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	MEASURES FOR THE ADMINISTRATION OF TENDERS AND INVITATIONS TO BID IN GOVERNMENT PROCUREMENT OF GOODS AND SERVICES

	(Order of the Ministry of Finance (No. 18), August 11, 2004: The "Measures for the Administration of Tenders and Invitations to Bid in Government Procurement of Goods and Services", which have been discussed and adopted at the ministerial affairs meeting, are hereby promulgated, and shall come into force on September 11, 2004)


SUBJECT : GOVERNMENT PROCUREMENT; TENDERS AND BID
ISSUING DEPARTMENT : MINISTRY OF FINANCE OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 08/11/2004
IMPLEMENT DATE : 09/11/2004
LENGTH : 8,852 words
TEXT :

TABLE OF CONTENTS

CHAPTER I GENERAL PROVISIONS
CHAPTER II INVITATIONS TO BID
CHAPTER III TENDERS FOR BID
CHAPTER IV OPENING OF BID, BID EVALUATION AND DETERMINATION OF BID
CHAPTER V LEGAL LIABILITIES
CHAPTER VI SUPPLEMENTARY PROVISIONS

CHAPTER I GENERAL PROVISIONS

Article 1. These Measures are formulated in accordance with the "Government Procurement Law of the People's Republic of China" (hereinafter referred to the Government Procurement Law) and other relevant laws in order to regulate the procurement conducts of the parties involved in government procurement, strengthen the supervision and administration of tenders and invitations to bid in government procurement of goods and services, maintain public benefits as well as the lawful rights and interests of the parties involved in tenders and invitations to bid in government procurement.

Article 2. These Measures shall apply to tenders and invitations to bid in government procurement of goods or services (hereinafter referred to "goods or services") carried out by any buyer or procurement agency (hereinafter uniformly referred to "bid-invitation procurement entity").

The procurement agency mentioned in the preceding paragraph means an institution of centralized procurement or any other lawfully accredited procurement agency.

Article 3. Invitations to bid concerning goods or services may be divided into public invitations to bid and invitation-based tenders for bid.

A public invitation for bid means that a bid-invitation procurement entity lawfully invites by announcement uncertain suppliers to bid.

An invitation-based tender for bid means that a bid-invitation procurement entity lawfully and randomly selects three or more suppliers from the qualified ones, whom are invited by an invitation letter to bid.

Article 4. Goods or services must be procured by public invitation for bid if they reach the amount limitation for public invitation for bid. If, due to a particular circumstance, a method other than public invitation for bid needs to be adopted, the party concerned shall, prior to the beginning of procurement, obtain approval from the finance department of the people's government at the level of a city divided into districts or an autonomous prefecture or above.

Article 5. A bid-invitation procurement entity may not divide the goods or services to be procured by public invitation for bid into several parts, or avoid procurement under public invitation for bid by any other means.

Article 6. No entity or individual may impede or restrict suppliers from free participation in tenders and invitations to bid concerning goods and services, may not designate the brand of goods, the supplier of services or the procurement agency, or illegally interfere with tenders and invitations to bid concerning goods and services by any other means.

Article 7. If, in a tender or invitation for bid concerning goods and services, any staff member of a bid-invitation procurement entity, any member of the bid evaluation committee or any other related person has an interest relationship with the suppliers, he must withdraw. If a supplier considers that any of the aforementioned persons has an interest relationship with any other supplier, it may apply for his withdrawal.

Article 8. The suppliers participating in the bids for supply of goods or services under government procurement (hereinafter referred to "bidders"), shall be home suppliers who supply home goods or services. If it is prescribed by laws and administrative regulations that foreign suppliers may participate in tenders and invitations to bid concerning goods and services, they may participate.

If a foreign supplier lawfully participates in a tender for bid concerning goods and services, it shall abide by the provisions in these Measures.

Article 9. The tenders and invitations to bid concerning goods and services shall be beneficial to achieving the targets of economic and social development policies of the state, including protecting environment, supporting undeveloped regions and minorities regions, and promoting the development of medium and small enterprises, and so on.

Article 10. The finance department of each people's government at the county level or above shall lawfully perform its supervision and administration duties over the tenders and invitations to bid concerning goods and services.

CHAPTER II INVITATIONS TO BID

Article 11. A bid-invitation procurement entity shall organize and arrange the activities of tenders and invitations to bid concerning goods and services in accordance with these Measures.

A buyer may lawfully entrust a procurement agency to handle an invitation for bid concerning goods or services, or may discretionally organize and arrange the invitation for bid concerning goods or services, provided that it must fulfill the conditions prescribed in Article 12 of these Measures.

An institution of centralized procurement shall independently arrange an invitation for bid concerning goods or services in accordance with the law. Other procurement agencies shall, upon entrustment of the buyer, handle the matters in the invitation for bid concerning goods or services.

Article 12. Where a buyer meets the following conditions, it may organize an invitation for bid at its own discretion:

(1) Having independent capacity to bear civil liabilities;

(2) Having the capacities of compiling bid-invitation documents and organizing the offer, and having procurement and management staff members in the areas of technology, economy, etc. who are suitable for the project scale and complexity of the procurement in the invitation for bid; and

(3) The buyer has participated in the government procurement training held by the finance department of the people's government at the provincial level or above.

Where a buyer fails to fulfill the conditions prescribed in the preceding paragraph, it must entrust a procurement agency to represent the invitation for bid.

Article 13. Where a buyer entrusts a procurement agency in an invitation for bid, it shall conclude an entrustment agreement with the procurement agency to determine the particulars of agency, and to stipulate the rights and obligations of both parties.

