Yes, types of enforcement mechanism includes:[1]
- Discipline, administrative sanction, civil damages, criminal prosecution, depending on the types of violation; and
- Prohibition from participating in bidding activities and inclusion in the List of violating bidders on the National bidding portal.
[1] Article 90, Bidding Law.
Yes. Violators of procurement legislation are also subject to remedies under the criminal, administrative and civil laws. For example, violators causing damages to other organizations/individuals as the result of their violation to procurement legislation are liable to pay civil damages.[1]
In addition, the Law on Construction and the Law on Commerce offer remedies in terms of penalties, provided that the parties have already agreed on such penalties under the contract.
- For construction works using state capital, the contractually agreed penalties shall not exceed 12% of the total value of the violated obligation.[2]
- For any contract involving a merchant as a party and/ or relating to commercial activities,[3] the contractually agreed penalties shall not exceed 8% of the total value of the violated obligation.[4]
[1] Article 90.1, Bidding Law; Article 124, Decree No. 63.
[2] Article 146, Law on Construction.
[3] Article 1, 2, Law on Commerce.
[4] Article 301, Law on Commerce.
There is no specific forum where procurement disputes/appeal are heard.
However, under the Bidding Law, parties has the right to either initiate the case to the Court,[1] or submit the case to the Consultancy Council.[2] The Consultancy Council shall hear the appeal only if the appeal is not submitted to the Court.[3]
The central Consultancy Council shall be set up by the Minister of Planning and Investment. At ministries or ministerial-level agencies the Consultancy Councils shall be set up by ministers or heads of ministerial-level agencies and in localities this Council is set up by heads of local state management agencies in charge of bidding activities.[4]
The costs for settlement must be paid by the appealing contractors where the appeal relates to contractor selection results is 0.02% of the bid of such contractor but must be between VND 1 million (approximate USD 47) and VND 5 million (USD 230).[5]
[1] Article 91.1(b), Bidding Law.
[2] Articles 92.2, 92.4, Bidding Law.
[3] Article 118.4, Bidding Law.
[4] Article 92.2(c), Bidding Law; Article 119.1, Decree No. 63.
[5] Articles 9.8, 118.5, Bidding Law.
Under the law, the prescribed timeline of appeal's review by the Consultancy Council on matters arising from contractors/investors selection procedures, selection result, is between from 20 days to 60 days depends on the seriousness of the matter.[1]
However, in practice, timeline for this review normally extends beyond the period provided by law.
[1] Articles 92.3,92.4 Bidding Law.
Pre-conditions for a review are as follows:
- The contractor shall send a written appeal to the project owner at any time after the matter arises but before the contractor selection result is announced;
- The appeal is submitted to the competent person. Specifically,
- for appeals regarding the selection procedures, the appeal is filed to the party calling for biddings. If the parties cannot resolve the matter, the contactor may file a written appeal to the competent person
- for protests regarding the selection results, the appeal is filed to the party calling for biddings. If the parties cannot resolve the matter, the contactor may file a written appeal to the competent person and the appeal settlement consultancy council (the "Consultancy Council" ) to resolve the matter. The central Consultancy Council shall be set up by the Minister of Planning and Investment. At ministries or ministerial-level agencies the Consultancy Councils shall be set up by ministers or heads of ministerial-level agencies and in localities this Council is set up by heads of local state management agencies in charge of bidding activities.[1]
- The content of the appeal has not been filed to court;[2]
- The contractor who is appealing has paid the deposit for the appeal (applicable when the appeal is resolved by the competent person or the Consulting Council for resolution of the appeal).[3]
[1] Article 92.2(c), Bidding Law; Article 119, Decree No. 63.
[2] Article 118.4, Decree No. 63.
[3] Article 118.5, Decree No. 63.
For an on-going bidding procedure: Yes. If the appeal is successfully filed to the competent person/Consulting Council for resolution, the competent person may suspend the on-going bidding procedure on a temporary basis, if it is deemed necessary. The suspension duration will last from the date the party calls for bidding receives the notification on suspension until the date the competent person issues a document to resolve the appeal.[1]
For an awarded contract: There is no specific provision dealing with the awarded contract in this case. However, in general, a contract might be declared invalid by court upon the request of a party if the contract is entered into with objectives and contents that breach legal prohibitions. An invalid transaction shall not give rise to, change or terminate any civil rights and obligations of the parties as from the time the transaction is entered into. The parties shall restore everything to its original state and shall return to each other what they have received. If the restitution is not able to made in kind, it may be paid in money. The party at fault which cause the damage must pay the compensation.[2]
[1] Articles 92.2(dd), 92.4(dd) Bidding Law.
[2] Article 131.4, Civil Code 2015.
The Bidding Law allows the application of cancellation or termination of bidding and rejection of contractor selection results.[1] However, there is no clear differentiation of legal consequences among those measures.
For the affected bidding procedure: a successful review proceeding may lead to the cancellation of the bid, if the following instances are discovered as the result of the review:[2]
- All bid dossiers or dossiers of proposals fail to satisfy requirements of the bidding dossier or dossier of requirements;
- The investment purpose and scope stated in the bidding dossier or dossier of requirements are changed;
- The bidding dossier or dossier of requirements is incompliant with the bidding law and other relevant laws, leading to the failure of selected contractors or investors to satisfy requirements for execution of bidding packages or implementation of projects; and
- There is evidence of the giving, receipt or brokering of bribes, collusion in contractor selection, fraud, abuse of position and power to illegally intervene in bidding activities, leading to false results of selection of contractors or investors.
In addition, termination of bidding or rejection of contractor selection results applies where there is evidence that there is a violation of the Bidding Law or other relevant laws, which make the bidding uncompetitive, partial and economically ineffective or falsifies the bidding result.[3]
In addition, the competent person shall suspend the bid, deny the selection results or declare decisions of project owner, bid solicitor are invalid if detected that there is violation of the Bidding Law or other relevant regulations.[4]
In such instances, the violator shall reimburse expenses for related parties and be liable for fines under relevant provisions of the laws (please refer to Section 8(a) and 8(b) above).[5]
For an awarded contract: Please see Section 8(g) above.
[1] Article 123, Decree No. 63.
[2] Article 17, Bidding Law.
[3] Article 123.2(a), Decree No. 63.
[4] Article 73.5, Bidding Law.
[5] Article 18, Bidding Law.
Depending on the complexity of the case, judicial proceeding for review can take months to several years.
Review proceedings record is not publically available. However, from what we see in practice, review is not common.