GOVERNMENT PROCUREMENT LAW OF THE PEOPLE’S REPUBLIC OF CHINA
The Standing Committee of the National People’s Congress Order of the President of the People’ s Republic of China No.68 Government Procurement Law of the People’s Republic of China has been adopted at the 28th Meeting of the Standing Committee of the President of the People’s Republic of China Jiang Zemin June 29, 2002 Government Procurement Law of the People’s Republic of China ContentsChapter I General Provisions Chapter II Government Procurement Party Chapter III Forms of Government Procurement Chapter IV Procedure for Government Procurement Chapter V Government Procurement Contract Chapter VI Query and Complaint Chapter VII Supervision and Inspection Chapter VIII Legal Responsibilities Chapter IX Supplementary Provisions Chapter I General Provisions Article 1 This Law is hereby enacted in order to standardize the government procurement behavior, improve the efficiency of use of government Article 2 Government procurement within the territory of the People’s Republic of China shall be governed by this Law. Government procurement mentioned therein refers to behaviors of state organs at various levels, undertakings and social organizations The catalogue and quota for centralized government procurement shall be set forth within the limit of authority as prescribed herein. Procurement mentioned herein refers to the behavior of obtaining compensated commodities, engineering works and related services, Commodities mentioned herein refer to substances of different kinds in all forms, including raw and semi-finished materials, fuels, Engineering works mentioned herein refer to construction projects including the construction, reconstruction, extension, fitting, Services mentioned herein refer to all objects other than commodities and engineering works under government procurement. Article 3 Government procurement shall be conducted in line with the principles of openness, transparency, fair competition, impartiality and Article 4 Where government procurement of engineering works takes the form of public bidding, the bidding law shall prevail. Article 5 No units and individuals are allowed to obstruct and restrict by whatsoever means suppliers from their free access to the government Article 6 Government procurement shall be carried out strictly in accordance with the approved budget for the purpose. Article 7 Government procurement may be conducted in combination of centralized and scattered ways. The scope of centralized procurement shall For those to be procured by government under central budget, the catalogue for centralized procurement of them shall be determined Items included in the catalogue for centralized government procurement shall be procured in a centralized way. Article 8 The quotas for government procurement shall be determined and published by the State Council if they fall into those to be procured Article 9 Government procurement shall be helpful to the realization of the state policy targets for economic and social development, including Article 10 Government procurement shall target at domestic commodities, engineering works and services, except in the following cases: (1) Where commodities, engineering works or services to be procured are not available or cannot be obtained under reasonable commercial (2) Where such items are to be procured for use outside China; and (3) Where other laws and administrative regulations prescribe otherwise for such procurement. Domestic commodities, engineering works and services afore-mentioned shall be defined in accordance with the relevant regulations Article 11 Information on government procurement shall be timely released to the public on the news media as designated by the government supervisory Article 12 If, in the activity of government procurement, the procurement personnel and concerned people have a conflict of interest with the Concerned people afore-mentioned include members of the bid appraisal committee if the procurement is carried out by public bidding, Article 13 The fiscal department of the people’s governments at various levels is one in charge of supervision and administration of government Other relevant departments of the people’s governments at various levels shall, according to law, perform their supervisory and administrative Chapter II Government Procurement Parties Article 14 Government procurement parties mentioned herein refer to various kinds of mainstream entities, including procurement personnel, supplier Article 15 Procurement party refers to state organs, undertakings and social organizations. Article 16 A centralized procurement organization shall be the procurement agency. People’s governments of cities and autonomous prefectures Centralized procurement agencies shall be non-profitable corporate bodies that deal with procurement matters in accordance with the Article 17 When centralized procurement agencies conduct government procurement activities, they shall meet the requirements that the procurement Article 18 When a procurement party purchases items that are included in the catalogue for centralized government procurement, such items must Where items included in the catalogue for centralized procurement are those to be procured by the government for general use, a centralized Article 19 A procurement parties may entrust any procurement agency that the relevant department under the State Council or the relevant department A procurement party has the option to select any procurement agency, and no unit or individual is allowed to designate in whatsoever Article 20 Where a procurement party entrusts according to law a procurement agency to carry out procurement on its behalf, the procurement party Article 21 Suppliers mentioned herein refer to corporate bodies, other organizations or natural persons that supply