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Sat 20 Jan 2007 12:00 AM

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Calls for tougher legislation in the ME tendering process

Lawyer says that region is lagging behind other countries in the ‘transparency' of competitive tendering

A Dubai-based lawyer has called for more legislation to protect contractors bidding under competitive tender in the Middle East.

According to Nick Carnell, lead partner at the Dubai office of Kennedys, the region is lagging behind other areas of the world such as Europe when it comes to adopting procedures that ensure procurement is transparent and fair.

"The considerations which apply to public procurement in Europe simply do not exist [in the Middle East]," he said. "Government agencies are not subject to the degree of regulatory interference which affects those subject to European Union Procurement rules."

In the UK, the Code of Practice for the Selection of Main Contractors is used to ensure that best practice in tendering is observed. But the UAE currently has no equivalent, meaning that contractors face losing out to selective clients.

Although he acknowledges that market conditions in the Middle East and other areas of the world are very different, Carnell believes that if a project is put up for competitive tender in the region, then it must follow its intended route.

"The level of regulation which governs tendering processes in Europe is both unnecessary and inappropriate, but where works are expressed to be let on the basis of competitive tenders, that tender process should be truly competitive.

"If an employer wishes to let works to someone he favours, he can, but in doing so he risks not achieving the best price," added Carnell.

Rod Stewart, regional managing director, Hyder Consulting Middle East, said that greater tender transparency was needed and that it would also increase contractors' interest in bidding for projects.

"It would be greatly advantageous to know that tenders are fully transparent, and also that there was a greater reliance on a two-envelope process - technical competence being the first filter, and openly viewed as such, with at least a 70% emphasis on technical ability and available resources.

"We believe that the market forces of supply and demand are the main reasons for current low levels of tendering interest.

"And the opportunities to enter into open and more transparent partnering style arrangements in these circumstances will then appear to be the more attractive," he added.

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