CIRCULAR

SPECIFYING PREPARATION OF INVITATION TO BID ON CONSTRUCTION WORKS

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

Pursuant to the Government’s Decree No. 63/2014/ND-CP dated June 26, 2014 on providing specific provisions on implementation of several articles enshrined in the Law on Bidding in terms of the contractor selection procedure;

Pursuant to the Government's Decree No. 116/2008/ND-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 hereby promulgates the Circular on providing specific provisions on preparing the invitation to bid on construction works.

Article 1. Scope of application

1. This Circular hereby provides specific provisions on preparing invitation to bid on construction work within the scope of application stipulated in Article 1 of the Bidding Law No. 43/2013/QH13 as follows:

a) Form of the invitation to bid on construction works No. 01 (Form No.01) applying to national competitive and limited bids by following the single-stage one-envelop bidding procedure;

b) Form of the invitation to bid on construction works No. 02 (Form No.02) applying to national competitive and limited bids by following the single-stage one-envelop bidding procedure.

2. With regard to the bid for construction works specified as projects financed by official development assistance from Asian Development Bank (ADB) and World Bank (WB) under the national competitive bidding process, the form of the invitation for national competitive bid written in Vietnamese by ADB and WB shall apply.

Article 2. Applicable entities

This Circular shall apply to organizations or individuals participating or involved in the procedure for selection of contractors for procurement of construction works within the scope of application stipulated in Article 1 hereof.

Article 3. Application of Forms of invitation to bid for construction works

1. Forms of invitation to bid for construction works issued together with this Circular shall be created on the basis of regulations laid down in the Vietnam’s bidding law, and simultaneously consult bidding regulations adopted by ADB and WB in order to facilitate contracting parties’ involvements in contractor selection and further improve the competitiveness, equality, transparency and economic efficiency in the bidding process.

2. With regard to the procurement of construction works financed by ODA, if contributors agree, the Form No. 01 or Form No. 02 issued together with this Circular shall apply, or certain contents provided in bidding regulations enshrined in the International Treaties and Agreements between Vietnam and these contributors may be amended and modified.

3. With regard to the international bidding, based on the size and characteristics of the bid, organizations or individuals charged with preparing the invitation for bid shall be obliged to modify regulations on the language, currency type, incentive and schedule in the bidding process and other relevant contents in conformity with regulations enshrined in the Law on Bidding No. 43/2013/QH13, and the Decree No. 63/2014/ND-CP.

4. With regard to the bid for small-scale procurement of construction works, based on the characteristics of this bid, if stakeholders find that it is necessary to employ the method for single-stage two-envelop contractor selection, they shall be required to submit the plan for contractor selection to competent authorities for approval and use the Form No. 02 enclosed herein to prepare their invitation for bid.

5. When preparing, verifying and approving the invitation for bid on construction works, organizations or individuals are required to adopt the form of invitation for bid on construction works enclosed herein and, depending on the size and nature of the specified bid, set out proper requirements on the basis of sticking to the principle of competitiveness, fairness, transparency and economic efficiency; and not to impose requirements to constrain bidder's participation or give more advantages to one or several bidder(s) as a manner to result in the unfair competition. They shall not be allowed to revise regulations on bidders' instructions and general contractual terms and conditions laid down in the Form of invitation for bid; as regards other contents, they are allowed to carry out any necessary revision to make these regulations appropriate for the size and characteristics of the bid. In case there is any amendment to regulations laid down in the form of invitation for bid, organizations or individuals charged with formulating, verifying and accrediting the invitation for bid must undertake that such amendments are more appropriate, scientific and stringent against regulations stated in the Form of invitation for bid, and are not in breach of legal regulations on bidding. The written request for approval of the invitation for bid must clarify contents that have been modified as per regulations specified in the Form of invitation for bid and clearly state reasons for such modification for stakeholders' consideration and decision.

6. With regard to the bid for non-consulting services to be furnished, based on the size and characteristics of this bid, regulations specified in the Form of invitation for bid mentioned above may be modified to make them more appropriate for implementation.

Article 4. Implementation of regulations on taxes, fees and charges

1. The offer price of bidders must be composed of all expenses necessary to execute the awarded contract, inclusive of taxes, fees and charges (if any). Taxes, fees and charges shall be calculated by reference to statutory tax rates and fee or charge levels 28 days prior to the bid’s closing date.

2. When participating in the bid, bidders shall be responsible for learning, calculating and proposing the quoted price which includes types of taxes, fees and charges (if any). In the event that the bid package does not mention taxes, fees or charges, the bidder’s quoted price shall be considered to include all of taxes, fees or charges; in this case, if the bidder is selected and awarded the contract, all liabilities or obligations to pay such taxes, fees or charges (if any) to the State must be fulfilled. In the event that the bidder submits the quoted price excluding taxes, fees or charges (if any) in the bid package, this bid package shall be rejected.

