Support for the Implementation of the CGAP applicable to HEP d.d.

Location:

Croatia

Funding source:

EBSF - EBRD Shareholder Special Fund

Contract type:

Consultancy Services

Notice type:

Invitation for expressions of interest (CSU)

Issue date:

03 Aug 2020

Closing date:

02 Sep 2020   at  17:00   London

Access eSelection

Single Stage Open Competitive Selection – Request for Proposals

Background: The European Bank for Reconstruction and Development (the “EBRD”) is
providing a loan of up to EUR 87 million to HRVATSKA ELEKTROPRIVREDA
dioničko društvo (“HEP” or the “Company”),
[1] a joint stock company incorporated in Croatia. As part of the Loan Agreement between HEP and EBRD, HEP committed to
implement a Corporate Governance Action Plan (“CGAP”), targeting the most relevant
areas necessitating improvements in corporate governance practices and related legal acts.
The CGAP also includes actions aimed at strengthening HEP’s compliance function and
related internal policies and procedures.

The EBRD is providing further support to HEP with respect to improving corporate
governance. In this context, the EBRD is providing technical assistance (subject to
availability of donor funding) to HEP in order to assist with the implementation of the
CGAP. In particular, it is foreseen that activities will, inter alia, include developing
succession planning for key function holders and in establishing a risk management
function and compliance function (including the development of a compliance programme).

Where appropriate, this work shall be followed up with provision of training related to the
functioning of the mentioned bodies/functions.

All the tasks to be performed in the above mentioned areas will be undertaken following
best applicable corporate governance practices and international standards (in particular
the OECD Principles of Corporate Governance and the OECD Guidelines on Corporate
Governance for State-Owned Enterprises), and taking into account Croatian corporate
governance standards, national regulatory framework, primarily Government decision on
the obligation to introduce the function of monitoring compliance of business operations
majority state-owned entities of 17 October 2019[2], national best practices and the
specificities of the local legal/institutional setting, as well as the commitments undertaken in
the CGAP. The tasks relating to compliance shall also be in line with good international
practice documents, including (but not limited to) ISO 37001 on Anti-Bribery
Management Systems, Transparency International’s Business Principles for Countering
Bribery and Transparency International’s 10 Anti-Corruption Principles for State-Owned
Enterprises.

Assignment Description: In the context of the EBRD Project the EBRD is now seeking
to engage a corporate governance consultant (the “Consultant”) in order to support HEP
in improving its corporate governance practices by implementing specific actions of the
CGAP (the “Assignment”).

Further details on the Assignment can be found in the attached Terms of Reference the “ToRs”) attached hereto: http://www.ebrd.com/documents/admin/dwdtor84200.pdf

Consultant Selection Procedure: Single stage open competitive selection.
Interested firms or groups of firms are invited to submit a Technical and Financial Proposal.

Assignment Start Date and Duration: The Assignment is expected to start in
September 2020 and has an estimated overall duration of 36 months.

Cost Estimate for the Assignment: EUR 175,000.00 exclusive of VAT but including
any costs i.e., travel, translation, etc.
The Consultant must determine whether any VAT
would be chargeable on the services and the basis for that determination, without
taking into consideration the special status of the Bank as an IFI and state this to
the Bank in their response to the Invitation for Expressions of Interest. To the
extent that a Consultant incurs input VAT on goods and services purchased in
connection with the provision of services (e.g. VAT on airline ticket) which is not
otherwise recoverable by the consultant from the local tax authority, the gross cost
to the consultant of such expenses shall be treated as a reimbursable expense.

Subject to availability of funding, the performance of the selected Consultant and the
business needs, the Assignment may be extended beyond the current scope.

Funding Source: It is anticipated that the contract will be financed by EBRD’s
Shareholder Special Fund.
Selection and contracting will be subject to the availability of
funding.

