Electronic Invoicing: $27 million or $8.5 million?

There is a striking difference between the offers received by the Ministry of Finance in Costa Rica, in a competition which was held exclusively between state entities in order to avoid mandatory controls on public procurements.

Tuesday, June 28, 2016


In Costa Rica, there is a new phenomenon not seen before: the illogical is no longer surprising, and, what is worse, the unexplainable is accepted as normal.

How is it that two bids to do the same thing can have such different prices, as is the case of those submitted to develop an electronic invoicing system for Empresa de Servicios Públicos de Heredia (ESPH) and Radiographic Costarricense S.A. (RACSA)?  

Is it possible that this absurdity is simply part of a crude process for palming a juicy contract without having to compete with private companies? What are the testimonies of both companies as software developers?

An article in Elfinancierocr.com reports  "...Empresa de Servicios Públicos de Heredia (ESPH) won the contract for electronic invoicing for Radiographic Costarricense S.A. (RACSA), awarded by the Ministry of Finance through a contract between public bodies and without recourse to any tender or contract that would have required the endorsement of the Comptroller General of the Republic (CGR). "

ESPH must now hire a specialized software company to develop the system, and the name of that company "... was not released because it was alleged that there is a confidentiality clause."

Perhaps the Kafkaesque system of public procurements in Costa Rica is forcing the authorities who want to get the job done to avoid it. Maybe this is the only way that the much needed electronic invoicing system will be implemented on time, in the manner required and at an appropriate costs.

I hope it does work out like this, but even though a noble outcome is being sought, the ends do not justify the means, which in practice are undermining the free competition between companies that should exist in an economy that claims to be liberal.

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More on this topic

Costa Rica: Mandatory Electronic Invoicing for Some Companies

January 2017

It has been announced that from March a group of large taxpayers will have to start using the electronic billing system mandatorily.

According to the Directorate General of Taxation, they will begin with a group of companies considered large taxpayers, who have already received training to implement the use of electronic invoices starting from March.

Ultra Fast "Tender" in Costa Rica

July 2016

In the tender to design and implement an electronic billing system for the Treasury, interested companies only have five working days in which to submit bids.

In a tender which requires, among other things, five years of experience in systems development, experience in project management and even a certificate from the Project Management Institute, Empresa de Servicios Público (ESPH) is only allowing five business days for interested companies to submit their proposals.

Costa Rica: Contracts Between "pals" in the Public Institutions

December 2015

State institutions avoid competition between telecoms companies by hiring telecommunications services, without using tender processes and without time limits, from the state run Instituto Costarricense de Electricidad and Radiográfica Costarricense.

Instead of creating tenders to generate healthy competition between telecommunications operators and to find the best cost / benefit ratio, as all private companies do, state institutions renew agreements with the state run ICE and RACSA despite the market opening of the telecommunications industry, regardless of price or terms of service that they offer.

RACSA: A -Blind- Elephant in the Bazaar

April 2015

Costa Rica's state telecom company plans to reach viability as a company competing with the private sector in logistics services, data centers, and in the area of ​​Digital Government.

This will be a new attempt to recover the positive numbers of Radiographic Costarricense, whose new portfolio of products aims to compete with private companies that have over twenty years of experience in the market.