Forms and methods of selection of bidders/investors and professional bidding organizations in Vietnam

Vietnam law has regulations on Forms and methods of selection of bidders/investors and professional bidding organizations. Let’s find out this issue with Lawyer X through the following situation: “Dear Lawyer! I want to ask what are forms of selection of bidders/investors in Vietnam? What are Regulations on Professional bidding organization? Thanks for answering me!”

Legal grounds

• 2013 Vietnam Law on Bidding

Regulations on Competitive bidding

– Competitive bidding is form of selection of bidders/investors in which the number of participating tenders, investors shall be unrestricted.

– Competitive bidding is applied to packages, projects under Scope of regulation of 2013 Vietnam Law on Bidding, except for cases specified in Articles 21, 22, 23, 24, 25, 26 and 27 of 2013 Vietnam Law on Bidding.

Regulations on Limited bidding

Limited bidding shall apply in case where a package has highly technical requirements or technical peculiarities for which only a limited number of bidders are capable of satisfying the requirements of the package.

Regulations on Direct Contracting

– Direct Contracting for contractor shall apply in the following cases:

+ Packages need to be performed to immediately overcome or timely handle consequences caused by force majeure event; packages need to be performed to ensure national secret; packages need to be carried out immediately to not cause damages directly to life, health and assets of population communities on geographical areas or to not severely affect to adjacent projects; procurement of purchasing drugs, chemicals, supplies, and health equipment in order to carry out the work of prevention and fighting of epidemics in urgent cases;

+ Urgent packages need to be carried out aiming to protect national sovereignty, national borders, and islands;

+ Packages of provision of consulting services, non-consulting services, procurement of goods which must buy from contractors performed previously due to ensuring the compatibility of technologies, copyright which not able to buy from other contractors; packages with nature of research, test; purchase of intellectual property copyright;

+ Packages provide consulting service for making feasible study reports, construction designs which have been appointed for authors of designs of works architectures who won in selection or are selected when authors have full conditions and capability in accordance with regulations; packages of construction of statues, reliefs, monumental paintings, art works in association with author right from the creation stage to stage of construction of the works;

+ Packages of relocation of technical infrastructure works managed directly by a specialized unit in order to serve the work of ground clearance; packages of detection and disposal of bombs, mines, explosives in order to prepare construction of works;

+ Packages of providing public products and services, packages with package price in the limitation allowed to apply Direct Contracting as prescribed by Government in line with economic-social conditions in each period.

– Implementation of Direct Contracting for packages defined at points b, c, d, dd and e Clause 1 this Article must satisfy all the following conditions:

+ Having an approved decision on investment, except for consulting packages for project preparation;

+ Having an approved plan on selection of bidders;

+ Having been allocated capital at the request of the time for performance of procurement;

+ Having an approved estimate in accordance with regulation, except for case of EP, EC, EPC packages, turnkey packages;

+ Having time for implementation of Direct Contracting as from the day of approving Request for Proposals to day of signing contract not exceeding 45 days, case of packages with big scale, complex content not exceeding 90 days;

+ Contractor who is suggested for Direct Contracting must have name in the database on contractors of regulatory bodies on bidding operation.

– For packages under cases of Direct Contracting specified at Clause 1 this Article and satisfy conditions for Direct Contracting specified at Clause 2 this Article but still able to apply other forms of selection of bidder defined at Articles 20, 21, 23 and 24 of 2013 Vietnam Law on Bidding, encouraging to apply other forms of selection of bidder.

– Direct Contracting for investor shall apply in the following cases:

+ There is only one investor registering bidding;

+ There is only one investor able to perform due to concerning intellectual property, commercial secret, technologies or capital arrangement;

+ Investor proposing project satisfy requirements of implementation project with feasibility and highest efficiency in accordance with regulations of Government.

Regulations on Shopping Method

– Shopping Method shall apply to packages with value in limitation as prescribed by Government and belonging to one of the following cases:

+ Package of procurement of non-consulting services which are commonly used and simple;

+ Package of procurement of goods which are commonly used goods, readily available on the market, have standardized technical features and are similar to each other in quality;

+ Package of procurement of simple works which have had the approved construction drawing design.

– Shopping Method is performed when satisfying all following conditions:

+ Having an approved plan on selection of bidders;

+ Having an approved estimate in accordance with regulation;

+ Having been allocated capital at the request of the time for performance of package.

Regulations on direct Procurement

– Direct Procurement shall apply to packages of procurement of similar goods of a same project, estimated budget of procurement or of other project, estimate of procurement.

