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A Review of Business

A study conducted for the World Bank

E-GP – Implementations

Models and Approaches

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 E-GP – Implementations
A Review of Business Models and Approaches

1. Overview

E-procurement systems have become an integral component of procurement reform by

governments around the world as they move to institute competitive and fully transparent
procurement systems, and to address issues of corruption and transparency. This rise in
demand for e-Government Procurement (e-GP) systems has created an innovative
industry of technical products and business arrangements.

To support the development, implementation and operation of e-procurement systems,

governments have undertaken several different business approaches, from complete in-
house solutions to various types of third-party partnerships. Each implementation has its
own set of benefits and business issues associated with it, which directly affect both the
government and the suppliers doing business with the government.

The Bank has been conducting technical assessments of different systems around the
world for government organizations wishing to use its e-procurement system for bank-
funded procurement. These assessments are conducted in accordance with the
Multilateral Development Bank (MDB) e-procurement guidelines, which ensure the
technical integrity of the system and ensure the system supports the functionality, usability
and security requirements of the Bank. While the focus of these assessments has
primarily been on the technical aspects of the system applications and the technical
infrastructure in which they operate, they have also shown that countries use different
business arrangements for e-procurement which could affect the integrity or security of
the system.

In order to better understand the business arrangements required for an effective e-

procurement system and to better support governments looking at different approaches to
the implementation of an e-procurement system, the World Bank undertook a study to
examine the business approaches and practices used by governments around the world
for the execution and operation of their e-procurement systems.

The purpose of the study is to identify the types of business arrangements used by
governments; the benefits of these arrangements; how they may or may not affect the
procurement process; the types of issues or perceived issues that have resulted from the
business approaches applied; the contractual arrangements or policies that have been
drafted to mitigate issues and ensure the integrity and security of the procurement
process; and, the conditions that have been applied to ensure the long-term sustainability
of the e-procurement system, as well as to protect the government and its participating
vendors in the case of a failed business operation or a government opting for a different
solution in the future.

The goal of this study is to continue expanding the World Bank knowledge base on e-
procurement programs, approaches and solutions so that it can continue to assist
organizations with the implementation and management of new and current government
e-procurement initiatives.

2. Rationale for the Study

With the increasing need for and growth of e-procurement solutions, more governments
are undertaking e-procurement programs while others are planning for the future. The
number of technical solutions and business options available is also continuing to rise and,

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in some circumstances, can create significant issues for the future if proper business
arrangements are not made during the initial implementation of the e-procurement system.

Organizations have also come to realize that the implementation of an e-procurement

program is more than a technical project, and that the business model, approach and
practices applied may have more of an affect on the success and integrity the e-GP
system than the technical features of the application itself.

It is important for the Bank to continue to expand its knowledge base of e-procurement
solutions in order to ensure that current and future governments can institute appropriate
solutions and business practices for their e-procurement programs, whether they opt for
in-house solutions or enter into relationships with service providers.

3. Study Description

This study examines four common business models used to support e-procurement
implementations, using four separate countries as examples of each: Shared Services
(Canada); Public Private Partnership (India); Government Owned and Operated
(Singapore); and, Government Managed Service (Philippines). The primary focus is on the
business policies and practices surrounding these systems, and how those policies and
practices affect their integrity, operation and security. The examination looks at:

 The business model applied to support the implementation and on-going

operation of the e-GP system.

 The relationships between the government and its service provider, the
government and its suppliers, and the service provider and suppliers, and
whether or not the defined relationships present any issues to the procurement
process including liabilities, penalties, privacy, security, data rights and terms of
use.

 Ownership or rights to the system application, hardware and required

infrastructure, including what happens in the event of a failure by the service
provider to continue with service delivery of the e-procurement platform or, at the
end of a stated contract period, to ensure continuity of the service.

 The terms and conditions related to the ownership and privacy of any information
recorded in the system, including but not limited to user registration information,
bid notices, bid queries and associated bidding documents, bid submissions by
suppliers, user log data and additional information recorded by the system.

 Fees applied to the use of the system or participation in a bidding process,

whether any payment information is stored in the system, who has access to that
payment information, reasons for the fees (cost recovery, profitability, support),
and who controls application of the fees.

 Security processes for the e-GP system, in particular any procedures associated
with the bid submission process (if applicable) and how those procedures ensure
the integrity of the system.

 Reporting and monitoring facilities that allow governments or independent bodies

to audit the procurement process, as well as the integrity and security of the e-GP
system.

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The underlying objective of the study is to produce a best practice case study of the
different approaches for supporting an e-GP system in order to help the MDB expand its
knowledge base and to continue its support of governments in their on-going
implementation and management of e-procurement programs. By doing so, the World
Bank will help to ensure that e-GP programs maintain and deliver the integrity and
security that is expected, and that governments around the world can properly protect
their own long-term interests, as well as the interests of their suppliers, when developing
and operating e-procurement programs.

4. Common Business Approaches

The implementation and on-going support of an e-Government Procurement program can

reflect a significant investment by government. Unlike the manual process, which is
normally managed by individual government organizations and where the associated
costs typically relate to newspaper advertisements and copies of bid documents, the e-GP
system represents an enhanced service operation supporting many government
organizations and their vendors who become reliant on the system for timely access to
information required to conduct business. Though the government can realize significant
savings in advertising and bid document expenses, new costs are incurred with the
development of and support of the system and its users.

A number of governments may not have access to the initial investment required to
implement a system, nor may they have the necessary expertise or resources to support
the development and operation of a service. Most governments that have undertaken the
implementation of an e-GP system have come to realize that implementation of the
system is more than just a short-term information and communication technology (ICT)
project. Rather, the development of an e-GP system reflects a re-engineered business
process to meet new policy objectives for a more open, efficient, effective and transparent
procurement environment for government. The implementation of the e-GP system is
normally associated with the institution of procurement reforms across the government,
and supported by a comprehensive information management system that enables future
data mining and auditing of the procurement process.

The scale and scope of the envisioned system can become a significant development
project, creating different levels of risk and cost for the government to ensure its successful
implementation, operation and support. Many systems require an investment of millions of
dollars and the allocation of 30 to 40 technical resources to support on-going operation.

The most common approaches used by governments for the implementation of their e-
procurement platforms include:

 Shared Service – A third-party e-procurement service that is fully managed,

owned and operated by the third party and used by one or more governments
and their suppliers.

 Public Private Partnership (PPP) – A government e-procurement solution that

is managed, owned and operated by a third-party service provider, often with the
intent to transfer the platform back to the government in the future.

 Government Owned and Operated – A government developed and operated e-

procurement solution that may or may not have been delivered by third-party
partners.

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 Government Managed Service – A government managed e-procurement

solution that is operated and owned by a third-party partner.

The choice of business model is associated with the amount of risk and cost a
government organization is willing to undertake when implementing its e-Government
Procurement program. Governments must recognize that e-procurement involves more
than just the technical development and implementation of applications and infrastructure,
it also involves the business services required to support on-going development activities
and to build customer relationships.

The e-GP program often becomes a critical part of government service operations,
supporting the procurement and delivery of goods, services and works projects required
to sustain the government. The systems also contain important information for monitoring
and auditing government purchases, as well as private and confidential information on
participating vendors, procurement initiatives, responses to bids, and in many cases,
payment information. Nevertheless, it is important to note that e-procurement systems
fundamentally provide a service to support the exchange of information and therefore
remain independent of the procurement process itself. A certain level of security is
required in order to ensure the integrity, transparency and privacy of the e-procurement
system, but the actual procurement process is protected by the procuring authority.

The involvement of third parties in the delivery and support of an e-GP program creates a
variety of new business relationships between the service providers, governments and
suppliers that did not exist previously with manual procurement systems. Therefore, a
government needs to ensure any ensuing relationships and associated business
practices are protected, and that they support the interest of the participating parties.

This study will review the experiences of four countries who have implemented their e-GP
programs, each one representing one of the four common approaches.

5. Summary

The reviews of the different e-GP solutions for Canada, Singapore, the Philippines and the
State of Karnataka uncover a number of variations in business approach and system
implementation strategies. The common principles for an e-procurement system,
however, remain the same: transparency, efficiency and the establishment of a more
open and competitive environment for government procurement.

Over the years, e-GP solutions have evolved to the point where the technical system can
almost be viewed as a commodity, allowing any level of government to take advantage of
its benefits. The real challenge lies in understanding that e-procurement is an on-going
business operation that requires support throughout its entire life-cycle, from the initial re-
engineering of a manual process into an electronic one, to the development of an
integrated procurement environment. The key element for success of the system
therefore resides with the business operation of the service and not just its technical
features. The full benefit comes from increased competition due to a broader supplier base
that generates more competitive pricing.

The choice of a business model to support a government’s long-term planning boils down
to the level of commitment and risk a government is willing to take when providing e-
procurement services. Whether it decides to absorb all of the costs and risks – as in the
case of a Government Owned model – or to outsource to a third party – as in the case of
the other three models – will depend on several operational and business considerations.

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The business model and system approach should reflect the individual needs, capacity
and situation of the government.

Country Canada Singapore Philippines GoK, India

Comparison
rd rd
3 party owned and Govt owned and Govt managed, 3 PPP, Govt Managed
operated on behalf managed party service in partnership with
Business of multiple govt orgs. provider
rd
3 party
Model

Self funding thru Primarily funded thru Funded by govt. Funded through
user fees; GOC transaction fees to transaction fees for
Funding Model subsidizes access to govt dept. Free access to govt bid submission fees
federal information. users and vendor based on est.
Initial registration community. contract value (500
User subscription free to vendors; fees rupees – 7500
fees ~$200/yr for additional Plans to introduce
fees in the future. rupees; $10 - $150
accounts. USD)
Govt licenses Internal govt to govt Service contract with Service contract with
rd rd rd
information to 3 service contract 3 for provision of 3 party for provision
Basis of party provider system, of system including
contract with infrastructure and all supporting
service support for fixed software and
service fee. hardware supporting
provider delivery of system,
development
support and support
services under a
revenue sharing
agreement. Govt
provides facilities for
support and data
centre.
Service operated at Primarily funded Service contract is Govt funds its
no cost to govt; through inter- approx. P50M portion of support
Cost to Govt. however GOC has government service ($1Million USD) per operations with a
opted to subsidize fees year. budget of 10 Crores
cost for access to ($2Million USD) plus
federal opportunities Govt also operates the cost of the data
and funds centre and
PHilGEPS support bandwidth cost.
office.
18 months, approx System has evolved Initial pilot was Initial development
50 resources for since initial launch running within 6 and implementation
Cost / Time to development and starting with a months, current took over 1 year with
implement support the simple web portal for system took over 1 a team of over 40
migration of 20000 the advertisement of year to implement resources.
users. Represented tenders. Initial time with a team over Development
nd
2 release of the and cost were kept 30+ resources. continues.
system. Investment to a minimum.
> $5M
The MERX Gebiz has a staffing The Govt PhilGEPS The govt has
operations involve of approximately 35 office has about 25 approximately 20
Resources approximately 40+ resources resources resources
supporting resources dedicated supporting the supporting the supporting the
operations to the service operation, administration, administration and
operation including a management and support, training and management of the
help desk. on-going product planning. service operation.
development of the
GOC operates their system and support The service provider The Service
own call centre for activities has about 20 Provider has about
inquiries related to resources allocated 40 resources
individual to the operational allocated to on-going
procurement and support, training, support,

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coordinates supplier management and management,

development on-going development and
programs. development deployment of the
activities service operation.
Original system Gebiz launched in PhilGEPS pilot Eproc launched late
launched in 1991. 2001 launched in 2001; 2007.
In operation Current Merx current system in
since system in operation production since
since 1997 Aug 2006.

Participating 50,000+ 39,000+ 40,000+ 2000+.

Vendors

8 provincial govts, 40,000+

39,000+ 2000+
Participating federal govt, and 7500 national and
Govt Orgs 4500 other orgs. 5000 30 govt dept.
local govt orgs

For the Philippines and the Government of Karnataka, the choice of a third-party system
had to do with mitigating the risk that would be associated with the development,
management and operation of an e-procurement system. Each government, however,
followed a different business relationship with its service provider.

In the Philippines, the government was looking for a technical service partner and wanted
to establish a service agreement for the development and delivery of the backend system.
The service provider is the technical delivery partner, providing all services required for the
development and delivery of the system. The service provider has ownership of the
physical application and infrastructure; however, the Philippine Government retains
ownership over the market brand, PhilGEPS, the URL, all data in the system and the
overall business service operation. The government retains responsibility for all users of
the system, as well as users who enter into a contractual relation with the government.
This approach allows the government to mitigate the risk associated with the development
and operation of the system, while also mitigating some of the financial risk for the service
partner who receives a monthly fee in return for use of the system environment. The
Philippine government has made a significant investment over the years in the
development of the PhilGEPS operation, including office space and support staff required
to support the system, but in the long term it maintains control of the business operation
and can opt to acquire the current platform at the end of the contract period. It may also
consider an alternate solution if, in the future, new technologies and processes can
provide a more effective option for servicing its customers.

Going forward, the Philippine Government plans to introduce service fees to make
PhilGEPS a self-funding operation. Its first objective, however, is to integrate the system
within all government organizations and suppliers in order to establish PhilGEPS as the
national procurement portal. The government believes that user fees may impede
adoption of the system, and is therefore waiting until there is a significant volume of
procurement opportunities to demonstrate its value before instituting fees. Over the last
five years, PhilGEPS has grown to over 39,000 vendors and 6,500 participating
government agencies.

The Government of Karnataka (GoK) opted for a Public Private Partnership, outsourcing
both the system development and operational support service of its e-procurement system
to its service partner. The PPP is based on a self-funding model under which the service

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partner recovers its investment and operational cost from transaction fees generated
through system activity, mostly related to bid response fees. In essence, the GoK
transferred the risk for both the development and operational cost to the service provider,
yet retains ownership and control over the system and business operation. The e-
procurement system is presented as a government-operated system and users enter into
an agreement with the government, paying any required fees directly to the government.
The government then pays the service provider from the fees collected and helps to
subsidize part of the operational cost by hosting the system in a government data centre.
The government also provides overall management for the service operation through a
small management team that works directly with the service provider to deal with any
operational issues that occur and to participate in the long-term planning for the system.
At the end of the agreement, the Government has the right to acquire the system from the
service provider and either continue to provide the service itself, or retain the service
provider to supporting its on-going operation and development.

Under the PPP, the service provider assumes significantly more risk in relation to cost
recovery since there are no guarantees about the volume of activity that may or may not
occur on the system, and yet the revenue stream is tied to the submission of bids. The
service provider therefore has a significant vested interest in helping the government to
build a large supplier base in order to generate more competition in the government
procurement process. The GoK e-procurement system is still in its initial stages of
deployment and has only been in operation for 18 months. Currently, the system has
about 2,000 contractors and is supporting 25 agencies.

In Canada, the choice of a third-party service offering had more to do with bringing
together multiple independent jurisdictions into one national portal. Though each
jurisdiction had the means to establish its own system, they believed an independent
service provider would be better suited to support to their collective objectives than a
government-run service. The overall objective was to establish transparency across the
country, and to promote and support open and unrestrictive access to all government
opportunities, regardless of vendor jurisdiction. To support a third-party business
operation, the participating provincial governments and the federal government provided
the service provider with a sole non-exclusive licence agreement for the distribution and
sale of government procurement information to the supplier community, thus providing a
captive user base for the information.

The service provider is responsible for all aspects of service delivery, from system
development and operation to customer support and billing for services. The service
provider also provides a full bid distribution service that supports delivery of not only
electronic bid documents from the government, but also hardcopy bid documents. The
current service also supports a virtual plan room which allows governments to post and
distribute full sets of blue print specifications. The non-exclusive licence agreement for
access to all government procurement information guarantees the necessary business
volumes required for a service provider to establish and support a self-funding operation.
The service provider owns and operates the service at no cost to the government;
however, each jurisdiction retains full control and ownership over its data as per the terms
of the licence agreement.

The licence approach has served Canada well as it has managed to offer an e-GP system
for the past 19 years at virtually no cost to itself. The governments have also incurred
significant cost savings from the reduction of newspaper advertising costs and unloading
of distribution costs for hardcopy bids. Canada has tendered its e-GP service agreement
three times since its inception, switching service providers once with the incumbent
winning the last tender. On each occasion, Canada has received more than four

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competitive bid responses to provide its e-GP system. The current MERX system provides
a competitive marketplace of over 50,000 vendors accessing more than 20,000 tenders
each year – a substantial increase in the number of active vendors participating in
government procurement when compared to the previous manual system.

In Singapore, where the government had the in-house technical capabilities and resources
to develop and maintain its own e-procurement system, a government owned and
operated system made the most sense. Even though the system is owned and controlled
by the government, the DSTA (the operating agency for the system) operates the service
as an independent business service offering which is fully self-funded through the
application of service fees. Users, both government and vendor, enter into an agreement
with DSTA to use the system. Similar to the third-party service providers under the other
three approaches, the DSTA provides all of the necessary technical services to support
the operation and development of the system as well as help desk and management
services to support users and to continue building the online marketplace. To better
support its customer base, the DSTA continues to plan and develop new features and
functions for the system as the product evolves. The current GeBiz system has been
operational since 2001 and currently supports over 10,000 government buyers and 39,000
contractors.

Conclusion

Each of the countries referenced in this report has been clear in the definition of its service
offering, which is simply to offer a service to support the procurement process, not
necessarily to govern the procurement process itself. The e-procurement systems claim
no responsibility in the actual procurement process as the procurement remains the
responsibility of the procuring entity, and any awards granted through the system
represent a contractual relationship between the vendor and the procuring entity. The
primary function of the systems is to serve as a gateway between government buyers and
their vendor communities. All four services profiled in this report have established well-
defined terms of use agreements to clarify their role in the procurement process and to
protect themselves from potential claims or liabilities related to use of the system. At the
same time, they all claim full ownership and copyright over the information presented in
their systems.

Each of the countries has established proper business operations to support its respective
e-GP system, with each requiring an average of 30 to 40 resources for service operations
including management, customer care, operations and on-going development. Each
system is set-up to run as an independent service offering supporting a broad user group,
either as a country-wide system or, as in the case of the Government of Karnataka, a
state-wide system. The larger the region, the better the opportunity for establishing a
broad user base, which is required to ensure long-term success and sustainability. It can
also be assumed that a broader implementation – either at a national or state level – will
be more effective in establishing transparency, implementing procurement reform,
leveraging costs, creating monitoring and reporting functions, and generating efficiencies.

The implementation of an e-procurement system can require significant investment and

upfront capital cost depending on its size and scope, and the functions or customizations
that may be required. Most of the systems reviewed were developed over time and have
evolved as their requirements changed. Initial implementations typically take one to two
years to get up and running, including the scoping of requirements, development and
implementation. During this stage, consideration needs to be given to security processes
and to ensuring the system can adequately support forecasted user loads and storage

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requirements. The system implementation must also take into account operational
procedures to protect against system failures or disasters that may occur. As the system
becomes more integrated with the various processes associated with procurement, such
as delivery, bid submission and payment, the more critical it will become to the
government and its vendor community, requiring a higher level of service.

In addition to the technical implementation of the system itself, there is also the
deployment and support of the system across the participating government agencies and
their vendors to consider. Much like the advertisement of tenders in newspaper, the
implementation of a new system will require significant promotion through a
comprehensive communication plan. Depending on the level of integration of the e-GP
system into the procurement process, there may also be a need to train and support users
as they migrate to the electronic environment. In many developing countries, and some
developed countries, the support and training of users can be a very significant task as
targeted users may not have the technical skills or even the Internet access to make
effective use of the new system.