Article 14. In the event of procurement in the way of public invitation for bid, the bid-invitation procurement entity must promulgate a bid-invitation announcement through a medium designated by the public finance department for promulgating government procurement information.

Article 15. In the event of procurement in the way of invitation-based tender for bid, the bid-invitation procurement entity shall promulgate an announcement for pre-examination of qualifications through a medium designated by the finance department of the people's government at the provincial level or above for promulgating government procurement information, and promulgate the qualification conditions of the bidders, the period of announcement for pre-examination of qualifications shall be no less than 7 working days.

The bidders shall, 3 working days prior to the end of the period of announcement for pre-examination of qualifications, submit the qualification certificates required by the announcement. The bid-invitation procurement entity shall randomly select at least three bidders from those who are examined qualified, and shall send them an invitation letter for bid.

Article 16. In the event of procurement in the way of invitation for bid, there shall be no less than 20 days from the day when the bid-invitation documents are sent until the deadline for the bidders to submit the bidding documents.

Article 17. An announcement on public invitation for bid shall include the following main contents:

(1) name, address and contact method of the bid-invitation procurement entity;

(2) names and number of the projects offered to bidders, or the nature of the projects offered to bidders;

(3) qualification requirements for the bidders;

(4) time, place and method of obtaining bid-invitation documents, as well as the price of the bid-invitation documents; and

(5) deadline for bidding, time of and place for opening of bid.

Article 18. A bid-invitation procurement entity shall compile the bid-invitation documents in light of the characteristics and requirements of the projects offered to bidders. The bid-invitation documents shall include the following contents:

(1) An invitation-based tender for bid;

(2) Instructions to bidders (including sealing, signing and stamping requirements, etc.);

(3) Qualification and credit certificates which ought to be submitted by the bidders;

(4) Requirements on quoting bidding prices and compiling bidding documents, and method of paying guaranty bond for bidding;

(5) Technical specifications, requirements and number of projects offered to bidders, including annexes and drawings, etc.;

(6) Main contract clauses and method of concluding contracts;

(7) Time of delivery of goods or provision of services;

(8) Bid evaluation method, bid evaluation standards and clauses of invalidating bids;

(9) Deadline for bidding, time of and place for opening of bid; and

(10) Other particulars prescribed by the finance department at the provincial level or above.

The tenderee shall stipulate and indicate in the bid-invitation documents the substantive requirements and conditions.

Article 19. The bid-invitation procurement entity shall make paper bid-invitation documents, and may also, through a network medium designated by the finance department, promulgate electronic bid-invitation documents, in addition, the paper documents and the electronic ones shall be consistent with each other. The electronic bid-invitation documents shall have the same legal binding force as the paper ones.

Article 20. The bid-invitation procurement entity may require the bidders to submit bidding proposals required by the bid-invitation documents for selection, provided that it shall state the fact in the bid-invitation documents, and clarify the evaluation standards and treatment measures accordingly.

Article 21. All technical standards stipulated in the bid-invitation documents shall meet the compulsory national standards.

The bid-invitation documents may not require or indicate certain bidders or products, or contain tendentious contents or other contents repulsing potential bidders.

Article 22. A bid-invitation procurement entity may, upon the need, ask for opinions of relevant experts or suppliers regarding the bid-invitation documents.

Article 23. The price of the bid-invitation documents shall be determined pursuant to the principles of filling up the costs of printing such documents, and may not aim at making profits, nor may the sum of money for procurement in the invitation for bid be regarded as the basis for determining the price of the bid-invitation documents.

Article 24. A bid-invitation procurement entity may not terminate its invitation for bid at its own discretion after promulgating the announcement on the invitation for bid, and sending the invitation letter to bidders or sending the bid-invitation documents.

Article 25. A bid-invitation procurement entity may, in light of the specific circumstance of the projects of procurement in the invitation for bid, organize potential bidders to make on-site inspections, or convene a meeting for answering questions prior to the opening of bid, but may not solely or separately organize any on-site inspection which is participated in by one bidder.

Article 26. Before the opening of bid, neither the bid-invitation procurement entity nor the relevant staff members may disclose to others the names or number of the potential bidders who have obtained the bid-invitation documents, or other relevant information on tenders and invitations to bid which might affect fair competition.

Article 27. Where a bid-invitation procurement entity makes necessary clarification or amendment to the already sent bid-invitation documents, it shall, 15 days prior to the deadline in the bid-invitation documents for submission of the bidding documents, promulgate a modification announcement through a medium designated by the finance department to promulgate government procurement information, and notify in writing all recipients of the bid-invitation documents. Such clarified or amended contents shall be the integral parts of the bid-invitation documents.

Article 28. A bid-invitation procurement entity may, according to the specific circumstance of the procurement, extend the deadline for bidding and the time for opening of bid, provided that it shall, at least three days prior to the deadline for submission of the bidding documents required by the bid-invitation documents, notify the modified time in writing to all recipients of the bid-invitation documents, and promulgate a modification announcement through a medium designated by the finance department to promulgate government procurement information.

CHAPTER III TENDERS FOR BID

Article 29. A bidder is a legal person, other organization or natural person who responds to the invitation for bid, meets the qualification conditions prescribed in the bid-invitation documents, and participates in the bidding competition.

Article 30. A bidder shall compile bidding documents pursuant to the requirements in the bid-invitation documents. The bidding documents shall substantively respond to the requirements and conditions proposed by the bid-invitation documents.

The bidding documents shall be composed of the commercial part, technical part, price part and other parts.

