Vietnam: Rules of bid preferences in contractor selection

Vietnam: Rules of bid preferences in contractor selection (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Rules of bid preferences in Vietnam

Rules of bid preferences in contractor selection under Article 3 of Decree 63/2014/ND-CP are as follows:

- In case bid package and proposal documentation are ranked at the same position after bid preferences that has been counted, bidders who quote more domestic expenses or employ more local employees (based on their wage and salary).

- In case bidders are granted more than one bid preference, they are only allowed to get access to the optimal bid preference as prescribed in the bidding documents and request for proposals.

- With respect to mixed contracts, bid preferences are based on all of bidder’s proposals for the contracts for consulting service and goods supply as well as construction works. Bidders shall be granted proper bid preferences if they propose expenses incurred by the execution of domestic contracts (consulting services, goods and construction works) which account for more than 25% of the total value of the contracts.

2. Regulations on bid preferences for the international bidding

The bid preferences for the international bidding under Article 4 of Decree 63/2014/ND-CP are as follows:

- In terms of contracts for the consulting service supply:

+ In case of the application of lowest bid method, bidders who are not granted bid preferences must provide an additional monetary amount accounting for 7,5% of these bidders’ quoted bid after correction of errors, adjustment of deviations and deduction of discounts (if any) in order to carry out bidder’s comparison and rating;

+ In case of the application of fixed price method or technical method, bidders who receive the bid preferences are given additional 7.5% of technical score to these bidders' total technical score to serve the purpose of comparison and rating;

+ In case of the application of combined technical and price-based method, bidders who receive the bid preferences are given additional 7.5% of combined scores to total combined scores of these bidders for comparison and rating.

- In terms of contracts for non-consulting service supply, construction works and mixed contracts:

+ In case of the application of lowest bid method, bidders who are not granted bid preferences must provide an additional monetary amount accounting for 7.5% of these bidders’ quoted bid after correction of errors, adjustment of deviations and deduction of discounts (if any) for comparison and rating;

+ In case of the application of lowest bid method, bidders who are not granted bid preferences must add a monetary amount accounting for 7.5% of these bidders’ quoted bid after correction of errors, adjustment of deviations and deduction of discounts (if any) to the evaluated price of these bidders for comparison and rating;

+ In case of the application of combined technical and price-based method, bidders who receive the bid preferences are given additional 7.5% of combined scores to total combined scores of these bidders for comparison and rating.

- In terms of the contract for goods procurement, the bid preference applied to domestic goods shall be implemented as regulated in Article 5 of Decree 63/2014/ND-CP.

3. Regulations on bid preferences for the domestic bidding in Vietnam

Article 6 of Decree 63/2014/ND-CP stipulates bid preferences for the domestic bidding as follows:

- In terms of the contract for goods procurement, the preference applied to domestic goods shall be implemented according to the regulations specified in Article 5 of Decree 63/2014/ND-CP.

- Bid envelopes and proposals from bidders who employ total female workers and wounded soldiers or invalid employees accounting for above 25% and signing minimum 03 month’s labor contracts and who are small enterprises granted bid preferences as regulated in Clause 3 Article 14 of the Bidding Law shall achieve higher ranks than those of bidders who are not granted bid preferences in case their bid envelopes and proposals are ranked at the same position.

- In case of construction contracts worth less than VND 05 billion, only small and ultra small enterprises are allowed to participate into the bidding as stipulated by laws.

- In case bid envelopes and proposals from bidders achieve the same rank after bid preferences that have been granted, those of local bidders shall be given priority over others during the contract award.

Quoc Dat

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