MEASURES FOR HANDLING THE COMPLAINTS OF THE GOVERNMENT PROCUREMENT SUPPLIERS

Ministry of Finance

Order of the Ministry of Finance of the People’s Republic of China

No. 20

Measures for Handling the Complaints of the Government Procurement Suppliers discussed and adopted at the executive meeting of the
Ministry, are hereby promulgated and shall come into force as of the day of September 11, 2004.

Minister, Jin Renqing

August 11, 2004

Measures for Handling the Complaints of the Government Procurement Suppliers ContentsChapter I General Provisions

Chapter II Filing of Complaints and the Acceptance

Chapter III Handling of Complaints and the Decisions

Chapter IV Legal Liabilities

Chapter V Supplementary Provisions

Chapter I General Provisions

Article 1

With a view to preventing and rectifying the illegal or inappropriate government procurement actions, protecting the legal rights
and interests of the suppliers in government procurement, safeguarding the national and public interests and establishing a sound
and highly efficient handling mechanism for government procurement complaints, the present Measures are formulated in accordance
with the Government Procurement Law of the People’s Republic of China (hereinafter referred to as the Government Procurement Law).

Article 2

The present Measures shall apply to the suppliers’ initiating of complaints to the financial departments pursuant to the law, the
financial departments’ acceptance of complaints and making of decisions.

Article 3

The financial departments of the people’s governments at the county level or above shall be responsible for accepting and handling
the complaints filed by the suppliers in accordance with the law.

The Ministry of Finance shall be responsible for handling the complaints of the suppliers in the government procurement activities
under the central budget projects.

The financial departments of the local people’s governments at the county level or above shall be responsible for handling the complaints
of the suppliers in the government procurement activities under the budget projects at the same level.

Article 4

The financial departments at all levels shall publicize their respective telephone number, fax and other matters that may facilitate
the suppliers’ filing of complaints through the media designated by the financial departments for releasing the government procurement
information.

Article 5

When the financial departments handle the complaints; they shall stick to the principle of fairness, impartiality, convenience and
high efficiency so as to safeguard the national and public interests.

Article 6

A supplier shall be subject to the real name system when it (he) files a complaint. Such complaint shall have specific matters to
complain about and factual basis. No one may file any false or malicious complaint.

Chapter II Filing of Complaints and Acceptance

Article 7

Where a supplier alleges that the procurement documents, process, bid and transaction results have caused any damage to its (his)
legal rights and interests, it (he) may initially challenge the purchaser or procurement agency. If the purchaser or procurement
agency fails to give a satisfactory response or respond within the prescribed time limit, the supplier may lodge a complaint to the
financial department at the same level within 15 working days after the expiry of the time limit for response.

Article 8

When a complainant initiates a complaint, it (he) shall submit a statement of complaint and shall offer enough number of duplicates
on the basis of the number of the purchaser, procurement agency against whom the complaint is filed (hereinafter referred to as the
party against whom a complaint is filed) and the supplier(s) relating to the matters complained about.

A statement of complaint shall mainly contain:

(1)

The name, address and telephone number of the complainant and the party against whom the complaint is filed;

(2)

Specific matters to complain about and the factual basis;

(3)

Query and response thereto and relevant evidentiary materials; and

(4)

Date of filing a complaint.

The statement of complaint shall be signed. If the complainant is a natural person, it shall be signed personally. If the complainant
is a legal person or any other organization, it shall be signed by the legal representative or the person chiefly in charge and shall
be affixed with the official seal.

Article 9

A complainant may entrust an agent to handle the complaint related matters. When the agent deals with such matters, it (he) shall
not only submit a complaint, but also a power of attorney from the complainant to the financial department at the same level. The
power of attorney shall clearly set forth the specific power and matters under entrustment.