System implementation issues need to be considered with the understanding that roughly
half of the required investment will be for training, which will be necessary regardless of
who owns the resulting e-GP system – especially in environments where there may be a
large disparity between the technical skill sets of the target users and the infrastructure
used to connect users to the system.

Whoever takes ownership for developing and maintaining the e-procurement system
needs to have the capacity and resources to manage failure; for example, if the system is
a year late in being delivered or projected revenue models are slow to materialize, the
carrying costs for the system can be significant. The party assuming the risk must be
prepared and capable of carrying those costs and accepting a delay in return on
investment.

When choosing an e-procurement model, the highest risk issue facing a government is in
relation to its capacity to manage and implement the software application and its
underlying infrastructure. The software required to run an e-procurement system can
become especially complex, leading to the possibility of evolving costs over time, delays in
the delivery of the system and downtime due to unplanned system failures. The use of a
third party with the necessary skills and expertise can help to alleviate the risk associated
with the management and retention of resources, as well as the ever-evolving changes in
technology.

Another significant problem for government is the risk management involved in extracting
itself from a provider if, at a subsequent date, the relationship becomes too expensive or
service levels are unsatisfactory. When a third-party developer has created the software,
and has been responsible for its management, this problem can be quite severe.
Regardless of any contractual arrangements, it would be impractical to assume that a new
service provider could conceivably take over from its predecessor while ensuring business
continuity. It would take time to gain familiarity with software coding and systems, and
there would be little incentive for the outgoing provider to assist. The prospect of
government procurement being offline for days or weeks, and the political and financial
fallout that would ensue, would be particularly unattractive.

Regardless of the model followed for system administration, data ownership should
always remain with the government. This is necessary in order to ensure the sanctity of
the procurement data and the on-going operation of the system in case of significant
failure by the provider. The ownership of the data is the most critical issue due to the fact

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that the technology will always change and evolve, yet the data will basically stay the
same. In cases where the system administration is outsourced to a service provider,
sufficient security systems need to be in place to ensure that the database administrator
does not have read/write/modify access to sensitive data.

Another related issue is that of the Intellectual Property Rights (IPR) of the e-GP system
software. Since e-GP implementations can be supported by Customized Off-the-Shelf
(COTS) packages, it may not be possible for a government to actually claim ownership of
the IPR for its entire solution. In such cases, the IPR for any software product or solution
held by the service provider, as on the date of agreement with the government, would
continue to vest with the service provider. However, the IPR for the processes, software,
applications and components developed specifically for the project, would remain vested
with the government. In cases where custom development of the e-GP system is
undertaken, the IPR of the custom-developed software remains with the government.

In the case of custom development, governments maintain complete ownership of the

source code for the e-GP system software. In PPP models, there should be a provision to
keep the source code in an escrow account to mitigate the risk of a service provider being
liquidated. This ensures business continuity to the government when adopting a new PPP
model. The onus of maintaining the same version of source code in the escrow account as
that of the code running in the application rests with the vendor. It will be up to the
government to put third-party mechanisms in place to oversee this process.

Typically, government contracts for the implementation and on-going support of an e-

procurement system range from five to seven years in length. While this may seem like a
long period, the reality is that by the time the system is up and running smoothly, it will
most likely be time to re-tender. It’s therefore crucial that governments entering into third-
party agreements for the operation of their procurement system consider this upfront. The
original contract should contain a well-documented transition plan to ensure the
government will have the option to acquire the system and software at the end of the
contract, as well as to extend the service portion of the contract or facilitate a contract
renewal to minimize the expense of a full procurement process. If the plan is to re-tender
the e-procurement system, the tendering process needs to start almost as soon as the first
contract is signed in order to ensure that there will be adequate time to plan and conduct
the bidding process, as well as to give the incumbent time to put a new system in place
before the contract expires. Canada learned this firsthand when transitioning from OBS to
MERX. When tendering a third time, the Canadian government took those transition costs
and challenges into account.

One of the most important contractual considerations is ownership of the URL supporting
the e-procurement system. By owning the URL, a government relieves itself of the burden
of transitioning to a new one in the event that it changes third-party providers. As long as
users maintain the same user ID and log-on procedure, they will continue to use the
service even if changes are made behind the scenes.

It should also be noted that the true value that a government receives from e-procurement
is in the size of its on-line marketplace. Building that user base doesn’t happen overnight.
It requires a lot of effort in the promotion, marketing and delivery of an e-procurement
system that encourages vendors to participate.

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6. CANADA: A Shared Services Approach

Canada is an example of a third-party e-procurement service that is fully managed, owned

and operated by a third party, and used by one or more governments and their suppliers.
The federal government manages the relationship with the third-party service provider
responsible for the system, while each provincial jurisdiction has the flexibility to run
additional services, or to build onto the main licensing agreement.

The choice of a shared service using a third-party provider originated in Canada’s vision of
establishing a national government procurement portal for federal, provincial and local
governments.

Canada operates with a federal government accompanied by independent provincial and

territorial governments, each of which has its own legislations and regulations governing
procurement. All levels of government work together through an Internal Trade Secretariat
to promote and co-ordinate procurement rules and to trade between their respective
jurisdictions. Due to the differing natures of the organizations, the respective governments
decided that individual procurement interests would be better served using an
independent party capable of addressing the needs of each organization versus a platform
developed and managed by one of the government entities.

The different levels of Canadian government recognized that the implementation of a

system was not a technical issue as much as it was a business issue. Each government
had the resources to undertake the implementation of its own system, but collectively they
also recognized the need for a common portal to ensure the most benefit for the
participating parties – both governments and the vendor community – and to provide
transparency across all jurisdictions.

The two main considerations for the implementation of a national procurement portal were:
how to fund such an undertaking; and, how to address and support the various interests of
multiple government organizations participating in one service. The choice at the time was
to establish a self-funding system at no cost to the participating governments.

The Government of Canada (GoC) initiated the implementation of the first service in 1991
with the development of the Open Bidding Service. This initial foray into e-tendering was
one of the first introductions of a user-pay system for access to government opportunities.
Though there were some early complaints from some groups and vendors, the value-
added proposition offered by the electronic service offering more than compensated users
for any costs incurred.

The selection of a service provider was completed through an open competitive tender
process by which the government issued draft Request for Proposal (RFP) documents to
solicit feedback on the approach that should be taken to deliver its e-procurement
program. This gave the industry time to develop business strategies and relationships to
support the delivery of the service. The primary evaluation criteria was to ensure the
successful organization had the technical and financial capacity, experience and know-
how to support a customer-driven and funded service offering, at the best value to end-
users paying for the service and at no cost to the government.

The success of the initial service offering paved the way for participation by the other
provincial jurisdictions. The initial service provider had a five-year contract with options for
annual extensions. At the end of the initial contract period, the participating governments
formed a joint committee to conduct the procurement for the next incarnation of the e-

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tendering program that would be a joint initiative by all jurisdictions in Canada. The second
program led to the development and implementation of the current MERX service in 1997.
The contract for the government procurement was tendered again in 2004. The latest
contract was won by the incumbent service provider, although the participating
governments did receive a number of very competitive bids for the delivery of the current
service offering.

Many of the larger participating governments also run their own internal procurement
management systems using either common ERP systems such as SAP, Peoplesoft or
Oracle, or their own internal systems to support internal workflows, approvals and controls
on their respective procurement processes. These organizations manage their
procurement internally and exchange data with the MERX service provider in order to post
opportunities and bid documents to the vendor community. The federal government also
manages additional e-procurement services for small dollar contracts (less than $25,000)
and operates a Contracts Canada website for the purpose of providing general information
about conducting business with Canada, including links to the MERX system for federal
opportunities.

The shared service approach adopted by Canada has allowed it to participate in electronic
procurement for the past 19 years, at essentially no cost or investment required for system
development or implementation.

(a) System Overview

Today, MERX operates as Canada’s national e-tendering portal supporting the federal
government, eight provincial jurisdictions, thousands of cities, universities, hospitals, and
over 50,000 vendors. The third-party service provider responsible for delivering MERX is
Mediagrif Interactive Technologies Inc., which has been operating since 1997 at
www.merx.com. Through MERX, roughly 4,500 registered government agencies
process an average of 20,000 to 25,000 opportunities each year. On average, 600
users visit the site each hour.

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MERX is a fully Internet-based application that allows both government buyers and their
suppliers to conduct all activity over the Internet. It provides governments with a full tender
management system that allows them to create, publish and update procurement
opportunities, as well as publish notices following the awarding of a contract. MERX
provides governments with a full audit trail of all activity on a given opportunity, including
the history of the notice and any associated documents, the recording of all documents
delivered to suppliers, and any subsequent amendments issued by the government buyer
for the opportunity. The system also provides a series of activity reports so that
governments can monitor their own activity as well as the cross-jurisdictional trade
occurring within the system.

To ensure the MERX system is open to as many suppliers as possible, they are able to
register online with minimal information requirements. Suppliers can also establish a bid
match profile that enables them to be automatically notified of any new opportunity
matching their profile. Suppliers can download bid documents and respond electronically
when the electronic submission option is enabled by the buyer.

MERX also includes a number of special interfaces that support information exchange
between internal government systems used for the creation and management of a
procurement request, including management systems or enterprise resource planning
(ERP) systems. In such cases, MERX serves as the communication medium between the
supplier community and the government organization when opportunities become active,
while individual government buyers use their own internal systems to update and publish
any new information as opposed to using the available MERX web interfaces.

In addition to the online system, MERX also provides governments with a bid distribution
centre to print and distribute physical copies of tender documents when requested by

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suppliers. Bid documents can be sent by courier, fax or e-mail, or a supplier may pick up
bid packages at the bid distribution centre. The bid distribution centre also provides quality
assurance services to ensure all bid documents are associated with the correct notice
before the notice is published. This serves to minimize any errors with the information
published in the system.

The bid receiving system in MERX is available to assist participating governments in

recording the receipt of bids submitted by suppliers. It prints time-stamped receipts to
recognize the receipt of a bid and synchronizes with the main MERX system to
incorporate the bid receipt information with the bid distribution list.

MERX also includes a virtual plan room to provide online access to the full set of plans for
civil works projects. Users can browse the individual drawings, requesting only those that
they require to respond to a given request.

Each participating government enters into its own individual service agreement with
MERX and elects to use the features and functions it requires or wishes to apply in their
procurement process. For most participating government organizations, the applied
features of MERX relate to electronic tendering which supports the advertising and
distribution of bid documents. At the present time, most participating governments do not
accept electronic bid submissions through the MERX service. The government tend to
request a manual submission to be presented to the designated bid submission location
as most of the government procurement policies and associated rules and regulations
relating to the acceptance of electronic bid submissions and the recognition of electronic
signatures are not in place at this time.

MERX is also open to private sector buyers to advertise and distribute documents and
includes sections for private construction and private opportunities for goods and services.
Accesses to private opportunities require additional subscriptions for participating
suppliers. Many private sector buyers take advantage of the MERX electronic bid
submission functions and fully encourage participating suppliers to respond electronically.

(b) Business Model

The MERX service operates under a licensing agreement whereby the federal and
provincial governments grant MERX a sole non-exclusive licence to publish and
redistribute government procurement information, establishing MERX as the central
government procurement portal. To ensure use of the MERX service, most participating
government organizations require suppliers to be registered users of MERX and to acquire
any associated bid documents from MERX. Suppliers who are not included in a MERX
document distribution list for a given opportunity may be deemed as non-compliant by the
government.

In return for the sole non-exclusive licence to government procurement information,

MERX provides all of the necessary hardware, software, network infrastructure,
bandwidth, and secure facilities for both a production and backup operation. It also
supplies customer support services, account management, and bid distribution facilities
for both electronic and non-electronic distribution, including on-demand printing of bid
documents or blueprints, courier services and order management facilities to track the
distribution of items requested from the service. All of this is provided at essentially no
cost to the participating governments. The only costs incurred by a government would be
for special requested services such as hardcopy versions of documents or to subsidize
the cost of any items to end-users.

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Though the main business model for the service is still based on a user-pay program, the
service agreement contains options for participating jurisdictions to subsidize the cost of
the service so that the information is available at no cost to the supplier community. The
federal government has since elected to subsidize the cost for delivery of the electronic
version of its information on the system.

The Government of Canada serves as the primary contract manager of the MERX
service and as such, establishes the general framework for the governing licence
agreement used by each jurisdiction. Each jurisdiction has the option to negotiate
separate agreements to support any individual requirements they may have; however, all
agreements have the same term arrangements, allowing them to terminate at the same
time should there be any change in service providers at the end of the contract term.

The individual governments also retain the rights to publish and distribute their own
information on their own websites, which most organizations have, and they may also
issue a licence to another third party if they desire to include information on another site.

For the majority of participating jurisdictions, MERX serves as the official site for
procurement information. Even those jurisdictions which have set up their own
procurement portals will advertise on the MERX service in order to reach a wider supplier
marketplace and generate a more competitive response.

MERX also supports Canada’s commitment under international trade agreements with
respect to the North America Free Trade Agreement (NAFTA), the World Trade
Organization (WTO) and others, whereby MERX represents Canada’s official publication
of tender notices and each tender will identify whether it falls under a specific trade
agreement and is opened to international bidders.

At the end of the contract, the licence agreement may be revoked and all government
information must be returned to the government. This would also include any information
collected by the third party in relation to the delivery of the government information, such
as transaction log records that may have been recorded and subscriber information
pertaining to vendors accessing the government information, but would not include any
billing or account information applying to charges incurred by users. The third party would
retain rights to keep and use any information collected in the system such as subscriber
information and transaction logs, excluding data collected from a subscriber specifically
relating to a transaction with the government such as requesting bid documents or, if
applicable, the submission of a bid response.

Funding Model

MERX was originally established as a self-funding service operation with no cost to

participating governments. All funding was to be generated through the application of user
fees for subscription services, bid matching services, bid documents fees, and fees for the
automatically delivery of any amendments. Suppliers had to the option of fees for one
time use or annual subscriptions of about $200 CDN per year. The current subscription
pricing is included in Annex 1 – Canada – MERX Pricing.

Fees associated with access to government information and associated documents are
governed by the terms of the licence agreement entered into between the participating
government organization and MERX, and are set for the term of the agreement. One of
the key criteria for selecting a service provider was based on the proposed pricing models
and which model offered the best value to the supplier committee in terms of cost and
value added services.

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Changes to fees, though possible, require approval of the participating government

organizations in relation to how a proposed change would affect the information they
distribute through the service. The government also retains the right to audit all
operational costs in order to validate changes to the fee structures. The government
wants to ensure that a service provider makes a reasonable return on investment as a
way to ensure the ongoing viability and sustainability of a service-level operation. It also
aims to ensure all users are receiving full value for the services offered.

MERX has introduced a number of value added services for suppliers over the years
including access to U.S. Tenders, Private Tenders and Private Construction. Suppliers
can use MERX for their own procurement in order to benefit from the large marketplace
currently servicing the governments.

A few years ago, the federal government elected to accept an option to subsidize the cost
of the MERX service so that access to federal government opportunities and the electronic
versions of associated bid documents would be free of charge. This change was a
political decision by the federal government and MERX is now paid an annual service fee
by the government to support the service delivery of federal government information.
Provincial jurisdictions still operate on a user-pay system for access to their opportunities.

All revenues generated by MERX remain with the service provider. The government
license agreement does not have any requirements for revenue sharing regardless of how
big the subscriber base may become. The government felt that any revenue sharing they
may require would only increase the cost for the participating suppliers and the overall
objective is to keep service fees to the supplier community to a minimum which is one of
the reasons the Government of Canada elected to subsidize the cost for accessing federal
government information.

(c) Business Relationships

The use of MERX in Canada creates different business relationships between the
participating parties.

The primary business relationships are between MERX and the federal government, and
MERX and the participating provincial governments which govern the use of the system
by organizations within their jurisdictions through a licensing agreement with MERX to re-
distribute and sell government procurement information.

Governments

MERX

Suppliers Buyers

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Though each government will have an overriding licence agreement, the individual buyer
organizations, such as specific departments, the Crown Corporation, a city or other public
organization, will enter into an agreement with MERX through the acceptance of terms of
use agreements initiated when they register with the service. The terms of use set forth
the individual organization’s roles and responsibility pertaining to their use of the service,
and clarify MERX’s responsibility for delivery of the service.

Participating suppliers enter into an agreement with the MERX service provider to access
and use the system, and to pay for any costs incurred from their use of the system. The
end-user is fully responsible for all costs incurred on the system and must provide valid
credit card information at the time of registration in order to access the service. During
registration, each supplier must accept the terms of use of the system before proceeding
with the registration. The terms of use are deemed legally binding upon online acceptance
and use of the service. The terms of use define MERX’s role in the delivery of the service
and set forth that MERX will not be liable for any cost or losses that may be incurred by a
supplier when using the MERX service, and that the supplier shall indemnify MERX from
any action brought forth to a supplier.

The use of MERX does not, in and of itself, establish a contractual relationship between a
supplier and a government buying organization. A contractual relationship is established
when the supplier responds to and wins a procurement opportunity that was published on
MERX. MERX has no involvement in this process; the system is only used to publish
award information. Liabilities and indemnification clauses contained in the Terms and
Conditions for the use of MERX essentially absolve the service provider from any liability
that may occur as a result of their use of the system.

However, MERX does have policies in place in relation to claims against user fees
incurred in error. Most fees are low value. Therefore, it is considered easier to simply credit
the transaction. When fees are incurred by users in the case of cancelled bids by the
government, any refunds would be at the expense of the organization that cancelled the
bid.

(d) Operation

In Canada, the MERX service provider is fully responsible for the development and
implementation of the MERX platform, as well as the on-going operation and
maintenance of the system and facilities. However, no changes may be made to the
MERX service without prior approval by the federal government. The government and the
MERX management team meet on a regular basis to discuss the application and plan
any changes. Changes to the system that affect the federal or other governments, must
be reviewed, approved and accepted by the government before being migrated to the
production environment.

MERX maintains the right and ability to develop and offer other service offerings to users
that do not affect government service delivery. Over the years, MERX has been
expanded to include private tenders, U.S, tenders, as well as white label services for other
organizations and governments. MERX provided the backend service offering for the
initial pilot system for the Government of the Philippines, before the Philippine government
undertook its own initiative to develop a system.

In Canada, the third party operates the service under a service level agreement (SLA)
which requires a 99 percent up-time over a 30-day period. In the event that service is not
maintained, the main penalty that the government could apply would be the issuance of a

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licence to another provider to create a secondary service environment. Due to the nature
of the licence agreement, the participating governments have a variety of options for the
continuation of their e-procurement programs including developing their own system or
providing the information to a secondary source.

In addition to the online service offering, MERX also operates a bid distribution centre
which conducts quality assurance on all bid documents to be distributed through the
service to ensure the correct documents are associated with the correct bid notice before
the notice is published and provides print on demand services to distribute physical copies
of documents requested by users. Though the majority of bid documents are submitted
electronically, government buyers may also submit original bid documents in a hardcopy
form to the distribution centre where the documents will be digitized and made available
for download or print distribution. All document distribution is performed within hours of a
document request and shipped for next day delivery to any city in Canada. The MERX
system also supports a virtual plan room that allows government to upload a complete set
of blue prints for a project and allows contractors to preview the specifications online and
download or request a print copy of only the specifications they require versus the full set
of plans.

The bid distribution function of MERX provides the Government of Canada with one of its
biggest savings when compared to manual procurement practices, which used to involve
sending out physical copies of bid documents to multiple vendors interested in
participating in a particular bid. In the initial years of operation, the federal government
realized annual savings of $6 million in photocopying and shipping charges as these fees
were passed onto interested suppliers.

