Regulation on the Implementation of the Bidding Law of the People's Republic of China (2019 Revision)

Regulation on the Implementation of the Bidding Law of the People's Republic of China (2019 Revision) Regulation on the Implementation of the Bidding Law of the People's Republic of China (Promuglated by Order No. 613 of the State Council of the People's Republic of China on December 20, 2011; revised for the first time in accordance with the Decision of the State Council to Amend and Repeal Certain Administrative Regulations on March 1, 2017; revised for the second time in accordance with the Decision of the State Council to Amend and Repeal Certain Administrative Regulations on March 19, 2018; and revised for the third time in accordance with the Decision of the State Council to Amend Certain Administrative Regulations on March 2, 2019) Chapter I General Provisions Article 1 To regulate bidding activities, this Regulation is formulated in accordance with the Bidding Law of the People's Republic of China (hereinafter referred to as the “ Bidding Law ”). Article 2 The term “construction projects” as mentioned in Article 3 of the Bidding Law means projects as well as goods and services related to project construction. The term “projects” as mentioned in the preceding paragraph means construction projects, including new construction, refurbishing and expansion of buildings and fixtures and the relevant decorating, demolition and renovation of buildings and structures. The term “goods related to project construction” means equipment and materials which constitute an integral part of projects and are required for realizing the basic functions of projects. The term “services related to project construction” means services such as survey, design and supervision required for the completion of projects. Article 3 The specific standards on the scope and size of construction projects that legally require bidding shall be determined by the development and reform department of the State Council jointly with the relevant departments of the State Council and be subject to the approval of the State Council before issuance and implementation. Article 4 The development and reform department of the State Council shall guide and supervise the bidding work across the country and supervise and inspect the bidding activities for the state's major construction projects. The departments of industry and information technology, housing and urban-rural development, transport, railways, water resources and commerce of the State Council shall supervise the relevant bidding activities according to the prescribed division of functions. The development and reform department of the local people's government at or above the county level shall guide and coordinate the bidding work of its administrative region. The relevant departments of the local people's government at or above the county level shall, according to the prescribed division of functions, supervise bidding activities, and legally investigate and deal with violations in bidding activities. Where the local people's government at or above the county level otherwise prescribes for the division of supervisory functions of its subordinate departments on the relevant bidding activities, such provisions shall prevail. The public finance department shall, according to law, supervise the implementation of government procurement policies on government procurement construction projects that are subject to bidding. The supervisory organ shall, according to law, supervise the relevant supervisory objects relevant to bidding activities. Article 5 The local people's government at or above the level of a city divided into districts may, according to the actual demand, establish uniform and standardized trading venues to provide services for bidding activities. Such trading venues for bidding shall not be affiliated with administrative supervision departments and shall not be aimed at seeking profits. The state encourages electronic bidding by means of an information network. Article 6 State officials shall be prohibited from illegally interfering in bidding activities in any form. Chapter II Bid Invitation Article 7 With regard to projects for which project examination, approval and verification formalities must be handled according to the relevant provisions of the state and bidding is required according to law, the bidding scope, methods and organizational forms shall be reported to the department in charge of project examination, approval and verification for examination, approval and verification. The department in charge of project examination, approval and verification shall, in a timely manner, notify the relevant administrative supervision department of the bidding scope, methods and organizational forms determined upon examination, approval and verification. Article 8 Projects for which state-owned funds take the controlling or leading position and bidding is required according to law shall be subject to public bidding. Selected bidding is permitted under any of the following circumstances: 1. only a small number of potential bidders are available for selection because of complicated technologies, special requirements or restrictions from the natural environment; or 2. the cost of adopting public bidding accounts for an excessively large proportion of the project contract amount. Where the circumstances as listed in item 2 of the preceding paragraph occur to the projects