Article 5. Construction, commonly shared works and provision expenses

1. The quoted price must be constituted by construction, commonly shared works and provision expenses.

2. Provision expenses shall be composed of provisions for price drifts, additional workloads and advances (if any).

The determination of provision expenses shall be carried out as per specialized legal regulations on construction cost management and particular attributes of the bid. Stakeholders shall rely on the size, characteristics, time and location of construction site as well as other related elements in order to decide how such provision expenses are used but ensure compliance with specialized legal regulations on construction cost management.

3. As for the lump-sum contract, bidders shall be obliged to calculate and distribute provision expenses to the quoted price, and shall not be allowed to separate provision expenses already distributed to be included in the quoted price for the purpose of consideration and evaluation during the process of financial and commercial evaluation of bid packages.

4. As for firm fixed-price contracts and fixed-price contracts with price adjustment, once financial and commercial bid evaluation takes place, provision expenses shall not be considered and evaluated as the basis for making a comparison with other bidders and identifying the bidder’s rating. Provision expenses shall be rectified during the contract negotiation process. The best price and the contractual price shall be constituted by provision expenses; these provision expenses shall be managed by stakeholders and only used for paying bidders under the terms and conditions of the contract whenever payments are arising.

The invitation for bid must clearly specify contents and principles of using provision expenses as the basis for bidders' price quotation, conclusion and execution of the contract which specifically clarify the monetary amount or percentage of provision expenses calculated based on construction costs of the bid in order for bidders to submit their bid proposal. Bidders are required to make a bid proposal inclusive of provision expenses in compliance with requirements laid down in the invitation for bid.

Article 6. Contract

1. The invitation for bid shall comprise the form of contract and specific provisions on contractual terms and conditions as the basis for bidders' bid proposal and contracting parties’ negotiation, contract perfection and conclusion.

2. The contract signed between the stakeholder and the bid solicitor must conform to the Form of contract and contractual terms and conditions stipulated in the invitation for bid, and amendments or corrections proposed by the contractor and accepted by the investor in the course of contract negotiation and perfection, but ensure such amendments or corrections are not in breach of legal regulations on bidding and other relevant legal regulations.

Article 7. Implementation

1. This Circular shall enter into force from July 1, 2015 as a replacement for the Circular No. 01/2010/TT-BKH of the Ministry of Planning and Investment dated January 6, 2010 on specifying preparation of the invitation for bid on construction works, and the Circular No. 02/2010/TT-BKH of the Ministry of Planning and Investment dated January 19, 2010 on specifying preparation of the invitation for bid on small-scale construction works.

2. Ministries, Ministry-level agencies, Government agencies, and other central organs, and the People’s Committees at all levels, as well as organizations or individuals concerned, shall be responsible for implementing this Circular. In the course of implementation, if there is any difficulty that may arise, Ministries, Ministry-level agencies, Government agencies, and other central organs, and the People’s Committees at all levels, as well as organizations or individuals concerned, shall be requested to send their feedbacks to the Ministry of Planning and Investment for timely instructions./.

Form No. 23

LETTER OF ACCEPTANCE AND NOTICE OF AWARD

……….[place], …………………..[date]

To: [insert name and address of the successful bidder “hereinafter referred to as “the Contractor”]Re: Letter of Acceptance and Notice of Award.

Pursuant to Decision No…………………. dated………………….of the Investor [insert the Investor’s name (hereinafter referred to as “the Investor”)] giving approval for the result of selection of contractor for………………………. [insert name and number of the contract package], the Employer [insert name of the Employer (hereinafter referred to as “the Employer”) would like to notify that the Investor has accepted your Bid and award the contract for execution of the [insert name and number of the contract package. If a package is divided into several items, specify the name and number of the item for which the bidder is selected] with the contract price of…………………………. [insert the successful bid price specified in the decision on giving approval for results of bidder selection] and the contract duration of…………………. [insert the duration for completion the contract package specified in the decision on giving approval for results of bidder selection] .The Contractor’s legal representative is requested to prepare and enter into the Contract with the Investor/ Employer according to the following plan:

- Contract completion time:……………… [specify the time when a complete contract is prepared], at………………………… [specify the location where the contract is completed];

- Contract conclusion time:………….. [specify the time when the contract is duly entered into by the parties], at………………………… [specify the location where the contract is concluded], enclosed with the draft contract.

The Contractor is also requested to provide the performance security as prescribed in the Form No. 22 Chapter IX – Contract forms included in the bidding documents with an amount of …………………….. and validity period of ……………………. [specify the amount and validity period as prescribed in Section 5 Chapter VIII – Specific conditions of contract included in the bidding documents].

This document is an integral part of the Contract. Upon the receipt of this document, the Contractor must provide a notification of acceptance of the completion and conclusion of the Contract as well as the provision of the performance security as mentioned above, in which the Contractor must state that the Contractor’s current capacity still meets all requirements specified in the bidding documents. The Investor shall refuse to complete and enter into the contract if the Contractor is found to fail to satisfy the capacity requirements for executing the package.

If the Contractor fails, or refuses, to complete and enter into the contract, or provide the performance security as required by…………………………….. [date] [based on the scope and nature of the contract package, the deadline for provide the performance security, complete and enter into the contract is determined and not later than 28 days from the issuance of this document], the Contractor shall be rejected without the bid security returned.

Attachments: The draft contract.