MERX is responsible for any increase in operating cost without receiving compensation
from the government. If a cost adjustment is proposed to cover such an increase, the
government retains the right to a cost audit under which the service provider would be
required to validate the cost before any increase would be allowed. Adjusting prices within
the current agreement would prove challenging as there are a number of participating
governments in the system who may each be affected by any price adjustment.

MERX and the individual government jurisdictions work together in the marketing and
promotion of the MERX service, as all parties have much to gain from a broader supplier
base. For the service provider, a larger supplier base provides additional revenue growth
and for the governments, a larger supplier base provides for a more competitive
procurement process that creates the best value to government.

MERX currently supports an active supplier base of over 50,000 suppliers and more than
15,000 government buyers from over 5,000 government and private buying organizations.
At present, the MERX service is supported five web servers serving over a 1,000
concurrent users during peak business hours.

(i) Bid Response

Though the feature is not currently used by the Government of Canada, MERX does
support the electronic submission of bid documents. The choice to accept electronic
submissions is at the option of the originating buyer who may select electronic
submissions as mandatory, optional or manual submission only. If optional, the vendor
would have the option to respond electronically or manually.

To support electronic submissions, the buying organization creates a list of items the
supplier must provide to complete bid response as part of the original notice creation

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process. Any forms to be completed, including response formats and special files types,
should be included with the associated bid documents for the given opportunity.

The supplier would then download the bid documents from MERX, complete its response
offline, and upload a completed response for each of the required items. When a supplier
has included an attachment for each of the required items in the defined list it is able to
submit a completed response to the buying organization. The system will not prevent a
supplier from submitting an incomplete response, but will inform the supplier of any
missing components before proceeding with the submission. The MERX service only
serves as a delivery service for a user’s response. The system does not collect or
disseminate any information from the response as the details of the response are
contained in the attached files. All files uploaded as part of the response are left in their
original format and MERX does not check for any file type or format. Files will be delivered
as-is to the buying organization once the bids are opened. Any document format
requirements would therefore need to be specified by the buying organizations in their bid
documents.

Suppliers wishing to respond through the electronic submission process need to acquire a
Digital Signature PIN from MERX by providing a notice that identifies the individual
authorized to conduct business and sign contracts on their behalf. The designated
individuals are assigned a Digital Signature PIN that will be used to sign and encrypt their
information on the system. The notice may be submitted electronically, and will be
attached to the supplier’s profile and shared with the buying organization. Once
authorized to conduct business, MERX will provide the identified individual with a Digital
Signature PIN. The individual does not need to be the registered user for the supplier in
the MERX system, but he or she will be required to enter the PIN during a submission
process in order to sign and approve their submission.

MERX manages its own certification authority within the system environment for the
creation and assigning of Digital Signature PINs for both suppliers submitting responses
and buying organizations accepting responses. There is no need for any outside Digital
Key from a third-party certification authority.

While a bid response is in a pending/draft state, ownership and control of the response
remains with the supplier. All bid response information stored on the system is encrypted
to the supplier organization to ensure there is no unauthorized access to the information.
Once a bid response is submitted, ownership and control of the documents is transferred
to the designated buying organization.

Bid responses are submitted to an electronic bid box which can not be accessed until after
the specified closing date and time in the originating bid notices. All submissions are
encrypted to the buying organization’s key and can only be opened by the designated user
after the designated closing time.

The submission of a bid response must be completed by the designated closing time or
the response will be flagged as a late submission. Typically, the system will not allow a
supplier to initiate the submission of a response after the designated closing time, but
suppliers do have the ability to withdraw a bid prior to the closing time. A withdrawn bid
would be returned to the pending/draft state where the supplier may apply changes as
necessary before resubmitting the bid response prior to the designated closing time.

However, the buying organization can set controls handling the submission of electronic
responses such as whether late bids will be accepted or not. If late bids are not accepted,
a supplier will not be able to submit a bid after the designated closing time specified in the

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tender notice. If late bids will be accepted, the submit option will remain active and the
system will indicate through time stamps if the submission was late. Acceptance of late
bids is solely at the discretion of the buying organization.

As part of the bid response process, the buyer may elect to include an individual letter of
intent or non-disclosure agreement that suppliers would need to agree to prior to
accessing bid documents and participating in the bidding process.

The system automatically tracks supplier activity for each individual tender opportunity.
The buyer is able to view which suppliers have ordered and paid for bid packages (if
payment was required); the method of delivery; which suppliers opted to receive automatic
notification of amendments; which suppliers received the amendments; which suppliers
initiated a draft electronic response; and, which suppliers submitted an electronic
response. If manual submission was an option, it is the responsibility of the buying
organization to record the bids submitted by suppliers and to update the bidder’s list prior
to a contract award. Tracking information is available to the buying organization so that it
can monitor the activity on individual tenders. The tracking report also provides an audit
trail for the opportunity.

MERX will only store submitted bids on the system for 30 days after the bid opening by the
buying organization, after which the bids are to be removed from the system and a backup
copy of the electronic submissions will be provided to the buying organization. The buying
organization is responsible for any long term storage of bid response that may have been
received electronically through the system along with any manual responses that may
have received in accordance to their individual policies and legal requirements. The
buying organization is also responsible for updating MERX tracking information to record
any manual submissions and for posting any resulting award information.

(ii) Security

MERX is hosted and managed from a secure data centre with controlled access
procedures that limit any authorized physical access to the facilities. The data centre is
separate from the MERX operation office which also has established security processes
limiting any unauthorized access to the facilities.

The system has implemented industry-standard security controls to limit any unauthorized
access to the system with appropriate firewalls and other security measures.

Access to the system is primary controlled through the user ID/password pair assigned to
each user and the use of Secure Socket Layer (SSL) to ensure the secure transmission of
information from the user to the host system. Users participating in electronic bid
submissions are also provided with a digital key referred as their authorize signer PIN
which is associated with their user profile and enables them to sign, accept and encrypt
data. The assignment of digital keys is managed within the MERX environment and is
only applicable within the MERX application. The individual users are responsible for the
protection and security of their user ID and password, and the use of their signer PIN.

Within the MERX database, all payment information is stored separately in a different
application server and database environment behind another level of security to ensure
the security of the payment information. MERX has followed the same security criteria
governing access to the financial payment gateways that support the automatic payment
process within the system environment.

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Part of the normal service operation includes regular security audits throughout the
contract period to ensure the security and integrity of the system and the operational
environment.

7. India: Public Private Partnership

Over the last number of years, India has seen a number of e-procurement initiatives
implemented across its country as national agencies, state governments, cities and state
agencies institute procurement reforms, and take advantage of technology options to
establish more transparent and effective procurement programs. The number of different
e-procurement initiatives has led to several different technical solutions and business
models to support the solutions, from government owned and operated systems, and the
use of shared service exchanges, to Public Private Partnerships (PPPs). For many
institutions, the PPP model presents the most viable option to manage the risk associated
with the development and implementation of an e-GP system and the on-going operation
of the service.

Such is the case in India for the Government of Karnataka (GoK). The Government of
Karnataka instituted a state wide e-government procurement initiative with the passing of
the Karnataka Transparency in Public Procurement Act (KTPPA) in 1999. Under the
direction of the act, which was amended in 2001 and again in 2003, all state agencies
shall process their procurement activity through the stated sanctioned e-procurement
system (e-proc) in accordance to the implementation schedule set forth for integrating the
various state agencies.

The implementation of the system is being conducted by the Centre for e-Governance
which holds overall responsibility for the implementation, operation and management of
the system. The Centre for e-Governance conducted a competitive bidding process to
select a technical partner to design, build and operate the e-proc system under a Public
Private Partnership arrangement. The selected partner was HP Sales India. Though the
physical system is hosted in a GoK data centre and the GoK is responsible for security
and network infrastructure, HP maintains responsibility for the on-going support,
development, operation and maintenance of the system, as well as the provisioning of
help desk services and training, and reports directly to the Centre for e-Governance.

The initial development and implementation of the system took about 18 months and the
e-proc system has been in operation since in November 2007.

Six key procuring agencies, including the Public Works Department (PWD), participated in
the initial launch and pilot period of the e-proc system. During that period, participating
agencies were required to use the system to conduct all bidding for 50 Lakhs ($5 Million
Dollars) and above. Now that the system has been operating for over one year, and the
platform has become fairly robust and stable, the government will proceed with the
integration of the remaining state agencies onto the system and will begin to lower the
base value for procurement for selected agencies to 10 Lakhs ($1 Million Dollars) and
above. The KSHIP-II project has also requested to use the e-proc system for procurement
under World Bank funding.

The primary focus of the e-procurement initiative was to instil transparency in government
procurement and to standardize the procurement process within the state in order to
institute a more fair, open and competitive environment for government procurement
through one central state portal.

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The GoK wanted the e-proc system to address concerns arising from the previous manual
procurement process with respect to potential collusion – or bid rigging – whereby, on
occasion, contractors would be prevented from picking bid packages or submitting bids, or
could be influenced if they were known to be participating in a bid. The electronic system
is intended to help GoK deal with many of these concerns by ensuring all interested
contractors have access to bid packages with complete anonymity and may submit a
response without any threat of interference.

The system provides open and equal access to all opportunities in an environment that is
technologically neutral and applies standards to ensure interoperability and security. The
system provides complete audit trails of the procurement process and ensures each step
receives the required approvals within the tendering organization.

Since the initial pilot launch, 25 state agencies have been integrated onto the system,
which has roughly 2,000 registered contractors/vendors and just over 1,000 government
users. Over 1,200 tenders have been processed. The Centre for e-Governance and its
service provider, HP, have trained and set-up each of the participating agencies in the
system. HP has also worked closely with each of the participating agencies to ensure the
system supports their individual requirements with respect to internal workflows, standard
bidding documents and practices.

(a) System Overview

The e-proc system provides the state government with a complete e-procurement system
to help support the procurement process from its initial inception at the estimate stage,
through to contract management and e-payment. The base system consists of six main
modules to support the entire procurement process. Those modules are:

 Indent Management

 E-Tendering (Estimated Contract Value (ECV) and non-ECV)

 Supplier Registration

 Contract Management

 E-Auctions

 Catalogue Based Procurement

The entire system is secured through PKI-enabled security in accordance with the IT 2000
Act of the Government of India for supporting electronic transactions.

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The system includes well-defined workflow processes to manage the initial creation of
estimates in the Indent Management Process and the assigned roles for approving a
request. This ensures that an Indent does not move to a tendering process without first
receiving all necessary approvals. The Indent process for Works includes well-structured
estimate generation from standard schedule of rates tables to fully support the creation of
specification and base rates for each item required for a project, based on the location of
the project. The content included in the system provides for a more complete set of
standard bidding specifications and documents for Works projects, and will greatly
improve the efficiencies within the department for creating and approving the initial indents
and tenders.

The workflow will send the detailed estimate for administrative, followed by technical,
sanctions. It includes Approve, Reject and Send Back for Clarification processes at each
approval stage. Any request for clarifications or changes would return to the originator of
the Indent or Tendering request, and then flow through the approval process again to
ensure all designated users/authorities approve the final estimate or bidding documents
that will be released in the system. Users are then automatically notified by the system
regarding any pending action to be performed pertaining to those changes.

The initial system implementation focused primarily on the Indent Management, E-

Tendering, e-Payment and Supplier Registration modules, and the additional modules for
Contract Management, Catalogue Procurement and e-Auctions are currently being
implemented and tested with some of the participating agencies. The additional modules
will be released to all agencies once testing is complete.

The system provides all of the basic functionality required for advertising, registration, e-
payment, authentication, e-bid submission and other processes associated with the
management of an e-procurement system. As an Internet-based system, it is accessible

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through any standard web browser and will serve as the central government procurement
portal for the Government of Karnataka. The overriding goal is to instil transparency in the
government procurement process. As such, all procurement information is made
available to any interested party through the portal without having to register in the portal.
Only vendors participating in a tender must be registered in the system.

(b) Business Model

India’s e-Government Procurement system is an example of a Public Private Partnership

(PPP). Through an open competitive bidding process, the Government awarded a five-
year contract to (HP) Sales India, establishing HP as its third-party partner responsible for
the development, operation, deployment, training and support of the e-procurement
system. The Government of Karnataka’s Centre for e-Governance supplies administrative
support staff to oversee and manage the third-party contract with HP and to reconcile all
payments for EMD and other transactions fees processed through the system. The bulk
of the resources required to build and support the system however are provided through
HP.

The two primary considerations leading to India’s choice of a PPP model were limited
technical resources and managing the risk associated with the implementation of a broad
base service across the state. The private sector would be in a better position to supply
and manage the technical expertise required to establish and operate an e-procurement
system. The private sector would also be willing to undertake the risk required to finance
the initial implementation and setup. A PPP model works well because it addresses both
limitations; the third party supplies the technical and financial resources to build and
operate the system, and in return for assuming the financial risk, is entitled to the revenue
generated by the system.

Under the Government of Karnataka model, GoK retains overall control of the
procurement system by providing network infrastructure, bandwidth and secure data
centre facilities to support the on-going operation of the system, while its third-party partner
facilitates the process by providing the necessary technical infrastructure, complete with
application software, servers, networks, security and payment gateways to support the
system operation.

HP will recover its initial investment and monthly operating cost through transaction fees
applied to user registration and 95% of bid submissions over the term of the contract. At
the end of the contract, the Centre for e-Governance has an option to acquire the system
including the source code for the application. All fees are collected by the Centre for e-
Governance who in turn pays HP from the fees collected. The government share of the
bid submission fees goes to support some of the operational cost of the Centre for e-
Governance. The Gok invest about 10 Crores ($2 million USD) per annum to support
their share of the operations for the system and the business development initiatives to
support the transition of government departments to the electronic system.

Funding Model

The main source of revenue for India’s e-procurement system is generated through bid
submission fees paid by vendors, ranging from a minimum of 500 rupees (US$10) to a
maximum of 7,500 rupees (US$150). In addition, a nominal subscription fee of 500
rupees and an annual renewal fee of 100 rupees is charged

HP put forth the initial investment required to build and implement the system, and aims to
recover that investment as well as generate income through on-going operation of the

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portal. The inherent risk in a PPP model for e-procurement is the lack of guaranteed
payback. If the projected volume of transactions is not achieved, HP and the Government
of Karnataka will need to work together to ensure on-going delivery of the service. The
GoK helps alleviate some of the cost associated with the operation of the system by
providing the network infrastructure, bandwidth and secure data centre facilities for the
eproc system. Provisioning of the data centre helps the government maintain a level of
security and control over the system as HP can not access the physical system without
government permission.

(c) Business Relationships

There are three main relationships involved in India’s PPP model for e-procurement:

- The Government of Karnataka and HP

- The Government of Karnataka and Suppliers

- Suppliers and Government Agencies

The relationship between HP and the Government, although crucial to service delivery,
remains hidden in the background. HP owns the applications, as well as the system and
database design, while the government maintains ownership of all content. HP is also
responsible for scaling the service as required, and must meet a high level of service.
However, as specified in the terms and conditions for use of the e-procurement system,
HP cannot be held liable for any issues or problems related to the bidding process itself.

The relationship between the Government of Karnataka and the vendor community is for
the purpose of collecting fees and disseminating information. Once a contract is awarded,
the government agency deals directly with the vendor and all transactions are carried out
directly between the two parties involved. In order to protect the integrity of the service,
the Government requires users to provide proof at the time of registration (typically in the
form of Power of Attorney) that they are in fact authorized to conduct business on behalf
of the organization they represent.

(d) Operation

Though the physical system is hosted in a GoK data centre and the GoK is responsible
for security and network infrastructure, HP maintains responsibility for the on-going
support, development, operation and maintenance of the system, as well as the
provisioning of help desk services and training, and reports directly to the Centre for e-
Governance.

The Centre for e-Governance retains overall management control for the system planning
and system support services. The Centre of e-Governance office has a small
management team working side by side with HP consultants who provide the majority of
the technical and operational resources, including help desk and training support. There
are approximately 40 combined resources involved in the continual development and
management of the system.

On-going monitoring of the system is HP’s responsibility and HP is therefore in charge of

scaling the service as required to meet user demands. Anticipated user volumes were
clearly set out in the original contract and the system has been fully tested to support the
planned level of activity.

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(i) Bid Response

All responses for the tenders processed on the e-proc system must be submitted
electronically through the system. Only registered bidders may respond to a tender and
each bidder must pay a bid submission fee ranging from 500 rupees (US$10) to 7,500
rupees (US$150), depending on the value of the ECV and the Earnest Money Deposit
(EMD) / Bid Security associated with the tender.

The e-proc system presents bidders with a list of forms to be completed and files to be
included in a response. All mandatory items in the list must be completed before a
completed response may be submitted. The system will display the status of a response,
providing users with a visual indicator of any outstanding items that must be completed.

The bid response remains in a draft state until a bid response is submitted to the
designated Tender Authority. Users can edit and change the content of their responses
while they are in the draft state. Once they submit and digitally sign their bid response, the
bid is encrypted to the designated Tender Authority and stored in a locked state until the
designated bid opening time (as specified by the Tender Authority during the initial tender
creation.) Only the designated bid opening Tender Authority may open submitted bids,
and only after specified bid opening time.

Bidders are responsible for ensuring that any file uploaded as part of their response is
virus-free. The e-proc system does not scan for viruses; however, it does store the
documents in segments in the system to guard against a virus being propagated within the
e-proc application. Files are reassembled when they are downloaded by the designated
Tender Authority.

The e-proc system allows bidders to withdraw bids prior to the defined closing time. Once
withdrawn, a bit reverts back to the draft state where bidders are able to make
modifications before resubmitting the bid any time prior to the stated closing time as
defined in the tender notice.

It should be noted that when a bid is submitted, the commercial bid is encrypted with the
digital key of the designated Tender Authority authorized to open the bid documents.
Therefore, when a bid is withdrawn, the encrypted information cannot be displayed to the
bidder and bid forms such as the commercial bid remain blank. Bidders would then need
to re-enter the content of the form in order to resubmit the bid.

Bidders may withdraw and resubmit their bids any number of times before the deadline of
the bid submission. However, their final submission must be made before the bid
submission deadline. Failure to re-submit a bid prior to the bid submission deadline will
result in a no-bid response.

The EMD must be paid prior to the bid closing time. A bid cannot be submitted unless the
EMD has been paid. Bidders can pay the EMD using the e-payment functions provided
by e-proc, which supports real-time credit card and debit card payments, or with an
electronic fund transfer or over-the-counter payment at an e-proc designated bank branch.
As over-the-counter payments may take up to two days to process through the banking
system, bid openings are normally set for two days after closing time. This provides
sufficient time for payments made just prior to the closing to be received and validated by
the e-proc system.

Late bids are not permitted through the e-proc system. All bids must be completed and
received through the system prior to the designated closing time as defined in the Tender
Notice. Only the authorized Tender Authority sets or changes the closing date and time

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for a tender. Any changes made by the Tendering Authority are automatically sent to all
participating bidders via an e-mail message

The bid opening can only occur after the defined tender opening time for the specified
tender, and only by the designated user appointed by the Tender Authority. Responses
are encrypted and can only be opened by the user with the matching digital key. The bid
opening time and designated user are defined during the tender creation process.

Once the bid opening time has passed, the designated user can initiate the bid opening
process in accordance to the rules specified in the tender – such as one cover (technical
and commercial opened at the same time), two cover (completion of technical evaluation
must be completed prior to commercial bid opening) or three cover (pre-qualification
followed by technical and commercial openings).

