Transparency in European public procurement: benefits and lessons for Malaysia

Malaysia has rather robust procurement regulations that compel agencies to implement the principles of transparency, value for money, and fair dealings in procurement activities. However, there are areas in which Malaysia can improve especially to encourage competition and innovation. The paper outlines measures that can be adopted by the Malaysian government to improve the competitiveness and transparency of its procurement system. These measures are inspired by the European Procurement system that is explored in the first part of the paper along with the benefits associated with greater transparency in public procurement.

Transparency is one of the core principles in EU procurement. It is required in all stages of procurement, but particularly in three phases of tendering, evaluation and review in order to ensure non discrimination and equal treatment. The paper describes how the principles of transparency is applied in these stages.

The four measures advocated by the paper are as follows: (1) contracting agencies should add clearer and more detailed evaluation criteria in tender notices or tender documents, (2) contracting agencies should provide information about the reasons for choosing certain contractors and rejecting others to both winning and losing contractors as well as to the public, (3) a review phase should be incorporated into the system to allow contractors to fi le for complaints if they are not happy with the decisions made by the agencies and (4) the government should create parameters to ensure Bumiputera preferences in government procurement are less distortive to competition and are awarded in a transparent manner.