HOW TO PROCESS A PENCOM, ITF, NSITF COMPLIANCE CERTIFICATES, REGISTER WITH BPP AND SUCCESSFULLY SUBMIT A TENDER/EXPRESSION OF INTEREST TO EXECUTE A GOVERNMENT CONTRACT.
The economic system of Nigeria being a blend of Government and private participation calls for a synergy between both partners in progress to formulate a course of action that will ensure the best qualified contractors, firms and companies in line with the Public Procurement Act (PPA) 2007 secure the right or license to implement Government projects that best suits public interest.
On the strength of the above premise, it is paramount for us to delve into the eligibility requirements prospective bidders are obligated to present before their bid is said to have been successfully submitted.
Firstly, before an entity can be classified as a qualified Firm or Company capable of processing a PENCOM, ITF and NSITF compliance certificate for purpose of a tender/expression of interest, such a body must have been appropriately registered with the corporate affairs commission (CAC). Upon completion of the registration process, the commission issues a Certificate of Incorporation as a prima facie evidence of registration, as well as a certified true copies(CTC’s) of the Form CAC 2A, 2.1, 7A or 1.1 which specifies details of the Directorship, shareholders/shareholding, secretary, and registered address of the company. These set of documents must be in the company’s registry at all time. It is then imperative for a prospective bidder to ensure that a fresh/new application for CTC of the Certificate, Form CAC 2A, 2.1, 7A or 1.1 is made to the commission so as to save the time which the Government agency making the offer will expend investigating the authenticity of the documents if mere photocopies of the originals were enclosed in the bid.
For a successful tender/expression of interest to be accomplished, a copy of the company’s income Tax Clearance Certificate(TCC) for the last three years preceding the invitation for tender/expression of interest valid till 31st December of the present year of bidding must be applied for and secured. A company’s income Tax Clearance Certificate is essential in the entire tender/expression of interest submission process in that the certificate is a reoccurring requirement all relevant commissions and agencies of Government need before a compliance certificate is issued. The foremost step in the process of securing a company’s income Tax Clearance certificate is obtaining the Company’s Taxpayers Identification Number (TIN) from an FIRS office closest to the company’s registered address. Then an application for the company’s income TCC has to be made to the Federal Inland Revenue Services (FIRS) with the following documents:
For new companies less than 6months
- Taxpayer registration input form.
- Completed FIRS questionnaire for new taxpayers on the company’s Letter Head addressed to the tax controller.
- A copy of the certificate of incorporation, Memorandum and articles of association. If the application is being made for the First time, the original certificate of incorporation must be presented for sighting.
- Letter of appointment of a tax adviser and Letter of acceptance.
- Completed VAT registration Form
For companies older than 6months
- All requirements listed above applies and,
- Statement of affairs or audited account signed and stamped by an auditor, accompanied with a Bank statement of the company. It aids the officials at FIRS to make an informed assessment.
- Payment of pre-operational levy
Essentially, an evidence of current pension (PENCOM) compliance certificate valid till 31st December of the bidding year is vital in ensuring a tender/expression of interest to execute a Government contract is successful. The PENCOM compliance certificate is the only document that confirms that the provisions of Pension Reform Act, 2014 has been complied with. The following are documents, processes and remittances prospective bidders wishing to obtain the PENCOM compliance certificate are required to possess and follow in their quest of procuring the compliance certificate:
- A copy of the certificate of incorporation and evidence of FIRS Taxpayers identification Number (TIN). These two documents accompany a Letter requesting for an employer code from PENCOM. The employer will submit the above listed documents to a Pension Fund Administrator (PFA) who will forward the criteria to PENCOM for the issuance of an employer code.
- Once the employer code is issued, the employer (who has more than 15 personnel) will be mandated to register at least 3 staff of the company with the PFA for a monthly pension contribution at the rate of a minimum of ten percent (10%) by the employer and eight percent (8%) by the employee making a total of eighteen percent (18%) pension contribution. The evidence of the Monthly pension contribution will be provided by the PFA for presentation to PENCOM.
- After concluding with the PFA, an application will formerly be made to PENCOM for the issuance of a compliance certificate which will be accompanied with a certified list of employees of the organization and their Monthly rate of pension contribution as at the end of the last fiscal year. The certification is best done by at least two Directors of the company to establish its authenticity.
- Last but not least, is an evidence of a current Group life insurance policy for a Minimum of 3 staff specifying the sum assured
Proof of current Industrial Training Fund (ITF) compliance certificate valid till 31st December of the bidding year is fundamental for a successful tender/expression of interest.