commodities, engineering Article 22 Suppliers participating in government procurement activities shall meet the following requirements: (1) They have the capability of undertaking civil liability; (2) They have a fine business reputation and a sound financial accounting system; (3) They have the necessary equipment and professional skills to perform contracts; (4) They have a fine record of paying taxes and surcharges and social security funds according to law; (5) They have no record of material malpractice in its business operation during the three years before participation in the government (6) They meet any other requirements as may be prescribed by laws and administrative regulations. Procurement parties may, in light of the special requirements for the items to be procured, set forth special terms and conditions Article 23 Procurement parties may request suppliers involved in government procurement to provide documents evidencing their qualification and Article 24 More than two natural persons, corporate bodies or other organizations may be formed into an associate to participate government procurement Suppliers participating in government procurement in the form of an associate should all meet the requirements as set forth in Article Article 25 Government procurement parties are prohibited from colluding with each other to infringe upon state interests, public interests of Suppliers are prohibited from winning the bid or concluding any transaction by offering a bribe or by any other illicit means towards Procurement agencies are prohibited from obtaining unlawful benefits from the procurement parties by bribe or any other illicit means. Chapter III Forms of Government Procurement Article 26 Government procurement shall take the following forms: (1) public bidding; (2) invitation for bid; (3) competitive negotiation; (4) unitary source purchase; (5) inquiry; and (6) other forms as may be approved by the government procurement supervisory and administrative department under the State Council in Public bidding should be taken as the main form of government procurement. Article 27 Where procurement parties should purchase commodities or services in the form of public bidding, the specific quotas shall be stipulated Article 28 Procurement parties are prohibited from breaking up the whole of commodities or services into parts that should be procured by public Article 29 Commodities or services in line with either of the following cases may be procured by invitation for bid: (1) they are of special nature and can only be procured from a limited number of suppliers; or (2) The percentage of expenses in the total value of government procurement is too large if they are procured by public bidding. Article 30 Commodities or services in line with any of the following cases may be procured by competitive negotiation according to this law: (1) after public bidding, there is no supplier tender or qualified tender or re-bidding is not possible; (2) specific descriptions or requirements cannot be determined for the sake of complex technology or special nature; (3) the time limit cannot meet the demand of users if public bidding is adopted; (4) The total price of the commodities or services cannot be worked out beforehand. Article 31 Commodities or services in line with any of the following cases may be procured by unitary source purchase: (1) they can only be procured from a sole supplier; (2) procurement from other suppliers is impossible due to the occurrence of an unexpected critical situation; (3) Additional procurement should be made from the original suppliers in order to keep consistency with the previous procurement or meet Article 32 Where the description and standard of commodities to be procured are unified, and commodities on hand are sufficient with a small Chapter IV Procedure for Government Procurement Article 33 When the department with the budgeting function prepares the budget for the ensuing fiscal year, the items of government procurement Article 34 Where commodities or services are to be procured in the form of invitation for bid, the procurement party shall select at random more Article 35 Where commodities or services are to be procured in the form of invitation for bid, the length of time between the date the bid documents Article 36 Where procurement takes the form of invitation for bid, the bid should be cancelled in any of the following cases: (1) there are no more than three suppliers that are eligible or give essential response to the bid documents; (2) there is any illegal and breaching act that affects fair procurement; (3) the offer of the tender exceeds the budget for procurement and is not affordable by the procurement party; (4) The task of procurement is cancelled for any important change. After cancellation of the bid, the procurement party should notify the tender of the reason therefor. Article 37 After cancellation of the bid, arrangement for a new invitation for bid should be made unless the task of procurement is cancelled. Article 38 Where the form of competitive negotiation is adopted for procurement, the following procedure should be observed: (1) Formation of a negotiation team. The team shall comprise more than three members in odd number who are representative and relevant (2) Preparation of negotiation documents. These documents shall definitely specify the procedure and contents of negotiation, terms and (3) Listing the names of suppliers to be invited to negotiation. The negotiation team shall select no less than three suppliers from among (4) Negotiation. All members of the negotiation team shall together negotiate with the candidate suppliers respectively. During the period (5) Determination of the conclusive supplier. After completion of negotiation, the negotiation team shall demand all the participant suppliers