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Memo

8th Amendment to the Public Finance Regulation

March 11, 2023

Introduction

The 8th amendment to the Public Finance Regulation (Regulation No: 2023/R-69) (“8th Amendment”) came into force on 13th February 2023. The amendment has been brought into effect to amend provisions concerning changes to procurement project agreements.

Public Finance Regulation

The Public Finance Regulation (Regulation No: 2017/R-20) (“Regulation”) came into force on 20th February 2017. The Regulation governs the utilization of public finance by government
offices.

8th Amendment

The 8th Amendment introduces new guidelines to follow in amending procurement project agreements. Below are the main changes:

  • To amend or terminate an agreement, consent has to be obtained from the most senior official of the office from which the project has been awarded.
  • If the price or the time period of the agreement is to be changed, consent has to be also obtained with respect to the following:

Table (a)

Change in price
  • < or = 15% increase: relevant office’s bid committee has to consent.
  • >15% increase: National Tender Board has to consent.

  • If there is a change in tax rate under the GST Act 2011, and subsequently if the tax rate under the agreement has to be revised, the most senior official of the relevant office has to consent.
  • Before consent is granted, the relevant office’s financial head has to: 
    • ensure that the change is feasible;
    • ensure that the change does not conflict with office budget policies; and
    • state the changes to budget that will result from this change in price. 
  • Relevant office has to publish the change on their website within 2 business days. 
Change in time

  • Relevant office’s bid committee has to consent.

  • If the change in time is related to, or subsequently brings about, a change in price, table (a) is applicable.

  • Relevant office has to publish the change on their website within 2 business days.

  • The prospective change to the agreement has to be within the scope of the project. 

 

Authors

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Zain Shaheed

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