Article 31. A bidder shall, prior to the deadline for submission of bidding documents required in the bid-invitation documents, seal the bidding documents and serve them to the bidding place. The bid-invitation procurement entity shall, after receiving the bidding documents, sign and preserve them. No entity or individual may unseal the bidding documents prior to the opening of bid.

The bidding documents which are served after the deadline for submission of bidding documents required in the bid-invitation documents shall be invalid bidding documents. The bid-invitation procurement entity shall refuse to receive them.

Article 32. A bidder may, prior to the deadline for bidding, make supplements or amendments to or withdraw the submitted bidding documents, and notify the bid-invitation procurement entity in writing. The supplemented and amended contents shall be signed and affixed with a stamp required by the bid-invitation documents, and be regarded as an integral part of the bidding documents.

Article 33. Where a bidder plans to, in light of the actual situation of the procurement object stated in the bid-invitation documents, deliver the non-principal or non-key tasks of the bid-winning project to others for completion after winning the bid, it shall state such delivery in the bidding documents.

Article 34. Two or more suppliers may form a bidding consortium, and submit a bid in the identity of one bidder.

In the event of bidding in the form of consortium, each party of the consortium shall fulfill the conditions prescribed in Paragraph 1 of Article 22 of the Government Procurement Law. If the buyer stipulates certain conditions on bidders pursuant to the particular requirements of the procurement project, there shall be at least one party to the consortium who meets the certain conditions prescribed by the buyer.

All parties to the consortium shall conclude a joint bidding agreement, clearly stipulating the tasks and duties of each party to the consortium, and submit the joint bidding agreement along with the bidding documents to the bid-invitation procurement entity. After all parties to the consortium have concluded the joint bidding agreement, none of them may solely bid for the same project in its own name, or form a new consortium to bid for the same project.

The bid-invitation procurement entity may not compel bidders to form a consortium for joint bidding, nor may it restrict the bidders from competing with each other.

Article 35. The bidders may not collude with each other to submit bids and quote prices, nor may they impede the fair competition of other bidders, or damage the lawful rights and interests of the bid-invitation procurement entity or those of other bidders.

No bidder may seek for winning of bid by offering briberies to the bid-invitation procurement entity or any member of the bid evaluation committee, or by other foul means.

Article 36. The bid-invitation procurement entity shall clarify in the bid-invitation documents the sum of guaranty bond for bidding and the method of payment. The sum of the guaranty bond for bidding stipulated by the bid-invitation procurement entity may not exceed 1% of the budgetary estimate of the procurement project.

When submitting a bid, a bidder shall pay the guaranty bond for bidding pursuant to the bid-invitation documents. The guaranty bond for bidding may be paid in the form of cash, check, bank drafts, bank guaranty letter, etc. If a bidder fails to pay the guaranty bond for bidding pursuant to the requirements in the bid-invitation documents, the bid-invitation procurement entity shall refuse to receive such bidder's bidding documents.

Where a consortium submits a bid, the guaranty bond for bidding may be paid either by one party to the consortium or jointly by all the parties. If the guaranty bond for bidding is paid in the name of one party, it shall be binding upon all parties to the consortium.

Article 37. The bid-invitation procurement entity shall, within 5 working days after the notice on winning the bid has been sent, refund the guaranty bond for bidding paid by the suppliers who do not win the bid, and within 5 working days after the procurement contract has been concluded, refund the guaranty bond for bidding paid by the bid-winning supplier. If the bid-invitation procurement entity fails to refund the guaranty bond for bidding within the time limit, it shall, in addition to refunding the principal of the guaranty bond for bidding, pay a fund occupation fee at the rate after increasing 20% of the loan interest rate of commercial banks of the corresponding period.

CHAPTER IV OPENING OF BID, BID EVALUATION AND DETERMINATION OF BID

Article 38. A bid shall be opened publicly at the deadline for submission of the bidding documents determined by the bid-invitation documents; the place for opening of bid shall be the place pre-determined in the bid-invitation documents.

The bid-invitation procurement entity shall, prior to the opening of bid, notify the finance department and other relevant departments of the people's government at the same level. The finance department and other relevant departments may, according to the specific circumstance, supervise the opening of bid on site.

Article 39. The opening of bid shall be presided over by the bid-invitation procurement entity, and shall be participated in by the buyer, the bidders, and representatives from relevant sectors.

Article 40. When a bid is opened, the bidders or their representatives shall inspect whether the bidding documents are sealed. And the public notarization institution entrusted by the tenderee may also inspect and notarize such fact. After the bidding documents have been confirmed inerrable, the tenderee's staff member shall unseal the bidding documents in public, declare the names of the bidders, the bidding prices, price discounts, the bidding proposals permitted by the bid-invitation documents for selection, and other main contents of the bidding documents.

Such undeclared substantive contents as the bidding prices, price discounts, and bidding proposals permitted by the bid-invitation documents for selection, etc. shall not be acknowledged at the time of bid evaluation.

Article 41. If, when a bid is opened, the contents of the schedule on opening of the bid (price quotation schedule) in the bidding documents are inconsistent with those of the detailed list in the bidding documents, the former (i.e., the price quotation schedule) shall prevail.

If the sum in words and the sum in figures in the bidding documents are inconsistent with each other, the sum in words shall prevail. If the sum of total price is inconsistent with the sum consolidated from unit prices, the sum calculated from unit prices shall prevail. If the radix point of the sum of unit price is obviously in a wrong digit position, the total price shall prevail, and the unit price shall be amended simultaneously. In the event of dissents concerning interpreting the bidding documents in different languages, the Chinese version shall prevail.

Article 42. The process of opening of a bid shall be recorded by a special person appointed by the bid-invitation procurement entity, and be kept in archives for consulting.

Article 43. Where there are less than three suppliers who participated in the bidding after the end of the deadline for bidding, the bid-invitation procurement entity shall, unless the procurement task is cancelled, report to the finance department of the people's government of the city divided into districts or autonomous prefecture, and the said finance department shall handle the matter pursuant to the following principles:

(1) If the bid-invitation documents have no unreasonable clauses, and the time and procedures for announcing the invitation for bid conform to the provisions, it shall consent to making the procurement in a way of competitive negotiations, price inquiries or single source;

(2) If the bid-invitation documents contain any unreasonable clause, or the time and procedures for announcing the invitation for bid do not conform to the provisions, it shall invalidate the bid, and order the bid-invitation procurement entity to make a new invitation for bid in accordance with the law.

If, during the bid evaluation, there are less than three suppliers who fulfill the professional conditions, or less than three suppliers who make substantive response to the bid-invitation documents, the matter may be handled with reference to the preceding paragraph.

Article 44. The bid evaluation shall be organized by the bid-invitation procurement entity, while the bid evaluation committee lawfully established by the bid-invitation procurement entity shall be responsible for the specific bid evaluation affairs, and independently perform the following duties:

(1) Examining whether the bidding documents meet the requirements in the bid-invitation documents, and making an appraisal;

(2) Requiring the bidding suppliers to explain or clarify the relevant matters concerning the bidding documents;

(3) Recommending the name list of the supplier candidates for winning the bid, or accepting the entrustment of the buyer to directly determine the bid-winning supplier in a method determined in advance; and

(4) Reporting illegal acts of interfering with the bid evaluation to the bid-invitation procurement entity or to the relevant departments.

Article 45. The bid evaluation committee shall be composed of the representatives of the buyer and the relevant experts in technical and economic areas, etc., and the members shall be an odd number of 5 persons or more. Among which, the experts in technical and economic areas, etc. shall be no less than two thirds of the total number of the members. For any project whose sum of money for procurement is no less than 3 million Yuan and which is technically complicated, the experts in technical and economic areas in the bid evaluation committee shall be an odd number of 5 persons or more.

The experts from whom the bid-invitation procurement entity has asked for opinions regarding the bid-invitation documents may no longer act as bid evaluation experts to participate in the bid evaluation. The buyer may not participate in the bid evaluation of its own procurement project in the identity of an expert. The staff member of a procurement agency may not participate in the bid evaluation of a government procurement item represented by this agency.

The name list of the members of the bid evaluation committee shall be determined prior to the opening of bid in principle, and be kept confidential before the result of invitation for bid is determined.

Article 46. The bid evaluation experts shall be familiar with the relevant policies and regulations on government procurement, tenders and invitations to bid, and market conditions, have good professional ethics, obey the disciplines on invitation for bid, have worked for no less than eight years in the related areas, and have senior professional titles or be at the equal professional level.

Article 47. The finance department of the people's government at each level shall manage the experts in a dynamic way.

Article 48. The bid-invitation procurement entity shall randomly select bid evaluation experts from the database of government procurement evaluation experts set up by the finance department at the same level or the next higher level.

Where it is difficult for the bid-invitation procurement entity to randomly determine suitable bid evaluation experts for a technically complicated and extremely professional procurement project, it may, upon consent of the finance department of the people's government at the level of a city divided into districts or autonomous prefecture or above, determine the bid evaluation experts in a selective way.

Article 49. The members of a bid evaluation committee shall perform the following obligations:

(1) Abiding by the laws and disciplines, performing duties objectively, impartially and incorruptibly;

(2) Evaluating the bids according to the bid evaluation methods and standards prescribed in the bid-invitation documents, and bearing individual liabilities for their respective evaluation opinions;

(3) Keeping confidential the bid evaluation process and result, and the suppliers' commercial secrets, as well;

(4) Participating in drafting the bid evaluation report;

(5) Cooperating with the finance department in dealing with the complaints; and

(6) Cooperating with the bid-invitation procurement entity in answering the queries raised by the bidding suppliers.

Article 50. There are three bid evaluation methods for procurement of goods or services in an invitation for bid, namely, the lowest price method, comprehensive scoring method and price quality method.

Article 51. The lowest price method means the bid evaluation method in which the supplier candidates for winning the bid are determined mainly on the basis of prices, that is, on the premise that all substantive requirements in the bid-invitation documents have been met, the lowest prices are determined according to the uniform price factors, and the bidders who quote the lowest prices shall be regarded as the supplier candidates for winning the bid or the bid-winning supplier.

The lowest price method shall apply to projects of normatively ordered commodities and general services.

Article 52. The comprehensive scoring method means the bid evaluation method in which the bidders who get the highest scores from the bid evaluation are regarded as the supplier candidates for winning the bid or the bid-winning supplier after the bids have been, on the premise that the substantive requirements in the bid-invitation documents are furthest met, comprehensively evaluated according to all the factors in the bid-invitation documents.

The main factors of comprehensive scoring include: price, technical and financial status, credit standing, performance, services, the extent of response to the bid-invitation documents, and the corresponding proportion or weighted average, etc. All the above factors shall be prescribed in the bid-invitation documents in advance.

At the time of bid evaluation, each member of the bid evaluation committee shall independently appraise the bidding documents of each effective bidder and score for them, and then add up the scores of each bidder concerning all scoring factors.

In the event of comprehensive scoring method, the proportion of the price score of the involved goods to the total score (that is, the weighted average) shall be 30% to 60%. While the proportion of the price score of the involved services to the total score (that is, the weighted average) shall be 10% to 30%. The price of the service applying the uniform rate shall not be listed as the scoring factor. In case it needs to be adjusted under a particular circumstance, it shall be approved by the finance department of the people's government at the same level.

Total score from bid evaluation = F1 x A1+F2 x A2+ ...... +Fn x An

F1, F2 ...... Fn are separately the total scores concerning all scoring factors;

A1, A2 ...... An are separately the weighted proportion of all scoring factors (A1 + A2 + ...... +An = 1).

Article 53. The price quality method means the bid evaluation method in which the bidding documents are evaluated as required, and then the total score concerning all other scoring factors of each effective bidder except the price factor (including technical and financial status, credit standing, performance, services, the extent of response to the bid-invitation documents, etc.) is calculated, which is divided by the bidding price quoted by the bidder, and the bidder whose quotient (total score from bid evaluation) is the highest is regarded as a supplier candidate for winning the bid or the bid-winning supplier.

Total score from bid evaluation = B/N

B shall be the comprehensive score of the bidders. B = F1 x A1 + F2 x A2 + ...... + Fn x An, among which: F1, F2, ...... Fn are separately the total scores concerning all scoring factors except the price factor; A1, A2, ...... An are separately the weighted proportion of all scoring factors except the price factor (A1+A2+ ...... +An = 1).

N is the bidding price quoted by the bidder.

Article 54. The bid evaluation shall be in compliance with the following work procedures:

(1) Preliminary inspections of bidding documents. The preliminary inspections include qualification inspection and conformity inspection.

1. Qualification inspection. To, in accordance with the laws, regulations and the stipulations in the bid-invitation documents, examine the qualification certificates, guaranty bond for bidding, etc. in the bidding documents, so as to determine whether the bidding suppliers are qualified for the bidding.

2. Conformity inspection. To, according to the stipulations in the bid-invitation documents, examine the effectiveness and entirety of the bidding documents, and the response to the bid-invitation documents, so as to determine whether to respond to the substantive requirements in the bid-invitation documents.

(2) Clarification of relevant issues. With respect to the contents in the bidding documents, if their meaning is unclear, issues of the same kind are not expressed consistently with each other, or there is any obvious literal or calculative error, the bid evaluation committee may require in written form (which shall be signed by the experts of the bid evaluation committee) the bidders to make necessary clarifications and explanations or to make corrections. A bidder's clarification, statement or supplement shall be made in written form, and be signed by his authorized representative, and may not exceed the scope of the bidding documents or change the substantive contents of the bidding documents.

(3) Comparison and appraisal. To, according to the bid evaluation methods and standards stipulated in the bid-invitation documents, carry out commercial and technical evaluation, as well as comprehensive comparison and appraisal on the bidding documents whose qualification and conformity are inspected to be qualified.

(4) Recommendation of the name list of the supplier candidates for winning the bid. The number of the supplier candidates for winning the bid shall be determined upon the procurement needs, provided that such supplier candidates must be listed in sequence.

1. In the event of the lowest price method, they shall be listed in a bottom-to-top order on the basis of the quoted bidding prices. In case the quoted bidding prices are the same, they shall be listed in an order from superiority to inferiority on the basis of the technical indices. If the bid evaluation committee considers that, the lowest bidding price of a supplier candidate for winning the bid who is listed in the front or some of its divided price quotations are obviously unreasonable or are lower than the costs, and are possible to affect the quality of the commodity or cause it to be unable to implement the contract honestly and credibly, it shall be required to provide written documents and explanations within the prescribed time limit, and submit relevant certificates; otherwise, the bid evaluation committee may cancel this bidder's qualification to be a candidate for winning the bid, and it shall be replaced in sequence by the next following supplier candidate for winning the bid, the rest shall be arranged in the same way.

2. In the event of comprehensive scoring method, they shall be listed in a bottom-to-top order on the basis of the scores from the evaluation. In case the scores are the same, they shall be listed in a bottom-to-top order on the basis of the quoted bidding prices. In case both the scores and the quoted bidding prices are the same, they shall be listed in an order from superiority to inferiority on the basis of the technical indices.

3. In the event of price quality method, they shall be listed in a bottom-to-top order on the basis of the quotient scores. In case the quotient scores are the same, they shall be listed in a bottom-to-top order on the basis of the quoted bidding prices. In case both the quotient scores and the quoted bidding prices are the same, they shall be listed in an order from superiority to inferiority on the basis of the technical indices.

(5) Compilation of the bid evaluation report. The bid evaluation report is a report compiled by the bid evaluation committee upon the original bid evaluation records and bid evaluation results signed by all the bid evaluation members, with its main contents including:

1. The name of the medium through which the announcement on the invitation for bid is published, the date and place for opening of bid;

2. The name list of the bidders who bought the bid-invitation documents, and the name list of the members of the bid evaluation committee;

3. Bid evaluation methods and standards;

4. Records on opening of bid, statement and explanation on the bid evaluation, including the name list of the bidders, whose submission of tenders is ineffective, and the reasons thereof;

5. Bid evaluation result and the sequential schedule of the supplier candidates for winning the bid; and

6. The bid evaluation committee's suggestion on granting the bid.

Article 55. In the bid evaluation, no one may change the bid evaluation standards or methods, or conditions for wining the bid, which are stipulated in the bid-invitation documents.

