Incentives in contractor and investor selection in Vietnam from January 1, 2024

Incentives in contractor and investor selection in Vietnam from January 1, 2024 are specifically stipulated in Article 10 of the Law on Bidding 2023 (taking effect on January 1, 2024) with the following contents: Basically as follows:

Subjects eligible for incentives in contractor selection:

(1) Originating goods of Vietnam;

(2) Eco-friendly products and services as prescribed by the Law on environmental protection;

(3) Domestic bidders that produce originating goods of Vietnam meeting the requirements laid down in bidding documents;

(4) Foreign bidders and domestic bidders coming together under a consortium agreement in which the domestic bidders take charge of at least 25% of total value of tasks of the package;

(5) A domestic bidder that submits a bid as an independent bidder or forms a consortium with other domestic bidders to participate in an international bidding;

(6) Bidders that are microenterprises or small enterprises as prescribed in the Law on assistance for small and medium-sized enterprises;

(7) Bidders that are startups as prescribed by laws;

(8) A bidder that employs the number of female workers, wounded soldiers and people with disabilities, or ethnics, each accounting for at least 25% of their total employees.

Incentives in contractor and investor selection in Vietnam from January 1, 2024 (Internet image)

Incentives in contractor selection in Vietnam

(i) In case where bidders are equally evaluated, the bidder eligible for incentives (eligible bidder) shall be ranked higher than those ineligible for incentives (ineligible bidder);

(ii) Extra points shall be given to the eligible bidder in case bidders are evaluated and ranked adopting the fixed-price method, technical-based evaluation method, or combined technical and price method;

(iii) An amount of money shall be added to the bid price or evaluated price of the ineligible bidder in case bidders are evaluated and ranked adopting the lowest-price method or lowest-evaluated price method;

(iv) Evaluation of capacity, experience and other criteria of eligible bidders shall be given priority during the evaluation of bids;

(v) Bidders that are microenterprises or small enterprises shall be given priority in bidding for construction packages whose price does not exceed VND 05 billion. Upon completion of the bidding process, if none of microenterprises and small enterprises meets the requirements of the package, a new bidding process shall be organized with the participation of other enterprises.

Application of incentives in contractor selection in Vietnam

- The entities specified in Points (1), (2), (3) and (7) shall be given incentives as prescribed in Point (ii) or (iii) when they participate in packages for procurement of goods or mixed packages;

- The entities specified in Points (4) and (5) shall be given incentives as prescribed in Point (ii) or (iii)  when they participate in international bidding for packages for consulting services, non-consulting services, construction or mixed packages;

- The entities specified in Point (8) shall be given incentives as prescribed in Point (i) when they participate in domestic bidding for packages for consulting services, non-consulting services, construction or mixed packages;

- The entities specified in Point (6) shall be given incentives as prescribed in Points (i) and (v) when they participate in domestic bidding for construction packages;

- In addition to the incentives in Points (ii) and (iii), the bidders specified in Points (3) and (7) shall also be entitled to the incentives prescribed in Point b Clause 2 of this Article when they participate in domestic bidding for packages for consulting services, non-consulting services, procurement of goods, construction or mixed packages;

- In case of domestic bidding for a procurement package, the employer may decide whether to require inclusion of a domestic good in bids if such good can be manufactured by at least 03 domestic manufacturers satisfying technical, quality and price requirements.

Investors eligible for incentives in investor selection in Vietnam

- Investors that apply technological solutions for reducing environmental pollution to their projects which pose high risk of adverse environmental impacts as prescribed by the Law on environmental protection;

- Investors that commit to make transfer of technologies included in the List of priority high technologies as prescribed by the Law on high technologies or the List of technologies of which the transfer is encouraged as prescribed by the Law on technology transfer.

Incentives in investor selection

- In case where investors are equally evaluated, the investor eligible for incentives shall be ranked higher than those ineligible for incentives;

- Extra points shall be given to eligible investors during evaluation and ranking of their bids.

Mai Thanh Loi

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