Ceska pozice_Interview: AmCham’s Weston Stacey on public procurement bill, new ‘Wings’ award winners

Daniel Weinhold and Dan Ťok won the ‘AmCham Wings’ award for helping push MPs to make public orders more transparent.

Link to the interview: http://www.ceskapozice.cz/en/news/politics-policy/interview-amcham%E2%80%99s-weston-stacey-public-procurement-bill-new-%E2%80%98wings%E2%80%99-award-winn?page=0,0

The American Chamber of Commerce (AmCham) in the Czech Republic connects more 1,600 top executives and business owners representing 450 companies and advocates policies that aim to increase economic competitiveness here. Its advocacy work, in terms of legal reform and economic development, has helped shape major Czech policies as regards investment incentives, bankruptcy, and the commercial registry.

Anti-corruption efforts, particularly in the realm of public tenders, is also high on the chamber’s agenda. AmCham held its traditional Thanksgiving Day ball in Prague, which raises money for charitable works it sponsors, on Nov. 19 at Palác Žofín. “The evening had a spirit of social responsibility: for the chamber’s charity project Kč 547,200 was raised and the first-ever AmCham Wings Award went to Daniel Weinhold of Weinhold Legal and Dan Ťok of Skanska,” the chamber said in a press release.

The chamber’s “One World, Many Voices” project is part of a larger Corporate Social Responsibility (CSR) initiative; the new AmCham Wings Award went to two members of the chamber who are heavily involved in the Platform for Transparency in Public Procurement (PTPP), which has lobbied parliamentarians for changes to the Law on Public Procurement (and succeeded, it says, in setting down stricter guidelines). Czech Positon asked AmCham’s executive director, Weston Stacey, about the chamber’s work in this regard. 

Q: What is the aim of the “One World, Many Voices” project, when was it founded, how is it funded, and what kinds of programs or activities has it funded/aided over the years?
A: One World, Many Voices was founded in 2000 because we wanted to help prepare children for the increasingly international world they will live and work in. Until recently, it had one aim: to help elementary schools purchase language laboratories. We are now considering whether we should expand the program to include the training of language teachers. One World, Many Voices is funded through donations of our members, primarily at the Thanksgiving Ball.

Q: Are Czech elementary schools the sole beneficiaries? How are the schools chosen? Is the program expanding?) Do AmCham members donate services, equipment and know-how, for example, in addition to raising money for One World, Many Voices recipients?
A: We have selected some middle schools in the past, but most of the laboratories have gone to elementary schools. The schools are selected by a group of businesspeople and local officials, and approved by our executive team. Members such as 3M, Hewlett Packard and AV Media have given us significant discounts on the equipment we purchased. If we expand the program to include training, we expect that we will ask some of our members to provide expertise in that area.

Q: Does AmCham have other such targeted initiatives in the realm of charity/Corporate Social Responsibility?
A: We have just started our Truth and Trust program. This program aims to create a more open and constructive dialogue between various segments of society, and to help educate students on the importance of ethical behavior.

Q: How did the Wings Award idea come about, and what is its aim?
A: Ron Adams, who is our president, thought we should publicly recognize the exceptional contributions that some of our members make to our organization and the wider business community. These people put in a great deal of time and talent to improving all our lives, and this award is a small token to tell them we appreciate it.

Q: How are nominees — and the eventual winners — chosen?
A: Our members were asked to nominate individuals, and our board of directors decided from amongst those nominees.

Q: Daniel Weinhold of Weinhold Legal, the non-voting chairman, and Dan Ťok (one of a couple of dozen members) were both honored for their work on the Platform for Transparency in Public Procurement initiative. Could you elaborate on how Mr Ťok, in particular, contributed to the effort beyond that of other members?
A: Dan Ťok was the chair of the Platform, which was composed of the top representative of all participating entities and which had to approve the recommendations made by the expert group, which Daniel Weinhold chaired. Dan spent a good deal of time meeting with various members of the platform preventing political and organizational conflicts and coaxing out an agreement on issues. He also pushed some members of the business community to support the reforms.

