STAFF INSTRUCTIONS BORROWER ADMINISTERED CONSULTING SERVICES GLOSSARY ADB Administered Consulting services financed by ADB’s administrative budget, capital budget, Consulting Services TA grant or other grant projects funded from special funds or trust funds, for which ADB selects and engages the consultants. ADB may also hire consultants funded by advance payment from prospective clients in its non- sovereign operations or following Public Private Partnership transaction advisory services mandate and similar arrangements. ADB financing Includes financing by loans, grants, technical assistance (TA) grants, or funds from external sources which ADB administers, ADB’s administrative budget, and the special capital budget. Biodata technical Basic type of technical proposal. Includes workplan and personnel schedule, proposal (BTP) CVs of proposed experts. It is the default type of proposal for Direct Contracting and CQS selections. Borrower Includes agencies or entities that act for the Borrower to carry out the project. It also includes recipients of grants for projects, under which the EA administers consulting services. Borrower-Administered Consulting services provided under ADB’s loan projects, grant projects or Consulting Services Delegated Technical Assistance projects, for which the Borrower selects and engages the consultants (used interchangeably with Consulting services that executing agencies (EAs) administer). Conflict of Interest Any situation in which a party has interests that could improperly influence that party’s performance of official duties or responsibilities, contractual obligations, or compliance with applicable laws and regulations. Consultant An individual or Consulting Firm that provides consulting services. Consulting Firm Any private or public entity with the capacity to provide consulting services. Such entities include international and national consulting firms, engineering firms, construction firms, management firms, procurement agents, inspection agents, auditors, United Nations (UN) agencies and other multilateral organizations, universities, research institutions, government agencies, civil society organizations (CSO) and nongovernmental organizations (NGOs), when such entities provide consulting services. Consultant Selection Convened to decide on consulting services matters, including evaluation of Committee (CSC) EOIs for high-value individual consulting selection1 and, technical evaluation of proposals received from consulting firms in response to the RFP. Consultant Electronic procurement system used by ADB and its Borrowers to recruit Management System consultants. For Borrowers the functionality is currently limited to posting (CMS) CSRNs. Consultant A system used to monitor the activities and time taken for consultant Recruitment Activity recruitment. Monitoring (CRAM) Consulting Services Automated procurement notice published on ADB’s Consultant Management Recruitment Notice System. See also REOI. (CSRN) Consulting services Consulting services provided under ADB’s loan projects, grant projects or that executing delegated TA projects, for which the EA selects and engages the consultants. agencies (EAs) (used interchangeably with Borrower-Administered Consulting Services). administer 1 Defined as exceeding $200,000 Delegated Technical Technical Assistance (TA) projects in which ADB delegates responsibility to Assistance the EA for implementation, including responsibility to select and manage consultants, and to sign and administer contracts (including payments) Executing Agency Identified in a financing agreement or TA agreement, and responsible for the (EA) carrying out of a loan, grant or a TA grant-funded project. The term EA may be extended to include an implementing agency that the EA designates to implement the project and recruit consultants. Expression of Interest Submitted by Consultants in response to the publication of Request for EOI (EOI) (REOI) through Consulting Services Recruitment Notice (CSRN). Full technical proposal Technical proposal used for complex, high value assignments. (FTP) Includes: Description of approach, methodology, workplan and personnel schedule, team composition, task assignments and CV summary, consultant’s organization and experience, comments and suggestions on the TOR, comments on the counterpart support and facilities, CVs of proposed key experts. International Consultant with international experience beyond that of the country in which Consultant the assignment is to be performed. National Consultant Consultant performing assignment in his/ her own country. The expert’s role does not require international experience. OAI Office of Anticorruption and Integrity. PASS Accreditation qualification for Project Units in the review of EA consultant selections under ADB’s Procurement Accreditation Skills Scheme (PASS). Project Unit The ADB project division, regional office or resident mission that supervises a project. REOI Request for Expression of Interest. Used interchangeably with CSRN. Request for Proposal The RFP is issued to shortlisted consulting entities. The RFP shall include (RFP) Terms of Reference, Evaluation criteria, Eligibility Criteria, Instructions to Consultants, Data Sheet, Standard forms for Submitting Technical and Financial Proposals, standard form of contract. ADB issues RFPs electronically using Consultant Management System. Simplified Technical Technical proposal used for majority of consulting assignments requiring Proposal (STP) services of the consulting team. The STP shall include: Description of approach, methodology, workplan and personnel schedule, team composition, task assignments and CV summary, CVs of proposed key experts. Terms of Reference Describes the purpose, objectives, scope of work, detailed tasks or specified (TOR) outputs; and reporting requirements which the consultant is expected to meet to complete the assignment for the benefit of the EA. User Unit The EA’s project implementation unit for using consulting services. TABLE OF CONTENTS I. ADB’S PROCUREMENT FRAMEWORK ....................................................................... 1 A. Introduction ............................................................................................................... 1 B. Scope ....................................................................................................................... 1 C. Structure ................................................................................................................... 2 II. DEFINITIONS, PRINCIPLES AND RESPONSIBILITIES ............................................... 2 A. Principles .................................................................................................................. 2 B. Anticorruption Policy ................................................................................................. 3 C. Conflict of Interest ..................................................................................................... 5 D. Avoiding Unfair Competitive Advantage .................................................................... 5 E. Responsibilities ......................................................................................................... 6 F. Types of Consultants ................................................................................................ 7 G. Using National Consultants from Developing Member Countries (DMCs) ................. 8 H. Eligibility ................................................................................................................... 8 III. PREPARING FOR CONSULTANT RECRUITMENT .....................................................12 A. Procurement Plan ....................................................................................................12 B. Terms of Reference (TOR) ......................................................................................12 C. Cost Estimate ..........................................................................................................13 D. Selection Method .....................................................................................................14 E. Change in Selection Method ....................................................................................14 F. Types of Technical Proposals ..................................................................................14 G. Changing the Type of Technical Proposal ...............................................................16 H. Determining International or National Expertise .......................................................16 I. Recruitment Mode (International or National Competitive Selection) .......................16 J. Consulting Services Provided by United Nations and Other International Organizations ..........................................................................................................16 IV. GENERAL PROCEDURE FOR SELECTING AND ENGAGING CONSULTANTS .......17 A. General Procedures .................................................................................................17 B. Selection Methods ...................................................................................................24 C. Contract Types ........................................................................................................31 D. Confidentiality and Absence of Undue Influence in the Selection Process ...............32 V. CONSULTANT RECRUITMENT BY THE EXECUTING AGENCY ...............................33 A. Responsibilities of the EA, ADB’s Project Unit, and ADB’s Procurement Staff .........33 B. Advance Contracting ...............................................................................................34 C. Advertising (Consulting Services Recruitment Notice) .............................................34 D. Consultant’s Expression of Interest ..........................................................................35 E. Recruiting Consulting Firms – Prior and Post Review (Sampling) ............................35 F. Prior Review ............................................................................................................35 G. Post Review (Sampling)...........................................................................................40 H. Recruiting Individual Consultants – Prior and Post Review (Sampling) ....................42 I. Requesting ADB Assistance in Selecting the Consultant .........................................44 J. Monitoring the Consultant Recruitment Process ......................................................44 K. Consulting Contract Management ............................................................................46 L. Complaints ..............................................................................................................47 M. Debriefing ................................................................................................................48 APPENDIXES ...........................................................................................................................49 Appendix 1: List of Guidance Notes ...............................................................................49 Appendix 2: Simplified Flow Chart of the Key Steps for Recruiting Consulting Firms by the EA with an ADB Prior Review Arrangement .......................................................50 Appendix 3: Simplified Flow Chart of the Key Steps for Recruiting Individual Consultants by the EA with an ADB Prior Review Arrangement ..................................................52 1 I. ADB’S PROCUREMENT FRAMEWORK A. Introduction 1. The new ADB procurement framework consists of the ADB Procurement Policy (the Policy), the Procurement Regulations for ADB Borrowers (the Regulations), the Staff Instructions (SI), and associated guidance notes (GN)1. (i) ADB Procurement Policy: Approved by ADB Board of Directors, the Policy specifies ADB’s six core procurement principles and various considerations relevant to their implementation in ADB financed operations. (ii) The Regulations: Approved by ADB Management, the Regulations provide choices for Borrowers to allow them to determine the most appropriate procurement method, specify the rules that must be followed and set out ADB’s procurement due diligence function. (iii) The Staff Instructions: Approved by the Procurement, Portfolio and Financial Management Department (PPFD) these Staff Instructions define the roles and responsibilities of ADB staff in implementing the Policy and Regulations, including the procurement decision authorities and service standards. They also set out the procurement procedures and practices to be applied by ADB Borrowers. (iv) The Guidance Notes: Approved by PPFD provide more details to ADB Borrowers to give best practice advice and assist them in implementing various procurement methods and modalities. B. Scope 2. These SI establish procedures for the Borrower-Administered selection, contracting, and contract management of consulting firms and individual consultants financed in whole or in part by way of an investment loan from ADB, ADB-financed grant, or funds administered by ADB. The SI may be referred to by staff to understand the procurement–related work flow within ADB’s project cycle and related roles and responsibilities of ADB staff to ensure that procurement is carried out in accordance with ADB policies and procedures. These SI do not apply to procurement activities under alternative procurement arrangements (APA) 2. The Project Administration Instructions continue to apply to procurement and recruitment of consulting services under the ADB Procurement Guidelines (2015, as amended from time to time) and ADB Consulting Guidelines (2013, as amended from time to time). 3. These SI are effective for projects or Delegated Technical Assistance with concept papers approved after 1 July 2017, the date on which the Policy and Regulations came into force. ADB and the Borrower may agree to use these SI for projects or Delegated Technical Assistance with concept papers approved before 1 July 2017, otherwise the Guidelines on Use of Consultants by ADB and Its Borrowers (2013) and PAI 2.01 to 2.07 shall be applicable. 1 A list of guidance notes is in Appendix 1. 2 If the use of APA has been permitted under a particular project, a trust-and-verify procurement oversight approach will be applied, whereby ADB may rely on oversight mechanisms of the borrower or those agreed in the applicable financing or other agreements. However, regardless of procurement arrangement, ADB’s Anticorruption Policy (1998, as amended to date) and ADB’s Integrity Principles and Guidelines (2015, as amended from time to time), will apply in all cases. 2 4. These SI do not apply to: (i) the procurement of goods, works and non-consulting services3, (ii) the procurement of ADB Administered Consulting Services4, (iii) results-based or policy-based loans5. C. Structure 5. The SI consists of: (i) Definitions, Principles and Responsibilities (ii) Preparing for Consultant Recruitment (iii) General Procedure for Selecting and Engaging Consultants (iv) Consulting Recruitment by the Executing Agency II. DEFINITIONS, PRINCIPLES AND RESPONSIBILITIES A. Principles 6. ADB’s Procurement Policy sets out six core principles, which are: i. Economy 7. The principle of economy means considering factors such as price, quality, and any nonprice attributes, as appropriate, without adversely affecting the viability of the project. ii. Efficiency 8. The principle of efficiency ensures that procurement processes are proportional to the value and risks of the required outcome and underlying project activities, considering implementation capacity, time constraints, and cost-effectiveness. iii. Fairness 9. The principle of fairness means: (i) equal opportunity for and treatment of eligible bidders; (ii) equitable distribution of rights and obligations between borrowers and bidders; and (iii) credible mechanisms for addressing procurement-related complaints and providing recourse. 10. ADB encourages open competition as the preferred procurement approach, whenever possible, to maximize fairness of the opportunity to bid. 3 Refer to the Staff Instructions – Procurement of Goods, Works and Nonconsulting Services. 4 Refer to Staff Instruction on ADB Administered Consulting Services. 