Law of the People’s Republic of China on Bid Invitation and Bidding
(Adopted at the 11th Meeting of the Standing Committee of the Ninth National People’s Congress on August 30, 1999
and promulgated by Order No. 21 of the President of the People’s Republic of China on August 30, 1999)
Contents
Chapter I General Provisions
Chapter II Bid Invitation
Chapter III Bidding
Chapter IV Opening, Evaluation and Winning of Bids
Chapter V Legal Liability
Chapter VI Supplementary Provisions
Chapter I
General Provisions
Article 1 This Law is enacted in order to regulate bid invitation and bidding activities, protect the interests of the State and
the public as well as the lawful rights and interests of the parties involved in bid invitation and bidding activities, increase
economic benefits and ensure project quality.
Article 2 This Law is applicable to any bid invitation and bidding activities conducted within the territory of the People’s Republic
of China.
Article 3 The following construction projects to be undertaken within the territory of the People’s Republic of China, including
the surveying, design, construction and supervision of such projects as well as the purchase of key equipment and materials for such
projects, shall be subject to bid invitation:
(1) large infrastructure and public utility projects that concern public interests and security;
(2) projects invested completely or partly with State-owned funds or financed by the State; and
(3) projects using loans or aid funds from international organizations or governments of other countries.
The specific scope and threshold for bidding of the projects listed in the preceding paragraph shall be formulated by the development
planning department under the State Council, together with the relevant departments under the State Council, and be submitted to
the State Council for approval.
Where there are provisions in other laws or in the regulations of the State Council governing scope of other projects for which bid
invitation is required, such provisions shall be followed.
Article 4 No units or individuals may break up into parts a project for which bid invitation is required by law or try to dodge bid
invitation by any other means.
Article 5 Bid invitation and bidding activities shall be conducted in adherence to the principles of openness, fairness, impartiality
and good faith.
Article 6 Bid invitation and bidding for projects for which bid invitation is required by law shall be subject to limitations imposed
by the local authorities or departments. No units or individuals may, in violation of law, impose limitations on legal persons or
other organizations from other regions or departments or exclude them from participating in bidding or illegally interfere, by any
means, in bid invitation and bidding activities.
Article 7 All bid invitation and bidding activities and the parties involved shall be subject to supervision in accordance with law.
Relevant departments for administrative supervision shall, in accordance with law, exercise supervision over bid invitation and bidding
activities, and investigate and deal with any violations of law in such activities.
The division of specific duties and powers among the departments for administrative supervision over bid invitation and bidding activities
and the relevant departments shall be determined by the State Council.
Chapter II
Bid invitation
Article 8 A bid inviter is a legal person or other organization that, in accordance with the provisions of this Law, presents a project
for bidding and calls for bids.
Article 9 Where a project for bidding is required by relevant State regulations to undergo examination for approval, it shall do
so before obtaining approval.
A bid inviter shall have the funds needed for the project for bidding or confirmed sources of funds and the fact shall be truthfully
stated in its bid invitation documents.
Article 10 Bid invitation is classified into two categories: public invitation and invited bidding.
Public invitation means that the bid inviter, in the form of announcement for bidding, invites unspecified legal persons or other
organizations to bid.
Invited biding means that the bid inviter, in the form of written invitation, to invite specified legal persons or other organizations
to bid.
Article 11 Where a national key project determined by the development planning department under the State Council or a local key
project determined by the people’s government of a province, an autonomous region or a municipality directly under the Central Government
is not suited for public invitation, it may be subject to invited bidding with the approval of the said department and the said people’s
government respectively.
Article 12 A bid inviter shall have the right to choose, on its own, a bid invitation agency and entrust it with the handling of
the matters of bid invitation. No units or individuals may, by any means, designate a bid invitation agency for the bid inviter.
A bid inviter who has the capability of preparing documents for bid invitation and arranging for bid evaluation may handle the matters
of bid invitation on its own. No units or individuals may compel the bid inviter to entrust a bid invitation agency with the handling
of such matters.
Where a bid inviter handles, on its own, the matter of bid invitation for a project for which bid invitation is required by law,
he shall register with the relevant department for administrative supervision.
Article 13 A bid invitation agency is an intermediary organization set up in accordance with law to engage in bid invitation as an
agent and provide service in this field.
A bid invitation agency shall satisfy the following conditions:
(1) having a place and the necessary funds for serving as a bid invitation agency;
(2) having the necessary professionals to prepare documents for bid invitation and arrange for bid evaluation; and
(3) having a pool of experts in technology, economics, etc. who meet the qualifications prescribed in Paragraph 3 of Article 37 of
this Law and who can be candidates for members of a bid evaluation committee.
