Principles to Goods for law no 4734

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Principles Amending the Principles to Apply in Calculation of Price Difference related with the Goods to be procured under Public Procurement Law No.4734
(As Amended)

Turkish Official Gazette Date:05/02/2003
Turkish Official Gazette No: 25015


Purpose
Article 1- The purpose of these principles is to establish the principles and procedures to be used in calculation of the price differences for the goods procurements contracted pursuant to Public Procurement Contracts Law No 4735 of the Contracting Entities under the scope of Public Procurement Law No 4734.
Scope
Article 2- The transactions related with the price difference calculations to be applied in lump sum contracts and unit price contracts related with the procurement of petroleum products contracted according to the Public Procurement Contracts Law No 4735 and goods, which are produced by the tradesmen and craftsmen under the Tradesmen and Small Craftsmen Law no 507, shall be carried out according to these principles.
Basis
Article 3- These principles have been drawn up based on the article 8 of the Public Procurement Contracts Law No 4735.
Principles to be observed by Contracting Entities
Article 4- The Contracting Entities must include provisions stated herein in the specifications and contracts of the goods to be procured under Public Procurement Law# 4734 in order to be able to calculate price difference.
Definitions
Article 5- For the application of provisions on the goods procurements the following definitions shall apply;
a) Contracting Entity: the organizations and institutions within the scope of the Public Procurement Law No 4734,
b) Goods: all kinds of goods and movable and immovable goods and rights procured with tenders under the Public Procurement Law No 4734,
c) Contract: Written agreement between the Contracting Entity and the contractor for the procurement of services over lump sum or unit prices,
d) Lump Sum Price: The total price offered by the tenderer for the whole of the goods procurement, detailed properties and quantity of which are specified by the Contracting Entity,
e) Contract unit price: the price established in the contract for each work item to be carried out according to the tender document in the unit price contracts,
f) Work item with offered unit price: The units forming the basis for the payments, technical or special characteristics of which are stated, and the costs of which are shown in the contract at the goods procurements to be carried out according to the unit price contract,
g) Delivery date: the date on which the good is delivered to the Contracting Entity in accordance with the delivery program approved by the Contracting Entity,
h) Petroleum products: gasoline types, kerosene, diesel, marine diesel, heating fuel, liquid petroleum gas and fuel-oil types,
i)  Price Schedule: the price schedules, which are prepared by the related chambers and enacted with the approval of the Union Presidential Board of such chambers, relating to the goods, produced by the tradesmen and craftsmen under the Tradesmen and Small Craftsmen Law no 507,
j) Maximum Retail Sale Price: the local maximum retail price (excluding VAT) of the petroleum products, notified by the liquid fuel distribution companies to Ministry of Energy and Natural Resources and to the governorships,
k) Price difference coefficient: The lowest local maximum retail sale price of the procured petroleum product on tender date or the coefficient showing the ratio of the difference between the price of the good produced by the tradesmen and craftsmen under the Law no 507 the in the price schedule and the contract price to the lowest local maximum retail sale price or the price in the price schedule,
l) Price difference: The price to be paid or deducted according to these principles for the good items delivered to the Contracting Entity according to the delivery program in the unit price contracts and for the goods amounts delivered as per the total delivery percentages according to the delivery program in lump sum contracts,
Application Principles
Article 6- The following principles must be observed in price difference calculation:
a) No amendments may be made to the procedures and principles in the contract related with the price difference once the contract is signed.
b) The costs to be paid or deducted in addition to the contract price as a result of the application of these principles are in the form of price difference and do not affect the contract price.
c) No price difference shall be paid for works procured all at once based on both the quantity and technical specifications.
d) No price difference shall be paid due to the increases in the price, tax and insurance. 
e) These principles shall not apply to works, the costs of which are paid in foreign exchanges or Turkish Lira equivalent of foreign exchanges by calculating exchange differences separately.
f) No provision on the payment of price difference shall be included in the administrative specifications and contracts for the goods, of which the local maximum retail price or price schedules have not been determined.
In cases where the prices of the goods, for which the price difference has been calculated, is freed or the price increase rates makes the execution of the contract impossible, it is mandatory to include in the contracts the provision that the arrangements on the price difference payment be invalid.
The Contracting Entities may include limitations related with the payment of price difference up to a specific ratio of the contract amount in the contracts
g) No price difference may be paid due to the delays resulted by the contractor's fault to perform his obligation on time in accordance with the provisions of the administrative specifications and contract.
h) In case time extension is granted to the contractor due to the forces majeure stated in article 10 of the law no 4735 or due to the Contracting Entity's fault, no price difference shall be paid to the contractor unless opposing provisions are stated in the administrative specifications and contract.
i) The price difference shall be calculated after deducting the advance payment for goods procurements where an advance payment has been made.
j) In the calculation of the price difference coefficient and the price difference of the petroleum products, the lowest local maximum retail prices (excluding VAT) notified to the Ministry of Energy and Natural Resources and the governorships by the liquid fuel distributors on tender date and during the execution of the contract, in the calculation of the price difference coefficient and the price difference of the goods produced by the tradesmen and craftsmen under the Law no 507 the price schedule valid as of the tender date and during the execution process shall apply.
k) For the healthy execution of the price difference application and the correct calculation of the price difference to be deducted or paid, the records of the delivered goods shall be kept as of price change periods.
Price difference calculation
Article 7 - The price difference coefficient and the price difference shall be calculated according to the following formulas:
F: Price Difference (TL),
Pn: Price difference coefficient,
A1: the lowest local maximum retail price (excluding VAT) of the procured petroleum product on the tender date or the price of the procured good in the price schedule,
B: Contract price,
A2: the lowest local maximum retail prices (excluding VAT) of the procured petroleum product notified to the Ministry of Energy and Natural Resources and the governorships by the liquid fuel distributors after signing the contract or the price of the procured good in the new price schedule,
M: The quantity of the good delivered to the Contracting Entity after the lowest local maximum retail price or the price schedule is changed,
1- The price difference coefficient shall be calculated according to the following formula:     
                           A1 - B
            Pn =   ------------
                  A1                 
2- (Amended: 05.02.2004- 25015/ art. 1) In case the lowest local maximum retail price or the price in the price schedule is established more than the contract price, the price difference to be paid to the contractor shall be calculated according to the following formula:
F=M x [ (1-Pn ) x (A2 - A1)]"
3- In case the lowest local maximum retail price or the price in the price schedule is established less than the contract price, the price difference to be deducted from the contractor shall be calculated according to the following formula:
F= M x [ B - ( A2 – ( A2 x Pn))] 
Enactment
Article 8- These principles shall enact as of the publication date to be valid from  1/1/2003.
Enforcement
Article 9- The Cabinet shall enforce these principles.