Article 10

A complainant who initiates a complaint shall meet the conditions below:

(1)

It (he) is a supplier who has participated in the government procurement activities;

(2)

It (he) has made a query in accordance with the law before initiating a complaint;

(3)

The content of the complaint shall be consistent with the present Measures;

(4)

It (he) initiates a complaint within the valid period for doing so;

(5)

It (he) is within the jurisdiction of this financial department;

(6)

The same matters complained about haven’t been tackled as a complaint by the financial department; and

(7)

Other conditions as prescribed by the financial department of the State Council.

Article 11

After the financial department receives a complaint, it shall examine it within 5 workdays. If the complaint does not meet the relevant
conditions, the financial department shall handle it respectively according to the following provisions:

(1)

If the content of the complaint does not meet the relevant requirements, it shall inform the complainant to make necessary corrections
and lodge a new complaint;

(2)

If the complaint is not within the jurisdiction of this department, it shall be transferred to the competent department and the complainant
shall be informed of the transfer; or

(3)

If the complaint doesn’t meet the other conditions, it shall inform the complainant in writing of the dismissal of the complaint and
set forth the basis for such dismissal.

As for a complaint that meets the relevant conditions, it shall be deemed to have been accepted as of the date on which the financial
department receives it.

Article12

The financial department shall serve duplicates on the party against whom a complaint is filed and the suppliers related to the matters
complained about within 3 working days after acceptance of the complaint.

Article 13

The party against whom a complaint is filed and suppliers relating to the matters complained about shall, within 5 working days after
their receipt of the duplicates, make a written explanation to the financial department and shall submit the relevant evidence, basis
and other materials.

Chapter III Handling of Complaints and Decisions thereupon

Article14

In principle, the financial department shall adopt the approach of written examination when handling a complaint. If it considers
necessary, it may make an investigation so as to obtain evidence as well as organize a face-to-face cross-examination between the
complainant and the party against whom the complaint is filed.

Article 15

If the financial department makes an investigation in accordance with the law, the complainant, the party against whom a complaint
is filed and the entities and persons relating to the complaint shall faithfully present the facts as well as the pertinent materials
as needed by the financial department.

Article 16

If the complainant refuses to be cooperative when the financial department makes investigation in accordance with the law, it (he)
shall be deemed to have withdrawn the complaint on its (his) own initiative; if the party against whom the complaint is lodged refuses
to bring forward the relevant evidence, basis and other materials, it (he) shall be deemed to have waived its (his) rights and have
admitted the matters complained about.

Article 17

Upon examination, the financial department shall make a handling decision as follows about the matters complained about respectively:

(1)

If the complainant withdraws the complaint, it shall terminate the handling of the complaint;

(2)

If the complaint lacks a factual basis, the complaint shall be dismissed; or

(3)

If the matters complained about are checked and found to be true upon investigation, it shall be handled in the light of pertinent
provisions of the present Measures.

Article 18

If, upon examination, the financial department determines that the procurement documents show obvious preference or discrimination
and have resulted in or likely cause damage to the lawful rights and interests of the complainant or other suppliers, the case shall
be handled according to the following circumstances respectively:

(1)

If the procurement activity hasn’t been completed yet, it shall order that corrections be made on the procurement documents, and the
activity shall be carried on according to the corrected procurement documents.

(2)

If the procurement activity has been completed, but no government procurement contract is concluded, the financial department shall
determine the procurement activity as illegal and order the parties concerned to carry out afresh the procurement activity; or

(3)

If the procurement activity has already been completed, and a government procurement contract has been signed, the financial department
shall determine the procurement activity illegal and order the party against whom the complaint is filed to bear the corresponding
compensation liabilities in pursuance with the law.