Article 14 The qualifications of a bid invitation agency for engineering projects shall be subject to verification by the administrative
department for construction under the State Council or the people’s government of a province, an autonomous region or a municipality
directly under the Central Government. The specific measures therefor shall be formulated by the administrative department for construction
under the State Council together with the relevant departments under the State Council. The competent departments for verifying the
qualifications of bid invitation agencies in other fields of endeavor shall be determined by the State Council.
There shall be no subordination or other relationship of interest between a bid invitation agency and an administrative organ or
any other State organ.
Article 15 A bid invitation agency shall handle the matters of bid invitation within the scope entrusted to it by the bid inviter
and shall abide by the provisions of this Law regarding the bid inviters.
Article 16 Where a bid inviter adopts public invitation, it shall make an announcement for bidding. An announcement for bidding made
for which bid invitation is required by law shall be published in newspapers, information networks or other medium as are designated
by the State.
In the announcement for bidding shall be clearly stated such particulars as the name and address of the bid inviter, the nature,
number, site and time of the projects involved and the means of obtaining the bid invitation documents.
Article 17 Where a bid inviter adopts invited bidding, it shall send written invitation to at least three specified legal persons
or other organizations that are capable of undertaking the project for bidding and have a good reputation and qualification.
In the written invitation for bidding shall be clearly stated the particulars specified in Paragraph 2 of Article 16 of this Law.
Article 18 Based on the requirements of the project for bidding, a bid inviter may, in its announcement or written invitation for
bidding, request potential bidders to provide certificates and information concerning their competence and business achievements
and examine the qualifications of the potential bidders. Where there are State regulations governing qualifications of the bidders,
such regulations shall be followed.
No bid inviter may, with unreasonable requirements, impose limitations on any potential bidder or exclude them from bidding or discriminate
against them.
Article 19 A bid inviter shall, on the basis of the characteristics and requirements of a project, prepare bid invitation documents.
Such documents shall include technical specifications of the project for bidding, criteria for examination of the bidders’ qualifications,
requirements for bid quotation, bid evaluation criteria, and other substantive requirements and terms, as well as the principal clauses
of a contract to be signed.
Where there are State regulations governing the technology and standards for the project subject to bidding, a bid inviter shall,
in accordance with such regulations, state its requirements in the bid invitation documents.
Where it is necessary to divide a project for bidding into bid lots or to fix a time limit for completion of the project, the bid
inviter shall do it reasonably and shall state it clearly in the bid invitation documents.
Article 20 In a bid invitation document no specified producer or supplier may be demanded or indicated, nor any other particulars
favoring or excluding potential bidders may be contained.
Article 21 A bid inviter may, in light of the specific conditions of a project subject to bidding, make arrangements for potential
bidders to inspect the site of the project.
Article 22 No bid inviter may disclose to others the names and number of the potential bidders who have obtained the bid invitation
documents or other information relating to bid invitation and bidding activities which may affect fair competition.
Where a bid inviter has fixed a base price for bid, it shall keep such price confidential.
Article 23 Where necessary clarifications or modifications are to be made in the bid invitation documents already issued, the bid
inviter shall notify in writing all the recipients of the documents at least 15 days prior to the deadline for submission of bid
documents set in the bid invitation documents. Such clarifications or modifications shall be a component of the bid invitation documents.
Article 24 A bid inviter shall set a reasonable period of time for bidders to prepare their bid documents; but for a project for
which bid invitation is required by law, the minimum period from the date of issuing the bid invitation documents to the deadline
for submission of bid documents by bidders shall be not less than 20 days.
Chapter III
Bidding
Article 25 A bidder is a legal person or other organization, that, in response to a bid invitation, participates in the competition.
Where individuals are allowed to participate in the bidding for a scientific research project subject to bidding in accordance with
law, the provisions of this Law on bidders shall be applicable to them.
Article 26 A bidder shall have the capability of undertaking the projects that are subject to bidding invitation. Where in relevant
State regulations or bid invitation documents there are provisions governing qualifications of bidders, a bidder shall meet such
qualifications.
Article 27 A bidder shall prepare its bid documents in compliance with the requirements set in the bid invitation documents. The
bid documents shall be prepared in response to the substantive requirements and terms specified in the bid invitation documents.
Where a project subject to bid invitation is a construction project, the bid documents shall include such information as the resume
and professional achievements of the project director and chief technicians to be assigned and the mechanical equipment to be employed
for completion of the project in question.
Article 28 A bidder shall deliver its bid documents to the place of submission prior to the deadline for submission set in the bid
invitation documents. Upon receiving the bid documents, the bid inviter shall sign for and safe-keep them but may not open them.
Where there are less than three bidders, the bid inviter shall, in accordance with this Law, invite bids anew.
The bid inviter shall refuse to accept any bid documents delivered after the deadline for submission set in the bid invitation documents.
Article 29 Prior to the deadline for submission of bid documents set in the bid invitation documents, a bidder may supplement, modify
or withdraw its bid documents already delivered and shall notify the bid inviter of the same in writing. Such supplements or modifications
shall be a component of the bid documents.
Article 30 Where a bidder, after winning the bid and on the basis of the actual conditions clearly stated in the bid invitation documents,
intends to subcontract some minor or less crucial parts of the project, shall make it clear in the bid documents.
Article 31 Two or more legal persons or other organizations may form a consortium and jointly bid in the capacity of one bidder.
Each party to the consortium shall have the necessary capability of undertaking the project subject to bidding. Where in relevant
State regulations or bid invitation documents there are provisions governing qualifications of bidders, all parties to the consortium
shall meet such qualifications. Where units of the same profession form a consortium, the qualification grade of the consortium shall
be determined on the basis of the unit at a lower qualification level.
All parties to a consortium shall sign an agreement on joint bidding, in which the tasks and responsibilities of each party are clearly
defined, and shall submit to the bid inviter the said agreement together with the bid documents. Where such a consortium wins the
bid, all parties of the consortium shall jointly sign a contract with the bid inviter and bear joint and several liability to the
bid inviter for the bid the consortium wins.
No bid inviter may compel bidders to form a consortium for joint bidding or limit competition among bidders.
Article 32 No bidder may collude with each other in the matter of their quotations or exclude others from fair competition so as
to impair the lawful rights and interests of the bid inviter or the other bidders.
No bidder may collude with the bid inviter in bidding so as to impair the interests of the State and the general public or the lawful
rights and interests of others.
Bidders are prohibited from bribing the bid inviter or members of the bid evaluation committee for the purpose of winning the bid.
Article 33 No bidder may compete for a bid at a price below cost, or to win the bid in the name of another person or by other fraudulent
means.
Chapter IV
Opening, Evaluation and Winning of Bids
Article 34 Opening of bids shall be done in public at the same time as the deadline for submission of bid documents set in the bid
invitation documents; and the place for opening the bids shall be the one predetermined in the said bid invitation documents.
Article 35 Opening of bids shall be presided over by the bid inviter, and all bidders shall be invited to participate.
Article 36 Before bids are opened, the bidders or their elected representatives shall check the sealing of their bid documents, and
the sealing may also be checked and notarized by the notary agency commissioned by the bid inviter. After checking and verifying
that nothing is wrong, a staff member shall open the bids in public and read out the names of the bidders, bid prices and other main
contents in the bid documents.
All the bid documents received by the bid inviter prior to the deadline for submission as required in the bid invitation documents
shall be opened and read out in public at the time when the bids are opened.
The bid opening process shall be recorded, which shall be filed for future examination.
Article 37 The bid evaluation committee established by the bid inviter in accordance with law shall be responsible for evaluation
of the bids.
The bid evaluation committee for a project for which bid invitation is required by law shall be composed of the representatives of
the bid inviter and experts in the relevant technological, economic and other fields. The number of the committee members shall be
an odd number not less than five, among whom, the number of experts in technical, economic and other fields shall be not less than
two-third of the total.
The experts mentioned in the preceding paragraph shall have at least eight years’ experience in relevant fields with senior professional
post_titles or at an equivalent professional level, and they shall be chosen by the bid inviter from the name lists of experts provided
by relevant departments under the State Council or under the people’s governments of provinces, autonomous regions or municipalities
directly under the Central Government, or from the name lists of experts in the relevant fields contained in the pools of experts
provided by bid invitation agencies. For an ordinary project subject to bid invitation, a random choice may be made, but for a special
project, the experts may be chosen directly by the bid inviter.
No one who has a relationship of interest with a bidder may become a member of the bid evaluation committee for the related project.
Where such a person is already a member, he shall be replaced.
The name list of the members of the bid evaluation committee shall be kept confidential before the bidders who win the bid are determined.
Article 38 A bid inviter shall take necessary measures to ensure that bid evaluation is conducted in a strictly confidential manner.
No units or individuals may illegally interfere in or exert influence on the bid evaluation process or results.
Article 39 The bid evaluation committee may ask a bid inviter to make necessary clarification or explanation of the parts of the
bid invitation documents that are not clear in meaning; however, such clarification or explanation may not exceed the scope of the
documents or alter any substantive contents of the documents.
Article 40 The bid evaluation committee shall, in accordance with the evaluation criteria and methods specified in the bid invitation
documents, evaluate and compare all the bid documents, and it shall refer to the base price where there is one available. After the
bid evaluation committee has completed evaluation, it shall present a written report to the bid inviter and recommend the candidates
that are qualified for winning the bid.
The bid inviter shall, based on the written report on bid evaluation presented by the bid evaluation committee, decode on the bid
winner from among the candidates recommended by the said committee. It may also authorize the bid evaluation committee to decide
on the bid winner directly.
Where there are specific regulations formulated by the State Council on bid evaluation of special projects subject to bid invitation,
those regulations shall be followed.
Article 41 The bid offered by a winner shall satisfy one of the following requirements:
(1) it meets, to the maximum extent, all the comprehensive evaluation criteria specified in the bid invitation documents;
(2) it meets the substantive requirements specified in the bid invitation documents and offers the lowest of the bid prices evaluated;
with the exception of the bid price that is below cost.
Article 42 If after evaluation the bid evaluation committee believes that none of the bids satisfies the requirements specified in
the bid invitation documents, it may reject all of them.
Where all the bids for a project for which bid invitation is required by law are rejected, the bid inviter shall invite bids anew
in accordance with this Law.
Article 43 Before the bid winner is decided on, no bid inviter may negotiate with the bidders on such substantive matters as the
bid prices and bidding plans, etc.
Article 44 Members of the bid evaluation committee shall objectively and impartially perform their duties, comply with the code of
professional ethics and be responsible for their own evaluation opinions.
No member of the bid evaluation committee may make any private contact with the bidders, or receive or accept any money, things of
value or other favors from the bidders.
No member of the bid evaluation committee or staff member involved in bid evaluation may disclose any information concerning the
evaluation and comparison of the bid documents, the recommended candidates for winning the bid or any other information relating
to bid evaluation.
Article 45 As soon as the bid winner is decided on, the bid inviter shall notify the winner of the fact in writing and, at the same
time, inform all the unsuccessful bidders of the result.
The notification is legally binding on both the bid inviter and the bid winner. Where after the notification is sent out, the bid
inviter changes the bidding result or the bid winner gives up the bid won, it shall bear legal liability in accordance with law.
Article 46 The bid inviter and the bid winner shall, within 30 days beginning from the date the notification is sent out, sign a
written contract on the basis of bid invitation documents and the bid documents of the winner. They may not conclude any other agreement
contrary to the substantive matters of the contract.
Where in the bid invitation documents the bid winner is required to provide performance security, it shall do so.
Article 47 For a project for which bid invitation is required by law, the bid inviter shall, within 15 days beginning from the date
the bid winner is decided on, submit a written report about the bid invitation and bidding to the relevant department for administrative
supervision.
Article 48 A bid winner shall, in accordance with the provisions of the contract, fulfil its obligations and finish the project.
It may not transfer the bid won to others or break it up into parts and transfer them to others.
A bid winner may, in accordance with the provisions of the contract or with the agreement of the bid inviter, subcontract some minor
or less crucial parts of the project to others. The subcontractors shall meet the necessary qualifications and may not further subcontract
the work.
A bid winner shall be responsible to the bid inviter for the subcontracted parts, and the subcontractors shall bear joint and several
liability for the subcontracted work.
Chapter V
Legal Liability
Article 49 Any unit that, in violation of the provisions of this Law, fails to invite bids for a project subject to bid invitation,
or breaks up the project into parts, or by any other means tries to dodge bid invitation shall put it right within a time limit and
may be fined not less than 0.5 percent but not more than 1 percent of the contract value of the project; where a project, which completely
or partly uses state-owned funds is concerned, its construction or allocation of funds may be suspended. The persons who are directly
in charge and the other persons who are directly responsible shall be given sanctions in accordance with law.
Article 50 Where a bid invitation agency, in violation of the provisions of this Law, divulges confidential information and materials
relating to the bid invitation and bidding activities or colludes with the bid inviter and bidders to damage the interests of the
State and the general public or the lawful rights and interests of others, it shall be fined not less than 50,000 yuan but not more
than 250,000 yuan. The persons who are directly in charge and the other persons who are directly responsible shall be fined not less
than 5 per cent but not more than 10 per cent of the fine imposed on the agency; the illegal gains, if any, shall be confiscated.
If the circumstances are serious, the qualifications of the agency shall be suspended or revoked. If a crime is constituted, criminal
responsibility shall be pursued in accordance with law. If any losses are caused to others, liability for compensation shall be imposed
in accordance with law.