[juana17]

Principles Amending the Principles to Apply in Calculation of Price Difference related with the Goods to be procured under Public Procurement Law No.4734
(As Amended)

Turkish Official Gazette Date:05/02/2003
Turkish Official Gazette No: 25015


Purpose
Article 1- The purpose of these principles is to establish the principles and procedures to be used in calculation of the price differences for the goods procurements contracted pursuant to Public Procurement Contracts Law No 4735 of the Contracting Entities under the scope of Public Procurement Law No 4734.
Scope
Article 2- The transactions related with the price difference calculations to be applied in lump sum contracts and unit price contracts related with the procurement of petroleum products contracted according to the Public Procurement Contracts Law No 4735 and goods, which are produced by the tradesmen and craftsmen under the Tradesmen and Small Craftsmen Law no 507, shall be carried out according to these principles.
Basis
Article 3- These principles have been drawn up based on the article 8 of the Public Procurement Contracts Law No 4735.
Principles to be observed by Contracting Entities
Article 4- The Contracting Entities must include provisions stated herein in the specifications and contracts of the goods to be procured under Public Procurement Law# 4734 in order to be able to calculate price difference.
Definitions
Article 5- For the application of provisions on the goods procurements the following definitions shall apply;
a) Contracting Entity: the organizations and institutions within the scope of the Public Procurement Law No 4734,
b) Goods: all kinds of goods and movable and immovable goods and rights procured with tenders under the Public Procurement Law No 4734,
c) Contract: Written agreement between the Contracting Entity and the contractor for the procurement of services over lump sum or unit prices,
d) Lump Sum Price: The total price offered by the tenderer for the whole of the goods procurement, detailed properties and quantity of which are specified by the Contracting Entity,
e) Contract unit price: the price established in the contract for each work item to be carried out according to the tender document in the unit price contracts,
f) Work item with offered unit price: The units forming the basis for the payments, technical or special characteristics of which are stated, and the costs of which are shown in the contract at the goods procurements to be carried out according to the unit price contract,
g) Delivery date: the date on which the good is delivered to the Contracting Entity in accordance with the delivery program approved by the Contracting Entity,
h) Petroleum products: gasoline types, kerosene, diesel, marine diesel, heating fuel, liquid petroleum gas and fuel-oil types,
i)  Price Schedule: the price schedules, which are prepared by the related chambers and enacted with the approval of the Union Presidential Board of such chambers, relating to the goods, produced by the tradesmen and craftsmen under the Tradesmen and Small Craftsmen Law no 507,
j) Maximum Retail Sale Price: the local maximum retail price (excluding VAT) of the petroleum products, notified by the liquid fuel distribution companies to Ministry of Energy and Natural Resources and to the governorships,
k) Price difference coefficient: The lowest local maximum retail sale price of the procured petroleum product on tender date or the coefficient showing the ratio of the difference between the price of the good produced by the tradesmen and craftsmen under the Law no 507 the in the price schedule and the contract price to the lowest local maximum retail sale price or the price in the price schedule,
l) Price difference: The price to be paid or deducted according to these principles for the good items delivered to the Contracting Entity according to the delivery program in the unit price contracts and for the goods amounts delivered as per the total delivery percentages according to the delivery program in lump sum contracts,
Application Principles
Article 6- The following principles must be observed in price difference calculation:
a) No amendments may be made to the procedures and principles in the contract related with the price difference once the contract is signed.
b) The costs to be paid or deducted in addition to the contract price as a result of the application of these principles are in the form of price difference and do not affect the contract price.
