Is direct contracting a contractor selection method in Vietnam? How many contractor selection methods are there under the Law on Bidding 2023?

Is direct contracting a contractor selection method in Vietnam? How many contractor selection methods are there under the Law on Bidding 2023?

Under Article 20 of the Law on Bidding, the contractor selection methods in Vietnam are stipulated as follows:

Contractor selection methods

1. Contractor selection methods include:

a) Competitive bidding;

b) Limited bidding;

c) Direct contracting;

d) Shopping;

d) direct contracting;

e) Self-execution;

g) Community participation;

h) Price negotiation;

i) Contractor selection in special circumstances.

2. The Government shall adopt specific regulations on contractor selection methods other than those specified in Clause 1 of this Article which are preeminent and use advanced and modern electronic equipment and facilities, procedures and subjects of such methods in conformity with new features of VNEPS and in a manner that ensures competitiveness, fairness, transparency and economic efficiency in bidding.

Thus, direct contracting is one of the contractor selection methods in Vietnam. Additionally, there are other contractor selection methods in Vietnam:

- Competitive bidding;

- Limited bidding;

- Shopping;

- direct contracting;

- Self-execution;

- Community participation;

- Price negotiation;

- Contractor selection in special circumstances.

Is direct contracting a contractor selection method in Vietnam? How many contractor selection methods are there under the Law on Bidding 2023? (Image from the Internet)

What are the cases of direct contracting in Vietnam?

According to Clause 1 Article 23 of the Law on Bidding, there are 12 cases of direct contracting, including:

1) Emergency packages which need to be executed to defend national sovereignty and national security; packages which need to be executed to immediately remedy or promptly handle consequences of natural disasters, conflagration, accidents, incidents, calamities or other force majeure events;

2) Packages for consulting services, non-consulting services, supply of goods or construction which need to be executed immediately to prevent direct harm to the life and property of local communities or serious impacts on adjacent works;

3) Packages for supply of consulting services, non-consulting services, drugs, chemicals, test equipment, medical devices, spare parts, accessories, facilities, or construction, which need to be executed immediately to serve epidemic and disease prevention and combat or maintain operation of health facilities in urgent cases so as to avoid causing harm to the life and health of people; packages for procurement of drugs, chemicals, test equipment, medical devices, spare parts, accessories used in giving emergency aid to patients as prescribed in the Law on Medical Examination and Treatment in case health facilities lack such drugs, chemicals, test equipment, medical devices, spare parts, accessories; packages for procurement of drugs or medical devices which can be manufactured by the only one manufacturer in the market;

4) Packages which need to be executed to protect state secrets;

5) Packages for consulting services which must be purchased from contractors that have previously executed packages in order to ensure technological compatibility and copyright which cannot be purchased from other contractors; packages for procurement of goods or non-consulting services which must be purchased from contractors that have previously executed packages or from manufacturers or their agents in order to ensure their technological compatibility and copyright with existing equipment, machinery, software and services or to meet warranty requirements laid down by contractors or manufacturers which cannot be purchased or acquired from other contractors or manufacturers;

6) Packages for research or testing purposes or purchase of intellectual property rights or copyrighted broadcast programs; packages for transport of national reserves for relief and aid purposes, which must be delivered immediately;

7) Consulting service packages for preparation of feasibility study reports or construction engineering which are designated to the authors of work architecture designs that win the bid or are selected when they satisfy the prescribed capacity requirements laid down in the Law on construction; packages for construction or restoration of monuments, relief, grant murals and artistic works subject to copyright from the stage of creation to the stage of construction; consulting service packages for preparation of construction plannings which are designated to the authors of construction planning schemes or initiatives that has been successful in the construction planning competition;

8) Packages for consulting services, relocation of technical infrastructure facilities to serve the land clearance; packages for consulting services, sweeping and removal of bombs and other explosive objects, demining to prepare for construction sites;

9) Packages for which there is only one bidder capable of performing the contract in the market due to specific technological solution requirements;

10) Packages of nationally important projects eligible for direct contracting according to the National Assembly’s resolutions issued when deciding investment guidelines;

11) Packages for leasing of warehouse facilities for impounded goods; packages for hiring of transport and handling services for impounded goods at seaports and concentrated inspection places in case there is only one entity providing such services in the port; packages for import of sporting weapons to serve training activities and annual sports competitions of sports training centers, schools and clubs;

12) Packages of procurement cost estimates whose price ranges from VND 50 million to VND 100 million; packages of investment projects of state-owned enterprises or wholly state-owned enterprises and investment projects defined in the Law on public investment, including: consulting service packages whose price does not exceed VND 500 million, and packages for non-consulting services, procurement of goods, construction, or mixed packages whose price does not exceed VND 01 billion.

In case the limits on package prices specified in this Point need to be adjusted to be suitable to socio-economic conditions and state management requirements, the Government shall submit such adjustments to the Standing Committee of the National Assembly for consideration and decision-making.

What is the contractor selection process in case of direct contracting in Vietnam?

According to Clause 2 Article 43 of the Law on Bidding, the contractor selection process in case of direct contracting includes the following steps:

- Preparation for contractor selection;

- Organization of contractor selection;

- Evaluation of proposals and negotiation on one or some proposals (if any);

- Submission, appraisal, approval and disclosure of contract selection result;

- Completion, signing and management of execution of contract;

In the case specified in Point m Clause 1 Article 23 of Law on Bidding 2023, the competent person may decide to adopt the simplified process, consisting of the following steps: preparing and sending the draft contract to the successful bidder; completing the contract; submitting for approval, approving and disclosing the contractor selection result; signing the contract and managing the contract execution.