All participating bidders can monitor the bid opening process through the e-proc system.
Once a bid is opened, the information is automatically shared among all participating
bidders. They may also track the status of the evaluation process and will be notified
when a contract award is made.

The e-proc system does not conduct any tender evaluation; it simply delivers the bid
responses to the designated Tender Authority who is responsible for the evaluation of the
responses and the approval of any decisions. The system provides an approval workflow
which allows the evaluation committee to record their decisions and attach any supporting
documents before submitting the decision for approval by the designated authorities.

Participating bidders have access to the decision once the approval of the contract award
is complete.

(ii) Security

Security of India’s e-procurement system is tightly monitored and controlled in the state-
owned data centre. Only authorized personnel are allowed into the facility and all visitors
must receive permission from the Centre for e-Governance before being admitted.
Redundancy is built into the system so that in the event of a server failure, the user load is
distributed to another server with no disruption to service. The system uses Secure Socket
Layer (SSL) encryption for communication between a user’s browser and the host web
server. This ensures the data is encrypted and cannot be hacked or misused by anyone.
The system also applies PKI-enabled enabled encryption to ensure the security and
privacy of the users responses stored in the database. Once encrypted, online bids are
stored in a locked environment and can only be opened by authorized users (the
Tendering Authority, for example) at a specified bid opening time.

Database administrators (DBAs) do have access to data but that access is strictly
monitored through user IDs and passwords, digital signatures, secure log-on procedures,
and automatically generated audit trails. To prevent an administrator from misusing his
access privileges, the system requires two-level password verification before allowing the
administrator to access the administrative module. The first password is provided by the
administrator and the second password is provided by a designated senior person within
the buying organization. As part of the security process, attachments are broken down
into components before being stored on a server and are only re-assembled after they are
downloaded. Not only does this prevent unauthorized access to documents, but it also
helps to protect against computer viruses.

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8. Singapore: Government Owned Model

Singapore’s GeBiz e-Government Procurement system is an example of a Government

Owned Model. The Singapore government had the benefit of having the required skill
sets, resources and information and communication technology (ICT) project experience
within its government organizations to undertake the development of its own system with
no more risk than if the project were to be outsourced to a third-party organization. GeBiz
was established as a joint collaboration between the Ministry of Finance (MOF), the
Defence, Science and Technology Agency (DSTA) and the Infocomm Development
Authority of Singapore (IDA), with the intent of creating a consolidated electronic tender
board.

Singapore had many other advantages working in its favour to support the introduction of
an electronic procurement environment. First, Singapore is a small city state with a very
strong telecommunication infrastructure, and has been a leader in introducing technology
to support a number of government services and operations. As a very structured, lean
and efficient city-state government, the government is able to implement appropriate rules
and regulations to control and apply standards to the procurement process without the
hassles of dealing with different levels of bureaucracy that other countries face.

In Singapore, the bulk of government procurement activities are decentralized to

individual government agencies, but at the same time, they must adhere to central
procurement guidelines issued by the Ministry of Finance. As a World Trade
Organization (WTO) signatory, Singapore must also adhere to WTO guidelines.

The Singapore government adopts the fundamental principles of fairness, openness and
competitiveness for its government procurement, awarding tenders to the bid that brings
the best value for public money. All tender notices and quotations are posted on the GeBiz
website, which also contains information on tender schedules and tender awards. The pre-
procurement plan containing the public sector’s proposed purchasing plan for the fiscal
year is also published on GeBiz. Three basic procurement procedures are supported:
Small Value Purchase, Quotation and Tender. A Small Value Purchase pertains to items
up to $3,000 in value and may be carried out directly by buying off-the-shelf or purchasing
from known sources. Quotations are invited for goods or services valued from $3,000 up
to $70,000. All government procurement above $70,000 must adopt tendering
procedures, either through open, selective or limited tenders. Additionally, GeBIZ enables
on-line purchases via electronic catalogues, as well as purchases made through pre-
determined framework agreements.

Today, GeBiz operates as the Singapore government’s one-stop e-procurement portal,

handling all public sector tenders, and enabling suppliers to submit their bids online. It has
become the main channel for all government tenders and quotations, supporting 137
government agencies, 10,000 users and 38,000 suppliers. In 2008 it processed 5,800
tenders and 79,000 quotations for a total of 181,000 orders placed.

(a) System Overview

The Singapore Government has developed its own e-GP system known as GeBiz. The
system is owned by the Ministry of Finance and supported and operated by DSTA who
acts as the service operator for GeBiz on behalf of the Government of Singapore.

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The GeBiz program started in 2001 with the establishment of a central portal to support
the advertisement of all government procurement and a catalogue of common items
available under framework contracts. By the end of 2003, the tender board had evolved
into a fully integrated procurement system called Government Electronic Business or
GeBiz (www.gebiz.gov.sg) with full support of online supplier registration, online invitation
and response, and online purchase, as well as interfaces to the existing financial systems
within each government agency.

Since the initial launch, DSTA has continued to evolve the system from a web presence to
an interactive environment that supports all procurement activities and processes as
defined by the procurement rules and regulations set forth by the Ministry of Finance.

The GeBiz system is designed as two separate sub-systems – the Partner System and
Enterprise System – operating independently from each other as a way to ensure overall
security. GeBiz is designed to serve as a gateway between vendors and government
buyers, exchanging information between the two sub-systems as required.

The Partner System is designed to support vendors when conducting business with
government. Vendors can register online and access all tender information, requests for
quotes and contract awards. Vendors may also add up to 10 product or service items to
be included in the GeBiz Mall for low value purchases as a way of promoting their product
and service offerings. GeBiz mall entries can be updated by vendors at any time to
promote specials or reflect changes to products or services.

Vendors can respond to requests for quotations or tenders online by completing online
forms and attaching any files required as part of their technical or commercial bid
responses. They may also respond to, submit and track purchase orders and invoices
through the system. The Partner System is accessed via the Internet and is open to all
vendors, both local and foreign, with very few requirements to register. This ensures the
system is open to all vendors.

The Enterprise System is designed to support the government organizations using the
system to perform procurement activities such as preparation, purchasing, tendering,
awarding, contract management and reporting. It is accessed through the Government
Intranet to ensure only designated government officers can gain access. The system also
supports a lead agency in establishing service-wide period contracts, as well as the

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decentralized purchasing of these contracts by other government agencies. The system

can be personalized and configured for specific government agencies.

The various modes of procurement supported by the system include:

 Small Value Purchase for estimated purchase value up to S$3,000

 Invitation To Quote (ITQ) for estimated purchase value up to S$70,000

 Invitation To Tender (ITT) for estimated purchase value greater than S$70,000

 Catalogue Buy for purchases off established Period Contracts through the Electronic
Catalogue or Printed Catalogue

 Framework Agreement (FA) for direct Request For Quotation

GeBiz will support end-to-end transactions with trading partners for various modes of
purchasing for all goods and services. However, GeBiz operates independently of the
financial system used by the agencies and although it supports transaction integration with
financial systems such as SAP, Oracle and Peoplesoft, it simply supports the transmission
and tracking of the payment request and the payment information between the two parties.
The individual organizations and their internal systems are responsible for the actual
processing of a payment as it relates to a transaction between the two parties and not with
GeBiz. GeBiz will only report on the status of a transaction for those transactions which
are sent through the system. Within the system, GeBiz only supports transactions for the
processing of actual service fees, such as vendor registration fees or fees billed to
government agencies in relation to their use of the system.

The Singapore DSTA has a team of close to 30 or 40 people who support the operation,
development, support and management of the GeBiz system, and operates the service
as an independent business service supporting the government agencies in the
procurement process. The function of the system is not to conduct the actual procurement
but to provide tools to support government agencies in their procurement process; the
overall responsibility for a given procurement and the awarding of a contract resides with
the buying organization. The system is there to support the exchange of information
between the parties and make sure the process is conducted in a fair, open and
transparent manner by ensuring all information is made available to all interested parties.

As GeBiz evolves, the DSTA continues to review and plan new system enhancements to
reflect new procurement practices and technology options. Currently, DSTA is in the
process of adding options to support auctions and reverse auctions in the system in order
to evaluate the value of such features in the procurement process.

(b) Business Model

Singapore is an example of a Government Owned Model where the Ministry of Finance is

the governing body for procurement policies, and as such is the owner of the on-line
portal. The Defence, Science and Technology Agency provides the technical expertise,
essentially serving as the third-party provider to develop, operate and manage the portal.
Meanwhile, the Infocomm Development Authority sets the IT policy and guidelines that
must be followed by the DSTA when implementing and running GeBiz.

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Funding

GeBiz is a self-funding service operation through the application of service/transaction

fees to the vendor and government buyer communities.

The Ministry of Finance is the owner of the system, and therefore funded its initial
development and implementation. Once the system was operational and part of the
government procurement process, a schedule of fees was established to make the service
self-funding. For vendors, an annual subscription fee of SGD280 ($190 USD) apply only
for additional user accounts within an organization. The first vendor account is provided
free of charge.

The objective of the fees is to generate the necessary income to support the service
operation, support and on-going product development initiatives by DSTA and to control
certain aspects of user behaviour.

Since one of the main objectives of the system is to encourage vendor participation in an
open and fair procurement process, very few fees are applied to the vendor community.
The only fees applied are for additional user IDs or GeBiz Mall listings in order to control
unnecessary registrations or mall listings. The initial user registration for a vendor is free
and vendors may also post 10 items in the GeBiz Mall for free. There are also no fees for
any procurement opportunity or any associated bid documents, or to respond to a bid in
order. By operating this way, the government hopes to encourage more vendors to
participate in the procurement process.

The main source of revenue to support the service operation is generated from transaction
fees applied to participating government users. The Ministry of Finance could have
provided DSTA with the operating budget to support the service; however, it decided that
organizations would better recognize and understand the value of the service if they paid
for it individually in relation to their own use of the system, or any customizations they
request of DSTA.

This business model approach has helped GeBiz to establish a very strong and
competitive marketplace with over 39,000 registered vendors to date. Singapore has
recognized that the best option to get the best value for money is from strong competition
through a fair, open and transparent procurement process.

(c) Business Relationships

Operation of the GeBiz portal results in two types of business relationships being formed:
one between the vendor community and the Singapore government for use of the portal;
and, one between the vendors and the government agencies themselves once a contract
is awarded.

(d) Operation

In a Government Owned Model, there are no questions about ownership or control. The
Singapore government owns and operates the portal, and individual agencies are
responsible for carrying out transactions. Terms of use and conditions are set out in the
procurement guidelines on the portal site, including indemnification clauses and loss bid
protection.

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GeBiz is hosted and operated from a Singapore government data centre. The centre is
maintained and managed as per the policies set by InfoComm to ensure the security,
integrity and service levels for all government services.

Access to the system is controlled by the user ID/password pair assigned to users during
the initial registration process for both vendors and government users. The GeBiz Partner
service for the vendor community is available through general Internet access to the host
GeBiz Partner sub-system.

Access from the Internet is managed and controlled at the data centre through standard
security measures with appropriate firewalls and network controls to ensure there is no
unauthorized access to the system or any other system within the facilities.

The GeBiz Enterprise sub-system is accessed through the government controlled and
managed intranet along with the user ID/password pair assigned to government users
during the initial registration process. This ensures only designated government officers
have access to the GeBiz Enterprise System.

GeBiz serves as the gateway between the vendors and government buyers, exchanging
information between the two systems as required for the distribution of tenders to vendors,
the submission of bids from vendors to buyers, the processing of purchase orders and the
monitoring of payments. GeBiz also supports internal access to government ERP systems
(Oracle, SAP and Peoplesoft) so that transactions and messages can be passed directly
through the appropriate system.

Outside the realm of system security, the DSTA also applies sound security processes to
the operational practices with its own facilities to ensure there is no unauthorized access to
the physical work environment by the different business units supporting the operation of
the service. Any visitors must sign-in to the facilities and all access is controlled using
secure key cards.

A team of 30 to 40 DSTA professionals are charged with supporting the GeBIZ site;
procurement training for both suppliers and government users is the only area outsourced
to a local technical institute.

(i) Bid Response

The Singapore government kept the bid submission process relatively straightforward with
simple tables for technical compliance and commercial bids, and any detail or
supplementary information included as attached files. The system allows buyers to
specify if a bid will be supported by an electronic bid submission process, a manual
process or a combination of both options, depending on the nature of the response they
would like to receive. The system is there to support the procurement and bid submission
process for the buyer, not to completely control the process.

Vendors are presented with a checklist of the components that make up a completed bid
response. The components could include the need to attach a file which forms part of the
response or to complete an online form presented as a web page. Commercial responses
are normally presented as a web form which is completed online. Forms are created by
buyers during the tender creation process.

All electronic submissions are encrypted and stored in the system until the defined bid
opening time. Encryption is managed by the system and does not use PKI keys as the
current policy for user identification is the user ID/password pair set up at registration.

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DSTA has recently added support for one or two cover bidding and will soon be testing e-
auctions as an option for commercial evaluation. It is not expected that e-auction will
apply to all biddings, nor does Singapore at this time intend to make auctions mandatory.
It simply wants to be able to provide buyers with the tools they may need or want to use in
their procurement processes.

GeBiz is simply intended to serve as the primary portal for government procurement and
the gateway between the vendor community and government buyers. GeBiz will report on
all activity but does not presume to fully control the activity of government buyers. Only
business rules stipulated by the Ministry of Finance will be implemented in the system.

(ii) Security

GeBiz is hosted and operated from a Singapore Government data centre. The centre is
maintained and managed as per the policies set by InfoComm to ensure the security,
integrity and service levels for all government services. Physical access to the data is
strictly controlled and no access is permitted without prior written approval.

Access to the system is managed and controlled at the Data Centre through standard
security measures with appropriate firewalls and network controls to ensure there is no
unauthorized access to the system or any other system within the facilities. Government
users access the system through the government-wide intranet, which further validates
that any access to the GeBiz Enterprise sub-system is from authorized government users.

Access to the system is controlled by the user ID/password pair assigned to users during
the initial registration process for both vendors and government users. The GeBiz Partner
service for the vendor community is available through general Internet access to the host
GeBiz Partner sub-system. The system makes use of Secure Socket Layer (SSL) to
ensure all information from the client to the host system is encrypted and cannot be
hacked or misused. Any bid response or private information stored in the database is in
an encrypted form, and access to the database is fully controlled to prevent any
unauthorized entry from outside or within the GeBiz operation.

Outside the realm of system security, the DSTA also applies sound security processes to
the operational practices with its own facilities to ensure there is no unauthorized access to
the physical work environment by the different business units supporting the operation of
the service. Any visitors must sign-in to the facilities and all access is controlled using
secure key cards.

9. Philippines: Government Managed Service

The Government of the Philippines (GOP) has initiated a number of reform measures and
strategies to raise efficiency and transparency levels in government procurement,
including the formulation of the newly enacted Government Procurement Act (R.A. 9184).
This law redefines procedures in government purchasing, and has enhanced
transparency, competitiveness and public accountability in government procurement. It
highlights one important change in the system, which is the establishment of the
Government Electronic Procurement System or E-Procurement System (G-EPS) that will
serve as the primary source of information in all government procurement and serve as
the central portal for all government bid opportunities1.

1
p.250 MTPDP 2004-2010

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The development of the G-EPS is in line with the thrusts of the government to promote the
use of information technology in public sector governance pursuant to Republic Act No.
8792, otherwise known as the E-Commerce Act.

The G-EPS is in compliance with several procurement reform initiatives. EO 322

mandates all GOP bid opportunities, notices, and awards to be advertised and posted in
the G-EPS and all suppliers that wish to conduct business with national government
agencies must register in the system. EO 262 mandates all bid tenders to be posted in
the G-EPS website. EO 40 and the Government Procurement Act (Republic Act No. 9184)
provide for transparent advertisement of invitations and posting of bids and awards
through the Internet and procurement through electronic means.

All of this activity has led to the implementation and development of the Philippine
Government Electronic Procurement System, known as PhilGEPS, which currently serves
as the central portal for all government bid opportunities.

The Bureau of Procurement Service of the Department of Budget and Management

(DBM-PS) is the implementing agency for the PhilGEPS system delivery. DBM-PS
reports to the Government Procurement Policy Board (GPPB), a joint committee
represented by eight government agencies that oversees the implementation of the
government procurement reforms and is responsible for the professionalization of public
procurement and the monitoring of procurement compliance with the new reforms.

The PhilGEPS program started as a pilot system in 2000 through the assistance of the
Canadian International Development Agency’s (CIDA’s) PTTAF Project using Canada’s
MERX service as the backend system. The objective of the pilot system was to help
DBM-PS gain a better understanding of the resource requirements for supporting and
operating an electronic procurement system across multiple government levels. The pilot
system started with one agency and a few hundred vendors, and quickly grew to support
more than a few thousand agencies, publishing tender notices and distributing tender
documents to more than 20,000 vendors.

Through the operation and delivery of the pilot system, DBM-PS prepared a project plan
for the development of its own e-GP system that would offer the features and functions
required to support the procurement reforms being instituted by the government.

DBM-PS elected to find a service partner to build, operate, maintain and support the
system. The service provider would be responsible for all technical aspects, including the
development, infrastructure, facilities, support and operational management, in
accordance to the requirements and service levels set forth by the government. DBM-PS
would be the service owner and operator of the service and would be responsible for all
users, including the provision of a help desk, training services and on-going product
planning to meet service requirements. The reasoning behind the decision to outsource
the technical delivery of the system was to mitigate the risk associated with system
development and delivery, as well as the recruitment and retention of the technical
expertise required for the system.

DBM-PS outsourced the development and operation of PhilGEPS to a private service

provider, duplicating the existing pilot services while adding significant functionalities such
as the Virtual Store, Charges and Fees, E-payment and E-bid Submission. The first
release of the PhilGEPS system was launched in August 2006, and included the central
tender board, online registration and an online catalogue. DBM-PS and its service partner
are currently in the process of developing additional features for the system, including the
replacement of the online catalogue with a virtual store to support online ordering, e-

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payment and order tracking; the implementation of charges and fees; and, support for e-
bid submission.

To handle the management, operation and training aspects of the system, DBM-PS
established the PhilGEPS Group with a full-time staff complement. Since launching the
pilot G-EPS in December 2000, the group has been conducting a nationwide marketing
and training strategy. So far, it has trained more than 10,138 procurement officers, supply
officers, buyers, administrative officers, and bids and awards committee members, 474
commission on audit personnel, and 658 budget officers. Roughly 25 percent of the
39,000 registered suppliers with the G-EPS were likewise trained.

(a) System Overview

PhilGEPS is the central procurement portal for the Philippine Government. The system is
designed as a fully web-enabled application easily accessible to any user though the
Internet without the need of any special software other than a common browser and the
Adobe PDF reader which is freely available.

The overall objective of the system is to instil transparency in the Philippine Government
procurement process and to introduce efficiencies and effectiveness to better support both
the buyer in the procuring entities and the suppliers wishing to participate in the
procurement process.

By law, all government agencies from the national agencies, down to cities and local
government units (LGUs), must use PhilGEPS to advertise any public procurement, and
any supplier wishing to conduct business with a government organization must be a
registered user on the system.

PhilGEPS supports multiple access views to the system depending on a user’s role. The
public has free access to the system; there’s no need to register in order to view all current
procurement being conducted by the procuring entities and any recent awards published
by the agencies.

