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Official Gazette

Wednesday, September 20, 2017

Law on Bidding

Updated: 09:51’ - 04/07/2014

The new Law on Bidding (the Law) was passed in November 2013 and will take effect on July 1 this year.

With 96 articles arranged 13 chapters, the Law provides bidding activities, responsibilities of related parties and state management of bidding.

Scope of regulation

Compared to the 2005 Bidding Law and its 2009 amendments, the Law expands its governing scope to cover all bidding activities to select contractors to provide consultancy or non-consultancy services, supply goods or carry out construction and installation work under development investment projects with a state capital accounting for 30 percent or more of the total investment funds or exceeding VND 500 billion. The Law also applies to the selection of investors to carry out public-private partnership projects or land-occupying projects. It additionally governs the selection of contractors to provide consultancy or non-consultancy services or supply goods in Vietnam for implementing Vietnamese enterprises’ offshore investment projects with a state capital accounting for 30 percent or more of the total investment funds or exceeding VND 500 billion. The selection of contractors in the field of oil and gas is also governed by the Law. 

Online selection of contractors and investors

Based on the pilot implementation of online bidding from 2009 to 2012, the Law devotes Chapter VII to providing the online process to select contractors and investors, which is simple and transparent. This online selection process will be conducted through the national bidding network.

According to Article 60, the following activities will be conducted online: publishing bid information and bid invitations; paying bid security or contract performance security; receiving, opening and assessing bids; and signing and concluding contracts; and other related activities.

The national bidding network must satisfy the requirements specified in Article 61.

The Government will specify the methods of online selection.

Foreign bidders

Under the Law, foreign bidders may take part in international bidding in Vietnam. However, they must join partnerships or sign sub-contracts with domestic contractors. Foreign contractors may employ foreign workers only when there are no qualified Vietnamese workers available for their bidding packages. These regulations aim to create jobs for local workers and help domestic contractors get access to advanced technologies and managerial experiences, thus improving their competitiveness. 

Besides, international bidding for selection of contractors must meet the conditions specified in Article 15.

Bid evaluation methods

Under Chapter IV, different bid evaluation methods are specified for the selection of contractors and selection of investors. Compared to the current regulations, the Law adds several new methods.

For non-consultancy services, goods procurement, and construction and installation or combined bidding packages, in addition to the current method based on the lowest price, the Law introduces a method based on both technical grounds and price.

For consultancy bidding packages, four methods are provided in the Law. The method based on technical and financial grounds and the method based on technical grounds are specified in the current Law. Two new methods are the method based on the lowest price and the method based on fixed price.

Modes of selection of contractors and investors

The Law allows four modes of selection of contractors and investors, including one-dossier-bag mode in one stage, two-dossier-bag mode in one stage, one-dossier-bag mode in two stages, and two-dossier-bag mode in two stages.

The second mode is applied to consultancy or non-consultancy services, goods procurement, and construction and installation or combined bidding packages (applied to consultancy service bidding packages under the current Law). Contractors meeting capacity, experience and technical requirements may submit financial proposals for review, comparison and ranking. A contractor offering the lowest price but failing to meet capacity experience and technical requirements will be eliminated before submitting financial proposals.

Two decrees guiding the selection of contractors and investors are expected to be issued soon.-

VNL_KH1 

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