sciences, ICT and renewable energy. Traditional sectors of dominance in expenditure have been health, education, transport and infrastructure and defence. Innovation in Italy is driven by an extensive network of high-quality public and private institutions. Italy ranks sixth for granted patents and fourth for registered trademarks among G12 countries. Italy has a sophisticated demand for innovative and niche market products and services.
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The top five Italian Government departments by expenditure
1 2
Ministry of Labour and Social Provision Ministry of Health
3
Ministry of Defence
4
Ministry of Defence
5
Ministry of Public Works
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THE ITALIAN PUBLIC PROCUREMENT SYSTEM
Ministry of Economy and Finance
Public Works Authority Legal supervision of public contracts
Consip SpA Central organisation of procurements through framework contracts
• binding opinion on public works contracts • opinion in other public procurement contracts when asked
• binding price and quality benchmarks, arose from the frame contracts • selectively binding frame
CNIPA Technical and economic consulting on ICT’s • compulsory technical and economic advices on procurement of ICT’s
National (ministries and public services) and Local (regions and municipalities) Administration Decentralised procedures with independent procuring agencies and rules
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Institutions responsible for national procurement
3. Italian National Centre for the Information Systems in the Public Sector (CNIPA)
1. Consip S.p.A.
www.cnipa.gov.it/site/it-IT
www.consip.it
CNIPA (Centro Nazionale per l’informatica nella Pubblica Amministrazione) is responsible for the effective use of new technologies and methodologies throughout the Public Administration (central and regional). CNIPA offers compulsory technical and economic instructions to the public sector regarding the procurement of ICT products and services.
Consip is a joint-stock company totally and directly owned by the Italian Ministry of the Economy and Finance (MEF). As a central procuring agency Consip executes three main operations: market research framework contracts
4. Local administrations – regions, municipalities
technical assistance. Consip is also in charge of implementing the Rationalisation Programme on Public Spending for goods and services through the application of information technology and innovative purchasing methods. The main objective of the programme is to guarantee the efficiency and transparency of procurement processes. To do this, Consip uses e-procurement tools and develops frame contracts through European-wide tenders (conventional or online).
Local and regional administrations are authorised to manage procurement either through Consip or internally, respecting Consip’s price and quality benchmarks. Regional authorities also have some degrees of freedom in establishing independent procurement rules using their legislative power provided they respect European and national law.
2. Public Works Authority www.autoritalavoripubblici.it The Public Works Authority (PWA) (Autorita per la vigilanza sui lavori pubblici) is an independent body established for the legal supervision of public works and engineering services. Its authority will soon be expanded to the entire public procurement system.
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Italian public sector websites Ministry for Cultural Assets and Activities www.beniculturali.it Ministry of Defence www.difesa.it Ministry of Environment www.minambiente.it Ministry of Foreign Affairs www.esteri.it Ministry of Health www.sanita.it Ministry of the Interior www.cittadinitalia.it Ministry of Justice www.giustizia.it Ministry of Labour and Social Policy www.lavoro.gov.it Ministry of Public Education www.istruzione.it Italian National Agency for Tourism www.enit.it Authority for Electric Energy and Gas www.autorita.energia.it
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railways, ports, and water infrastructure and energy networks. It is currently valued at €231 billion.
In 2012, Italian public expenditure included €127 billion of purchases of supplies and services, and €30 billion for fixed capital formation. Italian municipalities spent €19 billion in 2012, mostly on infrastructure and real estate maintenance. Local health authorities spent €19.9 billion. The Italian Government’s Strategic Infrastructures Plan involves significant investments in roads,
In Italy, just 20 percent of government procurement is at the national level, with 80 percent at a regional or municipal level. Many significant opportunities exist for New Zealand SME’s for mid-sized projects at regional and municipal levels.
