Laws of the People's Republic of China

The Standing Committee of the National People's Congress

Order of the President of the People's Republic of China

No. 21

Invitation and Submission of Bids Law of the People's Republic of China adopted by the 11th Meeting of the Standing Committee of the Ninth National People's Congress on August 30,1999, are hereby promulgated and shall come into force as of the day of January 1, 2000.

President of the People's Republic of China, Jiang Zemin

August 30,1999

Invitation and Submission of Bids Law of the People's Republic of China ContentsChapter 1 General Provisions

Chapter 2 Invitation of Bids

Chapter 3 Submission of Bids

Chapter 4 Opening of Bids, Evaluation of Bids and Determination of the Winning Bidder

Chapter 5 Legal Liability

Chapter 6 Supplementary Provisions

Chapter 1 General Provisions

Article 1

This Law is enacted in order to standardize bid invitation and bid submission activities, to protect the interests of the State, the public interests and the lawful rights and interests of the parties involved in the bid invitation and bid submission activities, to increase economic benefits and to guarantee project quality.

Article 2

This Law applies to bid invitation and bid submission activities conducted in the People's Republic of China.

Article 3

Bids must be invited for the following construction projects undertaken in the People's Republic of China, including surveying for, and design, construction and supervision of, the projects as well as the procurement of import equipment, materials, etc. for the construction:

(1)

Projects with a bearing upon the public interest and public safety such as large-scale infrastructure projects, public utility projects, etc.;

(2)

Projects that are totally or partially funded by the investment of State-owned funds or financed by the State;

(3)

Projects using loans form international organizations or foreign governments, or aid funds.

The specific range and scale standards for the projects enumerated in the preceding paragraph shall be formulated by the State Council's development planning department in conjunction with the other relevant departments of the State Council, and then submitted to the State Council for approval.

If any law or the State Council has provisions on the range of other projects that are subject to the invitation of bids, those provisions shall prevail.

Article 4

No unit or individual may divide a project that legally requires the invitation of bids into several small parts or otherwise avoid the invitation of bids.

Article 5

Bid invitation and bid submission activities shall follow the principle of openness, fairness, impartiality and good faith.

Article 6

The bid invitation and bid submission activities for a project that legally requires the invitation of bids shall not be subject to territorial or departmental restrictions. No unit or individual may illegally restrict or preclude the participation in bid submission by legal persons or other organizations from outside his or its own region or network and may not in any manner illegally interfere in the bid invitation and bid submission activities.

Article 7

Bid invitation and bid submission activities and the parties involved shall subject to lawfully implemented supervisions.

The relevant administrative supervision departments shall supervise bid invitation and bid submission activities according to law, and shall investigate and handle illegal acts committed during bid invitation and bid submission activities.

The administrative supervision of bid invitation and bid submission activities and the specific division of functions and powers among the relevant departments shall be formulated by the State Council.

Chapter 2 Invitation of Bids

Article 8

A bid inviting party is a legal person or other organization that puts forward a project and invites bids therefore according to this Law.

Article 9

If the relevant provisions of the State require that project examination and approval procedures be carried pot for a certain project for which bids are to be invited, the examination and approval procedures shall be carried out and approval shall be obtained first.

The bid inviting party shall have the appropriate amount of funds, or have secured the source of funds, for conducting an invitation of bids, and the same shall be truthfully specified in the bid invitation documents.

Article 10

Invitation of bids are divided into public invitation of bids and private invitation of bids.

The term "public invitation of bids" refers to the method whereby the bid inviting party, through a bid invitation announcement, invites unspecified legal persons or other organizations to submit bids.

The term "private invitation of bids" refers to the method whereby the bid inviting party, through a bid invitation letter, invites specified legal persons or other organizations to submit bids.

Article 11

If public invitation of bids is not appropriated for a certain project which the development planning department of the State council has determined to be a key State project or which the people's government of the province, autonomous region or municipality directly under the Central Government has determined to be a key local project, a private invitation of bids may be conducted, subject to the approval of the development planning department of the State Council or the people's government of the province, autonomous region or municipality directly under the Central Government.

Article 12

A bid inviting party has the right to appoint a bid invitation agency of its own choice to carry out bid invitation matters. No unit or individual may in any way designate a bid invitation agency for the bid inviting party.

A bid inviting party, which has the capability to prepare the bid invitation documents and organize the bid evaluation, may carry out the bid invitation matters itself. No unit or individual agency may coerce it into appointing a bid invitation agency to carry out the bid invitation matters.

A bid invitation party which carries out bid invitation matters itself for a project for which the invitation of bids is legally required shall report the same to the relevant administrative supervision departments for the record.

Article 13

A bid invitation agency is a social intermediary organization, which is established according to law and engages in the bid invitation agency business and provides related services.

