In South Korea, Government procurement can be centralized or decentralized. In centralized procurement a single specialized purchasing agency orders all goods and services. In Decentralized procurement, each government agency procures the material they need autonomously.
The public procurement is done from money collected from public vide taxes and other means for goods purchase, services and building facilities for public.
• High standards of fairness, transparency and ethicality required
• Function as efficient means to attain policy goals
• Appropriateness of prices and specifications is more critical.
KONEPS is overseen by PPS
The Public Procurement Service (PPS) established in 1961 is responsible for centralized procurement. Korea is also the member of WTO that enables Korea to procure from foreign companies. The major services of PPS are:
• Procuring for Korean Public Organization
• Government Stockpiling
• Management of government goods and nation-owned properties
• Operation of KONEPS
KONEPS is a comprehensive G2B e-Procurement platform not only for centralized procurement but also for more than 50 thousand public agencies (national agencies, local governments, public organizations etc) and over 340 thousand suppliers.
Key policy goals that KONEPS was subjected to achieve:
• Autonomous management with decentralization
• Globalization with open government procurement market
• IT enabled customer oriented innovation in government procurement
“KONEPS is a comprehensive G2B e-Procurement platform not only for centralized procurement but also for more than 50 thousand public agencies (national agencies, local governments, public organizations etc) and over 340 thousand suppliers.”
To achieve the project goals, KONEPS took following major initiatives
1. Strengthen Transparency: Disclose each bidding process to general public on real-time from bidding notice to evaluation to successful implementation.
2. Efficient procuring: Online automated processing with linkage between various procurement data without paper document.
3. Government Budget Saving from centralized, automated system.
4. Standardized procurement process prevent complicated contract provision interpretation
Standardization of DB establishment
• Standardization of user information, catalog information (UNSPSC – United Nation Standard Product and Service Code was introduced) and procurement documents (standardized based on ebXML).
• Other open source technologies used included PKI based electronic signature, SOAP based document distribution and Java based web services.
Laws related to procurement
• State Contract Act, Government Procurement Act and Local Finance Act were amended
• For decision making the procurement documents created by KONEPS is linked to the approval system from each of the related organizations such as business registration certificate, guarantee information from guaranteeing agencies, information on suppliers, performance etc.
KONEPS is now the world’s largest Government e-Marketplace and its shopping mall boasts of over 400 Thousand products. KONEPS system endorses Fair and transparent evaluation, feedback to businesses to achieve policy goals, support for green products. The evolution of KONEPS is depicted in trajectory below: