Circular No. 10/2015/TT-BKHDT dated October 26, 2015 of the Ministry of Planning and Investment on plan for contractor selection

THE MINISTRY OF PLANNING AND INVESTMENT

Circular No. 10/2015/TT-BKHDT datedOctober 26, 2015 of the Ministry of Planning and Investment on plan for contractor selection

Pursuant to the Law on Bidding No. 43/2013/QH13 dated November 26, 2013;

Pursuant to the Government s Decree No. 63/2014/NĐ-CP dated June 26, 2014 on guidelines for some Articles on contractor selection of the Law on Bidding;

Pursuant to the Government s Decree No. 116/2008/NĐ-CP dated November 14, 2008 on defining the functions, tasks, powers and organizational structure of the Ministry of Planning and Investment;

The Minister of Planning and Investment promulgates a Circular to provide guidelines for planning contractor selection.

Article 1. Scope of adjustment

This Circular provides specific guidance on making, submitting, appraising, approving contractor selection plans with regard to the procurements and projects regulated by the Law on Bidding No. 43/2013/QH13, except for drug procurement prescribed in Clause 1 Article 1 of the Law on Bidding.

Article 2. Subject of application

This Circular applies to agencies, organizations participating in making, submitting, appraising, approving contractor selection plans with regard to the procurements and projects mentioned in Article 1 of this Circular, and relevant entities.

Article 3. The application of this Circular

1.In case an international agreement contains regulations on contractor selection procedures, Clause 3 and Clause 4 Article 3 of the Law on Bidding shall apply. Procedures for submitting, appraising, and approving the contractor selection plan shall comply with this Circular.

2.In case an international agreement does not contain regulations on contractor selection procedures, the contractor selection plan shall be made, submitted, appraised, and approved in accordance with this Circular.

3.For procurements executed before a decision on project approval, the following adjustments must be made when applying this Circular:

a) If the investor is determined, the phrase “investor” will be replaced with “Units directly under investor”; “authorized people” with “the leader of investors”; “Decision approving the project” with “Decision of approval from the leader of investors”;

b) If the investor is not determined, the phrase “investor” will be replaced with “Units appointed to prepare the project”; “authorized people” with “unit’s leaders appointed to prepare the project”; “Decision to approve the project” with “Relevant Decisions from unit’s leaders appointed to prepare the project”

4.With regard to procurements funded by state budget prescribed in Point d Clause 1 Article 1 of the Law on Bidding, this Circular must be applied when making, submitting, appraising, and approving contractor selection plans, except for the contents prescribed by the Circular on use of state budget for regular operation promulgated by the Ministry of Finance. When applying this Circular, the phrase “Investor” will be replaced with “procuring entity”; “project” with “procuring estimation”

Article 4. Application for contractor selection plan approval

1.The rules for making the contractor selection plan are specified in Article 33 of the Law on Bidding.

2.The basis for making the contractor selection plan is specified in Article 34 of the Law on Bidding.

3.The application for contractor selection plan approval is made according to Form 1 enclosed herewith, which contains:

a) Completed tasks including tasks related to preparation of project and procurements to be completed first with corresponding values and legal basis;

b) Tasks that do not apply any contractor selection method include: operation of project management board, provision of compensation for land clearance, loan interest payment, tasks performed by the investor including making, appraising the request for expression of interest, pre-qualification documents, bidding documents, request for proposals; assessing expressions of interest, pre-qualification applications , bid-envelopes, proposals; appraising the contractor selection result, and other tasks that do not apply contractor selection with corresponding values;

c) The tasks that require the contractor selection must specify the quantity of procurements, content of each procurement, according to Article 5 of this Circular, and explanation for such contents. This part must specify the basis for dividing the project into smaller procurements. It is prohibited to divide the project into procurements against regulations of the Law on Bidding for the purpose of direct contracting or restricting participation of bidders. Provision of explanation for procurements competitive bidding and all-inclusive contracts is not required;

d) If there are tasks that do not require contractor selection (if any), contents and values of such tasks must be specified.

dd) Total value of the tasks mentioned in Point a, Point b, Point c, and Point d of this Clause. The total value must not exceed the approved total investment in the project;

e) Request.

Article 5. Tasks that require contractor selection

Contents of the tasks that require contractor selection include the tasks and value of each procurement according to Article 35 of the Law on Bidding. To be specific:

1.Procurement name:

The procurement must reflect its content (construction, installation, procurement of goods, consulting services, non-consulting services, mixed contents) and scope according to the decision on project approval. If the procurement is divided into smaller parts, the name of each part must reflect its basic content.

2.Procurement price:

The procurement price is determined on the basis of total investment in the project. If a cost estimate has been approved before the contractor selection plan is made, the cost estimate shall be the basis for determination of the procurement price. The procurement price must be sufficient to cover the expenses of the procurement including cost contingency (against inflation, additional works, and other temporary amounts (if any)), fees, charges, and taxes. If the contract duration is short without risks or inflation, cost contingency is zero. Cost contingency shall be determined by the investor depending on the characteristics of the procurement within the limits prescribed by law. The procurement price shall be updated 28 days before the bid opening date if necessary.

