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Latest Amendments to Government Procurement Act



The new amendments of Government Procurement Act (“the new Act”) were promulgated by the President on May 22, 2019 and have taken effect on May 24, 2019.  Provided below is a summary of the important amendments of the new Act:

 

1.    The new Act adds that the restrictions and review methods for the qualifications of domestic or foreign supplier may be established in the government procurement involving national security (see Article 17).

 

2.    The new Act modifies the terms of “forging or altering documents” related to tendering or contract performance to the term of “using false documents”.  The new Act clearly broadens the scope of prohibition.  Thus, when the supplier uses false documents in tendering or contract performance, it will meet the requirements of “confiscating the bid bonds” or “the ban from bidding government contracts”. The new Act apparently puts more duties on the supplier and thus the supplier shall strengthen the management in the documents related to tendering or contract performance (see Articles 31, 50 and 101).

 

3.    The new Act modifies that the government procurement contract shall stipulate the responsibility of either party in the event that its erroneous performance, false representation, or poor management has caused damages to the other party. In the past, the original provision is only applicable to the responsibility of the supplier (see Article 63).

 

4.    The new Act strengthens the protection of occupational safety and health. Under the new Act, the procuring entity shall prepare safety and health drawings and specifications in accordance with occupational safety and health regulations in the tender documentation and set out safety and health expenses. It shall also specify in the tender documentation that the supplier shall take necessary equipment or measures in accordance with occupational safety and health regulations and implement safety and health management and training in order to avoid occupational disasters. In the event of an occupational disaster, the procuring entity shall bear the responsibility in accordance with the government procurement act and the contract made by the parties. (see Article 70-1)

 

5.    In order to avoid the procuring entity’s delay on correcting illegal procurement conduct, the new Act adds that the procuring entity shall proceed with a lawful alternative within 20 days from the date following the date of receipt of the review decision of the Complaint Review Board for Government Procurement ("CRBGP") which specifies that the procuring entity is in breach of regulations. The supplier may file a written complaint with the CRBGP within fifteen days from the expiration of the 20-day period if the procuring entity fails to dispose the case within the 20-day period.  Where a review decision specifies that the procuring entity is in breach of regulations, the supplier may request the procuring entity to reimburse the necessary expenses incurred by the supplier for the preparation of tender and the filing of protest and complaint. (see Article 85)

 

6.    The new Act modifies and adds some provisions regarding the requirements and procedure of the ban from bidding government contracts (see Articles 101 and 103):

 

(1) The new Act adds that the supplier who offers, agrees to offer, or gives improper benefits to the personnel of government procurement shall be subject to the ban from bidding government contracts.

 

(2) The new Act adds the new requirement that the violation is of a serious nature for some circumstances of the ban from bidding government contracts. Furthermore, the new Act also prescribes that the procuring entity shall consider the damages of the procuring entity, the degree of supplier’s accountability, and the correction or compensation measure made by the supplier when determining whether the violation is of a serious nature.

 

(3) The new Act also adds some “due process” provisions for the procedure of the ban from bidding government contracts.  Under the new Act, the procuring entity shall give the supplier an opportunity to state its opinions before notifying the ban from bidding government contracts and shall establish a special task force to determine whether the supplier meets the requirements of the ban from bidding government contracts.

 

(4) The new Act also shortens the ban period for some circumstances regarding the violation of procurement contract, and the new ban period is from three months to one year depending on the times of violation.

 

(5) The new Act is also applicable to the ban which has not become final.



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