Article 19

Upon examination, if the financial department determines that the procurement documents or process has affected or likely has a bearing
on the award of bid or transaction result, or if there is any illegal act in the process of bid award or of transaction result, the
case shall be handled according to the following circumstances respectively:

(1)

If no government procurement contract has been concluded, the financial department shall determine the whole or partial procurement
act as illegal in light of different circumstances and order the party concerned to carry out afresh procurement activity;

(2)

If the government contract has been concluded but hasn’t been executed yet, the financial department shall determine the contract
as illegal and order the party concerned to carry out anew procurement activity; or

(3)

If the government procurement contract has already been executed, the financial department shall determine the procurement activity
as illegal; and if the said procurement activity inflicts any loss to the purchaser and complainant, the relevant persons responsible
shall bear the compensation liabilities.

Article 20

The financial department shall, within 30 workdays from the day when it accepts a complaint, make a decision on handling the matters
complained about and shall inform in writing the complainant, the party against whom the complaint is filed and other interested
government procurement parties that have to do with the handling result of the said decision.

Article 21

When the financial department makes a decision on handling a complaint, it shall lay down a letter on complaint handling decision
and shall affix its seal. The decision letter shall mainly contain the following items:

(1)

The name and address of the complainant and the party against whom the complaint is filed;

(2)

If an agent is entrusted to handle the relevant matters, the name, occupation, address and contact form of the agent shall be included;

(3)

The specific content of, factual and legal basis for the decision on complaint handling;

(4)

Informing the complainant of the rights to apply for administrative reconsideration or to lodge a lawsuit;

(5)

The date on which the decision on handling the complaint is made.

The service of the decision letter shall be made in accordance with the provisions on service in the law of civil procedure.

Article 22

The financial department may, in the light of circumstances during the time period for handling a complaint, notify the party against
whom the complaint is filed to suspend its procurement activities, but the period of such a suspension may not exceed 30 days at
most.

The party against whom the complaint is filed shall immediately suspend its purchase upon notification, and may not resume such purchase
prior to the expiry of the prescribed time period or before the financial department issues a notice of resuming procurement activities.

Article 23

The financial department shall release the handling result through the media designated by the financial department at the provincial
level or above for releasing the government procurement information

Article 24

If the complainant disagrees on the handling decision made by the financial department, or if the financial department fails to handle
the complaint within the prescribed time limit, the complainant may apply for administrative reconsideration or institute an administrative
proceeding in the people’s court.

Chapter IV Legal Liabilities

Article 25

When handling a complaint, if the financial department finds any unlawful act of the complainant and its personnel, bid evaluation
board or supplier, it shall have the official capacity to handle or punish it (him). If it has no such official capacity, it shall
transfer the case to the competent organ.

Article 26

The complaint filed by a complainant who is under any of the circumstances set forth below shall be a false or malicious one. The
financial department shall dismiss its (his) complaint and list it (him) in the records of misconducts, and give it (him) a punishment
in accordance with the law:

(1)

It (he) has filed 3 or more complaints, but investigation reveals no evidence;

(2)

Fabricating stories or presenting false complaint materials.

Article 27

Where the illegal act of the party against whom a complaint is filed inflicts any loss to others, it (he) shall bear the civil liabilities
in pursuance of the civil law.

Article 28

While in the process of handling a complaint, if any of the functionaries of a financial department abuses his official capacity,
neglects his duties or engages in malpractices for selfish ends, he shall be given an administrative sanction; if any crime is constituted,
he shall be prosecuted for the criminal responsibility in pursuance with the law.

Chapter IV Supplementary Provisions

Article 29

No financial department may collect fees from a complainant and the party against whom a complaint is filed for handling a complaint.
But as for the authentication expense in connection with the process of handling the complaint, it shall be borne by the party in
the wrong in light of the principle ?C “The one who is in the wrong shall make payment”; if both parties are in the wrong, it shall
be jointly and reasonably borne by both of them.

Article 30

The financial departments shall set up a file management system for the complaints handling archives and shall consciously accept
the supervision and inspection carried out by the departments concerned in accordance with the law.

Article 31

The financial departments and the persons in the know shall have an obligation to keep the business secret and personal privacy that
they get to know during the process of handling the complaints.

Article 32

The present Measures shall enter into force as of September 11, 2004.