A bid invitation agency shall meet the following requirements:

(1)

Possessing business premises and the appropriate amount of funds to engage in the bid invitation agency business;

(2)

Possessing the specialized capability necessary to prepare bid invitation documents and organize bid evaluations;

(3)

Possessing the conditions provided in paragraph 3 of Article 37 of this law that can be used as the pool of technical and economic experts as candidates for members of the bid evaluation committee.

Article 14

The qualifications of bid invitation agencies engaging in the bid invitation agency business for construction projects must be subject to recognition by the competent department of construction administration of the State Council or of the people's government of the relevant province, autonomous region or municipality directly under the Central Government. The specific measures are to be formulated by the competent department of construction administration of the State Council together with the relevant departments of the State Council. The competent department for recognizing the qualifications of bid invitation agencies engaging in other bid invitation agency business shall be specified by the State Council.

No superior-subordinate relationship or other relationship of shared interest may exist between a bid invitation agency and administrative agencies or other State organs.

Article 15

A bid invitation agency shall undertake bid invitation matters within the scope of commission of the bid inviting party, and shall observe the provision of this Law on bid inviting party.

Article 16

If the bid inviting party employs the public invitation of bids method; it shall issue a bid invitation announcement. The bid invitation announcement for a project for which the invitation of bids id legally required shall be issued in a State-designated newspaper or periodical, on a State-designated information network or in other State-designated media.

The bid invitation announcement shall specify such matters as the name and address of the bid inviting party, the nature, quantities, location and time of the project, the method of obtaining the bid invitation documents, etc.

Article 17

If the bid inviting party employs the private invitation of bids method, it shall send a bid invitation letter to at least three specific legal persons or other organizations which have the ability to handle the project and which have a good credit standing.

The bid invitation letter shall specify the matters stipulated in Paragraph 2 of Article 16 of this Law.

Article 18

Depending on the requirements of the project, the bid inviting party may require, in the bid invitation announcement or the bid invitation letter, that potential bidders provide the relevant documents certifying their qualifications and details of their business situation and may investigate the qualifications of potential bidders. If there are State regulations on the qualification requirements of bidders, such regulations shall prevail.

A bid inviting party may not restrict or preclude potential bidders by specifying unreasonable conditions and may not discriminate against potential bidders.

Article 19

The bid inviting party shall prepare bid invitation documents according to the special characteristics and requirements of the project. The bid invitation documents shall specify all substantive requirements and conditions, including the technical requirements for the project, the standards for the examination of the bidders' qualifications, bid price requirements, the bid evaluation standards, etc. and the principal terms of the contract to be executed.

If the State has regulations concerning the technology and standards for the project for which bids are invited, the bid inviting party shall include the corresponding requirements in the bid invitation documents according to those regulations.

If the project for which bids are invited needs to be split up into phases and the construction period needs to be specified, the bid inviting party shall split up the project into reasonable phases and specify a reasonable construction period and specify the same in the bid invitation documents.

Article 20

The bid invitation documents may not require or specify a specific procedure or supplier or contain other particulars, which favor or preclude potential bidders.

Article 21

In accordance with the specific circumstances of the project for which bids are invited, the bid inviting party may organize an on-the-spot survey of the project for the potential bidders.

Article 22

The bid inviting party may not disclose to a third party the names or number of potential bidders, which have received bid invitation documents or other bid invitation and bid submission details, which could affect fair competition.

If the bid inviting party has set a reserve price, the confidentiality of the reserve price shall be maintained.

Article 23

If the bid inviting party makes necessary clarification or amendments to the bid invitation documents, it shall notify in writing all the parties that have received the bid invitation documents at least 15 days before the deadline for the submission of bidding documents specified in the bid invitation documents. The contents of the clarifications or amendments shall become an integral part of the bid invitation documents.

Article 24

The bid inviting party shall set a reasonable time necessary for the bidders to prepare their bid documents. However, for projects which legally require the invitation of bids, the time between the date on which the issue of the bid invitation documents commences and the deadline for the submission of bid documents by the bidders may not be less than 20 days.

Chapter 3 Submission of Bids

Article 25

A bidder is a legal person or other organization, which responds to an invitation of bids and participates in the bidding competition. If a scientific research project for which bids are invited according to law permits individuals to participate in the bidding, the provisions of this Law concerning bidders shall apply to those individuals submitting bids.

Article 26

A bidder shall have the capability to undertake the project for which bids are invited. If the relevant provisions of the State or the bid invitation documents specify requirements as to bidder qualifications, the bidders shall possess the required qualifications.

Article 27

A bidder shall prepare its bid documents according to the requirements of the bid invitation documents. The bid documents shall respond to the substantive requirements and conditions put forward in the bid invitation documents.

If the project for which bids are invited is for construction work, the particulars of the bid documents shall include the resumes and business achievements of the person in charge of the project and the principal technical personnel intended to appoint, and the machinery and equipment intends to use in completing the project, etc.

