Conditions for direct procurement in contractor selection in Vietnam

Conditions for direct procurement in contractor selection in Vietnam (Internet image)

Conditions for direct procurement in contractor selection in Vietnam

Direct procurement is applied to procurement packages of similar goods belonging to a project or procurement estimate of the same investor or different investors and meets the conditions as regulated by the Law on Bidding 2023.

According to Clause 2, Article 25 of the Law on Bidding 2023, contractor selection through direct procurement is conducted when the following conditions are met:

- The contractor has won the bid through open or restricted bidding and has signed a contract for the previous package;

- The investor can only apply direct procurement once for goods of the package and the volume of each work item is less than 130% compared to the volume of the corresponding item in the previously signed package, excluding the volume of optional additional purchases (if any);

- The unit price of the work items under the direct procurement package does not exceed the unit price of the corresponding work items in the previously signed similar package and is in line with market prices at the time of contract completion;

- The time from the signing of the contract for the previous package to the date of approval for the direct procurement result does not exceed 12 months.

In cases where the contractor executing the previous contract is unable to continue with the direct procurement package, direct procurement may be applied to another contractor if they meet the required capacity, experience, technical, and pricing requirements as per the bid invitation documents and the previous contractor selection results.

Ensuring competitiveness in bidding in Vietnam

- Contractors submitting expressions of interest or pre-qualification documents must be legally and financially independent from the following parties:

+ Consultants preparing invitation documents for expressions of interest, pre-qualification, project management, supervision; consultants preparing, verifying, and appraising design documents and estimates; consultants preparing and appraising survey tasks, design;

+ Consultants evaluating expressions of interest or pre-qualification documents;

+ Consultants appraising the results of invitation for expressions of interest, pre-qualification results;

+ The investor, bidding party, except in cases where the contractor is a public service provider under a state management agency with assigned functions and duties suitable to the nature of the package of that state management agency or is a member company, subsidiary of a state-owned group or general corporation with main production and business lines suitable to the nature of the package of that state group or general corporation.

- Contractors participating in bidding must be legally and financially independent of the following parties:

+ Project management consultants, supervision consultants; consultants preparing, verifying, appraising design documents and estimates; consultants preparing and appraising survey tasks, design; consultants preparing and appraising bid invitation documents, request solicitation; consultants evaluating bid documents, proposals; consultants appraising the contractor selection results for that package;

+ Other contractors participating in the bidding for the same package in cases of restricted bidding.

- Supervision consultants executing the contract, contract-executing contractors, and testing consultants for that package must be legally and financially independent from each other.

- Contractors in the above categories are considered legally and financially independent when meeting the following conditions:

+ Not under the same direct management of the same agency or organization for public service providers;

+ No mutual shares or capital contributions exceeding 30% between the contractor and the investor, bidding party;

+ No mutual shares or capital contributions exceeding 20% between contractors when participating in the same package in cases of restricted bidding;

+ No mutual shares or capital contributions between the bidding contractor and consultants for that package; no mutual shares or capital contributions exceeding 20% of another organization or individual for each party.

- Investors participating in bidding must be legally and financially independent from the following parties:

+ The authoritative agency, the bidding party;

+ Consultants preparing and appraising bid invitation documents; consultants evaluating bids; consultants appraising the investor selection results until the day of signing the investment project contract.

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