Article 56. Where the bidding documents are under any of the following circumstances, they shall be treated as ineffective at the time of inspection on the quality and conformity:

(1) The guaranty bond for bidding which ought to be paid has not been paid;

(2) They are not sealed, signed or stamped as required by the bid-invitation documents;

(3) They fail to meet the qualification requirements stipulated in the bid-invitation documents; or

(4) They do not meet other substantive requirements in laws, regulations or the bid-invitation documents.

Article 57. In the event of any of the circumstances prescribed in Items (2) through (4) of Paragraph 1 of Article 36 of the Government Procurement Law during the procurement in an invitation for bid, the bid-invitation procurement entity shall invalidate the bid, and notify the reason to all bidding suppliers.

Unless the procurement task is cancelled, the bid-invitation procurement entity shall, after invalidating the bid, re-organize another invitation for bid. When it is necessary to adopt any other procurement method, it shall, prior to the beginning of the procurement activities, get approval from the finance department of the people's government at the level of a city divided into districts or autonomous prefecture or above.

Article 58. The bid-invitation procurement entity shall take necessary measures to guarantee that the bid is evaluated under a strictly confidential circumstance.

No entity or individual may illegally interfere with or influence the determination of bid evaluation measures, or the process or result of bid evaluation.

Article 59. A procurement agency shall, within 5 working days after the end of bid evaluation, deliver the bid evaluation report to the buyer.

The buyer shall, within 5 working days after receipt of the bid evaluation report, determine the bid-winning supplier in the order of supplier candidates for winning the bid as recommended in the bid evaluation report; and may also authorize the bid evaluation committee in advance to directly determine the bid-winning supplier.

In case the buyer organizes by itself an invitation for bid, it shall, within 5 working days after the end of bid evaluation, determine the bid-winning supplier.

Article 60. Where the bid-winning supplier is unable to implement the government procurement contract due to force majeure or its own reason, the buyer may conclude the government procurement contract with the supplier candidate for winning the bid who is at the first place following the bid-winning supplier, the rest shall be arranged in the same way.

Article 61. Before determining the bid-winning supplier, the bid-invitation procurement entity may not negotiate with bidding suppliers on such substantive contents as bidding prices, bidding proposals, etc.

Article 62. After the bid-winning supplier has been determined, the result on winning the bid shall be announced through a medium designated by the finance department for promulgating government procurement information. The announced contents shall include the name of the project offered to bidders, the name list of the bid-winning supplier, the name list of the members of the bid evaluation committee, the name and telephone number of the bid-invitation procurement entity.

When promulgating the announcement, the bid-invitation procurement entity shall send to the bid-winning supplier a notice on winning the bid, which shall have equal legal binding force on both the buyer and the bid-winning supplier.

If, after the notice on winning the bid is sent out, the buyer changes the result on winning the bid, or the bid-winning supplier waives its bid, it shall bear legal liabilities accordingly.

Article 63. Where a bidding supplier has any objection against the announcement on wining the bid, it shall, within 7 working days as of the promulgation of the said announcement, raise queries in writing to the bid-invitation procurement entity. The bid-invitation procurement entity shall make a reply on the queried contents within 7 working days after receipt of the bidding supplier's written queries.

Where an querying supplier is not satisfied with the reply of the bid-invitation procurement entity or the bid-invitation procurement entity fails to make a reply within the stipulated time, it may, within 15 working days after expiry of the period for reply, make a complaint to the finance department of the people's government at the same level in accordance with the relevant provisions. The finance department shall, within 30 working days after receipt of the complaint, make a decision on handling the matter complained about.

During the period when the matter complained about is handled, the finance department may, according to the specific situation, notify the bid-invitation procurement entity in writing to suspend concluding the contract or carrying out other activities, provided that the time of suspension may not exceed 30 days.

Article 64. The buyer or procurement agency shall, within 30 days as of the day when the notice on winning the bid is sent out, conclude a written contract with the bid-winning supplier according to the bid-invitation documents and the bid-winning supplier's bidding documents. The concluded contract may not make substantive amendments to the bid-invitation documents or the bid-winning supplier's bidding documents.

The bid-invitation procurement entity may not propose any unreasonable requirement to the bid-winning supplier as the condition for concluding the contract, nor may it conclude privately with the bid-winning supplier an agreement deviating from the substantive contents of the contract.

Article 65. A buyer or procurement agency shall, within 7 working days as of the day when the procurement contract is concluded, submit, in accordance with the relevant provisions, a counterpart of the procurement contract to the finance department of the people's government at the same level for archival purposes.

Article 66. For those contracts prescribed by laws or administrative regulations to be subject to approval or registration, etc. before taking effect, such provisions shall be followed.

Article 67. The bid-invitation procurement entity shall set up authentic and entire procurement archives on invitations to bid, appropriately keep the procurement documents in each procurement activity, and may not forge, alter, conceal or destroy them. The period for preserving the procurement documents shall be at least 15 years commencing from the ending date of the procurement.