SHARE OF GENERAL GOVERNMENT PROCUREMENT BY LEVEL OF GOVERNMENT EXCLUDING SOCIAL SECURITY FUNDS 2011
Sub-central government
Central government
100% 90%
20% 45%
80% 70%
79%
60% 50% 40%
80% 55%
30% 20%
21%
10%
Source: OECD 2014
Canada Spain Belgium Italy Germany Switzerland Finland Austria Sweden Denmark Japan Mexico United States France Netherlands Poland Czech Republic OECD Korea Slovak Republic Norway Hungary Iceland United Kingdom Slovenia Luxembourg Estonia Turkey Ireland Portugal Greece New Zealand Israel
0%
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Business opportunities in Italy There are growing opportunities in many sectors in Italy. However New Zealand companies need to be aware of the following: most products will have to be labelled in Italian EU regulations and import tariffs apply in Italy, but some manufacturing standards and claims are specific to Italy it is highly recommended to have a local presence (an agent, a distributor, an integrator, a registered local office) to build relationships and to show a clear commitment to the market.
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Key sectors of opportunity for New Zealand companies Health information technology (Health IT) New Zealand Health IT has been one of the major sectors of interest in Italy. The Italian healthcare sector is large and opportunities for New Zealand companies exist at a national, regional and municipal level.
Information and communication technology (ICT) Italy is a tech-savvy, tech-consuming nation and offers plenty of opportunities for foreign companies in the ICT sector. In particular, growth is expected in the sectors of e-health, industrial programmes, internet and mobile solutions and Green Information Technology.
Marine Surrounded by sea, Italy has an extensive coastline. Its large boat-building industry presents good opportunities for New Zealand companies who can pursue business opportunities with port authorities, the coastguard and the naval military.
Specialised manufacturing Opportunities can be found in the aviation, marine, automation and equipment, technology and telecommunication industries where New Zealand companies are considered innovative, high quality and flexible.
Renewable energy Given the price of fuel and the present concern over long-term energy supply, renewable energy is a very attractive proposition in Italy. Bio-energy is a dynamic and growing business for the country and the use of biomass feedstock from agriculture and agri-industrial residues is increasing.
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Impact of EU procurement directives As active members of the EU community, Italy, France and Spain adopts directives developed by the European Parliament. The European Parliament has adopted new public procurement directives that have become national law. The reforms allow for: increased flexibility and simplification of procedures clearer conditions on joint procurement and sub-contracting the ’most economically advantageous tender‘ award criteria replaces ‘lowest price’, which strengthens the use of whole-of-life costing better access and simplification of procedures for small to medium-sized businesses the promotion of e-procurement. These reforms make it easier, quicker and more cost-effective for bidders to respond to tenders. The increased transparency of notices and process, with standard procedures now common among most EU states benefits New Zealand businesses entering the market. Source: Crown Commercial Service
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Italian Government procurement processes How the Italian Government buys – procurement principles
Public procurement in Italy occurs at various levels – national, regional, provincial and communal – across all portfolios and institutions. Consip, Italy’s central purchasing body runs the Rationalisation of Public Administration Purchases Programme. Based on specific agreements, it supports the individual public administrations in all areas throughout the procurement process. www.consip.it/en/about_us Italian public procurement is very fragmented, open on the surface but complex beneath. Tenders are published in the Official Gazette every Monday, Wednesday and Friday and summarised under national, regional and local levels where the process and regulations all differ. All documentation is in Italian only and varies widely by Ministry at all levels. The main principles applicable to public procurement procedures are: free access to public procurement contracts equal treatment of bids and offers submitted by companies
‘In the tender process you must follow the rules and sequential steps carefully. You need to be compliant at every step in the process. As the administrative burden is high, you may even need a bank guarantee from the Managing Director/ Chief Executive Officer as a guarantor for the value of the tender. These may even carry personal liability.’ Patrick McSweeny – General Manager Europe, Fisher & Paykel Healthcare
transparency of procedures effectiveness of public procurement best value for public money.