Eligibility: There are no eligibility restrictions based on the Consultant’s nationality

Consultant Profile: Corporate services are required. The Consultant will be a firm or a
group of firms, with preferably previous project experience related to :
- developing, managing and implementing complex projects related to corporate
governance, compliance, risk management and internal audit of state-owned
enterprises
(previous experience in projects related to the energy sector and
corporate governance of state-owned enterprises in Croatia and/or in the region will
be considered an advantage);
- advising state authorities on the analysis and review of risk management/appetite
and corporate governance practices, processes and policies of state-owned enterprises
and in developing recommendations for their improvement as well as assisting authorities
for their implementation;
- assessing the compliance function of companies, especially relating to the
implementation of anti-bribery and anti-corruption policies, procedures and processes and
advising on the improvements of its design/effectiveness;
- reviewing and assessing corporate governance legislation and practices - through
desk reviews, field research, interviews and site-visits - and draft legislative and regulatory
amendments related to corporate governance of state-owned enterprises, in line with best
practices.

The Consultant's expert team is expected to include the following key experts (the 'Key
Experts
'):

Key Expert 1: (Senior Corporate Governance Expert - Team Leader) with 12 years or more of relevant project experience in:
- Corporate governance of state-owned enterprises, including local/regional practices and
standards as well as international best practices;
- Internal control and risk management; risk appetite frameworks; and risk
management/control function; compliance and internal audit functions for state-owned
enterprises;
- Advising state authorities on regulatory and governance issues;
- Projects related to energy and corporate governance of state-owned enterprises in
Croatia and/or in the EU or broader region;
- Designing and conducting knowledge-sharing activities on corporate governance in the
form of workshops, seminars and trainings; and
- Preferably fluent in both Croatian and English.

Key Expert 2: (Compliance and Legal Expert) with preferably 10 years or more of
experience in:
- Developing, implementing and monitoring corporate business integrity policies and
processes
(especially anti-bribery and anti-corruption related) as a way to prevent
misconduct, foster corporate accountability and serve to support consumer and investor
confidence;
- Integrating considerations of business integrity into companies’ corporate governance
frameworks
, strategy and operations, establishing compliance functions and delineating the
role of board and executive management in implementing business integrity-related
provisions to prevent, detect and address corporate misconduct;
- Applying international best practices related to corporate integrity and compliance
standards and procedures;
- the practices and legal framework on corporate governance of SOEs in Croatia;
- Advising SOEs, authorities and/or regulators on the laws and secondary legislation
governing SOEs in Croatia
, SOE decision making process, management structure,

corporate bodies’ functions and responsibilities, reporting and accountability lines, internal
control structure (including evaluation of risk management, compliance and internal audit);
and
- on the above issues;
- Preferably fluent in English and Croatian.

Key Expert 3: (Risk management expert) with preferably 10 years or more of experience in:
- Risk management in the energy sector, in particular financial and non-financial risks
related to electricity generation, distribution and supply as well as processes, systems and
practices used in identifying, measuring, reporting and mitigating these risks;
- Risk governance frameworks and processes in companies (preferably including SOEs),
including assessment of board’s (and board committees’) responsibilities in determining
risk appetite and establishing and overseeing reporting and monitoring systems as well as
allocating responsibilities within the company’s corporate bodies (i.e. Risk Management
Committee, Risk and Audit Committee and Board of Directors/Supervisory Board etc.);

- Advising SOEs and authorities on the above issues;
- Designing and conducting knowledge-sharing activities on risk management in the form
of workshops, seminars and trainings;
- Relevant projects for SOEs in Croatia and/or in the region; and
- Preferably fluent in English and Croatian.

Submission Requirements
: Interested consultants are now invited to submit a
completed Technical and Financial Proposal
as per the standard templates and
instructions available here:
http://www.ebrd.com/documents/procurement/single-stage-procurement-package-for-firms.docx

Interested Consultants should make themselves familiar with these Standard Templates,
Standard Instructions and Conditions of Contract in preparation of their proposals.

The Technical Proposal shall be submitted in English electronically via eSelection
not later than the Closing Date, as one single PDF file.
The Technical Proposal should not
exceed 40 pages excluding the Declaration Form and CVs (Form 1- TP 1 and Form 1 –
TP 6).

