Cases of applying Bid Security in Vietnam

Cases of applying Bid Security in Vietnam (Internet image)

Regarding this issue, LawNet responded as follows:

1. Cases of applying Bid Security in Vietnam

According to Clause 1, Article 11 of the Law on Procurement 2013, the bid Security shall apply in the following cases:

- Competitive bidding, limited bidding, and Shopping Method for procurement of non-consulting service provision, goods procurement, works, and mixed package;

- Competitive bidding and Direct Contracting for selection of investor.

2. Time for applying Bid Security in Vietnam

The time for applying bid security under Clause 2, Article 11 of the Law on Procurement 2013 is as follows:

 Bidders and investors must conduct measures for Bid Security before deadline for submission of bids for Bids, Proposals; case of applying method of two-stage bidding, bidders must provide a Bid Security during stage two.

3. Value of Bid Security in Vietnam

According to Clause 3, Article 11 of the Law on Procurement 2013, the value of Bid Security is stipulated as follows:

- For selection of bidder, value of Bid Security is stipulated in Bidding Documents, Request for Proposals under a defined amount of between 1% and 3% of package price basing on the scale and nature of each particular package;

- For selection of investor, value of Bid Security is stipulated in Bidding Documents, Request for Proposals under a defined amount of between 0.5% and 1.5% of total investment basing on the scale and nature of each particular project.

4. Validity period of Bid Security in Vietnam

The validity period of Bid Security under Clauses 4 and 5, Article 11 of the Law on Procurement 2013 is as follows:

- The validity period of Bid Security is stipulated in Bid, Request for Proposals equal to the validity period of the Bids, Proposals plus thirty (30) days.

- In case of extending the period of validity of Bids, Proposals after deadline for submission of bids, and the Procuring Entity must require bidders/investors to extend the period of validity of their Bid Security for an equivalent term.

In such a case, bidders/investors must extend the period of validity of their Bid Security and not be permitted to change the contents of their submitted Bids, Proposals.

If any bidder or investor refuses to extend the period of validity, his Bid, Proposal will be no valid longer and be rejected, the party calling for tenders shall return or release the biding guarantee to the bidder/investor within 20 days, since the Procuring Entity receives a written refusal for extension.

5. Cases in which the Bid Security shall not be returned in Vietnam

According to Clause 8, Article 11 of the Law on Procurement 2013, a Bid Security shall not be returned in the following cases:

- The bidder or investor withdraws Bid, Proposal after deadline for submission of bids when the Bid, Proposal still remains valid;

- The bidder or investor violates law on procurement which leads to be cancelled bid as prescribed at Clause 4 Article 17 of the Law on Procurement 2013;

- The bidder or investor fails to provide a Performance Security as prescribed at Article 66 and Article 72 of the Law on Procurement 2013;

- The bidder fails or refuses to negotiate and finalize the contract, within a period of twenty (20) days from the date of receipt of notification of winning bid from the Procuring Entity or has negotiated and finalized the contract but refuses to sign the contract except for force majeure cases;

- The investor fails or refuses to negotiate and finalize the contract, within a period of thirty (30) days from the date of receipt of notification of winning bid from the Procuring Entity or has negotiated and finalized the contract but refuses to sign the contract except for force majeure cases.

Quoc Dat

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE