Author: Zhangzhou Daocheng Bidding Agency Co., Ltd. Zhang Hongwen
In actual work, many people are confused or controversial about the legal application of government procurement projects and how to choose the correct procurement method. Even many government procurement practitioners are not very clear about this topic. The main reason is that government procurement projects not only involve the government procurement law system but also the bidding law system. There are many relevant laws and policies. If there is no in-depth research on the government procurement law system and the bidding law system at the same time, looking at a certain type of documents will often lead to generalization in the process of implementation, and it is difficult to make the correct choice. This article will conduct an in-depth analysis of this issue in light of relevant laws and regulations of government procurement projects.
What is a government procurement project?
Article 2, Paragraph 6 of the Government Procurement Law stipulates: "The project referred to in this Law refers to construction projects, including the new construction, reconstruction, expansion, decoration, demolition, and repair of buildings and structures." According to the provisions of the "Construction Project Quality Management Regulations" and the "Construction Project Safety Management Regulations", construction projects refer to civil engineering, construction projects, line pipeline engineering and equipment installation and decoration projects.
In actual work, it is very important to accurately understand the concept of government procurement projects, which is directly related to the legal application of the purchased projects and the correct choice of procurement methods. In actual work, we should avoid expanding our understanding of the concept of the project, such as understanding conceptual collaborative activities such as "Hope Project", "System Project", "Information Network Project", and "Street Light Maintenance Project" as construction projects, so as to prevent inappropriate use of government-procurement goods and service projects as engineering projects, or incorrectly include government-procurement goods and service projects in the adjustment scope of the "Tendering Law".
From the examples of government procurement projects in Article 2, Paragraph 6 of the Government Procurement Law, we can know that government procurement projects include new construction, reconstruction, expansion of buildings and structures, and related decoration, demolition, and repair, etc., as well as separate decoration, demolition, and repair that are not related to the new construction, reconstruction, and expansion of buildings and structures.
What is a project that must be tendered according to law?
Article 3, Paragraph 1 of the "Tendering Law" stipulates: "Tendering must be carried out within the territory of the People's Republic of China for the following engineering construction projects, including the exploration, design, construction, supervision of projects, and procurement of important equipment and materials related to engineering construction, and the bidding must be carried out...; the specific scope and scale standards of the projects listed in the preceding paragraph shall be formulated by the Development Planning Department of the State Council in conjunction with relevant departments of the State Council and submitted to the State Council for approval."
Article 2, paragraph 1 of the "Regulations on the Implementation of the Bidding Law" stipulates: "The engineering construction project referred to in Article 3 of the Bidding Law refers to projects and goods and services related to engineering construction." The second paragraph stipulates: "The project referred to in the preceding paragraph refers to construction projects, including the new construction, reconstruction, expansion of buildings and structures and their related decoration, demolition, and repairs." The definition of the project that is applicable to bidding methods in Article 7 and paragraph 2 of the "Regulations on Implementation of the Government Procurement Law" is completely consistent with the provisions of Article 2 and paragraph 2 of the "Regulations on Implementation of the Bidding Law".
"Reply to the question of the application of law and application of construction permits for government procurement engineering projects" (Guofa Secret Financial Letter [2015] No. 736) clearly stipulates: "Single decoration, demolition, and repair that is not related to the new construction, reconstruction, or expansion of buildings and structures is not a project that must be tendered according to law."
To sum up, projects that must be bid for according to law refer to construction projects that meet the bidding amount standard, including new construction, reconstruction, expansion of buildings and structures and related decoration, demolition, and repair, etc., but do not include separate decoration, demolition, and repair that are not related to the new construction, reconstruction, and expansion of buildings and structures.
The law of government procurement projects is applicable to
Article 4 of the "Government Procurement Law" stipulates: "If government procurement projects are bidding and tendering, the Bidding Law shall be applied."
Article 7, paragraph 1 of the "Regulations on the Implementation of the Government Procurement Law" stipulates: "If government procurement projects and goods and services related to engineering construction are subject to bidding and procurement methods, the "Bidding Law of the People's Republic of China" and its implementation regulations shall be applied; if other methods are used to purchase, the Government Procurement Law and this Regulations shall be applied"; Article 7, paragraph 3 of the "Regulations on the Implementation of the Government Procurement Law" stipulates: "Government procurement projects and goods and services related to engineering construction shall be subject to government procurement policies."
How to choose the correct procurement method for government procurement projects?
Article 25 of the "Regulations on the Implementation of the Government Procurement Law" stipulates: "If the government procurement project does not bid according to the law, it shall be purchased in accordance with the competitive negotiation or single-source procurement method stipulated in the Government Procurement Law and this Regulations." Pay special attention to the word "according to law". It does not directly say "government procurement project does not bid...", but says "government procurement project does not bid according to the law..." Although it is only a difference of two words, the meaning is very different. The "Bidding Law" and "Provisions on Projects that Must Bid" (National Development and Reform Commission No. 16) and other laws and policies have made clear provisions on projects that are bidding in accordance with the law. Therefore, the "government procurement projects that are not bidding in accordance with the law" stipulated in Article 25 of the "Regulations on the Implementation of the Government Procurement Law" refers to "all government procurement projects other than projects that must be bidded in accordance with the law".
Article 3 of the "Interim Measures for the Management of Procurement Methods for Competitive Consultation of Government Procurement" (Faiku [2014] No. 214) stipulates: "Procurement in projects that meet the following circumstances can be carried out in a competitive consultation:... (5) Engineering construction projects other than engineering construction projects that must be tendered in accordance with the Bidding Law and its Implementation Regulations."
"Reply on the Application of Laws in Government Procurement Projects" (Finance Letter [2020] No. 385) further clarifies the scope of projects that do not belong to the scope of bidding in accordance with the law and the procurement methods that should be adopted: "Single decoration, demolition and repair projects that are not related to new construction, reconstruction, or expansion projects of buildings and structures, as well as government procurement projects within the government centralized procurement catalog or above the government procurement limit standards and below the project bidding amount standards, are not projects that must be bidding in accordance with the law. When government procurement such projects, they shall adopt competitive negotiations, competitive consultations or single source methods in accordance with Article 25 of the Implementation Regulations of the Government Procurement Law."
To sum up, government procurement projects that do not bid according to law (i.e. all government procurement projects other than projects that must be bid according to law) should be purchased in accordance with competitive negotiations, competitive negotiations or single source; government procurement projects that must be bid according to law should be purchased in accordance with bidding (public bidding or invited bidding).
By the analysis of articles 1, 2, 3 and 4 above, the selection and legal application of government procurement projects are summarized as follows:
(I) If the new construction, reconstruction, expansion of buildings and structures and their related decoration, demolition, repair, etc. reaches the bidding amount standard or above, the procurement shall be carried out by public bidding or invitation to bid (in accordance with specific circumstances). Such projects shall be applicable to the "Tendering Law" and its implementation regulations, but government procurement policies shall be implemented (including protecting the environment, promoting the development of small and medium-sized enterprises, etc.).
(II) All government procurement projects within or above the government procurement limit standards and below the project bidding amount standards cannot be purchased through bidding, but should be purchased through competitive negotiation, competitive consultation or single source (in compliance with specific circumstances). Such projects are applicable to the Government Procurement Law and its Implementation Regulations.
(III) Individual decoration, demolition and repair projects that are not related to the new construction, reconstruction, or expansion of buildings and structures, if they meet the bidding standard or above the project bidding amount, they cannot be purchased through bidding. Instead, they should be purchased through competitive negotiations, competitive negotiations or single source methods (in compliance with specific circumstances). Such projects are applicable to the Government Procurement Law and its Implementation Regulations.
Source: China Tendering
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