prescribed in Article 7 of this Regulation, the department in charge of project examination, approval and verification shall make a determination when it conducts project examination, approval and verification. Other projects shall be determined by the relevant administrative supervision department upon receiving an application from the tenderee. Article 9 In addition to the special circumstances under which bidding is not required as prescribed in Article 66 of the Bidding Law , a project is not required to undergo bidding under any of the following circumstances: 1. any irreplaceable patent or proprietary technology is required; 2. the project can be legally constructed, produced or provided by the purchaser; 3. the project can be legally constructed, produced or provided by the franchise project investor that has been selected through bidding; 4. it is necessary to purchase projects, goods or services from the original bid winner, otherwise the construction or supporting functions would be affected; or 5. any other special circumstance prescribed by the state. Where the tenderee makes falsifications for the purpose of complying with the provisions of the preceding paragraph, the tenderee shall be deemed as evading bidding as prescribed in Article 4 of the Bidding Law . Article 10 The tenderee having the capacity to prepare bid invitation documents and organize bid evaluations as prescribed in paragraph 2 of Article 12 of the Bidding Law means that the bidder has professionals in the areas of technology and economy who are suitable for the project's scale and the complexity of the bid invitation project. Article 11 The departments of housing and urban-rural development, commerce, development and reform, and industry and information technology of the State Council shall supervise and administer bidding agencies according to the prescribed division of functions. Article 12 Bidding agencies shall have a certain number of professionals that have the corresponding capacity of preparing bidding documents and organizing bid evaluation, among others. Article 13 Bidding agencies shall carry out bidding agency business within the scope entrusted by the tenderee, and no entity or individual shall interfere. To conduct agency bidding business, a bidding agency shall abide by the Bidding Law and the provisions of this Regulation on the tenderee. No bidding agency shall bid in a bid invitation project under its agency or do so as an agency, or shall provide consulting to bidders for a bid invitation project under its agency. Article 14 The tenderee shall sign a written entrustment contract with the entrusted bidding agency, and fee standards prescribed in the contract shall comply with the relevant provisions of the state. Article 15 For a project subject to public bidding, the bidding notice shall be issued and bid invitation documents shall be prepared in accordance with the provisions of the Bidding Law and this Regulation. Where the tenderee examines the qualifications of potential bidders by means of pre-qualification, it shall issue a pre-qualification announcement and prepare pre-qualification documents. The pre-qualification announcement and bidding notice on a project legally requiring bidding shall be published through the media legally designated by the development and reform department of the State Council. The content of a pre-qualification announcement or bidding notice on the same bid invitation project that is published on different media shall be consistent. No fee shall be charged for the issuance of the domestic pre-qualification announcement or bidding notice on a project legally requiring bidding through the designated media. To prepare the pre-qualification documents and bid invitation documents on a project legally requiring bidding, the standard texts prepared by the development and reform department of the State Council jointly with the relevant administrative supervision department shall be adopted. Article 16 The tenderee shall sell pre-qualification documents or bid invitation documents at the time and place prescribed in the pre-qualification announcement, bidding notice or bid invitation. Pre-qualification documents or bid invitation documents shall be sold for a period of not less than five days. The fees charged by the tenderee for selling pre-qualification documents and bid invitation documents shall be limited to offsetting the cost of printing and postage, and shall not be aimed at seeking profits. Article 17 The tenderee shall reasonably determine the time for the submission of pre-qualification application documents. The time for the submission of pre-qualification application documents on a project legally requiring bidding shall not be less than five days from the day when the sale of pre-qualification documents is stopped. Article 18 Pre-qualification shall be conducted according to the standards and methods indicated in the pre-qualification documents. With regard to projects for which state-owned funds take the controlling or leading position and bidding is required according to law, the tenderee shall establish a qualification examination committee to examine the pre-qualification application documents. The qualification examination committee and its members shall abide by the Bidding Law and the provisions of this Regulation on the bid evaluation committee and its members. Article 19 After completion of pre-qualification, the tenderee shall, in a timely