Government Procurement Law of the People's Republic of China (2014 Amendment)

Government Procurement Law of the People's Republic of China (2014 Amendment) Government Procurement Law of the People's Republic of China (Adopted at the 28th meeting of the Standing Committee of the Ninth National People's Congress of the People's Republic of China on June 29, 2002; and amended at the Tenth session of the Standing Committee of the Twelfth National People's Congress of the People's Republic of China on August 31, 2014 according to the Decision of the Standing Committee of the National People's Congress on Amending Five Laws Including the Insurance Law of the People's Republic of China) Contents Chapter I General Principles Chapter II Parties Concerned in Government Procurement Chapter III Ways of Government Procurement Chapter IV Procedures for Government Procurement Chapter V Contract for Government Procurement Chapter VI Queries and Complaints Chapter VII Supervision and Inspection Chapter VIII Legal Liabilities Chapter IX Supplementary Provisions Chapter I General Principles Article 1 The present law has been enacted with a view to regulate the government procurement activities, increasing the benefits of government procurement funds, protecting the interests of the state and the social public interests, defending the lawful rights of the parties concerned in government procurement and promoting the building of a clean government. Article 2 The present law shall be applicable to the government procurement carried out within the territory of the People's Republic of China. The term “government procurement” as mentioned in the present law refers to the procurement of goods, projects and services within the lawfully made centralized procurement lists or above the procurement limits by the state organs, public institutions and bodies with public fiscal funds. The lists for centralized procurement by the government and the procurement limits shall be formulated within the authority as provided in the present law. The term “procurement” as mentioned in the present law refers to the paid obtainment of goods, projects or services by way of contracts, including purchasing, leasing, entrusting, employing, etc. The term “project” as mentioned in the present law refers to construction projects, including the fresh construction, reconstruction, expansion, decoration, dismantling and repairing, etc. of buildings and structures. The term “service” as mentioned in the present law refers to objects of government procurement other than goods and projects. Article 3 The principles of openness and transparency, fair competition, justice, honesty and trustworthiness shall be observed in government procurements. Article 4 Where the method of bidding is employed in government procurements, the bidding laws shall be applicable. Article 5 No entity or individual may, by any means, obstruct or restrict providers to enter freely into the government procurement market of the local place or the industrial sector concerned. Article 6 Government procurement shall be based strictly on the budgets approved. Article 7 Both the method of centralized procurement and decentralized procurement may be employed in government procurements. The range for centralized procurement shall be limited to the lists for centralized procurement which are published by the people's government on the provincial government or above. Article 8 If any government procurement item is to be paid by the budge of the Central Government, the list for centralized procurement shall be determined and published by the State Council; if the government procurement item is to be paid by the budget of local governments, the list for centralized procurement shall be determined and published by the people's government of the province, autonomous regions or municipality directly under the Central Government or the organs authorized thereby. Article 9 Government procurements shall be conducive to the realization of the policy goals for economic and social development of the state, including protecting the environment, supporting the underdeveloped regions and ethnic minority regions, promoting the development of medium-sized and small enterprises, etc. Article 10 Government procurements shall be based on the procurement of domestic goods, projects and services with the exception of the following circumstances: a.The goods, projects or services that are needed cannot be obtained within the territory of China or cannot be obtained under reasonable commercial conditions; b.The procurement is made for the use without the territory of China; c.It is otherwise provided in other laws or administrative regulations. Article 11 The information concerning government procurement shall be published in good time to the general public in the mass media designated by the departments supervising government procurements, with the exception of those that involve business secrets. Article 12 In government procurement activities, the purchasing personnel and other personnel who have interests in the providers shall withdraw. Where any provider believes that any purchaser or other relevant persons have interests with other providers, it may request them to withdraw. The term “relevant person” as mentioned in the preceding paragraph shall include the members of the bid appraising committee in bids, the members of the negotiation groups in competitive procurements, the members of the inquiry groups in inquiry procurements, etc. Article 13 The public fiscal departments under the people's governments at all levels are the departments in charge of the supervision and administration of government procurements and shall lawfully perform their duties of supervision and administration of the government procurement activities. Other relevant departments of the people's governments at all levels shall perform lawfully their duties of supervision and administration relating to government procurements. Chapter II Parties Concerned in Government Procurement Article 14 The term “parties concerned in government procurement” refers to the various subjects that enjoy rights and undertake obligations in government procurement activities, including the purchaser, provider, purchasing agency, etc. Article 15 A purchaser is a state organ, public institution or body that makes government procurements according to law. Article 16 Centralized procurement organs are purchasing agencies. The cities with districts and the people's governments on the level of autonomous prefecture and above may establish centralized procurement organs according to the demand for organizing centralized procurements. Centralized procurement organs are non-profitable public institutions that handle procurements upon the entrustment of purchasers. Article 17 The government procurements made by centralized procurement organs should satisfy the requirements that the procurement prices shall be lower than the average market prices, and the requirements of better procurement efficiencies, good procurement quality and good services. Article 18 Where a purchaser purchases any item of government procurement included in the list for centralized procurement, it must entrust centralized procurement agencies to make the purchases. If the item of government procurement is not included in the list for centralized procurement, it may make the procurement on its own initiative or entrust the centralized procurement agencies to make the procurement. If any item of government procurement that is included in the list for centralized procurement is a general item, the procurement thereof shall be made by the centralized procurement agencies upon entrustment; if there are special requirements of the department or industrial sector concerned for the item, the procurement thereof shall be made through centralized procurement by the department; if there are special requirements of the entity for the item, the procurement may be made by the entity itself upon the people's government on the provincial level or above. Article 19 The purchaser may entrust the procurement agencies recognized by the other than the centralized procurement institutions to make the government procurements within the scope of entrustment. The purchaser shall be entitled to select its own procurement agencies, no entity or individual may designate by any means any procurement agencies for the purchaser. Article 20 Where the purchaser entrusts any procurement agencies to handle the procurement according to law, an entrustment agency agreement shall be entered into between the purchaser and the procurement agency so as to specify the items of entrustment as well as the rights and obligations of the parties concerned. Article 21 A provider is a legal person or other organization or natural person that provides goods, projects or services to purchasers. Article 22 A provider who intends to participate in government procurement activities shall meet the following requirements: a.Having the capacity to independently undertake civil liabilities; b.Having good business credit standing and perfect financial and accounting rules; c.Having the necessary equipments and professional technical abilities for performing contracts; d.Having good records of paying taxes and social security funds according to law; e.Having no record of serious violation of law in business operations within the three years prior to participating in government procurement activities; f.Other requirements as provided in laws and administrative regulations. The purchaser may, according to the special requirements of the purchasing items, stipulate special conditions for providers, but shall not resort to unreasonable conditions so as to give different or discriminatory treatments to providers. Article 23 Purchasers may request the providers that participate in government procurements to provide relevant attestation documents about their qualifications and business performances, and examine the qualifications of the providers according to the conditions of the providers and the special conditions of providers required by the procurement items which have been set down according to the provisions of the present law. Article 24 Two or more natural persons, legal persons or other organizations may form a complex so as to participate in government procurements as a provider. Where any one participates in government procurements in the name of a complex, all the providers that join the complex shall meet the conditions as provided in Article 20 of the present law, and shall submit to the purchaser an agreement of complex, specifying the work and obligations undertaken by each party to the complex. All the parties to the complex shall jointly enter into a procurement contract with the purchaser and take several and joint liabilities for the matters as stipulated in the procurement contracts. Article 25 The parties concerned in government procurements may not collude with each other to impair the lawful rights and interests of the state or the general public or other parties concerned, and may not exclude the competitions of other providers by any means. Providers may not seek to win bids or conclude transactions by offering bribes to the purchaser, procurement agency, any member of the bid appraising committee, any member of the competitive negotiating group, any member of the inquiry group or by any other unfair means. No procurement agency may fish for unlawful interests by offering bribes to the purchaser or by any other unfair means. Chapter III Ways of Government Procurement Article 26 A government procurement may be made in any of the following ways: a.Public call for bids; b.Invitation-based call for bids; c.Competitive negotiations; d.Single-source purchases; e.Price inquiries; f.Other ways of procurement as recognized by the departments of the State Council in charge of the supervision and administration of procurements. Article 27 Where any purchaser procures goods or services by public call for bids, the specific amount rates shall be prescribed by the State Council is the procurement item is to be paid by the budget of the Central Government or to be prescribed by the people's government of the province, autonomous region or municipality directly under the Central Government concerned if the procurement item is to be paid by the budget of local governments. Where it is necessary to make the procurement by any means other than the public call for bids, it shall be subject to the approval of the supervision and administration department of the people's governm......