China publishes revised draft on Government Procurement Law for opinions

On December 4, 2020, China’s Ministry of Finance published “Government Procurement Law of the People’s Republic of China (Revised Draft for Opinions)” and is opened for public comments. The deadline for soliciting opinions is January 5, 2021. The main revisions are as follows.

Revisions of the scope of government procurement

• The scope of government procurement in Article 2 was revised as follows (underlined parts are revised parts).
• Government procurement in this Law refers to the act that national agencies, public institutions, organizations and other procurement entities use financial funds or other public resources to obtain goods, make constructions or purchase services for the purpose of realizing government activities and industrial services, including purchasing, leasing, consignment, and public-private partnership, etc.

Revisions of provisions related to “government procurement policy”

• A new chapter on “Government Procurement Policy” has been added, and “Resource Saving” and “Protection of the Interests of Vulnerable Groups” were added to the “Objectives of Procurement Policy” stipulated in Article 28.
• A provision has been added that procurers shall strictly implement government procurement policies in their procurement-related activities (Article 31).
• In consideration of the possibility that government procurement activities may affect national security, an article has been added that states shall establish a “Government Procurement Safety Review System” (Article 33).

Strengthen demand management for government procurement

• A new chapter on “Government Procurement Demand Management” has been added to clarify the definition of demand in procurement (Article 35).
• A new requirement for demand management within the procurer has been added (Article 40).

Development of contract system

• Several types of contract price determination methods have been established, such as fixed price, cost compensation, and performance incentives.

Simplification of supplier qualification conditions

• The “basic conditions + negative list” system was adopted as the qualification conditions for suppliers to facilitate their participation in government procurement activities.

For the original text of the above Revised Draft for Opinions, please refer to the following URL (in simplified Chinese)

http://www.gov.cn/xinwen/2020-12/08/content_5567837.htm