The ITF Act provides that any supplier, contractor or consultant bidding or soliciting for contracts from any Government Ministries, Departments or Agencies must contribute to the Fund one percent 1% of its total annual payroll. This rule applies to employers having 5 or more employees or having less than 5 employees but with turnover of N50m and above per annum.
The process of registering a new employer for an ITF compliance certificate is as follows:
- The Prospective Employer can download ITF Form 7A (Employer Registration and Payment of Training Contribution Form) from ibechidoassociates.com, complete it and present it for submission at the nearest ITF area office along with
- A copy of the company’s certificate of incorporation issued by the CAC
- Certified True Copy of the Company’s Audited Account
- A Copy of the Company’s Tax Clearance certificate.
- At the ITF area office, a Revenue inspectorate and compliance officers will evaluate and assess the liability of the company based on the total annual payroll contained in the Company’s Audited Account.
- The subsequent step will be for the company to generate an RRR based on the assessment of the officer through the Remita platform and make payment at any Bank for Training contribution.
- After payment is made, the company is expected to return the Remita payment receipt and the duplicate teller from the Bank to the ITF office. A Hard copy receipt and Acknowledgement letter will then be issued as a final confirmation of Payment of Training Contribution.
- At this stage, the ITF Area Office will then forward the employers details as contained in the ITF Form 7A to Headquarters’ Revenue Inspectorate and Compliance Department for issuance of ITF National Number.
- The ITF National Number will then be sent to the Area office for scripting and issuance of a Certificate of Compliance which serves as an evidence of compliance with the ITF Act.
Also evidence of current Nigerian Social Insurance Trust Fund (NSITF) Compliance certificate is key to a successful tender/expression of interest. The issuance of the yearly compliance certificate to an employer will require the following documentation and process of application:
- The employer/company will be expected to signify their intention to secure the compliance certificate by making a request on its letter head paper to the Fund. And the letter will be accompanied with the following documents:
- A copy of the Certificate of Incorporation issued by CAC
- Completed ECS RE 01 Registration Form, payroll Form RE 03 and the 10 digit Registration Number issued to the employer upon registration with the Fund.
- A copy of the NSITF receipt showing evidence of payment through remita.net
It is important to note that the assessment of the liability of the employer subject to the issuance of an NSITF Compliance certificate is 1% of 5 staff total salary for the Number of months applicable to an applying employer/company.
Furthermore, for a bid to be said to have been successfully submitted, an evidence of an Interim Registration Report (IRR) from the National Database of Federal contractors, consultants and service providers has to be attached to the bid.
For a company to be registered on the system, it has to provide the following documents:
- CAC Registration Number as captured on the Certificate of incorporation.
- The type of company of the employer (e.g. Private company limited by shares)
- FIRS (TIN)
- Company address details as contained in the CAC 3 or 1.1 of the company.
Upon a successful completion of the process, a Username and Password will be sent to the official mail address provided by the Company so as to afford the company the chance to provide its details to the portal.
Additional requirement such as a sworn affidavit which serve the purpose of ensuring under oath that the committee members of the MDA’s has no pecuniary interest in the Bidder has to be attached as well.
The Audited Account of the Company for the last three years preceding the bidding date has to be prepared stamped and sealed by an Auditor.
The Firm, Contractor or Company making the tender/expression of interest must show evidence that it has the financial capability to execute the project. Financial capacity is proved if the Firm, Contractor or Company can provide a reference letter from a reputable Commercial Bank showing readiness to offer the required capital to complete the project when needed.
Other pertinent documents that must accompany a Bid are:
Pictures of projects the company has completed within the last 5 years that has earned them the trust that they have the experience and capacity to execute the present bid project has to be enclosed too. The Letter of award, valuation/job completion certificate has to be attached to establish authenticity.
Evidence of registration with professional bodies and curriculum Vitae of key staff of the company is also imperative to the submission of a successful bid.
For the purpose of submission of the bid, potential bidders have to make certain that the Technical Documents which comprises of all relevant documents listed above as well as the Technical Capacity to handle the job is enclosed in a separate envelop (marked Technical) and the Financial bid which is the valuation of the of the entire project in the bid inclusive of VAT in another envelop (marked Financial). The two separate envelops shall the be enclosed in one sealed outer envelope marked “INVITATION FOR TENDER” stating the “Lot No”, Company name, RC No., “project title”.
In truth, whatever is worth doing at all is worth doing well and nothing can be done well without attention. The above listed process and procedure is the foundation most Government Ministries, Departments and Agencies must adopt so that they will not be in breach of the Public Procurement Act 2007 in the process of implementing projects appropriated in the MDA’s Budget.
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