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Suppliers, both local and foreign, wishing to participate in the procurement process can
register online by completing a simple registration form and accepting the terms and
conditions for accessing the system. As registered users, suppliers can sign up for
automatic bid matching in order to be notified by e-mail of any new opportunities matching
their profiles; update their company profile, included in a directory available to government
buyers; search and view both current and former opportunities; view, order and download
any associated bid documents published with an opportunity; and, track opportunities of
interest. Each registered supplier organization has one registered user who is designated
as the organization’s coordinator. This supplier coordinator is responsible for the
administration of the organization and has the ability to add and remove additional users
assigned to the organization. Each user is presented with a list of any outstanding or
pending task to perform, such as new matches not viewed, invitations to participate in a
bid, updates or amendments to bids they are participating in, or reminders to pick up a
non-electronic bid package that was ordered.

Government buyers can also register online by completing a registration form and
accepting terms and conditions for participating as a government user. As registered
buyers, the system allows users to create and manage tender notices and their associated
bid documents; access a supplier directory of all registered suppliers; search and view
former and current opportunities; or view tracking reports on their service activity or a
specific notice. The notice creation and management functions are provided under a
MyNotices section. The notice creation process supports various business rules to ensure
users provide and enter the correct information, such as the approved budget and the
minimum advertising periods.

Users may create a tender for a single lot or multiple lots by adding individual line items to
a notice with individually approved budgets. Some of the business rules have been
adjusted to support tender notices being procured under MDB guidelines. Users can
attach electronic copies of bid documents to the notice for online distribution or elect to
support the manual distribution of bidding documents. For manual distribution, the system
provides order management functions that allow suppliers to request a bid package, and
track when the package is retrieved from the procuring agency. Users would
automatically be notified when the bid package is available for pickup. After a notice is
published, buyers may issue amendments to the notice via the notice management
process. Once published, any amendments or changes are automatically sent to
participating suppliers, and buyers can track the delivery or retrieval of the amendments
via a detailed tracking report for the tender notice. Upon closing, buyers can update the
bidders list by indicating which suppliers submitted a bid and post the award notice after
evaluating the submitted tenders.

The system allows buying organizations to establish their own supplier list or designated
accreditations to a supplier. It also allows buyers to request blacklisting of suppliers, but
with a reason. Any blacklisting request would be sent to a committee for review and
approval prior to a blacklisting notice being associated with a given supplier.

PhilGEPS provides an audit role which provides auditors full access to the system to
monitor system activity and view tracking reports on individual tenders or system
management reports. Auditors can view system activity being conducted by buying
organizations but cannot make any changes on the system.

PhilGEPS also provides DBM-PS with administrative functions that allow it to administer
and support the users on the service, including vetting and approval, supplier and buyer
registration, and being able to assist users setting up the organization profiles and bid
matching services or assisting in the creation of a tender notice. The system

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administration has the ability to post events in a calendar, post announcements on the
system, and update content on various information pages as well as content in system
data tables used in drop down or selection lists. Administrators also have access to
system management reports with the ability to extract data from the database in order to
generate custom reports. The system administrator is responsible for maintaining the
content in the online catalogue being published on the system.

All activity in the system is recorded in transaction log records and users can view any
activity that may have been performed on their account, including activities that an
administrator may have conducted on their behalf, such as updating their contact profile or
changing their status on the system.

DBM-PS and its service provider are currently in the planning stage for the development
and implementation of additional features in the PhilGEPS platform which will include
transforming the online catalogue to a virtual store to support online ordering, e-payment
and order tracking of requested items through delivery and acceptance. DBM-PS also
intends to introduce charges and fees for the use of the system and support electronic bid
submission in the coming year. In addition to adding more features, DBM-PS intends to
review the functions of the existing system with users to plan future changes and product
upgrades as the system continues to evolve.

(a) Business Model

DBM-PS elected to pursue a Government Managed System using a third-party owned

and operated solution to ensure that the government would be responsible for and able to
control the business operation of the system. It also aimed to mitigate the risk associated
with the technical implementation and operation of the system.

As the owner of the service operation, DBM-PS controls, manages and is responsible for
the users of the system. The system is presented as a government owned and operated
service and, for all intents and purposes, the service is owned and controlled by the
government. All content of the PhilGEPS service belongs to the government.

The physical system, facilities, network infrastructure and applications to support the
service operation of PhilGEPS are provided under a service agreement with the third-party
service provider, Ayala Systems of the Philippines (ASTI). ASTI is responsible for all
technical components of the system delivery, including the development and on-going
support of the system to ensure it continues to meet government requirements and
supports the anticipated growth in user activity. ASTI owns all rights to the application as
well as any hardware or facilities supporting the delivery of the system. ASTI must also
provide all necessary resources and technical expertise as required for delivery of the
service in accordance to the terms of the agreement and defined service levels.

As per the nature of the agreement, DBM-PS pays ASTI a monthly fee for the use of the
service environment, resources to support the service delivery, and the management and
support of the service. The monthly fee is based on the system components delivered
and accepted by the government as the system development plan was to phase in the
different system components over five individual development phases. DBM-PS did not
start to pay the monthly fee until the system was accepted and placed into production,
mitigating the risk associated with any cost overruns or delays with initial development.
The contract with the service provider provides for up to P50 Million pesos per year or
approximately $1,000,000 USD depending on the services delivered.

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The fixed fee service arrangement also mitigates some of the risk for the third party as its
revenue stream is not based on a set of projected transactions which may or may not
occur as expected. Meanwhile, the government is able to better forecast its operating cost
and plans to implement a charges and fees schedule that will cover the cost of supporting
and operating the service.

The service agreement is for a period of five years with options to extend on a year-to-year
basis. The government also retains an option to acquire the system and continue the
operation of the services itself, or with the assistance of a third-party partner or other
service provider. The government can elect to look for another technical solution to deliver
and support its electronic procurement needs, in particular if it is felt that the current
solution may not meet its needs in the long run or if new technical developments appear
offer better options and cost savings in the future.

By separating the business operation from the technical operation, the government feels it
has better control over its service operations, giving it the flexibility to choose different
alternatives in the future versus being tied to a solution due to the capital investment that
has been made. Also, in controlling the business operation, the government can institute
a charge and fee schedule that covers any operational cost over the lifetime of the service
operation, regardless of the backend solution being used to deliver it.

Funding

Since the initial launch of the pilot EPS system in 2000, DBM-PS Philippines has been
funding the operation of PhilGEPS from its own operating budget. DBM-PS currently
receives funding from the Government of the Philippines through the E-GOV program to
pay for the technical operation of the system.

The decision to fund the project directly during the initial implementation of the system was
intended to encourage participation by both the government agencies and the supplier
community, and to remove cost as a decision factor for participation. DBM-PS wanted to
demonstrate the value of the service offering to the user community. During the initial
implementation years, it would have been difficult to apply charges to suppliers to access
a service which may or may not have contained opportunities of interest.

The annual cost for the delivery of the service operation including all required
infrastructure, facilities, network, bandwidth, software, backup site, operational support,
development support and project support to the service provider is approximately P50
Million ($1 Million USD). The government also funds the PhilGEPS support office with
approximately 25 resources who perform end user training, business development
activities, product planning, service management and customer support functions.

Now that PhilGEPS has established itself as a significant marketplace for government
procurement, DBM-PS will begin planning for the introduction of service fees in order to
become a self-funding service operation. This will occur after the additional planned
functions for PhilGEPS are in place and DBM-PS implements its new financial
management system to better support the application of fees within the service offering.

(b) Business Relationships

The implementation of PhilGEPS has created new business relationships within the
framework for conducting business with the Government of the Philippines.

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All suppliers now have an agreement with PhilGEPS to access government procurement
information in the service and, in the future, to pay some service fees related to their use of
the system or to buy bid packages from a procuring entity. Suppliers will also enter into
individual contracts with government organizations after winning a procurement that was
processed through the system.

All buyers will also have an agreement with PhilGEPS to use the service to advertise and
distribute their procurement information. In the future, this agreement will include support
for purchasing items through the virtual store and perhaps paying service fees for use of
the service. Buyers will also enter into individual contracts with suppliers they purchase
items from.

DBM-PS has a contract with its third-party service provider for the delivery and support of
the service operation. The contract includes a service level agreement (SLA) governing
the uptime, response time and responsibilities of the service operation; however, it also
protects and indemnifies the third party from any claims or losses that may be brought
forth from any user due to a service operation failure.

Likewise, DBM-PS will operate the PhilGEPS service as an independent service

operation, assuming no responsibility over the delivery of the service and providing no
guarantees to users regarding the availability of the service offering. Nor will it assume
liability with respect to a user’s utilization of the service; users shall indemnify PhilGEPS
and DBM-PS from any claims or losses that may be incurred when using the system.

PhilGEPS is only intended as a service to provide access to information published by

individual government organizations related to their own activities. It takes no responsibility
over the content or the procurement process applied to a given opportunity.

(c) Operation

The service provider, ASTI, is required to provide and maintain an architecture plan, an
operations plan, a disaster recovery plan and a change management plan to ensure
continuous operation and management of PhilGEPS and its associated service
operations.

PhilGEPS is hosted and operated from a third-party secure data centre facility under a
contract with the PhilGEPS service provider. The PhilGEPS system is maintained within
its own secure area and cannot be physically accessed by anyone without prior written
approval as all visitors must register with the data centre in advance of a visit. The
facilities provide all network infrastructure, redundant bandwidth and backup power
systems to ensure on-going operation of the facilities. The primary host system has built-
in redundancy to alleviate or minimize any system failures and sufficient resources to
support the required service levels.

In addition to the primary host site, a backup facility is also maintained in another city
within the Philippines as part of a disaster recovery plan. The host and backup sites are
synchronized throughout normal operations to minimize any potential loss of data. In the
event of a failure, the backup facility would come online within minimal interruption to the
service operation.

Access to the system is controlled by the user ID/password pair assigned to users during
the initial registration process for both vendors and government users. Access from the
Internet is managed and controlled at the Data Centre through standard security

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measures with appropriate firewalls and network controls to ensure there is no

unauthorized access to the system or any other system within the facilities, and any
exchange of information between a registered user and the host system is conducted via a
Secure Socket Layer (SSL) connection. This ensures information is encrypted and cannot
be hacked or misdirected.

In addition to the primary host and backup sites, ASTI also maintains development,
staging and training server environments to support the change management process and
acceptance testing prior to any changes being migrated to the production environment.

A team of approximately 25 management and support resources from the PhilGEPS

office manage the business operations, help desk and training programs. PhilGEPS
operates from a central office location in Manila and is establishing a local presence in 16
regional offices around the country to provide local support for government agencies and
suppliers. The technical operation provided by ASTI is supported by a team of about 20
technical and project management resources to ensure the on-going operation and
development of the PhilGEPS system.

(i) Bid Response

PhilGEPS currently does not support electronic bid responses. This function is in the
future plans for the system. DBM-PS is currently reviewing bid submission processes and
will be formulating its own solution to support the requirements of its participating buying
organizations.

In the short term, bid response to public procurement conducted will continue to be
submitted manually in accordance to the instructions presented in the individual bid
documents issued by the procuring organization.

(ii) Security

PhilGEPS is hosted and managed from a secure data centre with controlled access
procedures that limit any authorized physical access to the facilities. The data centre is
separate from both the PhilGEPS operation office and ASTI’s technical operation office,
which also has established security processes limiting unauthorized access.

The system has implemented industry-standard security controls to limit any unauthorized
access to the system with appropriate firewalls, intrusion detection and other security
measures.

The service provider was required to provide and maintain an operations plan, security
plan, disaster recovery plan and system architecture to satisfy all of the current and future
security needs of the system. An outside firm was retained to test the load capacity and
security features of the system to ensure all requirements were met prior to the launch of
the system.

Access to the system is primary controlled through the user ID/password pair assigned to
users, and through the use of SSL to ensure the secure transmission of information from
users to the host system. The system will also check all uploaded files for viruses or any
other malware. If a file is found to contain a virus or malware, the system will reject the
upload request and require the user to clean the file, as well as their system, before
attempting the upload again.

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The Philippine Government will be instituting reforms in the e-commerce law to recognize
digital signatures and will be establishing a national certification authority to issue digital
keys that will be applied for electronic transactions with the government. The new digital
key, when available, will be applied in the PhilGEPS system for encrypting information and
digitally signing transactions.

Part of the normal service operation includes provisions for regular security audits
throughout the contract period to ensure the security and integrity of the system and the
operational environment.

10. Annex 1 – Terms and Conditions

This Annex contains copies of the various terms of use, privacy policies and terms and
conditions applied on users participating in the various e-GP systems considered in this
study.

Singapore

GOVERNMENT OF SINGAPORE PRIVACY STATEMENT

1) This is a Government of Singapore website. Thank you for examining our privacy
statement.

2) If you are only browsing this website, we do not capture data that allows us to identify
you individually.

3) If you choose to make an application or send us an e-mail for which you provide us
with personally identifiable data, we may share necessary data with other
Government agencies, so as to serve you in a most efficient and effective way, unless
such sharing is prohibited by legislation. We will NOT share your personal data with
non-Government entities, except where such entities have been authorized to carry
out specific Government services.

4) For your convenience, we may also display to you data you had previously supplied
us or other Government agencies. This will speed up the transaction and save you the
trouble of repeating previous submissions. Should the data be out-of-date, please
supply us the latest data. We will retain your personal data only as necessary for the
effective delivery of public services to you.

5) To safeguard your personal data, all electronic storage and transmission of personal
data are secured with appropriate security technologies.

6) This site may contain links to non-Government sites whose data protection and
privacy practices may differ from ours. We are not responsible for the content and
privacy practices of these other websites and encourage you to consult the privacy
notices of those sites.

Terms of Use

Thank you for visiting http://www.gebiz.gov.sg (this website). By accessing and using
this website, you shall be deemed to have accepted to be legally bound by these Terms
of Use. If you do not agree to these Terms of Use, please do not use this website.

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5.1.1.1 General

These Terms of Use may be changed from time to time. Changes will be posted on this
page and your use of this website after such changes have been posted will constitute
your agreement to the modified Terms of Use and all of the changes.

5.1.1.2 Proprietary Rights

This website is maintained by DSTA - Defence Science and Technology Agency.

The materials located on this website, including the information and software programs
(the Contents), are protected by copyright, trademark and other forms of proprietary rights.
All rights, title and interest in the Contents are owned by, licensed to or controlled by
DSTA.

5.1.1.3 Privacy Policy

Click here to review this Website Privacy Statement.

5.1.1.4 Restrictions on use of Materials

Except as otherwise provided, the Contents of this website shall not be reproduced,
republished, uploaded, posted, transmitted or otherwise distributed in any way, without
the prior written permission of DSTA.

Modification of any of the Contents or use of the Contents for any other purpose will be a
violation of DSTA's copyright and other intellectual property rights. Graphics and images
on this website are protected by copyright and may not be reproduced or appropriated in
any manner without written permission of DSTA. Disclaimer of Warranties and Liability

The Contents of this website are provided on an "as is" basis without warranties of any
kind. To the fullest extent permitted by law, DSTA does not warrant and hereby disclaims
any warranty: (a) as to the accuracy, correctness, reliability, timeliness, non-infringement,
title, merchantability or fitness for any particular purpose of the Contents of this website; (b)
that the Contents available through this website or any functions associated therewith will
be uninterrupted or error-free, or that defects will be corrected or that this website and the
server is and will be free of all viruses and/or other harmful elements.

DSTA shall also not be liable for any damage or loss of any kind caused as a result (direct
or indirect) of the use of the website, including but not limited to any damage or loss
suffered as a result of reliance on the Contents contained in or available from the website.

5.1.1.5 Right of Access

DSTA reserves all rights to deny or restrict access to this website to any particular
person, or to block access from a particular Internet address to this website, at any
time, without ascribing any reasons whatsoever. Links from this website to other
websites.

This website contains hyperlinks to websites which are not maintained by DSTA. DSTA is
not responsible for the contents of those websites and shall not be liable for any damages
or loss arising from access to those websites. Use of the hyperlinks and access to such
websites are entirely at your own risk.

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Hyperlinks to other websites are provided as a convenience. In no circumstances shall

DSTA be considered to be associated or affiliated with any trade or service marks, logos,
insignia or other devices used or appearing on websites to which this website is linked.

Except as set forth below, caching and links to, and the framing of this website or any of
the Contents are prohibited.

You must secure permission from DSTA prior to hyperlinking to, or framing, this website or
any of the Contents, or engaging in similar activities. DSTA reserves the right to impose
conditions when permitting any hyperlinking to, or framing of this website or any of the
Contents.

Your linking to, or framing any part of this website or its Contents constitutes acceptance
of these Terms of Use. This is deemed to be the case even after the posting of any
changes or modifications to these Terms of Use. If you do not accept these Terms of Use,
you must discontinue linking to, or framing of this website or any of the Contents.

In no circumstances shall DSTA be considered to be associated or affiliated in whatever

manner with any trade or service marks, logos, insignia or other devices used or
appearing on websites that link to this website or any of the Contents.

DSTA reserves all rights to disable any links to, or frames of any site containing
inappropriate, profane, defamatory, infringing, obscene, indecent or unlawful topics,
names, material or information, or material or information that violates any written law, any
applicable intellectual property, proprietary, privacy or publicity rights.

DSTA reserves the right to disable any unauthorized links or frames and disclaims any
responsibility for the content available on any other site reached by links to or from this
website or any of the Contents. Governing Law 19: These Terms of Use shall be governed
and construed in accordance with laws of the Republic of Singapore.

5.1.1.6 Registration

GeBIZ Trading Partner Registration - Useful Information and

Registration Requirements

5.1.1.6.1 1. Useful Information

Suppliers can refer to the Registration Guide and the Frequently Asked Questions to find
out more information before registering as a GeBIZ Trading Partner.

Register a business/company in Singapore

Applicants are advised that registration as a GeBIZ Trading Partner or Government
Registered Supplier is not equivalent to a licence to conduct business in Singapore.
Please visit the Accounting and Corporate Regulatory Authority (ACRA) website for more
information regarding the registration of a business/company in Singapore.

Register as a Government Supplier

After registering as a GeBIZ Trading Partner, you may wish to register as a Government
Registered Supplier to respond to business opportunities that specify this as a criteria.
Click here for more information.

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Establish Banking Arrangements

After registering as a GeBIZ Trading Partner, applicants may be requested by the various
government agencies to establish banking arrangements. Suppliers that conduct business
with the Ministry of Defence and the Defence Science and Technology Agency are
advised to establish banking arrangements. Click here to download the forms.

5.1.1.6.2 2. Registration Requirements

Register with a Unique Entity Number (UEN) Issuing Agency for Singapore
based entities
Applicants are advised that Singapore-based entities will need to register with an UEN
Issuing Agency before registering as a GeBIZ Trading Partner to obtain a unique
identification number to facilitate correspondence and interaction with the Singapore
government. Singapore individuals can transact in GeBIZ using their National
Registration Identification Card Number (NRIC No.) or Foreign Identification Number
(FIN No.). Please visit the UEN website at http://www.uen.gov.sg to find out the UEN
issuing agencies.

GeBIZ Trading Partner Applicant and Authorized Representatives

Applicants will need to nominate at least one representative that has been authorized to
transact on behalf of your entity in GeBIZ. The applicant and authorized representatives
will need to be at least 18 years of age at the time of registration as this is the minimum
age at which contracts are binding and enforceable under the Singapore statute.

Annual Subscription Fee For Authorized Representative

All GeBIZ Trading Partners (GTPs) will enjoy the use of one authorized representative
(AR) account free-of-charge. Subsequent AR accounts in addition to the first free account,
is chargeable at SGD280 (inclusive of prevailing GST) per account per annum. Any
payment made is not refundable.

To help suppliers lower their business costs during the economic downturn, the annual
subscription fee for second and subsequent AR account (new or renewed) will be reduced
from SGD280 to SGD180 per account per annum (inclusive of the prevailing Goods and
Services Tax) for subscription periods that commence between 1 Apr 2009 and 31 Mar
2010.