CHAPTER V LEGAL LIABILITIES

Article 68. Where a bid-invitation procurement entity is under any of the following circumstances, it shall be ordered to make a correction within a time limit, be imposed upon a warning, and may be imposed upon a fine in accordance with the relevant legal provisions, moreover, the directly responsible person in charge and other directly liable persons shall be imposed upon sanctions by their competent administrative authority or the relevant organ in accordance with the law, and a notice on this shall be circularized:

(1) For the procurement which ought to be carried out by means of public invitation for bid, it carries out such procurement by other means at its own discretion;

(2) For the information which ought to be announced through a medium designated by the finance department for promulgating government procurement information, it fails to announce such information;

(3) For a project which must be subject to invitation for bid, it divides the entire project into several parts, or avoids the invitation for bid by any other means;

(4) It restricts or repulses potential bidding suppliers with unreasonable requirements, applies differential or discriminatory treatment to potential bidding suppliers; or its bid-invitation documents specify certain suppliers, or contain tendentious contents or other contents repulsing potential bidding suppliers;

(5) The composition of the bid evaluation committee does not conform to these Measures;

(6) It fails to, without any justifiable reason, determine the bid-winning supplier in the lawfully recommended order of the supplier candidates for winning the bid, or determines the bid-winning supplier out of the supplier candidates for winning the bid who are lawfully recommended by the bid evaluation committee;

(7) It negotiates with any bidder in the process of inviting tenders, or concludes the government procurement contract not according to the matters determined in the bid-invitation documents and the bid-winning supplier's bidding documents, or separately concludes with the bid-winning supplier an agreement deviating from the substantive contents of the contract;

(8) It does not conclude a procurement contract with the bid-winning supplier without any justifiable reason after the notice on winning the bid has been sent out;

(9) It fails to, according to these Measures, submit the agreement on entrustment for invitation for bid, the bid-invitation documents, the bid evaluation report, the procurement contract and other documents, which ought to be archived, to the finance department of the people's government at the same level for archival purposes; or

(10) It refuses the supervisions or inspections lawfully conducted by the relevant department.

Article 69. Where the bid-invitation procurement entity or any of its employees is under any of the following circumstances, and a criminal offence is constituted, it/he shall be prosecuted for criminal liabilities in accordance with the law. If no criminal offence is constituted, it/he shall be imposed upon a fine in accordance with the relevant legal provisions, and its/his illegal proceeds (if any) shall be confiscated. Moreover, it/he shall be imposed upon sanctions by its/his competent administrative authority or the relevant organ in accordance with the law, and a notice on this shall be circularized:

(1) It colludes maliciously with any bidder;

(2) It accepts bribes or obtains other foul benefits in the process of procurement;

(3) It provides false information in the supervision or inspection lawfully conducted by the relevant department; or

(4) It, prior to the opening of bid, divulges the names and number of the potential bidders who have obtained the bid-invitation documents, or the minimum bid, or other relevant information on tenders and invitations to bid which might affect fair competition.

Article 70. Where a procurement agency commits any of the illegal acts in Article 68 or Article 69 of these Measures and the case is serious, its qualification for representing government procurement may be revoked, and an announcement shall be promulgated accordingly.

Article 71. In the event of any of the illegal acts in Article 68 or Article 69 of these Measures, which affects or might affect the result on winning the bid, the matter shall be handled in light of the following circumstances respectively:

(1) If the supplier candidates for winning the bid have not been determined, the activity of invitation for bid shall be terminated, and a new invitation for bid shall be carried out in accordance with the law;

(2) If the supplier candidates for winning the bid have been determined but the procurement contract has not been implemented, the contract shall be cancelled, and the bid-winning supplier shall be separately determined in sequence from the supplier candidates for winning the bid; or

(3) If the procurement contract has been implemented, and losses have been caused to the buyer or the bidders, the liable person shall bear the liabilities for compensation.

Article 72. Where, with regard to a government procurement item which ought to be subject to centralized procurement, the buyer does not entrust an institution of centralized procurement to carry out the invitation for bid, or entrusts an intermediary institution unqualified to represent government procurement to handle the affairs in the invitation for bid for the sake of government procurement, it shall be ordered to make a correction. If it refuses to make a correction, the payment of funds to it upon the budget shall be ceased, and its superior competent administrative authority or the relevant organ shall lawfully impose sanctions upon the directly responsible person in charge and other directly liable persons.

Article 73. Where any bid-invitation procurement entity violates the relevant provisions by concealing or destroying in the process of inviting tenders the relevant documents which ought to be preserved or by forging or altering the relevant documents in the process of inviting tenders, it shall be imposed upon a fine of not less than 20,000 Yuan but mot more than 100,000 Yuan, and its directly responsible person in charge and other directly liable persons shall be imposed upon sanctions by its competent administrative authority or the relevant organ in accordance with the law, and a notice on this shall be circularized in addition. If a criminal offence is constituted, criminal liabilities shall be prosecuted for in accordance with the law.

Article 74. Where a bidder is under any of the following circumstances, it shall be imposed upon a fine of not less than 0.5% but not more than 1% of the sum for winning the bid in the government procurement item, be listed into the name list of records on ill behaviors, and be prohibited from participating in government procurement activities within one to three years, in addition, it shall be announced to the public. If it has any illegal proceeds, such illegal proceeds shall be confiscated. If the case is serious, its business license shall be revoked by the administration for industry and commerce. If a criminal offence is constituted, criminal liabilities shall be prosecuted for in accordance with the law:

(1) It provides false documents to seek for winning the bid;

(2) It defames or repels other bidders by foul means;

(3) It colludes maliciously with the bid-invitation procurement entity or any other bidder;

(4) It offers bribes or provides other foul benefits to the bid-invitation procurement entity;

(5) It negotiates with the bid-invitation procurement entity in the process of inviting tenders, concludes a contract without following the bid-invitation documents or the bid-winning supplier's bidding documents, or separately concludes with a buyer an agreement deviating from the substantive contents of the contract; or

(6) It refuses the supervision or inspection conducted by the relevant department, or providing false information.

Where a bidder is under any of the circumstances in Items (1) through (5) of the preceding paragraph, the bid it wins shall be ineffective.