Article 39 Where the form of unitary source purchase is adopted, the procurement party and the supplier shall abide by the principles as stipulated Article 40 Where the form of inquiry is adopted for procurement, the following procedure shall be abided by: (1) Formation of an inquiry team. The inquiry team shall comprise more than three members in odd number who are representative and relevant (2) Listing the names of suppliers to be inquired. The inquiry team shall select no less than three suppliers from among those eligible (3) Inquiry. The inquiry team shall demand the inquired supplier to give a one-time offer without alteration. (4) Determination of the conclusive supplier. The procurement party shall select and determine the conclusive supplier under the principle Article 41 The procurement party or the procurement agency with its authority shall organize an inspection on how the supplier has performed Article 42 The procurement party and the procurement agency shall keep in safe custody the procurement documents for each item under the government Procurement documents include the record of procurement activities, budget for procurement, bid documents, tender documents, bid appraisal The record of procurement activities shall at least contain the following contents: (1) category and name of the item to be procured; (2) budget for procurement, structure of funds and contract price; (3) form of procurement, and the reason if any form other than public bidding is adopted; (4) requirements and reasons set for the suppliers to be invited and selected; (5) bid appraisal standards, and the reason why the bid winner is determined; (6) reason for cancellation of the bid; and (7) corresponding record if any form other than public bidding is adopted. Chapter V Government Procurement Contract Article 43 Government procurement contracts shall be governed by the Contract Law. The rights and obligations of the procurement party and the A procurement party may appoint any procurement agency to conclude, on its behalf, a government procurement contract with the supplier. Article 44 A government procurement contract shall be made in writing. Article 45 The procurement supervisory and administrative department under the State Council shall, in consultation with other departments thereunder, Article 46 The procurement party, the bid winner and conclusive supplier shall, within 30 days after the issue of notices of winning the bid The notices of winning the bid and concluding the transaction shall have binding force upon both the bid winner and the supplier. Article 47 The procurement party shall, within 7 business days after the date on which the government procurement contract is signed, submit Article 48 The bid winner and the conclusive supplier may, with the approval of the procurement party, perform the contract in the form of sub-contract. Where a government procurement contract is to be performed in the form of sub-contract, the bid winner and the conclusive supplier Article 49 In case the procurement party needs an increase of the same commodities, engineering works or services as the contracted subject in Article 50 Both parties to a government procurement contract shall not alter, suspend or terminate the contract without mutual consent. In case the continuous performance of a government procurement contract would do harm to the interests of the state and society, both Chapter VI Query and Complaint Article 51 When the supplier has any question about the government procurement activities, the question may be put to the procurement party, Article 52 Where the supplier deems that the procurement documents, the procurement process and the result of winning the bid and concluding Article 53 The procurement party shall, within 7 business days after receipt of the written query, give a reply and notify in writing the query Article 54 Where the procurement party entrusts a procurement agency to make procurement on its behalf, the supplier may consult or make a query Article 55 If the query supplier is not satisfied with the reply given by the procurement party or its agency, or the procurement party or its Article 56 The government procurement supervisory and administrative department shall, within 30 business days after receipt of any complaint, Article 57 When the government procurement supervisory and administrative department is dealing with the complaint, it may notify in writing Article 58 In case the complainant is not satisfied with the decision on his complaint or the government procurement supervisory and administrative Chapter VII Supervision and Inspection Article 59 The government procurement supervisory and administrative department shall strengthen supervision and inspection of government procurement Supervision and inspection shall include the following main items: (1) the implementation of the laws, administrative regulations and rules regarding government procurement; (2) the implementation of the requirements in respect of the scope, form and procedure of procurement; and (3) the professional quality and technical ability of the government procurement personnel. Article 60 The government procurement supervisory and administrative department shall set up no organization for centralized procurement and The procurement agency should have no relationship of subordination to or other relationship of interest with the administrative organ. Article 61 A centralized procurement organization should have a sound internal supervisory and administrative system. The procedures for making Article 62 Personnel in charge of centralized procurement should have corresponding professional quality and technical ability, which meet the The centralized procurement organization should strengthen education and training of its working personnel, and at a regular time |