GeBIZ Terms and Conditions

The applicant and authorized representatives will need to abide by the GeBIZ Terms and
Conditions to become a GeBIZ Trading Partner.

GeBIZ Trading Partners billing the Government Ministries, Statutory Boards and Schools
are required to submit invoices electronically. Please refer to paragraph 14 of the GeBIZ
Terms & Conditions for more information.

India – Karnataka

Terms and Conditions for Contractor

5.1.1.7 1. Definitions

1.1 For the purposes of this document, the following expressions shall have the meanings
hereby assigned to them except where the context otherwise requires:

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"Terms and Conditions" means the Terms and Conditions mentioned herein and applying
to the e-Proc System and as amended by the Government from time to time.

"Certification Authority" shall have the same meaning as in the Information Technology
Act, 2000 and any amendments thereof.

"Contract(s)" shall unless otherwise specified refer to Contract(s) concluded by Parties.

"Digital Signature" shall have the same meaning as in the Information Technology Act,
2000 and any amendments thereof.

"e-Proc System" means the Government Electronic Procurement system, a structured

electronic system operated by the Government via the Internet which facilitates the
procurement of goods and/or services by the Government through electronic means.

"Government" means the Government of Karnataka including, where the context so

admits, its officers/officials and agents.

"Message(s)" means data structured in accordance with e-Proc System and transmitted
electronically through e-Proc System between the Parties and/or generated by e-Proc
System, including where the context admits any part of such data.

"Messages Log" means a complete historical record of all Messages transmitted through
and/or generated by e-Proc System.

"Party" means either the Government or the Contractor and "Parties" mean both the
Government and the Contractor.

"Representative" means any person authorized by the Contractor under these Terms and
Conditions to access and use e-Proc System on the Contractor's behalf. Notwithstanding
anything herein, any person who uses and/or enters the correct Security Device as
prescribed by the Government shall be deemed to be a Representative of the Contractor.

"Security Device" means any or any combination of Login ID, password, electronic device
with encoded electronic strip and/or chip, digital signature or such other device, method,
item or machine prescribed by the Government for access and/or use of e-Proc System or
any part thereof by the Contractor.

"Service Provider" shall mean the entity or organization responsible for maintaining and
operating the e-Proc System under an agreement for services executed with the
Government.

"Contractor" means any person who has applied for and granted by the Government the
right to access and use e-Proc System upon the Terms and Conditions and shall, where
the context so admits, include its Representatives.

"Website" means the Internet website of e-Proc System,

http://www.eproc.karnataka.gov.in, maintained by the Government and shall include but
not limited to all its pages and all information, text, forms, items, images, links, sound and
graphics displayed therein.

1.2 Words importing the singular include the plural and vice versa.

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1.3 The headings are for convenient reference only and shall not affect the interpretation
of this interpretation.

1.4 Words importing a gender include any other gender.

1.5 A reference to a person includes individuals, partnerships and other bodies, whether
corporate or otherwise.

1.6 Any reference to any statute or legislation shall be deemed to be a reference to such
statute or legislation as amended from time to time and be deemed to include any
subsidiary legislation made thereunder.

1.7 All references to date and time herein (including but not limited to the date and time of
delivery of Messages) shall be as per Indian Standard Time and date.

5.1.1.8 2. e-Proc System

2.1 The Government agrees to grant the Contractor the right to access and use e-Proc
System on the terms set out herein and such other terms as may be specified by the
Government from time to time. The Contractor also recognizes and acknowledges that the
e-Proc System is being maintained and operated by a Service Provider under an
agreement for services executed between the Government and the Service Provider. The
Contractor hereby agrees and acknowledges that Service Provider shall not be
responsible or liable for any damage or loss resulting from the use of the e-Proc System.

2.2 The Contractor will pay the Government the prevailing subscription fee. The prevailing
subscription fee and other specifications will be set by the Government from time to time in
the Website.

2.3 The Contractor agrees to fully comply with and observe all the Terms and Conditions.
The Contractor further agrees that if any such Message or communication contains
anything that is inconsistent with the Terms and Conditions, the Government shall be
entitled to treat such Message or communication as if it did not contain or include any such
inconsistency and such inconsistency shall not have any legal effect.

2.4 Where the Government procures or seeks to procure any goods and/or services from
the Contractor through e-Proc System, Parties agree that the Government shall be entitled
to, at its discretion, prescribe the methodology and the manner in which such procurement
of goods and services shall be made. The manner and the methodology as may be
prescribed by the Government shall be mentioned and provided on the Website.

2.5 The Government shall be entitled to, at its discretion, to enter into Contracts with the
Contractor, in such manner as may be decided by the Government from time to time for
the procurement of Goods and Services from the Contractor.

2.6 In the event that e-Proc System is unavailable due to reasons solely attributable to the
operations of e-Proc System and is likely to remain so for a reasonable period of time
(which shall be determined solely at the discretion of the Government), the Government
shall notify the Contractor of the unavailability of e-Proc System by posting a notice on the
Website (which shall constitute sufficient notice to the Contractor). In such an event, the
Parties may transact with each other in writing through conventional means if the
Government expressly specifies in its notice that the Parties may do so.

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5.1.1.9 3 Security, Access and Use of e-Proc System

3.1 The Contactor shall access and use e-Proc System in the manner and with the use of
such Security Devices as are or as may be prescribed by the Government from time to
time.

3.2 The Government reserves the right to prescribe different Security Devices for
accessing and/or using e-Proc System or any part thereof, including but not limited to
prescribing different Security Device(s) for accessing and/or using different parts of e-Proc
System. The Government also reserves the right to vary, from time to time, the Security
Device(s) and/or the manner of accessing and/or using e-Proc System or any part thereof.
The Government will inform the Contractor by posting a notice on the Website of any
change(s) in the Security Device(s) and/or the manner of accessing and/or using e-Proc
System or any part thereof and such posting notice shall constitute sufficient notice to the
Contractor.

3.3 Without prejudice to Clause 3.2, the Government reserves the right to prescribe
password(s) and Login ID(s) for the Contractor and its Representatives as well as any
combination and/or sequence of letters and/or numerals for the password(s) and Login
ID(s).

3.4 The Contractor shall comply and adhere to all the security measure and obtain , at its
own cost, all necessary Security Devices that may be required and made applicable by
way of instructions or directions provided by the Government on the Website or otherwise.

3.5 The Contractor shall authorize Representative(s) to access and use e-Proc System on
its behalf. The Contractor shall notify the Government in writing of its Representative(s) in
the form and manner prescribed by the Government from time to time.

3.6 The Contractor shall also immediately notify the Government in writing in the form and
manner prescribed by the Government from time to time of any changes in its particulars
or the particulars of its Representative(s).

3.7 The actions, failures, omissions and defaults of the Contractor's Representative(s)
shall be construed and be given legal effect as if they are the actions, failures, omissions
and defaults of the Contractor and the Contractor shall be fully responsible for all such
matters.

3.8 The Contractor shall do all things necessary to preserve and maintain the integrity and
security of e-Proc System, including but not limited to ensuring that there is no
unauthorized access and/or use of e-Proc System or any Security Device and that the
Security Devices are treated with extreme care and are available to and used by only its
authorized Representatives.

3.9 The Contractor shall ensure that all Messages transmitted by it or its Representative(s)
are duly authorized. The Contractor shall in any event be fully responsible for all
Messages transmitted by it or by its Representatives(s).

3.10 The Contractor agrees, after taking into account all relevant factors, that the security
procedure for e-Proc System constitutes a commercially reasonable security procedure.

3.11 The Contractor agrees that the Government is entitled to rely on the correct use
and/or entry of the prescribed Security Device(s) by the Contractor or its Representative(s)

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as conclusive evidence of the authenticity of the Message and the authority of the
originator of such Message.

3.12 The Government shall be entitled to prescribe such codes and abbreviations for use
in e-Proc System and may delete, amend or make additions to such codes and
abbreviations from time to time. The codes and abbreviations used in e-Proc System shall
be set out and explained in the Website.

3.13 Where the prescribed Security Device is a Digital Signature, the Contractor shall
ensure that all provisions of the Information Technology Act, 2000 are complied with.

3.14 The Contractor shall bear all costs and expenses in relation to its access and use of
e-Proc System, including but not limited to the costs and expenses incurred in ensuring its
continued access and use of e-Proc System.

3.15 The Service Provider shall not be responsible or held liable under these Terms and
Conditions for any loss or damage that is caused to any party due to use or misuse of the
e-Proc System or breach, by any party, of the Terms and Conditions mentioned herein.

5.1.1.10 4 Representations and Warranties

4.1 The Contractor represents and warrants at all times as follows:

a. all particulars of the Contractor and its Representatives given and to be given to the
Government from time to time are accurate;

b. the Contractor is validly existing, not insolvent, and has the legal capacity and power to
enter into, perform and comply with the Terms and Conditions; and

c. all actions, conditions and things required to be taken, fulfilled and done in order to
enable the Contractor to enter into, perform and comply with its obligations under the
Terms and Conditions and to ensure that those obligations are valid, legally binding on the
Contractor and enforceable against the Contractor have been taken, fulfilled and done.

4.2 The Contractor undertakes to ensure and hereby represents and warrants at all times
that Messages and other communications sent to the Government using e-Proc System
and/or pursuant to the Terms and Conditions are and shall be:

a. complete, accurate, true and correct; and,

b. transmitted or sent by such persons as are duly authorized by the Contractor to transmit
or send the Messages and communications.

4.3 The Contractor represents and warrants at all times to be bound by all Messages and
other communications transmitted or sent by the Contractor and/or its Representatives.
The Contractor further agrees that the Government is under no obligation to check any
Messages or other communications to ascertain their completeness, veracity and
accuracy.

4.3 This Section shall not apply to the Service Provider. The Contractor and the
Government hereby acknowledge that the Service Provider is not expected to rely on
warranties and representations provided herein.

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5.1.1.11 5 Service of Notices

5.1 Any notice which the Government is required to give to the Contractor shall only be
deemed to have been served on the Contractor if the notice is sent by:

a. post to the address provided by the Contractor in its e-Proc System Contractor
Registration Form or such other address as may be specified in writing by the Contractor
to the Government, whichever is the latest in time;

b. facsimile transmission to the facsimile number provided by the Contractor in its e-Proc
System Contractor Registration Form or such other facsimile number as may be specified
in writing by the Contractor to the Government, whichever is the latest in time; or

c. e-mail to the e-mail address provided by the Contractor in its e-Proc System Contractor
Registration Form or such other e-mail address as may be specified in writing by the
Contractor to the Government, whichever is the latest in time.

5.2 It shall be the duty of the Contractor to immediately notify the Government of any
change in its correspondence address, facsimile number and e-mail address.

5.1.1.12 6 Off-line Communication

6.1 The Contractor may direct queries, comments or difficulties encountered with the
access and/or use of e-Proc System in the manner specified in Clauses 5.3 and 5.4 or to
the Government's Internet e-mail address specified in the Website for the purposes of
receiving such off-line communication.

6.2 The Government may likewise conduct off-line communication with the Contractor in
the manner specified in and in accordance with Clause 5.1.

5.1.1.13 7 Evidence and Validity

7.1 Information in the form of an electronic record shall be given legal effect, validity and
enforceability.

7.2 The Parties expressly accept and agree that any and all Messages transmitted
through and/or generated by e-Proc System are final, conclusive and binding for all
purposes and shall be relevant and admissible in evidence. The Parties further expressly
agree that they shall not dispute the authority, accuracy and/or authenticity of any
Message (or any part thereof) on the ground that the Message is transmitted and/or
generated electronically.

5.1.1.14 8 Invitation To Tender or Quote ("ITT" or "ITQ")

8.1 The Government may at any time invite Contractors to submit tenders for the supply of
goods and services through e-Proc System. This is referred to hereafter as electronic ITT.

8.2 The Government reserves the right to disregard any tender which is submitted after
the time specified, regardless of whether the delay in the submission of the tender was
occasioned wholly or in part by any unavailability of e-Proc System, interruption in the
access and/or use of e-Proc System or any other factor attributable to the operations of e-
Proc System, except where the delay is caused solely by mishandling on the part of the
Government.

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5.1.1.15 9 Contracts

9.1 Contracts may be concluded between Parties pursuant to such instructions and
directions provided by the Government on the e-Proc System and also in accordance with
the Terms and Conditions mentioned herein.

5.1.1.16 10 Revocation of Authorisation of Contractor's Representative

10.1 The revocation of the authorization given by the Contractor to its Representative for
the purposes of transacting through e-Proc System on the Contractor's behalf shall be
effected in e-Proc System in one of the following ways only:

a. The Contractor shall notify the Government in writing of the revocation of the
authorization given to its specified Authorized Representative; or,

b. The Contractor's Representative may delete his account in e-Proc System and the
revocation of the authorization of the Contractor's Representative shall take effect
immediately upon the deletion of the account.

10.2 The Contractor shall be fully responsible for the actions, failures, omissions and
defaults of its Representative until the effective date of the revocation of the
Representative's authorization.

10.3 The following consequences shall immediately follow upon the revocation of the
authorization of the Contractor's Representative:

a. The Representative shall not be allowed to access and use e-Proc System on the
Contractor's behalf;

b. The revocation of the Representative's authorization shall not in any way affect the
Contractor's obligations under the Terms and Conditions mentioned herein, Contracts
concluded through GeBIZ and existing Contracts; and,

c. It shall be the sole duty of the Contractor to ensure that it is able to continue to access
and use e-Proc System.

10.4 The Government shall not be liable in any way for any damages, losses, costs,
expenses, liabilities or compensation, whether direct or indirect, which arise from or are
referable in any way to the revocation of the authorization of the Contractor's
Representative.

5.1.1.17 11 Liability and Indemnity

11.1 The Contractor acknowledges that there are security, corruption, transmission errors
and access availability risks associated with using open networks and Internet websites
and hereby expressly assumes such risks.

11.2 Without prejudice to the foregoing, the Government and the Service Provider does
not make any warranty or representation that the access and/or use of e-Proc System or
any part thereof will be uninterrupted, timely, secure, free from virus or other malicious,
destructive or corrupting code, programme or macro, free from transmission errors or
otherwise error-free.

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11.3 No warranty of any kind, implied, express or statutory, including but not limited to the
warranties of non-infringement of third party rights, title, merchantability, satisfactory quality
and/or fitness for a particular purpose, is given in conjunction with e-Proc System.

11.4 Any hyperlink to any other website or any reference to any website, entity, product or
service is not an endorsement or verification by the Government of such website, entity,
product or service. Any access, use or engagement of or other dealings with such website,
entity, product or service shall be solely at the Contractor's own risks.

11.5 The Government or the Service Provider shall not be liable in any way for any
damages, losses, costs, expenses, liabilities or compensation, whether direct or indirect,
which arise from or are referable to, regardless of the form of action, any breach of
security, delay, corruption or destruction of data or systems (including due to but not
limited to causes such as virus or other malicious, destructive or corrupting code,
programme or macro), transmission error and unavailability of access associated with
accessing and/or using e-Proc System or any part thereof even if the Government is
advised as to the possibility.

11.6 The Government or the Service Provider shall not be liable in any way for any
damages, losses, costs, expenses, liabilities or compensation, whether direct or indirect,
which arise from or are referable to, regardless of the form of action, any difficulty
whatsoever encountered in accessing and/or using e-Proc System or any part thereof
arising out of or in connection to the Contractor's facilities (including but not limited to
computer terminals, modem, software, hardware, systems, subscription to services of
Certification Authority, subscription to the services of Internet Service Provider and
telecommunications facilities).

11.7 The Contractor shall solely be responsible and liable and shall hold the Government
free of liability for the acts, failures, omissions and defaults of the Contractor and its
Representatives, including but not limited to unauthorized access and/or use of e-Proc
System or any part thereof, unauthorized disclosure or use of any Security Device, access
and/or use of e-Proc System or any part thereof in a manner inconsistent with the Terms
and Conditions mentioned herein, doing anything contrary to this Terms and Conditions
and failing to act in accordance with the Terms and Conditions or any such directions or
instructions provided by the Government.

11.8 Without prejudice to the foregoing, the Government shall not be liable, regardless of
the form of action, for any damages, losses, costs, expenses, liabilities or compensation
whatsoever (whether direct, indirect, special or consequential or economic loss and
whether foreseeable or not) arising from or in connection with or referable to the access
and/or use of e-Proc System.

11.9 The Contractor hereby agrees to indemnify and hold the Government harmless
against all damages, losses, costs (including legal costs), expenses and liabilities suffered
or incurred by the Government arising out of or referable to any claims, suits or
proceedings brought against the Government by third parties arising out of or in
connection to the Contractor's and/or its Representative's access and/or use (including but
not limited to unauthorized access and/or use) of e-Proc System or any part thereof.

11.12 The word "Government" in Clause 17 shall include the Government's

officers/officials agents and Service Provider(s).

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5.1.1.18 12 Confidentiality

12.1 The Contractor shall ensure that any Message (including part thereof) from the
Government is maintained in confidence and is not disclosed to any unauthorized person
or used by the Contractor other than for the purposes to which the Message relates.
Messages or any part thereof shall not be regarded as containing confidential information
to the extent that such information is in the public domain.

5.1.1.19 13 Intellectual Property Rights

13.1 The copyright in e-Proc System and the Website is owned by the Services Provider.
The e-Proc System and/or the Website or any part thereof shall not be reproduced,
distributed, adapted, modified, republished, displayed, broadcasted, hyperlinked, framed
or transmitted in any manner or by any means or stored in an information retrieval system
or "mirrored" on any other server without the Government's prior written permission.

5.1.1.20 14 Applicable Law and Jurisdiction

14.1 The Terms and Conditions shall be governed by, construed and interpreted in
accordance with the laws of India.

14.2 Each Party agrees to submit to the exclusive jurisdiction of the Courts in Bangalore
as regards any claim or matter arising under these Terms and Conditions.

THE GOVERNMENT AND THE SERVICE PROVIDER PROVIDES THIS E-PROC

SYSTEM AND RELATED SERVICES SUBJECT TO YOUR COMPLIANCE WITH THE
ABOVE TERMS AND CONDITIONS. PLEASE READ AND ACKNOWLEDGE THE
FOLLOWING INFORMATION CAREFULLY IN THE MANNER STATED HEREIN
BELOW. YOU WILL NOT BE ALLOWED TO COMPLETE YOUR REGISTRTION FOR
USE OF THE E-PROC SYSTEM WITHOUT AGREEING TO COMPLY WITH ALL OF
THE TERMS AND CONDITIONS SET FORTH ABOVE AND BY COMPLETING
REGISTATION FOR A USER NAME AND PASSWORD, YOU AGREE TO ABIDE BY
ALL OF THE TERMS AND CONDITIONS SE

Canada

(a) Terms and Conditions

Important Notices to All Users of This Website

To use, as a supplier, the MERX service operated by Mediagrif Interactive Technologies

Inc., or one of its affiliates, you must agree to the following terms and conditions by clicking
on the "I accept" button on the MERX Website or by signing and returning to MERX the
attached Registration Form by fax or mail. In this Agreement, "We", "Us", "Our" and "You"
means any person or other entity applying to register with the MERX Service as a Supplier
or submitting an "Order Basket" which contains one or more Bid Components on a one
time basis.

