There are basically three methods for public procurement by the Government, namely, general competitive bidding, selective bidding and discretionary contracts. The same applies to procurement by local governments.

First, "general competitive bidding" is a method in which the Government enter into contracts with the bidder who provided the best conditions for the Government through competition among an unspecified number of bidders. This method is equivalent to open bidding under the GPA.

Second, "selective bidding" is a method in which only participants designated by the Government may participate. In cases where the number of participants are limited or it is otherwise not suitable for open bidding due to the nature or purpose of the relevant contract, selective bidding can be employed (the Accounting Act, paragraph 3 of Article 29-3). For example, where it appears there is some risk that relevant business operators may obstruct a fair and open bidding process, selective bidding may be more suitable.

A "discretionary contract" is a type of contract not the result of open bidding or selective bidding, used where, due to the nature or purpose of the contract, or due to some urgent need or potential adverse effect, competition either cannot be held or is otherwise inappropriate.

In terms of priority, general competitive bidding comes first as a rule, and selective bidding or discretionary contracts can be used in exceptional cases.

For procurement by the Government, it is possible to use the "electronic procurement system" to handle the whole process of procurement, including bidding, bid opening, establishing a contract, accepting orders, processing delivery inspections and claims. The electronic procurement system is operated as a common system used across many Government Ministries and Agencies. So long as the institution engaging in procurement is using this system, procurement procedures can be smoothly carried out using the unified processes of this system.

A handful of local governments have begun transferring their processes to similar electronic procurement systems.

Information regarding the Government's public procurement is published in Government journals and that of local governments' public procurement is set out in local journals, respectively. The "electronic procurement system" also discloses bidding information, and can be found at: https://www.chotatujoho.go.jp/csjs/pr006/JohoInActionEN.do

Certain parties are not permitted to participate in bidding, including (i) any person who does not have the power to execute the relevant contract, (ii) any person who received an order of commencement of bankruptcy proceedings and has not had the its rights restored and (iii) any person relating to an Organized Crime Group (the Cabinet Order on Budgets and Accounts, Article 70).

Under the Cabinet Order on Budgets and Accounts, Article 71, if a person has (i) intentionally carried out construction, or manufacturing or any other service in a careless manner or acted fraudulently with regard to the quality or volume of an object in the course of performing a contract, (ii) obstructed the fair implementation of a tender or has hindered a fair price from being reached or colluded with others to obtain an unlawful profit, (iii) obstructed a successful bidder from entering into a contract or obstructed a party to a contract from performing the contract, (iv) obstructed an official from performing the official's duties in relation to a supervision or inspection, (v) failed to perform a contract without a justifiable reason, (vi) has intentionally claimed an excessive amount for a price based on false facts when, under a contract, the price is to be fixed subsequent to the signing of the contract or (vii) has employed a proxy, manager or other employee in the conclusion or performance of a contract who would not be eligible to participate in open bidding due to the foregoing (i) through (vi), such person can be prevented from participating in open bidding for a period of up to three years from the time of such behavior.

These restrictions are generally same in local governments' procurement (the Order for Autonomy, paragraph 2 of Article 167-4).