Q: Could you comment a bit on the work of the runners-up for the AmCham Wings award?
A: Peter Hájek [of PriceWaterhouse Coopers] has been an essential player in developing our programs to promote research and development in the country. Karel Janeček’s [RSJ Algorithmic Trading] fight against corruption [via the Anticorruption Endowment, or NFPK] has vitalized the business community. Lucie Melicharová [of learn2grow] helped to create our ethics program in schools. And Jan Valdinger [Managing Partner at Change Partnership] has been a longstanding force within our organization in such areas as ethics and the development of human resources.

Q: How does the Platform for Transparency in Public Procurement assess the amendment to the Law on Public Procurement adopted in early November? Mr Ťok said at the time that the most important changes made were 1) the obligation to publish contracts, 2) to disclose prices actually paid; 3) to explain reasoning for expedited contracts; 4) reduction of threshold for holding tenders from Kč 3 million to Kč 1 million; 5) obligation to reveal subcontractors taking above 10% of the project (and 5% for large orders). What had the Platform lobbied to include, specifically? Mr Ťok alludes to unspecified “shortcomings” — in what aspects was it successful and in which unsuccessful?
A: The 39 principles of the Platform can be downloaded [in Czech] at www.transparentnizakazky.cz and an overview of the new act can be found in the policy pipeline on www.czechcompete.cz. In essence, we wanted to create more efficiency and transparency in the procedures, and more transparency in the contracts and ownership.
The bill that was sent to the Senate achieves major improvements in the procedures — for example, by introducing measures that should make it much harder to rig bids and requiring authorities to publicly justify the necessity for issuing the procurement — and contracts. It was not intended to address fully the transparency of ownership, which experts believe should be addressed in other laws. ‘One subject of controversy is how “business secrets” should be defined in order to protect true competitive secrets’
The government is currently drafting amendments that would introduce such transparency in public transactions not only in the procurements governed by the law but in the smaller procurements which fall outside the law, as well as in the activities of state-owned enterprises. We are going to be supporting that effort to make sure it moves quickly and effectively.
We still have some discussions about how some of the new procedures will work in practice. One subject of controversy is how “business secrets” should be defined in order to protect true competitive secrets while avoiding abuse of the term to hide pricing and other basic information that is necessary for the public — who pays the bills — to know.
Many of the participants of the Platform were extremely disappointed by Mr. [Milan] Urban’s decision to re-introduce provisions that will allow [state-controlled power company] ČEZ to escape from the transparency and efficiency required by the new law. Minister [for Regional Development Kamil] Jankovský has promised to fix this problem in new legislation, and we hope that this will happen.

Q: Could you expand a bit on the importance of these specific measures, perhaps with examples of favoritism or corruption that have been publicized?
A: The measures against bid-rigging should prevent tenders in which only one bidder “fits” the criteria. The publication of contracts and the requirement to make public the final cost when the project is finished will curtail all sorts of manipulation after the tender is decided. Publishing the economic and policy arguments for conducting a tender increases the accountability of public officials to the public, and, if the public is active, can prevent wasteful or unnecessary projects. By requiring top officials to approve major procurements and not hide behind a decision of a lower level bureaucrat, the new law is raising the level of accountability of our elected officials.

Q: One member of the public wrote on the site in June (www.transparentnizakazky.cz) that he could find no clear statement on how the initiative would work to increase transparency. No one answered him (on line, anyway) – what would you say to him now? And is there anything you would like to stress about the work of AmCham and the Platform?
A: For effective procurement, you need transparency of procedures, transparency in the transaction and fulfillment, and transparency of ownership. As I said before, the new law greatly improves the transparency in the procedures and the transactions. It needs amendment of other legislation to achieve transparency in ownership. The legislation, of course, is only step one. Much will depend on how the authorities implement the new rules, and how much the public pressures the government to be open and accountable.
The only thing I would say about AmCham’s participation is that while we view the Chamber [lower house of Parliament] bill as substantial progress, we do not view it as final victory. We made a commitment to the public to make the procurement process transparent and effective, and we intend to keep working at it until the country is considered an example of how to conduct public procurement.


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