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House Approves Public Procurement (Amendment) Regulations 2023

The House of Representatives on Tuesday (July 4) approved the Public Procurement (Registration and Classification of Suppliers) (Amendment) Regulations, 2023, Resolution.

The Regulations amend Part One of the Second Schedule of the Public Procurement (Registration and Classification of Suppliers) Regulations 2019.

This will increase the fees commensurate with the maximum registration period of three years in accordance with Regulation Nine of the Principal Regulations.

Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, noted that in 2019, a comprehensive law for public procurement came into effect in Jamaica that consolidated and modernised the supporting legislative framework.

He pointed out that the Act establishes the Public Procurement Commission pursuant to Section Nine of the Public Procurement Act to, among other things, promote fairness, transparency, and equity in the registration of persons, firms and entities under the Act, and the award of procurement contracts.

Dr. Clarke said Section 11 of the Act grants the Commission the power to, inter alia, approve or endorse the award of procurement contracts above the value of the tier-one limit, register and classify suppliers, approve unregistered suppliers, and assess suppliers on an ongoing basis to ensure the consistency of performance with the registration and classification requirements.

The Minister said the registration process undertaken by the Commission serves, in part, to ensure that suppliers are eligible to participate in public procurement in Jamaica. But only if such suppliers meet the minimum requirements of technical, financial, and legal capabilities that are prescribed in each category of registration.

“Accordingly, the due diligence associated with the registration of suppliers includes examination of the applicant’s business and assets, products, services, prior projects, as well as review of financial information,” Dr. Clarke said.

He informed that Regulation 10, one and two of the Principal Regulations provide that upon notification by the Commissioner that the supplier application has been successful, a fee is payable in respect of the grade in which the supplier has been classified. This, as specified in the first column of Part One of the Second Schedule of the Principal Regulations.

“These fees are applicable only to those suppliers registering in the works supplier grade. It is to be noted that it was the policy of the Commission in relation to the registration process that once an application was approved by it, a certificate of registration is issued valid for a period of one and a half years or 18 months,” Dr. Clarke said.

“After the expiration of the certificate, the supplier may elect to return to the register by resubmitting a new application for registration. It is felt that the granting of a certificate of registration for only 18 months is inefficient and costly. In order to improve efficiency in the process of registration and re-registration of suppliers, it was determined that it would be more cost-effective to increase the registration period to three years,” he added.

The Minister noted that this increased registration period is expected to result in an overall reduction in the administrative burden on suppliers who participate in public procurement.

“It is also expected to positively affect competition by making a larger pool of eligible suppliers for a longer period of time who would be capable of participating in procurement proceedings,” Dr. Clarke stated.

Additionally, the longer period of registration may attract suppliers or economic operators to Jamaica who traditionally would have opted not to participate in government procurement.

“The Government, in extending the registration period from one and a half years to three years, is a good thing. The only challenge is that there will be loss of revenue to the Commission, because the Commission is only paid when the registration happens. We don’t propose any nominal increase in the fees. But what we need to do is to ensure that the Commission is not out of pocket,” Dr. Clarke said.

“So, if for 18 months, the registration fee was for $50,000, then for three years for the Commission not to be out of pocket, the fee would have to be $100,000. That is what this [that] we are debating is designed to do – to support the Commission in lengthening the registration period from 18 months to three years, but to do so in a way that is revenue neutral,” he added.

The Minister said the Public Procurement (Registration and Classification of Suppliers) (Amendment) Regulations, 2023 will enable the Commission to efficiently fulfil its functions of registering and re-registering suppliers.

For his part, Minister Without Portfolio in the Ministry of Economic Growth and Job Creation, Hon. Everald Warmington, welcomed the regulations.

“It’s been a long road. It took a long time but, finally, contractors do not have to go through this laborious process… every 18 months. They have breathing room now [to] re-register every three years,” he said.