c) No price difference shall be paid for works procured all at once based on both the quantity and technical specifications.
d) No price difference shall be paid due to the increases in the price, tax and insurance. 
e) These principles shall not apply to works, the costs of which are paid in foreign exchanges or Turkish Lira equivalent of foreign exchanges by calculating exchange differences separately.
f) No provision on the payment of price difference shall be included in the administrative specifications and contracts for the goods, of which the local maximum retail price or price schedules have not been determined.
In cases where the prices of the goods, for which the price difference has been calculated, is freed or the price increase rates makes the execution of the contract impossible, it is mandatory to include in the contracts the provision that the arrangements on the price difference payment be invalid.
The Contracting Entities may include limitations related with the payment of price difference up to a specific ratio of the contract amount in the contracts
g) No price difference may be paid due to the delays resulted by the contractor's fault to perform his obligation on time in accordance with the provisions of the administrative specifications and contract.
h) In case time extension is granted to the contractor due to the forces majeure stated in article 10 of the law no 4735 or due to the Contracting Entity's fault, no price difference shall be paid to the contractor unless opposing provisions are stated in the administrative specifications and contract.
i) The price difference shall be calculated after deducting the advance payment for goods procurements where an advance payment has been made.
j) In the calculation of the price difference coefficient and the price difference of the petroleum products, the lowest local maximum retail prices (excluding VAT) notified to the Ministry of Energy and Natural Resources and the governorships by the liquid fuel distributors on tender date and during the execution of the contract, in the calculation of the price difference coefficient and the price difference of the goods produced by the tradesmen and craftsmen under the Law no 507 the price schedule valid as of the tender date and during the execution process shall apply.
k) For the healthy execution of the price difference application and the correct calculation of the price difference to be deducted or paid, the records of the delivered goods shall be kept as of price change periods.
Price difference calculation
Article 7 - The price difference coefficient and the price difference shall be calculated according to the following formulas:
F: Price Difference (TL),
Pn: Price difference coefficient,
A1: the lowest local maximum retail price (excluding VAT) of the procured petroleum product on the tender date or the price of the procured good in the price schedule,
B: Contract price,
A2: the lowest local maximum retail prices (excluding VAT) of the procured petroleum product notified to the Ministry of Energy and Natural Resources and the governorships by the liquid fuel distributors after signing the contract or the price of the procured good in the new price schedule,
M: The quantity of the good delivered to the Contracting Entity after the lowest local maximum retail price or the price schedule is changed,
1- The price difference coefficient shall be calculated according to the following formula:     
                           A1 - B
            Pn =   ------------
                  A1                 
2- (Amended: 05.02.2004- 25015/ art. 1) In case the lowest local maximum retail price or the price in the price schedule is established more than the contract price, the price difference to be paid to the contractor shall be calculated according to the following formula:
F=M x [ (1-Pn ) x (A2 - A1)]"
3- In case the lowest local maximum retail price or the price in the price schedule is established less than the contract price, the price difference to be deducted from the contractor shall be calculated according to the following formula:
F= M x [ B - ( A2 – ( A2 x Pn))] 
Enactment
Article 8- These principles shall enact as of the publication date to be valid from  1/1/2003.
Enforcement
Article 9- The Cabinet shall enforce these principles.

Thank you for sharing with us the following Principles to Goods for law. Actually this is my first time to know and read that there are a principles to good for law.



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California Orange County Lawyer