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Italian Government procurement procedures Italian public procurement law provides for three different tender procedures to award a European public contract reaching or exceeding an applicable EU threshold. Italy has the sixth highest number of notices awarded and the fourth highest value of awards in the EU, making it a very important market for public procurement.
Companies bidding for a public sector contract may have to go through one of several different official procurement procedures. 1. The open procedure This is a single-phase procedure that involves the publishing of a call for bids to which any economic operator may submit a tender. Any supplier can request a copy of the tender documents and then submit a response by a set date. 2. The restricted procedure This is a two-phase procedure with a public announcement of the planned tender. Any economic operator may request to participate. After pre-qualification, those who are invited by the contracting authority may submit a tender. In order to pre-qualify, it is essential to be well prepared.
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3. The competitive procedure with negotiation The contracting authority consults economic operator(s) of its choice and negotiates the terms of contract. The AVC pass system The AVC pass (Authority Virtual Company Passport) is a system used to verify the requirements declared by the bidders to a public tender procedure. The AVC pass web system simplifies and standardises public tender procedures for both bidders and awarding bodies by automating the flow of information. It allows: bidders to upload documentation that proves they meet the requirements necessary to participate awarding bodies to manage and review the uploaded documentation, and request further information as required.
Framework agreements and direct bidding Framework agreements are contracts with one or more buyers. The maximum term of the framework agreement is four years. If you are part of a framework contract you may not need to bid for individual tenders.
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People you need to know when entering the market
Set up your local resources in-market To be in a position to win these important contracts, you need local people who can research and help you understand the market. This information will help you to select, prioritise and focus on appropriate opportunities. Before committing to a tender, make sure you complete a robust bid/no bid analysis.
Find local consultants and lawyers Finding local consultants or legal advisors to help you through the bidding and contract phase may be critical to your compliance and eventual profitable delivery of the contract. It takes significant time and resources to win a tender, and there is a certain level of risk involved, so obtain good advice early on in the process. Legal aspects can be complex and are binding. One implication is that you may have to adjust your insurance to manage this and it is good to get advice early.
Connect with local partners in your ecosystem Joining forces with local partners that complement your offering and have a track record in Italian public procurement may help you win work. A local partner will help you understand the market, find opportunities and knock on doors. They can also provide representation and help reassure government buyers that you will be
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able to successfully deliver locally. To find suitable partners, search the sites by theme, consultancy, technology etc. Promote yourself to these complementary partners and form the right local partnerships to be positioned to win.
Local prime contractors in your ecosystem Developing relationships with prime contractors will be important to help secure contracts and develop experience. To help you develop the most effective relationships, time spent researching potential prime contractors, how they are perceived by customers and their capabilities will be time well spent.
Get to know the government buyers Connecting and forming a relationship with the buyer early in the process is crucial to understanding what the buyer. You can do this by getting to know the government bodies who will be issuing tenders in your field in the future. Seek them out, make yourself visible, introduce yourself, visit them, understand what they need, and get on their Approved Supplier lists.
Cooperate with other relevant entities These may include industry bodies and associations for your sector, the Italian Chamber of Commerce and various other private and public procurement entities.
GUIDE TO WINNING GOVERNMENT BUSINESS IN FRANCE, SPAIN & ITALY
Finding contract opportunities Procurement websites in Italy A number of useful services exist at EU level to help with the tendering procedure: Tenders Electronic Daily (TED) is the online version of the ‘Supplement to the Official Journal of the European Union’, where tenders falling under EU-rules are published. TED provides free access to business opportunities, and is updated five times a week with approximately 1500 public procurement notices.
You can also find out about opportunities by contacting your local Enterprise Europe Network on the Enterprise Europe Network website and looking for contract notices in industry and trade magazines.
Official Italian Gazette lists contract notices and tender bid information www.gazzettaufficiale.it Technical Information Online www.lavoripubblici.it The National Anti-corruption Agency has the BDNCP, a tool containing information on national public contracts. www.autoritalavoripubblici.it/portal/public/classic The Authority for the Surveillance of Public Works: www.autoritalavoripubblici.it Detailed information on Italian public procurement is available on: www.eurosportelloveneto.it/pubblicazioni/67366_ Eurosport.pdf
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Are you ready to enter the French, Spanish or Italian market? Questions to ask before entering the market
Do you have the resources to win? Have you been through similar tender processes in other countries?
Do you speak the language? Do you know the key players in the supply chain in the market that could be potential partners for bidding for contracts? Do you have references? Do you have a track record with similar institutions in New Zealand, in the market or in the EU? Do you have a local partner? Can you deliver locally and provide local support? Can you prove you have a low risk of failure solution? Are you visible with an accessible and up-to-date website? Have you signed up for email alerts on TED? Have you registered your interest in future procurements and are you monitoring the procurement pipeline? Are you attending information days and public sector tendering events?
Have you studied similar tenders? Do you understand the themes and have you built these into your business proposition? Are you prepared to invest the time to win the first project?
Pre-qualification Are there approved supplier lists, supplier panels and framework agreements? Find out the supplier criteria and the selection process and timing and apply to be on these. Have you material (prepared responses) ready for pre-qualification? Do you have the required certifications – a CE Mark or an ISO certification? www.ce-marking.org
Do you know your competition? Who is winning in your sector and why?
www.iso.org/iso/home.html
Value proposition
Pre-qualification demands a lot of mandatory information and regulatory compliance to proceed to the next phase – do you have this ready?
Are you clear on the value you can provide and what differentiates you from your competition? What are your strengths? Are you focused on the opportunities that are right for you?
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Are you prepared to disclose your financial reports and references?
References and CVs Are these prepared and in the correct format?
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What you need to know
Understand the French, Spanish and Italian Government markets
Key points: connect and form a relationship with the buyer early in the process understand what the buyer really wants; become a trusted advisor form the right local partnerships to be positioned to win understand that the tender process will be long, formal and complex and requires attention to detail it also requires significant resources and time be selective, prioritise and focus on your best opportunities do a financial due diligence review on profitability before committing.
Government opportunities are like any other complex business opportunity – you need to focus, understand what your buyer wants and invest to win EU market is highly competitive – don’t underestimate the skilled competition you will be up against. Tendering for French, Spanish and Italian Government projects is a highly developed, specialised and price-competitive business. Speaking and understanding the local language is critical Information about opportunities is readily available – set yourself up to track procurement information and attend information days Be visible to procurers – make sure your website is accessible, professional, and tailored to the market. Register on Approved Supplier lists Investment is essential for winning work – be prepared to invest significant time and effort to win public contracts Have a market presence – it’s not compulsory to have market representation, but you do need to have a presence, either directly or through a partner Keep your eyes open for follow-on work – track, focus, invest, win and deliver and the follow-on work will come.
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Prioritise and be selective: Focus on your strengths – on what you do well, where you have credibility
Be prepared to invest locally if this is a requirement – a local partner, a registered local office, a local presence and the ability to support is critical
Pick your tender – you need to be the best, technically meeting all the requirements, specifications and financially robust enough to maintain competitive pricing
Do a robust bid/no bid analysis before committing – be prepared to walk away early if you are not going to make money.
Pick your market – think carefully about the markets in which you have the strongest value proposition
There are significant opportunities in France, Spain and Italy but New Zealand companies need to be focused, selective and resourced to invest to win and conduct successfully business.