5 For procurement under results-based loans refer to [reference to follow] and for procurement under policy-based loans refer to OM Section D4/BP. 3 iv. Transparency 11. The principle of transparency means ensuring, through appropriate documentation and review of activities in the procurement process, that: (i) relevant procurement information is made publicly available to interested parties, in a consistent and timely manner, through readily accessible and widely available sources at no (or reasonable) cost; (ii) appropriate reporting of procurement activity; and (iii) use of confidentiality provisions in contracts only where justified. v. Quality 12. This principle requires that the procurement arrangements are structured to procure inputs and deliver outputs of appropriate standard in a timely and effective manner to achieve the project outcomes and development objectives, taking into account the context, risk, value, and complexity of procurement. vi. Value for Money 13. This principle enables the borrower to obtain optimal benefits through effective, efficient, and economic use of resources by applying, as appropriate, the Core Procurement Principles and related considerations, which may include life-cycle costs and socioeconomic and environmental development objectives of the borrower. Price alone may not sufficiently represent value for money. 14. Such principles are best served through a competitive process among qualified shortlisted consultants, usually with a selection that is based on the quality and cost of services. 15. ADB permits its Borrowers to recruit consultants promptly and effectively by: (i) providing a range of fit-for-purpose recruitment options; (ii) permitting timely engagement (particularly in emergency situations); (iii) harmonizing procedures with those of the other major multilateral development banks; and (iv) monitoring the recruitment process only where necessary, and permitting post- review (sampling), where appropriate. B. Anticorruption Policy 16. ADB’s Anticorruption Policy (1998, as amended to date) and ADB’s Integrity Principles and Guidelines (2015, as amended from time to time) require that Borrowers, as well as consultants under ADB-financed contracts, observe the highest standard of ethics during the selection process and in execution of such contracts. In pursuance of this policy, in the context of these SI, ADB defines, for the purposes of this provision, the terms set forth below as follows: (i) “corrupt practice” means the offering, giving, receiving, or soliciting, directly or indirectly, anything of value to influence improperly the actions of another party; (ii) “fraudulent practice” means any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a party to obtain a financial or other benefit or to avoid an obligation; 4 (iii) “coercive practice” means impairing or harming, or threatening to impair or harm, directly or indirectly, any party or the property of the party to influence improperly the actions of a party; (iv) “collusive practice” means an arrangement between two or more parties designed to achieve an improper purpose, including influencing improperly the actions of another party; (v) “obstructive practice” means (a) deliberately destroying, falsifying, altering or concealing of evidence material to an ADB investigation; (b) making false statements to investigators in order to materially impede an ADB investigation; (c) failing to comply with requests to provide information, documents or records in connection with an Office of Anticorruption and Integrity (OAI) investigation; (d) threatening, harassing, or intimidating any party to prevent it from disclosing its knowledge of matters relevant to the investigation or from pursuing the investigation; or (e) materially impeding ADB’s contractual rights of audit or access to information; (vi) “integrity violation” is any act which violates ADB’s Anticorruption Policy (1998, as amended to date), including (i) to (v) above and the following: abuse, conflict of interest, violation of ADB sanctions, retaliation against whistleblowers or witnesses, and other violations of ADB’s Anticorruption Policy, including failure to adhere to the highest ethical standard. 17. The Borrower and/or ADB staff, as the case may be, must refer allegations of corrupt, fraudulent, coercive, collusive or obstructive practices, or integrity violations, to the Office of Anticorruption and Integrity (OAI) on a confidential basis. 18. ADB will (i) require the Borrower to reject a proposal for an award if ADB determines that the consultant recommended for the award has directly, or through an agent, committed an integrity violation in competing for the contract in question; (ii) cancel the portion of the financing allocated to a contract if ADB determines at any time that representatives of the Borrower committed an integrity violation during the consultant selection process or the execution of that contract, without the Borrower having taken timely and appropriate action satisfactory to ADB to remedy the situation; (iii) sanction a firm or individual, at any time, in accordance with ADB’s Anticorruption Policy (1998, as amended to date) and ADB’s Integrity Principles and Guidelines (2015, as amended from time to time), including declaring ineligible, either indefinitely or for a stated period of time, such consulting firm, individual, or successor from participation in ADB-financed, ADB-administered or ADB- supported activities or to benefit from an ADB-financed, ADB-administered or ADB-supported contract, financially or otherwise, if ADB at any time determines that the firm or individual has, directly or through an agent, committed in an integrity violation; and (iv) have the right to require that, in consultant selection documentation and in contracts financed by ADB, a provision be included requiring consultants to permit ADB or its representative to inspect their accounts and records and other