-With regard to the procurement of consultancy services for making the pre-feasibility study report or feasibility study report, the procurement price is determined according to information about average price according to statistics of completed projects over a certain period of time; total investment shall be determined according to investment rates and preliminary total investment;

-If the procurement is divided into smaller parts, the value of each part must be estimated.

3.Each procurement must have specific sources of capital or method of capital provision and disbursement time in order to pay the contractors; if the procurement is funded by ODA or concessional loans, the sponsors’ names, ratio of capital sources including grant capital and counterpart capital must be specified.

4.Contractor selection methods:

Each procurement must have a specific method of contractor selection: domestic or international contractor selection, whether or not short-listing, online contractor selection is applied according to regulations of law on bidding. Explanation for competitive bidding is not required; Explanation for international bidding is required; To be specific:

a) Competitive bidding is applied to procurements regulated by the Law on Bidding, except for the cases mentioned in Point b, Point c, Point d, Point dd, Point e, Point g, and Point h of this Clause;

b) Selective bidding is applied to procurements with high or special technical requirements that are met by few contractors;

c) Direct contracting is applied in the cases mentioned in Clause 1 Article 22 of the Law on Bidding and Article 54 of Decree No. 63/2014/NĐ-CP, provided requirements in Clause 2 Article 22 of the Law on Bidding are satisfied;

d) Competitive offering is applied according to Article 23 of the Law on Bidding and Article 57 of Decree No. 63/2014/NĐ-CP;

dd) Direct purchasing is applied according to Article 24 of the Law on Bidding. In this case, the investor must explain its advantages over other methods of contractor selection;

e) Self-performance is applied according to Article 25 of the Law on Bidding. In this case, the investor must explain its advantages over other methods of contractor selection;

g) Contractor selection in special cases is applied if the procurement has special requirements that cannot apply the contractor selection methods mentioned in Point a, Point b, Point c, Point d, Point dd, and Point e of this Clause. In this case, the person competent shall approve the contractor selection after the Prime Minister issues a decision on a contractor selection method in the special case according to Article 26 of the Law on Bidding;

h) Community participation shall be applied according to Article 27 of the Law on Bidding.

Contractor selection methods other than competitive bidding must not be applied without satisfying all conditions prescribed by the Law on Bidding.

5.Contractor selection processes:

a) One-envelop process is applied in the following cases:

-Competitive bidding, selective bidding are applied to procurements of non-consulting services, goods, construction and installation, small-scale mixed procurements; “single-stage two-envelop” process may be applied if necessary;

-Normal and abridged competitive offering is applied to procurements of non-consulting services, goods, construction and installation;

-Direct contracting is applied to procurements of consulting services, non-consulting services, goods, installation, mixed procurements; this part will be excluded if abridged direct contracting process is applied;

-Direct purchasing is applied to procurements of goods.

b) Single-stage two-envelop process is applied to competitive bidding and selective bidding with regard to procurements of consulting services, non-consulting services, goods, construction, and mixed procurements;

c) Two-stage two-envelop process is applied to competitive bidding and selective bidding with regard to large-scale, complicated procurements of goods, construction and installation, and mixed procurements;

d) Two-stage two-envelop process is applied to competitive bidding and selective bidding with regard to procurements of goods, construction and installation, and mixed procurements that involve new, complicated, special technologies;

6.Time for stating contractor selection

The contractor selection process shall begin when bidding documents, request for proposals are issued. In case of competitive bidding that applies short-listing, the contractor selection process shall begin when the request for expression of interest, pre-qualification documents is issued.

7.Types of contract:

Depending on the scale, characteristics of each procurement, the investor shall decide on the type of contract as the basis for making the bidding documents, request for expression of interest, bidding documents, or request for proposals, and conclude the contract. Each procurement may be done under one or multiple contracts; each contract may apply one or several types of contracts prescribed in Point a through d of this Clause. If multiple types of contract are applied, each type and its corresponding works must be specified. In case of all-inclusive contract, the investor is not required to provide explanation.

a) All-inclusive contract is a basic type of contract. All-inclusive contracts must be used for procurements of consulting services, non-consulting services, construction and installation and mixed procurements on a small scale.

All-inclusive contracts shall primarily be used for procurements of goods.

b) Contracts with fixed prices shall be applied to procurements of which prices for every work remain unchanged throughout the contract duration.

c) Contracts with variable prices shall be applied to procurements that do not have accurate quantity or volume, and prices are likely to vary during the contract duration.

If goods are special, complicated, and the contract duration exceeds 18 months, variable prices may be applied.

d) Fixed term contracts are applied to procurements of consulting services.

