During contract negotiation, is quoted bid adjusted to increase or decrease in Vietnam?

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Question date: 02/12/2022

During contract negotiation, is quoted bid adjusted to increase or decrease in Vietnam? What is determination of contract estimates in Vietnam? 

I am going to negotiate a contract package with a partner company A in the near future, and I wonder if the two parties are negotiating the contract can it be adjusted to increase or decrease the quoted bid? What is determination of contract estimates in Vietnam? 

Please advise. Thankyou.

    • 1. During contract negotiation, is quoted bid adjusted to increase or decrease in Vietnam?

      Pursuant to Article 19 of Decree 63/2014/ND-CP on contract negotiation, as follows:

      1. The bidder who has seized the first position in the bidder's rating shall be eligible for the contract negotiation. If any bidder who is invited to negotiate the contract has not turned up or refused to proceed to the contract negotiation, they are not allowed to reclaim their tender guarantee.

      2. Contract negotiation shall be based on the followings:

      a) Report on evaluation of the bidding documents;

      b) Bid package and bidder’s records of clarification of bid package;

      c) Bidding solicitation.

      3. Rules of the contract negotiation:

      a) Contents of the bid package that satisfy the requirements of the bidding documents do not need to be negotiated;

      b) Contract negotiation is not allowed to change the quoted bid after error correction, deviation adjustment and discount deduction (if any). While evaluating bid packages and negotiating contracts, if workloads specified in the bill of quantities are lower than these mentioned in the design documentation, the soliciting party must request contractors to make up for this inadequacy on the basis of the quoted price; if a bid package has not provided the quoted price, procuring entities shall send reports to investors for consideration and decision on fixing the price in the approved estimate for these inadequate workloads or the price quoted by other bidders who have passed the technical evaluation

      c) Negotiation over the negative deviation value shall comply with regulations specified in Point d Clause 2 Article 17 of this Decree.

      4. Contents of contract negotiation:

      a) Unspecified, inappropriate and inconsistent contents between bidding documents and bid packages or in the same bid package shall be negotiated to prevent any possible dispute or unexpected impact on the contractual obligations of contracting parties;

      b) Deviations that have been found by the contractor and contractor’s recommendations (if any), including possible alternatives which contractors are allowed to provide according to relevant bidding regulations;

      c) Personnel issues in respect of construction and mixed contracts:

      In the course of negotiation, selected bidder is not allowed to change their key personnel as proposed in the bid package for those who are in charge of design and survey (in respect of construction and mixed contracts that require contractors to implement one or two design steps prior to construction), construction site, except the case in which the evaluation time is extended longer than the regulated time or because of unexpected events that dissuade these key personnel from participating in the contract execution. In such case, contractors have the right to change other personnel but must ensure the substitute employees prove qualification, experience and capability equivalent to or higher than proposed personnel and bidders are not allowed to change their quoted bids;

      d) Any issue that arises during the selection of contractors (if any) in the aim of completing detailed contents of the contract;

      dd) Other necessary issues.

      5. In the course of contract negotiation, negotiating parties must proceed to draft and complete the official agreement, specific terms and conditions and annexes that determine detailed list of workloads, price list and contract execution progress (if any).

      6. If the negotiation fails, procuring entities must report investors for their consideration and decision on soliciting bidders who are ranked at the next positions for contract negotiation; if the successive negotiations also fail, procuring entities must report investors for their consideration and decision on the bid cancellation as regulated in Clause 1 Article 17 of the Bidding Law.

      According to this Article, during contract negotiation, the two parties are not allowed to change the quoted bid in Vietnam.

      2. What is determination of contract estimates in Vietnam?

      In Article 17 of Decree 10/2021/ND-CP stipulating determination of contract estimates, as follows:

      1. Contract estimates are determined on the basis of costs of each contract package and satisfactory to design, scope, nature, characteristic and specific conditions of contract package.

      2. For front end engineering design (FEED) projects for implementation of engineering, procurement and construction (EPC) contracts, contract estimates are determined on the basis of costs within contract package determined on the basis of FEED design.

      3. For projects and constructions permitted by investment deciders to implement construction design after fundamental design according to each construction contract package and each project execution phase, contract estimates are determined on the basis of costs within scope of respective contract package and construction design. Costs within contract estimates are determined similar to costs under construction estimates under Article 12 of this Decree satisfactory to scope, nature, characteristics and specific conditions of each contract package.

      4. For projects with approved construction estimates, investors shall determine contract estimates on the basis of costs within scope of contract package under approved construction estimates if necessary.

      5. Backup costs in contract estimates conform to form of contracts in contract package specified under contractor selection plans.

      Thus, the contract estimates will be determined according to the above regulations in Vietnam.

      Best Regards!

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    "This English translation is for reference purposes only and not a definitive translation of the original Vietnamese texts"

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