– Direct Procurement shall be performed when satisfying all following conditions:

+ The contractor has won bidding through open or limited bidding and has signed performance contract of previous package;

+ The package has similar content, nature, and scale less than 130% of package signed contract previously;

+ The unit price of the items of a package for which the form of Direct Procurement is applied shall not exceed the unit price of the corresponding items of the previous similar package for which a contract was signed;

+ Time-limit from signing contract of previous package to day of approving result of Direct Procurement does not exceed 12 months.

– If contractor performed the previous contract is not able to continue performance of package of Direct Procurement, form of Direct Procurement shall be applied to other contractor if such contractor satisfies requirements on capability, experiences, techniques and price according to the previous Bid and result of selection of bidder.

Regulations on Force Account

Force Account shall apply to packages of projects and estimates of procurement in case organizations directly managing and using such packages have technical and financial capability, and experiences satisfying requirements of packages.

Regulations on Selection of bidders/investors in special cases

In the case of a package, project with particular requirements for which the forms of selection of bidder/ investor stipulated in articles 20, 21, 22, 23, 24 and 25 of 2013 Vietnam Law on Biddingcannot be applied, the competent person shall prepare a plan for selection of bidder/ investor and submit it to the Prime Minister for consideration and decision.

Regulations on Community’s participation in performance

Population communities, organizations, teams, groups of workers in localities where have packages may be assigned to perform entire or part of such procurement in the following cases:

– Packages under the national objective programs, support programs of hunger elimination, poverty reduction for districts, communes in mountainous, deep-lying and remote areas, islands, areas with special difficulty-stricken economic-social conditions;

– Packages with small scale which population communities, organizations, teams, groups of workers may undertake.

The single-stage one-envelope bidding procedure

– The single-stage one-envelope bidding procedure shall apply in the following cases:

+ Competitive bidding, limited bidding for procurement of non-consulting service provision; procurement of procurement of goods, works, mixed packages with small scale;

+ Shopping Method for procurement of non-consulting service provision, goods procurement, works;

+ Direct Contracting for procurement of the consulting service provision, non-consulting service provision, goods procurement, construction, mixed packages;

+ Direct Procurement for procurement of goods procurement;

+ Direct Contracting for selection of investor.

– Bidders/investors may submit Bids, Proposals including Technical Proposal and Financial Proposal at the request of Bidding Documents, Requests for Proposals.

– The bid opening shall be conducted once for all Bids, Proposals.

The single-stage two-envelope bidding procedure

– The single-stage two-envelope bidding procedure shall apply in the following cases:

+ Competitive bidding, limited bidding for procurement of consulting services, non-consulting services, goods procurement, works, mixed packages;

+ Competitive bidding for selection of investor.

– Bidder or investor may submit concurrently both envelopes of Technical Proposal and Financial Proposal in a separate form at the request of Bid.

– Bid opening shall be conducted twice. Technical Proposal shall be opened as soon as deadline for submisison of bids. Bidders or investors satisfying the technical requirements shall have the envelope of Financial Proposal opened for assessment.

The two-stage one-envelope bidding procedure

– The two-stage one-envelope bidding procedure shall apply in cases of competitive bidding, limited bidding for package of procurement of goods, works, mixed packages with big scale and complex nature.

– In the first stage, bidders may submit Technical Proposal and Financial Proposal at the request of Bidding Documents but not yet had Bid Price. On the basis of exchange with each contractor participating in this stage, the envelope shall be determined for bid invitation in second stage.

– In second stage, bidders participated in first stage shall be invited for submission of Bids. Bids include Technical Proposal and Financial Proposal at the request of Bid for second stage, in which included Bid Price and Bid Security.

The two-stage two-envelope bidding procedure

– The two-stage two-envelope bidding procedure shall apply in cases of competitive bidding, limited bidding for procurement of goods, works, mixed packages with new, complex and particular techniques and technologies;

– In first stage, bidders shall submit concurrently both envelopes of Technical Proposal and Financial Proposal in a separate form at the request of Bid. Technical Proposal shall be opened as soon as deadline for submisison of bids. On the basis of assessment on Technical Proposal of bidders in this stage, to determine contents corrected in techniques in comparison with Bid and list of bidders satisfying requirements and being invited for bidding in second stage. Financial Proposal shall be opened in second stage.

– In second stage, bidders satisfying requirements in first stage shall be invited for submission of Bids. Bids include Technical Proposal and Financial Proposal at the request of Bid for second stage corresponding to content corrected in techniques. In this stage, the envelope of Financial Proposal submitted in first stage shall be opened concurrently with Bids in second stage for assessment.

Regulations on Professional bidding organization

– Professional bidding organization includes bidding agents, non-business units which are established with function of performing professional bidding.

– The establishment and operation of bidding agents shall comply with legislations on enterprises.

– The Government shall elaborate this Article.

Please see more:

• Instructions for exclusive registration of company logos in Vietnam
• Service of changing the legal representative of Vietnamese enterprises

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