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 andits 2009 amendments, the Law expands its governing scope to cover allbidding activities to select contractors to provide consultancy ornon-consultancy services, supply goods or carry out construction andinstallation work under development investment projects with a statecapital accounting for 30 percent or more of the total investment fundsor exceeding VND 500 billion. The Law also applies to the selection ofinvestors to carry out public-private partnership projects orland-occupying projects. It additionally governs the selection ofcontractors to provide consultancy or non-consultancy services or supplygoods in Vietnam for implementing Vietnamese enterprises’ offshoreinvestment projects with a state capital accounting for 30 percent ormore of the total investment funds or exceeding VND 500 billion. Theselection of contractors in the field of oil and gas is also governed bythe Law.
Online selection of contractors and investors
Based on the pilot implementation ofonline bidding from 2009 to 2012, the Law devotes Chapter VII toproviding the online process to select contractors and investors, whichis simple and transparent. This online selection process will beconducted through the national bidding network.
According to Article 60, the followingactivities will be conducted online: publishing bid information and bidinvitations; paying bid security or contract performance security;receiving, opening and assessing bids; and signing and concludingcontracts; 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.
Under the Law,foreign bidders may take part in international bidding in Vietnam.However, they must join partnerships or sign sub-contracts with domesticcontractors. Foreign contractors may employ foreign workers only whenthere are no qualified Vietnamese workers available for their biddingpackages. These regulations aim to create jobs for local workers andhelp domestic contractors get access to advanced technologies andmanagerial 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 bidevaluation methods are specified for the selection of contractors andselection of investors. Compared to the current regulations, the Law adds several new methods.
For non-consultancy services, goodsprocurement, and construction and installation or combined biddingpackages, 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, fourmethods are provided in the Law. The method based on technical andfinancial grounds and the method based on technical grounds arespecified in the current Law. Two new methods are the method based onthe lowest price and the method based on fixed price.
Modes of selection of contractors and investors
The Law allowsfour modes of selection of contractors and investors, includingone-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 twostages.
The secondmode is applied to consultancy or non-consultancy services, goodsprocurement, and construction and installation or combined biddingpackages (applied to consultancy service bidding packages under thecurrent Law). Contractors meeting capacity, experience and technicalrequirements may submit financial proposals for review, comparison andranking. A contractor offering the lowest price but failing to meetcapacity experience and technical requirements will be eliminated beforesubmitting financial proposals.
Two decrees guiding the selection of contractors and investors are expected to be issued soon.-