Article 75. Where the bid-winning supplier is under any of the following circumstances, the bid-invitation procurement entity may refuse to refund the already paid guaranty bond for bidding. If the circumstance is serious, it shall be listed by the finance department into the name list of records on ill behaviors, and be prohibited from participating in government procurement activities within one to three years, in addition, a notice on it shall be circularized:

(1) It does not conclude a contract with the buyer or procurement agency without any justifiable reason after winning the bid;

(2) It transfers the bid-winning project to others, or subcontracts the bid-winning project to others by neither stating the fact in the bidding documents nor getting consent from the bid-invitation procurement institution; or

(3) It refuses to perform its contractual obligations.

Article 76. Where any party involved in government procurement has any of the illegal acts in Article 68, Article 69, Article 74 or Article 75 of these Measures, thus causing losses to others, it shall bear civil liabilities in accordance with the relevant civil laws.

Article 77. Where a member of the bid evaluation committee commits any of the following acts, he shall be ordered to make a correction, be imposed upon a warning, and may be imposed upon a fine of not more than 1,000 Yuan, in addition:

(1) He clearly knows that he shall withdraw but does not do so;

(2) He privately keeps in touch with any bidding supplier within the period from the time when he knows his identity as a member of the bid evaluation committee up to the end of the bid evaluation;

(3) He leaves his post without permission in the process of bid evaluation, thus impacting the normal progress of the bid evaluation;

(4) He has obviously unreasonable or improper tendentious behaviors in the process of bid evaluation; or

(5) He does not comply with the bid evaluation methods and standards stipulated in the bid-invitation documents to evaluate the bid.

Where any of the above mentioned acts impacts the result on winning the bid, such result shall be invalid.

Article 78. Where a member of the bid evaluation committee or any employee related to the bid evaluation activity commits any of the following acts, he shall be imposed upon a warning, his illegal proceeds shall be confiscated, and in addition, he may be imposed upon a fine of not less than 3,000 Yuan but not more than 50,000 Yuan. For the member of the bid evaluation committee, his qualification as a member shall be cancelled, and he shall no longer participate in evaluating the bid for any government procurement item offered to bidders, in addition, his act shall be announced through a medium designated by the finance department for promulgating government procurement information. If a criminal offence is constituted, criminal liabilities shall be prosecuted for in accordance with the law:

(1) He accepts properties or other foul benefits from a bidder or any other interested party; or

(2) He divulges information related to the evaluation and comparison of the bidding documents, recommendation of candidates for winning the bid, and other information related to the bid evaluation.

Article 79. Where any entity or individual illegally interferes with or impacts the process or result of bid evaluation, it/he shall be ordered to make a correction. And the liable person of the entity or the individual shall be imposed upon sanctions by the superior competent administrative authority of this entity or individual, or by the relevant organ.

Article 80. Where any functionary in a finance department violates the provisions by abusing his powers, neglecting his duties or practicing frauds for personal gain in conducting supervision or inspection on government procurement, he shall be lawfully imposed upon an administrative sanction. If a criminal offence is constituted, he shall be subject to criminal liabilities in accordance with the law.

Article 81. Where the finance department does not deal with the complaint of a bidder without reason, the directly responsible person in charge and other directly liable persons shall be imposed upon administrative sanctions in accordance with the law.

Article 82. In the event of ineffective winning of bid prescribed in these Measures, the finance department at the same level or above shall ascertain such ineffectiveness. In this case, the bid winner shall be re-determined from other bid winners or candidates for winning the bid in accordance with these Measures, or a new invitation for bid shall be carried out in accordance with these Measures.

Article 83. The responsibility to impose the administrative penalties prescribed in these Measures shall remain with the finance departments of the people's governments at the county level or above.

Article 84. Where a party involved in government procurement refuses to accept an administrative penalty, it may apply for administrative reconsideration in accordance with the law, or directly bring an administrative lawsuit to the people's court. In case it does not apply for reconsideration or bring a lawsuit to the people's court within the time limit, and does not implement the decision on the administrative penalty, the organ making the decision on the administrative penalty shall apply to the people's court for compulsory enforcement.

CHAPTER VI SUPPLEMENTARY PROVISIONS

Article 85. The government procurement of goods or services may be either in the form of procurement upon supply of goods by agreement or in the form of fixed procurement, provided that the procurement upon supply of goods by agreement and the fixed suppliers must be determined by means of public invitation for bid. In case they need to be determined by a means other than public invitation for bid due to a particular circumstance, the party concerned shall get approval from the finance department of the people's government at the provincial level or above.

The measures for the administration of procurements upon supply of goods by agreement and fixed procurements shall be separately formulated by the Ministry of Finance.

Article 86. Tenders and invitations to bids for imported mechanical and electronic products among the goods of government procurement shall be carried out in accordance with the relevant measures of the state.

Article 87. With respect to invitations to bids in government procurement of goods and services using the loans of an international organization or foreign government, if the agreement reached between the lender or funds provider and the Chinese party contains other stipulations on the specific conditions for the procurement, such stipulations may apply, provided that the benefits of the state or the public may not be damaged.

Article 88. These Measures shall not apply to urgent procurements carried out due to serious natural disasters or other force majeure events, or the procurements involving national security or secret.

Article 89. The responsibility to interpret these Measures shall remain with the Ministry of Finance.

The finance department of the people's government of each province, autonomous region, or municipality directly under the Central Government may formulate specific implementation measures in accordance with these Measures.

Article 90. These Measures shall come into force on September 11, 2004. The "Interim Measures for the Administration of Tenders and Invitations to bid in Government Procurement" promulgated by the Ministry of Finance on June 24, 1999 for implementation (No. 363 [1999] of the Ministry of Finance) shall be repealed simultaneously.