The Financial Proposal (Form 2 – FP 1 and FP2) shall be submitted in English
separately by email only to the
following e-mail address:
poddprocurement@ebrd.com
. Please indicate the Project number and title in the
subject of your e-mail.
Consultants are reminded of the requirement to ensure the
confidentiality of the Financial Proposals.

A Technical Proposal that contains elements of a Financial Proposal shall be
declared non-responsive. A Financial proposal submitted together with the
technical proposals via eSelection shall be declared non-responsive.

For the avoidance of doubt, technical proposals should be sent through eSelection and
NOT to the above email address. Financial proposals should be sent to the above email
address and NOT through eSelection or the Bank Contact Person.

Bank Contact Person:

Viv Lewis-Headlam
European Bank for Reconstruction and Development
One Exchange Square
London EC2A 2JN
E-Mail: lewishev@ebrd.com

Deadline to Submit Clarification Questions: Via e-mail to PODDprocurement@ebrd.com by 22 August 2020.

Selection Method and Evaluation Criteria:

1. Technical Proposal Evaluation Criteria

(a) Firm’s relevant previous project experience in the region/country of the Assignment: (20%);
(b) Firm’s relevant previous project experience in similar assignments: (20%);
(c) Proposed approach to the Assignment, team composition and allocation of roles,
aligned to the tasks to be implemented within this Assignment, work plan and
methodology: (30%);
(d) CVs of Key Experts: (30%).

Interviews:

Following the evaluation under the technical criteria from (a) to (d) inclusive above, firms
with a combined score of 70 (%) or above will be invited to interviews. The interviews
must be attended by Key Expert 1, Key Expert 2, and Key Expert 3.

EBRD will advise the Consultant regarding the format (e.g. skype call, , conference call

etc) and date of the interviews at the time of the invitation. Please note that all and any

costs incurred by the Consultant in connection with attendance to interviews shall be

borne by the Consultant.

Combined Technical and Interviews Evaluation and Ranking:

The weights given to the Technical (T) and Interview (I) evaluation are:
T = 80 and

I = 20

Submissions will be ranked according to their combined technical (St) and interview (Si)
scores using the weights (T=the weight given to the Technical; I = the weight given to the
Interview; T+I=1) as following: S=St x T% + Si x I%.

2. Opening of Financial Proposals

After the technical evaluation as defined above is completed, only the submissions which
score 70 or above will be eligible to have their Financial Proposals opened.

3. Combined Technical and Financial Evaluation

The lowest evaluated Financial Proposal (Fm) is given the maximum financial score (Sf) of
100. The formula for determining the financial scores (Sf) of all other Proposals is
calculated as follows:
Sf = 100 x Fm/ F, in which “Sf” is the financial score, “Fm” is the lowest evaluated
Financial Proposal, and “F” the price of the Proposal under consideration.

Proposals are then ranked according to their combined technical (St) and financial (Sf)
scores using the weights (T = 80; F = 20) T + F = 100 as follows: S = St x T% + Sf x
F%.

Important Notes:

1. The proposal validity period is 120 days from the deadline date for the receipt of
submissions. During this period, the Consultant shall maintain its original Proposal without
any change, including the availability of the Experts, the proposed rates and the total price.

2. The selection will be made from the Proposals received in response to this notification
only, on the basis of the submission requirements and selection criteria set out in this
Procurement Notice. The highest-ranked Consultant will be selected and invited to
negotiate the contract, subject to availability of funding.

3. Any updates of and clarifications on this procurement notice shall be announced as
updates on this notice, without any other notification. In the event of changes consultants
will need to download the updated versions. Consultants are required to periodically
check the notice for updates. Failure to take the updates into account while preparing the
Proposal may result in disqualification or penalties to the scores in the evaluation.







[1] https://vlada.gov.hr/UserDocsImages/2016/Sjednice/2019/Listopad/185%20sjednica%20VRH/185%20-%206.docx

[2] As a fully state-owned joint-stock company, HEP is the central actor in the Croatian electricity sector, dealing with generation, distribution and supply of electricity. More information on HEP is available at: http://www.hep.hr.