8.Contract term:

The contact terms begins from the effective date of the contract until the parties fulfill their contractual obligations, except for warranty period (if any). The contract term must be appropriate for the project schedule. If the procurement is divided into smaller parts, the duration of each part must be specified.

Article 6. Submitting and approving contractor selection plan

1.The investor shall submit the contractor selection plan to the competent persons for consideration and approval.

2.The competent persons shall appoint an organization to appraise the contractor selection plan.

3.Appraisal of the contractor selection plan involves inspection, evaluation, and provision of opinions according to regulations of law on bidding and relevant regulations of law about:

a) Division of the project into procurements:

The project is divided into procurements according to the technical characteristics, procedures, consistency of the project, and rationality of the procurement scale.

b) Legal basis for making the contractor selection plan:

Legal basis for making the contractor selection plan and notes (if any).

c) Contents of the application for contractor selection plan approval:

-The contents mentioned in Clause 3 Article 4 of this Circular, conformity with regulations of law on bidding and relevant regulations of law, requirements of the project, notes (if any) with regard to the tasks that require contractor selection including the contents in Article 5 of this Circular;

-Conformity of total value of completed tasks, tasks that do not apply contractor selection method, tasks that require contractor selection, and tasks that do not require contractor selection compared to total investment of the project.

d) Bidding supervision:

If the bidding process must be supervised, the applicant shall request the competent person to appoint a person or unit mentioned in Clause 2 Article 7 of this Circular to supervise the bidding process.

4.The appraising organization shall give general remarks about the contractor selection plan, express agreement or disagreement with the investor’s contractor selection plan, request the competent person approve the contractor selection plan if it is accepted, or provide explanation and propose solutions to the competent person of the contractor selection plan is not accepted.

5.The appraising organization shall make an appraisal report according to Form No. 2 enclosed herewith and submit it to the competent person for approval.

6.Individuals participating in the appraisal must have suitable capacity, experience, foreign language skills, and bidding qualifications.

7.The appraisal report shall be sent to the competent person within 20 days from the day on which the appraising organization receives sufficient documents.

8.In case of direct contracting prescribed in Point a Clause 1 Article 22 of the Law on Bidding, unless the procurement is necessary for protection of state secrets, within 07 working days from the day on which the investor or supervisory authority of the procurement selects a qualified contractor, the investor must submit the contractor selection plan to the competent person for approval. In this case, appraisal of the plan is not required.

Article 7. Approving contractor selection plan

1.According to the appraisal report, the competent person shall issue a written approval for the contractor selection plan, which is the basis for contractor selection as soon as or after the project is approved.

The decision on approval for contractor selection plan is made according to form No. 3 enclosed herewith.

2.Bidding supervision:

a) In necessary cases at the request of the appraising organization, the competent person shall decide whether to supervise the bidding process if the investor that regularly receives enquiries or complaints, the procurement applies direct contracting; the procurement has a high value, high or special technical requirements. If supervision is requested, the decision on approval for the contractor selection plan must specify whether the supervision is a task that requires contractor selection, the procurements that need supervising, and supervising entities;

b) The competent person shall appoint qualified individuals or units to supervise the investor’s performance during the contractor selection process to ensure conformity with regulations of law on bidding.

3.The contractor selection plan shall be approved within 05 working days from the day on which the appraisal report is received.

Article 8. Posting the contractor selection plan

1.The procuring entity has the responsibility to post the approved contractor selection plan to national bidding network within 07 working days from the day on which it is issued. If the investor has not established or selected the procuring entity, the investor shall post the plan.

2.Disclosure of information about projects, procurements classified as state secrets shall comply with regulations of law on protection of state secrets.

Article 9. Supplementary contractor selection plan

1.If the approved contractor selection plan has to be revised, only the revisions are subject to approval. The supplementary contractor selection plan must be posted before the bid closing time, except for the case in Clause 2 and Clause 8 Article 117 of Decree No. 63/2014/NĐ-CP.

2.With regards to the tasks that initially do not require contractor selection and then require contractor selection, only such tasks are subject to approval.

Article 10. Transition clauses

1.The effect of contractor selection plans that have been approved before the effective date of this Circular shall remain unchanged. In case a contractor selection plan needs to be revised after the effective date of this Circular, the regulations of this Circular shall apply to the revisions.

2.Contractor selection plans that are being formulated, appraised but not approved when this Circular comes into force, regulations of this Circular shall apply to the process of formulation, appraisal, and approval of such plans.

Article 11. Implementation provisions

1.This Circular takes effect on December 10, 2015 and replaces Circular No. 02/2009/TT-BKH dated February 17, 2009 of the Ministry of Planning and Investment.

2.Ministries, ministerial agencies, Governmental agencies, other central agencies, the People’s Committees, and relevant entities are responsible for the implementation of this Circular. Difficulties that arise during the implementation of this Circular should be reported to the Ministry of Planning and Investment for guidance./.

The Minister

Bui Quang Vinh

* All Appendices are not translated.