manner, issue a pre-qualification result notice to the pre-qualification applicant. An applicant that fails to pass pre-qualification shall not have the qualification to submit bids. Where less than three applicants pass pre-qualification, the tenderee shall launch a new bid invitation. Article 20 Where the tenderee examines the qualification of bidders by post-qualification, the bid evaluation committee shall examine the qualifications of bidders according to standards and methods prescribed in the bid invitation documents after opening the bids. Article 21 The tenderee is allowed to make necessary clarifications or amendments on the issued pre-qualification documents or bid invitation documents. Where the clarified or amended content may affect the preparation of pre-qualification application documents or bidding documents, the tenderee shall notify all potential bidders that have obtained the pre-qualification documents or bid invitation documents in writing at least three days before the deadline for submitting pre-qualification application documents, or at least 15 days before the deadline for submitting bidding documents; and if such a time is less than the three or 15 day periods, the tenderee shall postpone the deadline for submitting the pre-qualification application documents or bidding documents. Article 22 Where a potential bidder or any other interested party has any objection to the pre-qualification documents, it shall raise such an objection two days before the deadline for submitting the pre-qualification application documents; if it has any objection to the bid invitation documents, it shall raise such an objection 10 days before the deadline for submitting bidding documents. The tenderee shall give a reply within three days after receiving an objection; and suspend bidding activities before replying. Article 23 Where the content of pre-qualification documents or bid invitation documents prepared by the tenderee violates any compulsory provision of laws and administrative regulations, or is against the principle of openness, fairness, impartiality or good faith, which affects the pre-qualification result or a potential bidders' submission of bids, the tenderee of a project legally requiring bidding shall launch a new bid invitation after amending the pre-qualification documents or bid invitation documents. Article 24 Where the tenderee divides bid invitation projects into different stages, it shall abide by the relevant provisions of the Bidding Law , and it shall not restrict or exclude potential bidders by dividing stages. The tenderee shall not evade bidding by dividing stages for projects legally requiring bidding. Article 25 The tenderee shall indicate the validity term of bids, which shall be calculated from the bidding document submission deadline, in the bid invitation documents. Article 26 Where the tenderee requires bidders to provide a bid bond in the bid invitation documents, the bid bond shall not exceed 2% of the estimated value of the bid invitation project. The validity term of bid bonds shall be consistent with the validity term of bids. Bid bonds submitted in the form of cash or check by a domestic entity bidding for a project legally requiring bidding shall be transferred from its basic account. The tenderee shall not misappropriate the bid bonds. Article 27 The tenderee may decide whether to prepare a base bid price. Each bid invitation project shall only have one base bid price. The base bid price must be kept confidential. An intermediary that accepts entrustment to prepare the base bid price shall not participate in the bidding for a project whose base bid price is prepared by it upon entrustment, nor shall it prepare bidding documents or provide consulting for the bidder of such a project. Where the tenderee has set a maximum bid price, it shall specify in the bid invitation documents the maximum bid price or the methods for calculating the maximum bid price. The tenderee shall not prescribe a minimum bid price. Article 28 The tenderee shall not organize a single potential bidder or partial potential bidders to make an on-site investigation of a project site. Article 29 The tenderee may, according to law, carry out overall contracting bidding for all or a portion of the projects and the goods and services relevant to project construction. Where the projects, goods and services at temporarily evaluated prices within the overall contracting scope fall under the scope of projects legally requiring bidding and reach the standards regarding scale as required by the state, the tenderee shall invite bids according to law. The term “temporarily evaluated price” as mentioned in the preceding paragraph means the value of projects, goods and services that cannot be determined in the overall contracting bidding and is thereby temporarily evaluated by the tenderee in the bid invitation documents. Article 30 The tenderee may invite bids in two stages if the project has complicated technologies or its technical specifications cannot be precisely formulated. At the first stage, the bidders shall submit technical suggestions without quotation according to the requirements of the bidding notice or bid invitation, and the tenderee shall determine the technical standards and requirements according to the technical suggestions submitted by the bidders and prepare bid invitation documents. At the second stage, the tenderee shall provide bid invitation documents to ......