Pick the price you can sustain – make sure you really understand the costs of servicing the contract Pick the reporting burden you can sustain – the cost of reporting, administration and management is high Pick the bid you can afford to invest the resources in to win – investment to win a tender is high in terms of time, resources and cost. Tenders must attract a minimum number of qualified bidders to be awarded, but there will be only one winner. Investing early with the buyer will help you to win Pick the bid you can afford to deliver successfully – continued significant investment could be required to deliver, ensure you are resourced to do so
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Serious about winning French, Spanish or Italian Government business? What you need to do
Promote your offering via your website, digital platforms and social media
Set up a system so that you have early notification of tenders and opportunities track and filter the government tender websites for the tenders and opportunities that are under the threshold for tendering on the EU Tenders Electronic Daily website track and filter the EU Tenders Electronic Daily website for large tenders and opportunities: http://ted.europa.eu tracking opportunities from national and EU operational programmes is key. Look for information on the government websites and in the media understand which opportunities are relevant to you filter TED and national procurement sites to focus on what you do create a profile for your company that matches EU Government procurement funded activities and requested deliverables look at past procurement projects and spending by government agencies to allow you to select and prioritise your target government agencies attend information days and industry events find out if the government agency has approved supplier lists, supplier panels and framework agreements and apply to be on these track future opportunities by using the procurement pipeline portal.
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with the digital revolution, traditional purchasing paths have transformed into more of a pattern of touch points. Business-togovernment sales are becoming more digital as government agencies research, evaluate, select and share experiences sellers need to meet buyers in real time so use digital tools and allocate resources accordingly. Set up your website and information technology systems so that you can meet the buyers' e-commerce and real-time requirements find out what certification you need and get this provide an up-to-date website with tailored references and cases use social media and digital industry platforms to promote yourself your website, Google, LinkedIn and Twitter identities.
Build an ecosystem and select suitable market partners local partners can be the main or subcontractors to you for bids and can ensure you can provide local support and deliver find the correct partner – search your supply chain and sector and promote yourself to complementary partners use local networking and relationships to get close to the buyer.
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Preparation to increase your success in becoming an approved supplier
Understand your competition
comply with the buyer's questionnaire. Tick every box to ensure you get to pass ‘go’
Identifying your competition in an unfamiliar market can be difficult. Here are some ways to improve your understanding of whom you might be up against:
prepare technical information in the standard required
networking will keep you alert to market developments. Join industry associations or business groups such as your local Chamber of Commerce or Industry Association to discover more about competitors
provided the regulatory documentations required
the internet offers a mine of information. Scour your competitors’ websites
do you have the required certifications – a CE Mark or an ISO certification
search TED for tender winners:
understand all of the mandatory information for pre-qualification
www.ce-marking.org www.iso.org/iso/home.html study similar tenders, understand the themes and build these into your business proposition
www.ted.europa.eu local industry-specific periodicals are a useful source of information and competitor advertisements.
prepare standard answers and make sure they are bulletproof have your references and track record documentation ready have the administrative and financial requirements to bid bidders must demonstrate financial robustness, transparency of annual revenue and evidence of similar recent engagements.
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NEW ZEALAND TRADE AND ENTERPRISE New Zealand Trade and Enterprise (NZTE) is New Zealand’s international business development agency. Our role is to help New Zealand businesses grow bigger, better, faster in international markets. We offer strategic advice, access to networks and influencers, research and market intelligence, and targeted financial support to help businesses on their international journey, and work to promote and support the growth of New Zealand business overseas.
0800 555 888 www.nzte.govt.nz
facebook.com/NZtradeandenterprise
@NZTEnews
linkedin.com/company/new-zealand-trade-and-enterprise
Disclaimer: This document only contains general information and is not formal advice. The New Zealand Government and its associated agencies (‘the New Zealand Government’) do not endorse or warrant the accuracy, reliability or fitness for any purpose of any information provided. It is recommended that you seek independent advice on any matter related to the use of the information. In no event will the New Zealand Government be liable for any loss or damage whatsoever arising from the use of the information. While every effort is made to ensure the accuracy of the information contained herein, the New Zealand Government, its officers, employees and agents accept no liability for any errors or omissions or any opinion expressed, and no responsibility is accepted with respect to the standing of any firms, companies or individuals mentioned.
ISBN No. 978-0-908344-00-0 September 2015