1.0 - Definitions

2.0 - Rates and Charges - Registered Suppliers

3.0 - Rates and Charges - Non Subscriber Orders (NSO)

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4.0 - Ownership and Use of Information

5.0 - Confidentiality and Security

6.0 - Use of Internet and e-mail

7.0 - Consent - Use of Name

8.0 - Change of Address

9.0 - Changes to Service and Agreement

10.0 - Termination

11.0 - Liability

12.0 - Laws of Application

13.0 - Assignment

14.0 - Prior Agreements

Important Notices to all users of the MERX Website

Confidentiality and Security

Non-responsibility

Available Only Where Permitted by Law

Applicable Agreements

Use of Information

Accuracy and Changes

Software Backup

Hyperlinks are Not Endorsements

Trademarks Belonging to MERX or Other Entities

1.0 - Definitions

1.1 - "Bid Component" refers to a document in paper or electronic form that contains
Information for a Supplier to prepare and submit a proposal to a Participating Organization
for an intended procurement. A Bid Component can also refer to Plans (blueprints) or
physical items such as videotapes, computer CDs, or samples of goods.

1.2 - "Information" refers to all of the information, software and other material provided in
connection with or available through the MERX Service, including the procurement

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information, Opportunity Notices and Bid Components that Participating Organizations

distribute through the MERX Service.

1.3 - "MERX" refers to Mediagrif Interactive Technologies Inc., or one of its affiliates,
operating the MERX Service.

1.4 - "MERX Service" refers to the electronic commerce service owned and operated by
MERX, which serves as the Electronic Tendering System for Participating Organizations
to support the distribution of Information regarding the procurement of goods and services
for both public and private organizations.

1.5 - "Opportunity Notice" refers to a summary in paper or electronic form of the

information relating to an intended procurement.

1.6 - "Participating Organization" refers to the Government of Canada or a provincial

government or a MASH Sector entity (municipality, municipal organization, school board
or publicly funded academic, health or social services entity) or any other public or private
organization that has licensed MERX to advertise and distribute procurement information.

1.7 - "Supplier" refers to an individual or entity that has ordered one or more Bid
Components from the MERX Service and/or is registered with the MERX Service as a
Supplier.

1.8 - "Order Basket" refers to a collection of orders for one or more MERX Bid
Components. Upon the submission of the Order Basket, the content of the basket is
complete.

1.9 - "Non Subscriber Order" refers to a one-time Order Basket that has been submitted
by an individual or entity that is not a registered MERX Supplier.

1.10 - "Electronic Signature" refers to a Personal Identification Number (PIN) that is used
to facilitate electronic signatures for the purpose of submitting a response to the
Participating Organization for an Opportunity Notice.

2.0 - Rates and Charges - Registered Suppliers

2.1 - We agree to register with the MERX Service and acknowledge that payment of the
registration fee, where applicable, is made monthly or in advance annually, as the case
may be. We acknowledge that our subscription to the services shall be automatically
renewed at the expiry of any subscription period for a period of time equal to the initial
subscription and that applicable registration fees for any renewal shall be automatically
charged or billed, as the case may be. We also recognize that all payments are not
refundable. There is no registration fee for basic access to Government of Canada
opportunities.

2.2 - We agree to pay any charges due for Bid Components not delivered via download,
and all physical items that are components of a bid set that cannot otherwise be ordered
via a download. We also agree to pay for delivery charges and any other charges incurred
by us in accordance with the current MERX Supplier price list. The current MERX Supplier
price list is attached.

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2.3 - We agree to pay any charges related to MERX Value Added Services (such as
having amendments delivered automatically) as established from time to time in the
MERX Supplier price list.

2.4 - MERX is authorized to charge our valid American Express, MasterCard or VISA
credit card for all charges when due.

2.5 -Interest on overdue accounts is charged at 1 1/2% per month, equal to 18% per
annum. MERX may apply a surcharge to any payments returned by the issuing Financial
Institution.

2.6- We acknowledge that MERX may terminate or suspend our use of the MERX Service
for non-payment, and that such termination or suspension will include suspension of
opportunity matching, notification of an opportunity amendment, the forwarding of
amendments to previously ordered Bid Components, the ordering of Bid Components and
other value added services. Basic Access to Government of Canada opportunities will not
be affected by this.

2.7 - We agree that MERX may amend the rates and charges for the MERX Service from
time to time in accordance with the criteria established with the Participating
Organizations. Revised rates and charges will be reflected in the MERX Price List, a copy
of which will be sent to us or available on-line.

2.8 - We agree all Submitted Orders are final. MERX is not obligated to refund or
exchange for services charged herein.

3.0 - Rates and Charges – Non Subscriber Orders (NSO)

3.1 - We agree to pay by valid credit card any Non Subscriber Orders (NSO) fees, fees for
Bid Components not delivered via download, and all physical items that are components
of a bid set that cannot otherwise be ordered via a download. We also agree to pay for
delivery charges and any other charges incurred by us in accordance with the current
MERX Supplier price list. The current MERX Supplier price list is attached.

3.2 - We agree to pay any charges related to MERX Value Added Services (such as
having amendments delivered automatically) as established from time to time in the
MERX Supplier price list.

3.3 – Upon ordering or contracting for such services, you will authorize MERX to charge
your valid American Express, MasterCard or VISA credit card for all charges when due.

4.0 - Ownership and Use of Information

4.1 - We acknowledge that any of the Information that we receive through the MERX
Service is owned either by the Participating Organization that issued the Information or by
MERX. We agree that we will not use, store, copy, or reproduce the Information, or
distribute or disclose it to any third party, except for the sole purpose of having such third
party assist us in evaluating an opportunity or preparing a response to an Opportunity
Notice. We agree that we will not sell, distribute publish or otherwise disseminate to
any third party, or make available for the purpose of resale to any third party, any
Information received from or through the use of the MERX Service without the prior
written consent of MERX.

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5.0 - Confidentiality and Security

5.1 - We acknowledge that MERX cannot ensure the privacy and authenticity of any
information that we send or receive through the Internet, and we agree that MERX will not
be responsible for any damages that we incur if we communicate confidential information
to MERX over the Internet, or if MERX communicates such information to us at our
request.

5.2 - We agree not to disclose our MERX Service password to any third party. We agree
that we are solely responsible for all use of our password and we agree to put reasonable
security procedures in place regarding its use and to notify MERX immediately of any
unauthorized use.

5.3 - We agree not to disclose our MERX Service Electronic Signature to any third party.
We agree that we are solely responsible for all use of our Electronic Signature and we
agree to put reasonable security procedures in place regarding its use and to notify MERX
immediately of any unauthorized use.

Furthermore, we agree that neither MERX nor Participating Organizations are under any
obligation to confirm the actual identity or authority of any individual user of the Electronic
Signature or any component thereof and have no liability for damages or harm we may
incur from misuse, non-acceptance, delay or restriction in obtaining registration, submitting
responses to Opportunity Notices, receiving Information or Bid Components, nor for any
unavailability, malfunction, cancellation or withdrawal of online bid submission access or
any portion of such service or any device associated with it.

5.4 - We acknowledge that links to other Websites through the MERX Service do not imply
any endorsement or approval by MERX.

6.0 - Use of Internet and e-mail

6.1 - We acknowledge that if we access the MERX Service through the Internet, we are
responsible for reading and complying with any notices, warnings or disclaimers posted on
the MERX Website or contained in the attached Internet Notices Page.

6.2 - We acknowledge the fact that e-mail is NOT a guaranteed delivery method and is
subject to what is conventionally referred to as ANTI-SPAM filters that may impact the
delivery of the e-mail to our e-mail account. We acknowledge that MERX will not be
responsible for an e-mail once it has left the MERX Server unless the delivery failure is
caused solely by the gross negligence of MERX.

7.0 - Consent - Use of Name

7.1 - We authorize MERX to make our name available to other registered users and
authorized users of the MERX Service at any time and in any format for the purpose of
meeting the requirements of the MERX Service, including the publication of document
request lists and the names of successful bidders, but excluding the provision of our name
to other third parties for the purpose of mailing lists or any other purpose not related to the
MERX Service.

8.0 - Change of Address

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8.1 - We agree that we are responsible for providing our current delivery or invoicing
address, our fax delivery number and/or our e-mail address to MERX for the MERX
Service. We will immediately notify MERX of any change of these addresses through the
MERX Website, by mail, by fax on Company letterhead. We acknowledge that MERX
shall bear no responsibility or liability for our failure to do so.

9.0 - Changes to Service and Agreement

9.1 - We acknowledge that, from time to time, and at its discretion, MERX may amend the
provisions of the MERX Service, including pricing or any of the terms and conditions of this
Agreement. MERX will provide us with sixty (60) days notice of any such changes in
writing or on-line through the MERX Service.

10.0 - Termination

10.1 - We acknowledge that MERX may terminate this Agreement with us and suspend
our use of the MERX Service at any time and for any reason, including where we fail to
pay the registration fee or any other charges incurred by us.

10.2 - We may immediately terminate this Agreement with MERX upon providing written
or electronic notice to MERX. Where an electronic notice will be provided by us to MERX
to terminate this Agreement, we agree to comply with all reasonable procedures
established by MERX in providing such electronic notice (as such procedures may be
amended from time to time at MERX's sole discretion) and which procedures shall be
made available to us through the MERX Service. Where a written notice will be provided
by us to MERX to terminate this Agreement, we agree to comply with all reasonable
procedures established by MERX to provide such written notice (as such procedures may
be amended from time to time at MERX's sole discretion), which procedures shall be
made available to us through MERX Service, upon termination, we acknowledge our
password and access to the MERX Service will be terminated and we will no longer
receive Bid Documents (including any notification of amendments that may be issued to
Bid Components previously ordered by us) unless otherwise requested by us, in
accordance with the termination procedures established by MERX (as they may be
amended from time to time at MERX's sole discretion). Termination of this Agreement will
not relieve us from our obligation to make payments to MERX for any outstanding fees or
other charges payable by us prior to termination for the MERX Service and our use of the
MERX Website, as set out in section 10.4 below, including any fees or charges for Bid
Components ordered by us (and including without limitation any amendments requested
by us to such Bid Components following our termination of this Agreement) or our monthly
registration fee for the MERX Service.

10.3 - On termination, we will return any Information provided to us on reasonable request

by MERX.

10.4 - We will pay any outstanding fees and charges on termination, and agree those
sections 4, 5 and 11 of these terms and conditions will continue in force following
termination. We acknowledge that annual, or semi-annual, or quarterly, or monthly
prepayments are not refundable.

11.0 - Liability

We acknowledge that MERX assumes no responsibility for the availability, accuracy,

completeness or timeliness of any of the Information, or for the fitness of such Information
for any particular purpose.

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11.1 - We acknowledge that MERX and its officers, directors, employees, agents and
subcontractors will not, under any circumstances, be liable to us for damages, including
direct, indirect, special or consequential damages, even if MERX has been advised of or
could have foreseen such damages, arising out of our use of or reliance on the MERX
Service, unless caused solely by the gross negligence of MERX. For greater certainty,
such damages shall include, without limitation, damages in respect of loss of profit, loss of
business revenue, failure to realize any expected savings, and any claim made against us
by a third party.

11.2 - We agree that we will indemnify and hold harmless MERX and its officers, directors,
employees, agents and subcontractors for any loss, damage, cost, expense, liability or
claim suffered or incurred by, or made against, MERX arising out of our breach of this
Agreement, or our fraud, misrepresentation, negligence or wilful misconduct in our
performance or non-performance under this Agreement, but our liability in any one year
under this Agreement will be limited to the value of the charges incurred by us for the
MERX Service in the twelve (12) months preceding MERX's claim or demand against us.

12.0 - Laws of Application

12.1 - We agree that this Agreement will be governed by the laws of Ontario and those of
Canada applicable therein.

13.0 - Assignment

13.1 - We agree that MERX may assign this Agreement, in whole or in part, without our
consent, and we may not assign this Agreement in whole or in part.

14.0 - Prior Agreements

14.1 - We agree that this Agreement supersedes any prior versions of this Agreement
governing the MERX Service.

Confidentiality and Security

MERX cannot ensure the privacy and authenticity of any information or instructions you
send to us or we send to you over the Internet. MERX, including the MERX™ Service, will
not be responsible for any damages you may incur if you communicate confidential
information to us over the Internet, or if we communicate such information to you at your
request.

Non-responsibility

MERX is not responsible in any manner for direct, indirect, special or consequential
damages, howsoever caused, arising out of use of this Website, the MERX™ Service, or
the reliance on the information it contains.

Available Only Where Permitted by Law

The products and services described in pages of Websites of MERX, including the
MERX™ Service, are only offered in jurisdictions where they may be legally offered for
sale or use.

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Applicable Agreements

All products and services of MERX, including the MERX™ Service, are subject to the
terms of the applicable agreements.

Use of Information

The information contained on this Website and pages within is not intended to provide
specific legal, accounting, financial or tax advice for any individual and should not be relied
upon in that regard.

Accuracy and Changes

Facts and information provided by MERX, including the MERX™ Service, are believed to
be accurate when placed on this Website. Changes may be made at any time to the
material or information at this Website without prior notice.

Software Backup

While every effort is made to ensure that all software provided at this Website is suitable
for use on a wide variety of computer systems, you should take reasonable and
appropriate precautions to scan for computer viruses, and ensure compatibility of the
software with your specific computer system. You should also ensure that you have a
complete and current backup of the information contained on your computer system prior
to installing such software.

Hyperlinks are Not Endorsements

Links to other Websites or references to products, services or publications other than

those of MERX at this Website do not imply the endorsement or approval by MERX of
such Websites, products, services or publications. MERX is not responsible or liable for
the content presented on these links including advertising claims, endorsements or
names. These Websites are not part of our Website or the MERX Service and MERX has
no control over their content or availability.

Trademarks Belonging to MERX or Other Entities

Certain names, graphics, logos, icons, designs, words, titles or phrases at this Website
may constitute trade names, trademarks or service marks of MERX or other entities.
Trademarks may be registered in Canada and in other countries as applicable. The
display of trademarks on pages at this Website does not imply that a licence of any kind
has been granted. Any unauthorized downloading, re-transmission or other copying or
modification of trademarks and/or the contents herein may be a violation of federal or
common law, trademark and/or copyright laws and could subject the copier to legal action.

Copyright

All Information at this site is protected under the copyright laws of Canada and in other
countries. In addition, certain information may be copyrighted by others. Unless otherwise
specified, no one has permission to copy, redistribute, reproduce or republish in any form,
any information found at this Website. Inquiries about permission should be directed to the
MERX Call Centre at 1-800-964-MERX (6379) or (613) 727-4900.

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(b) Terms of Use and Privacy

Overview

The privacy practices of this statement apply to our services available under the domain
and sub-domains of www.merx.com and apply generally to our parent, subsidiaries and
joint venture websites. By visiting this Website you agree to be bound by the terms and
conditions of this Privacy Policy. If you do not agree, please to not use or access our site.

This Privacy Policy describes the information, as part of the normal operation of our
services, that we collect from you and what may happen to that information. Our
subsidiaries and joint venture partners operate under similar privacy practices as
described in this Privacy Policy and, subject to the requirements of applicable law, we
strive to provide a consistent set of privacy practices throughout our global MERX User
community.

By accepting the Privacy Policy and User Agreement in registration, you expressly
consent to our use and disclosure of your personal information in accordance with this
Privacy Policy. This Privacy Policy is incorporated into and subject to the MERX Terms &
Conditions. This Privacy Policy is effective upon acceptance in registration for new
registering users, and is otherwise effective on June 1st, 2004 for all users.

Table of Contents

Information We Collect

Our Use of Your Information

Our Disclosure of Your Information

External Service Providers

Internal Service Providers for Our Operations

Other Corporate Entities

Legal Requests

Your Use of Other Users' Information

Control of Your Password

Accessing, Reviewing and Changing Your Personal Information

Control of Your Authorized Signer PIN (Electronic Signature)

Other Information Collectors

Security

Notice

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1. Information We Collect.

Our primary purpose in collecting personal information from you is to provide you with a
safe, smooth, efficient, and customized experience. This allows us to provide services and
features that will meet your needs, and to customize our service to make your experience
safer and easier. We only collect personal information about you that we consider
necessary for achieving this purpose.

In general, you can browse MERX without telling us who you are or revealing any
personal information about yourself. Once you give us your personal information, you are
not anonymous to us. If you choose to use our Site, we may require you to provide contact
and identity information, billing information, shipping information and other personal
information as indicated on the forms throughout MERX. Where possible, we indicate
which fields are required and which fields are optional. You always have the option to not
provide information by choosing not to use a particular service or feature.

Under some circumstances, we may require some additional financial information, such as
but not limited to credit card information. We use your financial information, including credit
card information, to verify the accuracy of your name, address, and other information, as
well as to bill you for your use of our services.

We automatically track certain information about you based upon your behaviour on our
Site. We use this information to do internal research on our users' demographics,
interests, and behaviour to better understand, protect and serve you and our community.
This information may include the URL that you just came from (whether this URL is on our
Site or not), which URL you next go to (whether this URL is on our Site or not), your
computer browser information, and your IP address.

We currently use cookies on our Website to check your language preference and to
maintain session information, including identification of users and preparation of
customized Web Pages. We do not save information across visits; we only use cookies to
maintain session information during one unique visit.

Web Browsers set aside a small amount of space on your hard drive to keep these
preferences, then every time you visit a Website your browser checks to see if you have
any predefined preferences (cookies) for that server. If you do, it sends the cookie to the
server along with the request for a web page. Your browser will not give up its cookie data
to any server except the one that set it.

If you establish a credit account with us to pay the fees we charge, we collect some
additional information, such as: a billing address, credit card number and credit card
expiration date and tracking information from cheques or money orders.

If you send us personal correspondence, such as e-mails or letters, we may collect such
information into a file specific to you.

2. Our Use of Your Information.

We use your personal information to facilitate the services you request. We use personal
information in the file we maintain about you, and other information we obtain from your
current and past activities on MERX to: resolve disputes; troubleshoot problems; bill your
account; inform you about online and offline offers, products, services, and updates;
customize your experience; detect and protect us against error, fraud and other criminal
activity; enforce our User Agreement; and as otherwise described to you at the time of

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collection, use or disclosure. At times we look across multiple users to identify problems or
resolve disputes, and in particular we may examine your personal information to identify
users using multiple User IDs, Authorized Signature PIN #s (electronic signature) or
aliases. We may compare and review your personal information for errors, omissions and
for accuracy.

If you choose to open a Credit account, or otherwise provide us your financial information,
we use your address and financial information to bill you and provide associated support.

You agree that we may use personal information about you to improve our marketing and
promotional efforts, to analyse MERX usage, to improve our content and product offerings,
and to customize MERX content, layout, and services. These uses improve MERX and
better tailor it to meet your needs, so as to provide you with a smooth, efficient, safe and
customized experience while using MERX.

You agree that we may also use your personal information to contact you and deliver
information to you that, in some cases, are targeted to your interests, administrative
notices, product offerings, and communications relevant to your use of MERX. By
accepting the User Agreement and Privacy Policy, you expressly agree to receive this
information. You may make changes to your notification preferences at any time.

3. Our Disclosure of Your Information.

As a matter of policy, we do not sell or rent any of your personal information to third parties
for their marketing purposes.

External Service Providers. There are a number of separate services offered by third
parties that we refer to as external service providers that may be complimentary to your
use of MERX (e.g., MERX Enhanced and Value Added Service Providers). If you choose
to use these separate services, disclose information to the external service providers,
and/or grant them permission to collect information about you, then their use of your
information is governed by their privacy policy. We do not disclose your personal
information to external service providers unless you provide your explicit consent. With
your consent we may provide some of your personal information to the external service
provider offering such services, for your convenience. To prevent our disclosure of your
personal information to an external service provider, you can decline such consent or
simply not use their services. Because we do not control the privacy practices of these
third parties, you should evaluate their practices before deciding to use their services.

Internal Service Providers for Our Operations. We may use third parties that we refer
to as internal service providers to facilitate or outsource one or more aspects of the
business, product and service operations that we provide to you (e.g. couriers, Canada
Post, and bill collection) and therefore we may provide some of your personal information
directly to these internal service providers. These internal service providers are subject to
confidentiality agreements with us and other legal restrictions that prohibit their use of the
personal information we provide them for any other purpose except to facilitate the specific
outsourced MERX related operation.

Other Corporate Entities. We may share our data, including personal information about
you, with our subsidiaries and joint ventures or potential partners or assignors. To the
extent that these entities may have access to your information, they will treat it at least as
protectively as they treat information they obtain from their other users. Our subsidiaries,
joint ventures, potential partners or assignors shall follow privacy practices no less

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protective of all users than our practices described in this document, to the extent allowed
by applicable law.

Legal Requests. MERX cooperates with law enforcement inquires, as well as other third
parties to enforce laws such as: intellectual property rights, fraud and other rights, to help
protect you and the MERX community from bad actors. Therefore, in response to a
verified request by law enforcement or other government officials relating to a criminal
investigation or alleged illegal activity, we can (and you authorized us to) disclose your
name, city, province, telephone number, e-mail address, UserID history, and order history
without a subpoena. However, in an effort to balance your right to privacy and the ability to
keep the community free from bad actors, we will not disclose additional information to law
enforcement or other government officials without a subpoena, court order or substantially
similar legal procedure, except when the additional disclosure of information is necessary
to prevent imminent physical harm or financial loss.

4. Your Use of Other Users' Information.

In order to facilitate interaction among all of the MERX User community members, MERX
provides you, via a Document Request List, with limited access other users' contact and
shipping information. As a subscriber you have access to this list as well as to any contact
information provided by a jurisdiction in an Award Notice.

By entering into our User Agreement, you agree that, with respect to other user's personal
information that you obtain through MERX or through a MERX-related communication or
MERX-facilitated transaction, MERX hereby grants to you a license to use such
information only for: (a) MERX-related communications that are not unsolicited
commercial messages, and (b) any other purpose that such a user expressly agrees to,
after you tell them the purpose you would like to use it for. In all cases, you must give
users an opportunity to remove themselves from your database and a chance to review
what information you have collected about them. In addition, under no circumstances,
except as defined in this Section, can you disclose personal information about another
user to any third party without our consent and the consent of that user. You agree that
other users may use your personal information to communicate with you in accordance
with this Section.

MERX and our users do not tolerate spam. Therefore, without limiting the foregoing, you
are not licensed to add a MERX user to your mail list (e-mail or physical mail) without their
express consent.

5. Control of Your Password.

You are responsible for all actions taken with your User ID and password, including fees
charged to your account. Therefore, we do not recommend that you disclose your MERX
password to any third parties. If you choose to share your User ID and password or your
personal information with third parties, you are responsible for all actions taken with your
account and therefore you should review that third party's privacy policy before doing so. If
you lose control of your password, you may lose substantial control over your personal
information and may be subject to legally binding actions taken on your behalf. Therefore,
if your password has been compromised for any reason, you should immediately change
your password as detailed in Section 6.

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6. Accessing, Reviewing and Changing Your Personal Information.

We offer you the ability to automatically review and change the personal information you
submit to us by logging into MERX and entering the new information yourself. Generally,
we prefer not to modify your personal information based upon your request but it is
possible to do so. You can change your password, e-mail address, contact information,
financial information, shipping information and user preferences by going to Customer
Profile and selecting the Update button. You must promptly update your information if it
changes or is inaccurate. The change of information will not alter the historical information
captured in the Document Request List. Only orders made after this change will be
affected.

Subscribers, who have opted for a monthly subscription as opposed to an annual, semi-
annual or quarterly subscription, may cancel their subscription on-line or upon written
request. We will deactivate your account, contact information, billing information, shipping
information and financial information from our active databases. To make this request,
please contact us at [email protected] or call our MERX Call Centre at 1-800-964-MERX
(6379) or (613) 727-4900

We will retain in our files some personal information you have requested us to remove in
order to prevent fraud, collect any fees owed, resolve disputes, troubleshoot problems,
assist with any investigations, enforce our User Agreement and comply with legal
requirements as is permitted by law. Therefore, you should not expect that all of your
personal information will be completely removed from our databases in response to your
requests. However, such personal information will be deactivated from public and member
viewing and will only be available to select MERX personnel.

7. Control of Your Authorized Signer PIN (Electronic Signature).

You are responsible for all actions taken with your Authorized Signer PIN, including
responses to Opportunity Notices submitted with the use of your PIN. Therefore, we do
not recommend that you disclose your MERX Authorized Signer PIN to any third parties. If
you choose to share your Authorized Signer PIN or your personal information with third
parties, you are responsible for all actions taken with your account and therefore you
should review that third party's privacy policy before doing so. If you lose control of your
Authorized Signer PIN, you may lose substantial control over your personal information
and may be subject to legally binding actions taken on your behalf. Therefore, if your
Authorized Signer PIN has been compromised for any reason, you should immediately
contact MERX to change your PIN.

8. Other Information Collectors.

Except as otherwise expressly included in this Privacy Policy, this document only
addresses the use and disclosure of information we collect from you. To the extent that
you disclose your information to other parties, whether they are Buyers, other users of
MERX or other sites throughout the Internet, different rules may apply to their use or
disclosure of the personal information you disclose to them. Since MERX does not control
the privacy policies of third parties, you are subject to the privacy customs and policies of
that third party. We encourage you to ask questions before you disclose your personal
information to others.

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9. Security.

Your information is stored and processed on computers located in Canada. MERX uses
procedural and technical safeguards to protect your personal information against loss or
theft, as well as against unauthorized access or disclosure, to protect your privacy,
including firewalls and encryption. We employ many different security techniques to
protect such data from unauthorized access by users inside and outside the company.
However, "perfect security" does not exist on the Internet.

10. Notice.

We may amend this Privacy Policy at any time by posting the amended terms on the
MERX system. All amended terms shall automatically be effective 30 days after they are
initially posted on MERX.

(c) MERX Pricing

MERX Canadian Public Tenders offers many benefits for registered Subscribers. As a
subscriber you have the ability to search for more than 1,500 open opportunities
(contracts) posted, and download the tenders (documents supporting the opportunities)
anytime, any day and anywhere. If you prefer to receive your tenders and amendments by
e-mail, fax, courier, pick-up or regular mail, MERX also offers Enhanced Services with
alternate delivery options to better serve you. MERX Subscribers can also access our
unique Opportunity Matching feature in addition to awarded opportunities, former
opportunities and international opportunities.

To meet your individual needs & budget, MERX Canadian Public Tenders offers two
subscription packages. Each package provides the option to customize and/or upgrade
with a number of Value-Added and Enhanced Services.

To view which offer best suits your needs, please see the information below.
Pricing does not include applicable taxes.

BASIC TENDERS SUBSCRIPTION

Basic Tenders Subscription Subscription Fee

1
Free access to Government of Canada (GC) tender documents $0/month for GC tenders

Pay an "Out of Jurisdiction Fee" to access non-federal tender $39.95/order basket for all other Canadian and Public-sector
documents tenders
1
Based on the Government of Canada's decision to eliminate fees for basic access to its
opportunities as of April 1, 2005.

The Basic Tenders Subscription package includes the following features and benefits:
 Access to all Open Opportunity Notices of Canadian public-sector buying
organizations

 Access to all Former Opportunities and Award Notices of Canadian public-sector

buying organizations

 Access to International Opportunities and Government Business Opportunities (GBO)

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 Access to GC tender documents only. Pay an "Out of Jurisdiction Fee" to access non-
federal tender documents.

 Access to the Document Request List (GC Opportunities only)

 Unlimited preview and download of GC tender documents

 Free Notification of Amendments

 One free Opportunity Matching profile

 Free delivery of Opportunity Matching results (e-mail, fax or online)

COMPLETE CANADIAN PUBLIC TENDERS SUBSCRIPTION

Choosing the Complete Canadian Public Tenders Subscription package gives you total
access to all public-sector tenders published online on MERX Canadian Public Tenders
for a low fixed monthly fee. Our rate also includes all of the Basic Tenders Subscription
benefits, as well as free Automatic Delivery of Amendments.

Complete Canadian Public Tenders

Subscription Fee
Subscription

Public sector Full access to all Canadian Open Opportunities $16.95/month or pre-pay $203.40/year

The Complete Canadian Public Tenders Subscription package includes the following
features and benefits:

 Full access to all Open Opportunities of Canadian public-sector buying

organizations

 Access to all Former Opportunities and Award Notices of Canadian public-sector

buying organizations

 Access to International Opportunities and Government Business Opportunities (GBO)

 Access to tender documents from ALL jurisdictions/regions (Federal, Provincial and

Municipal)

 Access to ALL Document Request Lists (Canadian Opportunities only)

 Unlimited preview and download of ALL tender documents

 Free Notification of Amendments

 Free Automatic Delivery of Amendments

 One free Opportunity Matching profile

 Free delivery of Opportunity Matching results (e-mail, fax or online)

 Low fixed monthly fee

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Value-Added Services

To better serve you, the Canadian Public Tenders service offers optional Value-Added
Services:

Service Price
Automatic Delivery of Amendments $4.95/month - With Basic Tenders subscription

$0 - included in Complete Canadian Public Tenders subscription

(Does not include applicable fixed order fees; see Enhanced

Services for a breakdown of prices)

Additional Opportunity Matching Profiles $1.95/month for up to 3 profiles,

$2.95/month for up to 9 profiles

Enhanced Services

The Canadian Public Tenders service offers Enhanced Services that offer alternate order
and delivery options of documents for all our service packages:

Service Price
Fixed fax and e-mail order $1.95/opportunity
$0.08/page

Fixed hard copy order $4.95

$4.95/additional set
(Regardless of the number of components in that one
opportunity) (Plus the duplication charge)

Fixed paper duplication charge $0.08/page

Fixed CD and DVD duplication charge $5.00

Fixed per blueprint duplication charge $0.15/square foot

$4.95/additional set

(Plus the duplication charge per additional set)

Delivery of documents, physical items and other media FREE for pick-up
$7.95 for courier
$2.50 for mail

(Does not include U.S. or International destinations)

Delivery of blueprints FREE for pick-up

$21.00 for courier
$15.00 for mail

(Does not include U.S. or International destinations)

Please note: If components are physical items (CD Rom, diskette, etc) and cannot be
delivered via download, a flat fee of $4.95 will be applied per opportunity ordered plus
delivery fees. These fees do not apply to Government of Canada opportunities.

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Philippines

Terms and Conditions

To use the Philippine Government Electronic Procurement System as a Supplier,

you must agree to the following Terms and Conditions by clicking the "I accept"
button. By submitting your registration information, you indicate that you agree to the
Terms and Conditions and have read and understand all the provisions included.
Your submission of this form will constitute your consent to the collection and use of
this information for processing and storage by PS-DBM. You also agree to receive
required administrative and legal notices such as this electronically.
1. Definitions
1. "Associated Component" means a document in paper or electronic form that
contains bid information for a Supplier to prepare and submit a proposal to a
government agency for an intended procurement. A Component can also refer to
Plans (blueprints) or physical items such as video tapes, computer CD's, or
samples of goods.
2. "Information" means all of the information, software and other materials provided
in connection with or available through the Philippine Government Electronic
Procurement System, including the procurement information, Bid Notices and
Associated Components that government agencies distribute through the
Philippine Government Electronic Procurement System.
3. "Philippine Government Electronic Procurement System" means the electronic
commerce service owned and operated by Procurement Service - Department of
Budget and Management, which serves as the central portal for all procurement
information and activities of the Government of the Philippines. The PHILGEPS
supports the distribution of this information about the procurement requirement
for goods and general support services, civil works or infrastructure projects and
consulting services.
4. "Opportunity Notice" means a summary in paper or electronic form of the
information relating to an intended procurement.
5. "Government Agency" means the Government of the Philippines or any other
public organization that has licensed the Procurement Service-Department of
Budget and Management to advertise and distribute its procurement information.
6. "Supplier" means an individual or entity that has ordered one or more Bid
Components from and is registered with the Government Electronic Procurement
System.
7. "Order Basket" refers to a collection of orders for one or more PHILGEPS'
Associated Components. Upon the submission of the Order Basket, the content
of the basket is complete.
2. Ownership and Use of Information
1. We acknowledge that any Information that we receive through the Philippine
Government Electronic Procurement System is owned either by the government
agency that issued the Information or by PS-DBM. We agree that we will not use,
store, copy, or reproduce the Information, or distribute or disclose it to any third
party, except for the sole purpose of having such third party assist us in
evaluating an opportunity or preparing a response to an opportunity. We agree
that we will not sell to any third party, or make available for the purpose of resale
to any third party, any Information received from the Philippine Government
Electronic Procurement System without the prior written consent of PS-DBM.

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3. Confidentiality and Security

1. We acknowledge that PS-DBM cannot ensure the privacy and authenticity of any
information that we send or receive through the Internet, and we agree that PS-
DBM will not be responsible for any damage/s that we incur if we communicate
confidential information to PS-DBM over the Internet, or if PS-DBM
communicates such information to us at our request.
2. We agree not to disclose our Philippine Government Electronic Procurement
System password to any third party. We agree that we are solely responsible for
all use of our password and we agree to put reasonable security procedures in
place regarding its use and to notify PS-DBM immediately of any unauthorized
use.
3. We acknowledge that links to other Websites through the Philippine Government
Electronic Procurement System do not imply any endorsement or approval by
PS-DBM.
4. Use of Internet
1. We acknowledge that if we access the Philippine Government Electronic
Procurement System through the Internet or other online access methods, we
are Responsible for reading and complying with any notice/s, warning/s or
disclaimer/s posted on the Procurement Service - Department of Budget and
Management or contained in the attached Internet Notices Page.
5. Consent - Use of Name
1. We authorize PS-DBM to make our name available to other registered users and
authorized users of the Philippine Government Electronic Procurement System at
any time and in any format for the purpose of meeting the requirements of the
Philippine Government Electronic Procurement System, including the publication
of document request lists and the names of successful bidders, but excluding the
provision of our name to other third parties for the purpose of mailing lists or any
other purpose not related to the Philippine Government Electronic Procurement
System.
6. Change of Address
1. We agree that we are responsible for providing our current delivery or invoicing
address, our fax delivery number or our e-mail address to PS-DBM for the
Philippine Government Electronic Procurement System. We will notify PS-DBM
immediately of any change of these addresses, by mail, by fax or by telephone.
7. Changes to Service and Agreement
1. We acknowledge that, from time to time, and at its discretion, PS-DBM may
amend the features of the Philippine Government Electronic Procurement
System, including the terms and conditions or pricing of this Agreement. PS-DBM
will provide us with a sixty-(60) days’ notice of any changes to the terms and
conditions in writing or on-line through the Philippine Government Electronic
Procurement System.
8. Termination
1. We acknowledge that PS-DBM may terminate this Agreement with us and
suspend our use of the Philippine Government Electronic Procurement System at
any time and for any reason.
2. We may terminate this Agreement as of the last day of any month by giving PS-
DBM at least thirty (30) days prior written notice.
3. On termination, we will return any Information provided to us on reasonable
request by PS-DBM.

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9. Liability
1. We acknowledge that PS-DBM assumes no responsibility for the availability,
accuracy, completeness or timeliness of any of the Information, or for the fitness
of such Information for any particular purpose.
2. We acknowledge that PS-DBM and its officers, directors, employees, agents and
subcontractors will not, under any circumstances, be liable to us for damages,
including direct, indirect, special or consequential damages, even if PS-DBM has
been advised of or could have foreseen such damages, arising out of our use of
or reliance on the Philippine Government Electronic Procurement System. For
greater certainty, such damages shall include, without limitation, damages in
respect of loss of profit, loss of business revenue, failure to realize any expected
savings, and any claim made against us by a third party.
3. We agree that we will indemnify and hold harmless PS-DBM and its officers,
directors, employees, agents and subcontractors for any loss, damage, cost,
expense, liability or claim suffered or incurred by, or made against PS-DBM
arising out of our breach of this Agreement, or our fraud, misrepresentation,
negligence or wilful misconduct in our performance or non-performance under
this Agreement, but our liability in any one year under this Agreement will be
limited to the value of the charges incurred by us for the Philippine Government
Electronic Procurement System in the twelve (12) months preceding PS-DBM's
claim or demand against us.
10. Laws of Application
1. We agree that this Agreement will be governed by the laws of the Government of
the Philippines.
11. Assignment
1. We agree that PS-DBM may assign this Agreement, in whole or in part, without
our consent, and we may not assign this Agreement in whole or in part.
12. Prior Agreements
1. We agree that this Supplier Agreement supersedes any prior versions of the
Supplier Agreement governing the Philippine Government Electronic
Procurement System.

IMPORTANT NOTICE TO ALL USERS:

Confidentiality and Security
The Procurement Service Department of Budget and Management cannot ensure the
privacy and authenticity of any information or instructions you send to us or we send to
you over the Internet. PS-DBM will not be responsible for any damages you may incur if
you communicate confidential information to us over the Internet, or if we communicate
such information to you at your request.

Non-Responsibility
Procurement Service - Department of Budget and Management is not responsible in any
manner for direct, indirect, special or consequential damages, howsoever caused, arising
out of use of this website, or the reliance on the information it contains.

Available Only Where Permitted by Law

The products and services described in pages of Website of Procurement Service-
Department of Budget and Management, including the Philippine Government Electronic
Procurement System, only offered in jurisdictions where they may be legally offered.

Applicable Agreements

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All products and services of the Procurement Service - Department of Budget and
Management, including the Philippine Government Electronic Procurement System, are
subject to the terms of the applicable agreements.

Use of Information
The information contained in this Website is not intended to provide specific legal,
accounting, financial or tax advice for any individual 0and should not be relied upon in
that regard.

Accuracy and Changes

Facts and information provided by the Procurement Service - Department of Budget and
Management, including the Philippine Government Electronic Procurement System, are
believed to be accurate when placed on the Website. Changes may be made at any time
to the information at this Website without prior notice.

Software and Backup

While every effort is made to ensure that all software provided in this Website is suitable
for use on a wide variety of computer systems, you should take reasonable and
appropriate precautions to scan for computer viruses, and ensure compatibility of the
software with your specific computer system. You should also ensure that you have a
complete and current backup of the information contained on your computer system prior
to installing such software.

Hyperlinks are Not Endorsements

Links to other Websites or references to products, services or publications other than
those of the Procurement Service - Department of Budget and Management, including
the Philippine Government Electronic Procurement System, do not imply the
endorsement or approval of such websites, products, services or publications.

Trademarks belonging to PS-DBM and Other Entities

Certain names, graphics, logos, icons, designs, words, titles or phrases in this website
may constitute trade names, trademarks or service marks of the Procurement Service -
Department of Budget and Management or other entities. Trademarks may be registered
in the Philippines and in other countries as applicable. The display of trademarks in
pages at this website does not imply that a license of any kind has been granted. Any
unauthorized downloading, re-transmission or other copying or modification of
trademarks and/or the contents herein may be a violation of existing or common law,
trademark and/or copyright laws and could subject the copier to legal action.

Copyright
All Information in this site is protected under the copyright laws of the Philippines and in
other countries. In addition, certain information may be copyrighted by others. Unless
otherwise specified, no one has permission to copy, redistribute, reproduce or republish
in any form, any information found in this Website. Inquiries about permission should be
directed to the Procurement Service - Department of Budget and Management at 63-2-
563-9365.

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