What is a Framework Agreement?
- A Framework Agreement is a legal instrument executed initially between PPI and suppliers who are owners of exclusive proprietary technology and/or their exclusive representative.
- The terms and conditions of the Framework Agreement are pre-negotiated and apply to all future contracting by the end users via the Framework Agreement.
- After the Agreement is signed, PEMEX and its subsidiaries become legal parties to it via a notice of accession and then issue orders to suppliers.
- Framework Agreements are used by PEMEX and its subsidiaries to implement strategic sourcing.
Benefits that these agreements offer to PEMEX:
- Provide an effective and efficient means for purchasing goods and services under an international procurement framework
- Allow them to leverage their spend volume
- Establish electronic delivery of purchase ordere
- Secure standardized best terms and conditions that would apply throughout the enterprise
- Drastically reduce paperwork and delivery times
- Accomplish a one-time comprehensive negotiation of terms and conditions
Benefits to Suppliers and Service Providers:
- Pre-negotiated and standardized terms and conditions
- Better payment terms
- Better delivery terms
- Reduced transportation risks (or none in some cases)
- Proof of delivery is obtained directly by PPI (depending on delivery term)
- Flexibility to add new products
- Multiyear blanket orders