Where the bid result is affected by any of the acts mentioned in the preceding paragraph, it shall be nullified.
Article 51 Any bid inviter who, with unreasonable requirements, imposes limitations on or excludes potential bidders from bidding
or discriminates against them, compels bidders to form a consortium to bid jointly, or restrains competition among the bidders shall
be ordered to make rectification and may be fined not less than 10,000 yuan but not more than 50,000 yuan.
Article 52 Any bid inviter for a project for which bid invitation is required by law who discloses the names and number of potential
bidders who have already obtained the bid invitation documents or any other relevant information regarding bid invitation and bidding
which may affect fair competition or divulges the bid base price shall be given a disciplinary warning and may also be fined not
less than 10,000 yuan but not more than 100,000 yuan. The persons who are directly in charge and the other persons who are directly
responsible shall be given sanctions in accordance with law. If a crime is constituted, criminal responsibility shall be pursued
in accordance with law.
Where the bidding result is affected by any of the acts mentioned in the preceding paragraph, it shall be nullified.
Article 53 Where a bidder wins a bid through colluding with other bidders or with the bid inviter in matters of bidding, or through
bribing the bid inviter or members of the bid evaluation committee, the bid won shall be nullified and the bidder shall be fined
not less than 0.5 percent but not more than 1 percent of the value of the bid won. The persons who are directly in charge and the
other persons who are directly responsible shall be fined not less than 5 percent but not more than 10 per cent of the fine imposed
on the bidder. The illegal gains, if any, shall be confiscated. If the circumstances are serious, the bidder shall be disqualified
for one to two years from taking part in bidding for projects for which bid invitation is required by law and the matter shall be
made known to the general public, or its business license shall be revoked by the administrative department of industry and commerce.
If a crime is constituted, criminal responsibility shall be pursued in accordance with law. If any losses are caused to others, liability
for compensation shall be imposed in accordance with law.
Article 54 Where a bidder wins a bid by submitting the bid in the name of another person or by other fraudulent means, the bid won
shall be nullified. If losses are caused to the bid inviter, it shall bear liability for compensation in accordance with law. If
a crime is constituted, criminal responsibility shall be pursued in accordance with law.
Where a bidder for a project for which bid invitation is required by law commits any of the acts mentioned in the preceding paragraph,
which does not constitute a crime, it shall be fined not less than 0.5 percent but not more than 1 percent of the value of the bid
it wins. The persons who are directly in charge and the other persons who are directly responsible shall be fined not less than 5
percent but not more than 10 percent of the fine imposed on the bidder. The illegal gains, if any, shall be confiscated. If the circumstances
are serious, the bidder shall be disqualified for one to three years from taking part in bidding for projects for which bid invitation
is required by law and the matter shall be made known to the general public or its business license shall be revoked by the administrative
department of industry and commerce .
Article 55 Where a bid inviter for a project for which bid invitation is required by law, in violation of the provisions of this
Law , negotiates with bidders on such substantive matters as the bid prices and bidding plans, it shall be given a disciplinary warning
and the persons who are directly in charge and the other persons who are directly responsible shall be given sanctions in accordance
with law.
If any of the acts mentioned in the preceding paragraph affects the bidding result, the bid won shall be nullified.
Article 56 Where a member of the bid evaluation committee receives or accepts money, things of value or other favors from a bidder
or where a member of the bid evaluation committee or a staff member involved in bid evaluation discloses to another person any information
concerning the evaluation and comparison of bid documents, the recommended candidate for winning the bid or any other information
relating to bid evaluation, he shall be given a disciplinary warning, the money or things of value he received or accepted shall
be confiscated, and he may also be fined not less than 3,000 yuan but not more than 50,000 yuan. The said member who commits the
violation mentioned above shall be disqualified for membership of the committee and he may no longer take part in any bid evaluation
of projects for which bid invitation is required by law. If a crime is constituted, criminal responsibility shall be pursued in accordance
with law.
Article 57 Where a bid inviter decides on the bid winner from among people other than the candidates recommended by the bid evaluation
committee in accordance with law, or a bid inviter decides on the bid winner on its own after all the bids for the project for which
bid invitation is required by law have been rejected by the bid evaluation committee, the bid won shall be nullified. The bid inviter
shall be ordered to make rectification and may be fined not less than 0.5 percent but not more than 1 percent of the value of the
bid. The persons who are directly in charge and the other persons who are directly responsible shall be given sanctions in accordance
with law.
Article 58 Where a bid winner transfers the bid won to others, or breaks it up into several parts and transfers them separately to
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