VOLUME 8
TYING OF AID AND UK BILATERAL AID EXTRACT FROM ODA OFFICE PROCEDURE VOLUME III
IIIB
9 TYING OF AID
(See para 16.9)
ANNEX 20
9.01 GENERAL
9.01.1 UK bilateral aid is tied to the provision of Eritish goods and services. In certain circumstances, as described below, a limited amount of bilateral aid may be untied.
9.01.2 UK multilateral aid is untied for procurement in those countries which are themselves members of the appropriate multilateral institutions.
Local Costs
9.01.3 Bilateral aid provided in the form of local costs is untied: for further details see OP IIIB-10.*
Aid Loans
9.01.4 Bilateral aid loans are partially untied, and are offered on the basis that, if the recipient government wishes, procurement will be extended to include not only sources in the UK but also to suppliers in the "poorest" developing countries.
9.01.5 In all cases where this limited untying provision is taken up, the Crown Agents must be used as the procurement agent. This is to ensure that there is fair competition, that rules of origin are enforced (see 9.01.6 below) and that value for money is obtained. For practical reasons it is also necessary to stipulate that this wider procurement option must apply to either the whole of a loan or to the whole of a project allocation. It would be impractical to use the Crown Agents to operate the wider procurement just for individual items within a project, with procurement for the rest of the project being limited to the UK.
Foreign Content and Waivers
9.01. 6 It is acknowledged that many goods supplied under tied aid will have an unavoidable foreign content in the form of raw materials or components which are an integral and inseparable part of the finished product. To cater for this a set of admissibility rules, which define the conditions under which foreign content is per- missible, has been agreed between Whitehall departments. A copy of these rules, which describe the circumstances in which waivers may be sought from the Export Policy Branch, CRE 2/2, Department of Trade, is at Annex 1.
9.01.7 Fertilisers supplied under the aid programme are subject to the normal admissibility rules. Each year the DOT agree with the Fertiliser Manufacturers Association the average foreign content in a range of fertilisers most commonly supplied under aid. The list (which is classified) is circulated periodically as a CM.
Enquiries
9.01.8 Enquiries about tied aid, including waivers of foreign content, should be addressed to Development Co-ordination Department.
*to be issued
September 1980
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AL/2