Article 28

The bidders shall deliver the bid documents to the bid submission address before the deadline for the submission of bid documents specified in the bid invitation documents. After receiving the bid documents, the bid inviting party shall sign for receipt and preserve the same, and may not open them. If there are fewer than three bidders, the bid inviting party shall invite bids anew according to this Law.

The bid inviting party shall refuse to accept bid documents, which are delivered after the deadline for the submission of bid documents specified in the bid invitation documents.

Article 29

Before the deadline for the submission of bid documents specified in the bid invitation documents passes, a bidder may supplement, amend or withdraw the bid documents it has submitted, and it shall notify the bid inviting party thereof in writing. The content of the supplementation or amendments shall become an integral part of the bid documents.

Article 30

If a bidder, on the basis of the actual circumstances of the project as specified in the bid invitation documents, intends to subcontract out some of the non-principal, non-key parts of the work after its bid is accepted, it shall specify the same in the bid documents.

Article 31

Two or more legal persons or other organizations may organize as a consortium and jointly submit a bid as a single bidder.

Each of the members of a consortium shall have the appropriate capability to undertake the project for which bids are invited. If the relevant provisions of the State or the bid invitation documents specify requirements as to bidder qualifications, each of the members of the consortium shall possess the corresponding required qualifications. If the consortium is composed of units that specialize in the same field, the qualification grade of the consortium shall be determined according to the qualification grade of the unit with the lowest qualification grade.

The members of a consortium shall execute an agreement for joint submission of a bid, clearly specifying the work and responsibilities each member intends to undertake, and shall submit such agreement together with the bid documents to the bid inviting party. If a consortium submitted the wining bid, the member of the consortium shall jointly execute a contract with the bid inviting party and bear joint and several liabilities towards the bid inviting party for the project that they have won.

A bid inviting party may not coerce bidders into organizing a consortium to jointly submit a bid and may not restrict the competition among the bidders.

Article 32

Bidders may not collude on the bid price, may not preclude fair competition form other bidders or prejudice the lawful rights and interests of the bid inviting party or other bidders.

Bidders and the bid inviting party may not collude in the submission of bids in order to harm the interests of the State, the public interest or the lawful rights and interests of a third party.

Bidders are prohibited from bribing the bid inviting party or members of the bid evaluation committee in order to have their bid accepted.

Article 33

A bidder may not submit a below cost bid price in competing for a project, or submit its bid in the name of a third party or use other fraudulent means to have its bid accepted.

Chapter 4 Opening of Bids, Evaluation of Bids and Determination of the Winning Bidder

Article 34

The bids shall be opened in public at the time of the deadline for submission of the bid documents as determined in the bid invitation documents. The bids shall be opened at the predetermined place specified in the bid invitation documents.

Article 35

The opening of the bids shall be presided over by the bid inviting party, and all the bidders shall be invited to attend.

Article 36

When opening the bids, the bid inviting party or the representative chosen by him shall inspect the status of the seals on the bids; alternatively, the same may be inspected and notarized by a notarial institution appointed by the bid inviting party. After the seals have been confirmed to be intact, the working personnel shall break the seals in public and read out the names and bid prices of the bidders and other major particulars of the bid documents.

All bid documents received by the bid inviting party by the deadline for submission of bid documents as specified in the bid invitation documents shall have their seals broken and be read out in public at the time the bids are opened.

Minutes shall be kept of the bid opening procedures and be filed for future reference.

Article 37

Bid evaluation shall be the responsibility of a bid evaluation committee organized according to law by the bid inviting party.

If a project legally requires the invitation of bids, the bid evaluation committee shall be composed of the representative of the bid inviting party and the relevant experts in technology, economics, etc. The number of members shall be an odd number of five or more, and the number of experts in technology and economics, etc. shall account for at least two-thirds of the total.

The experts referred to in the preceding paragraph shall have worked in their relevant fields for at least eight years and have a senior title or attained an equivalent professional level. They shall be selected by the bid inviting party from the list of experts provided by the relevant departments of the State Council or the relevant departments of the people's government of the province, autonomous region or municipality directly under the Central Government or from the list of experts in the relevant fields forming part of the bid invitation agency's pool of experts. For ordinary projects, the experts may be selected at random. For special projects, they may be determined directly by the bid inviting party directly.

Persons with a material interest in the bid inviting party may not sit on the bid evaluation committee for the relevant project. Those already sitting on the committee shall be replaced.

The list of members of the bid evaluation committee shall be kept confidential until the winning bidder has been determined.

Article 38

The bid inviting party shall take the steps necessary to ensure that strict confidentiality is maintained during the evaluation of the bids. No unit or individual may illegally intervene in or influence the course and result of the bid evaluation.

Article 39

The bid evaluation committee may require bidders to give the necessary clarification or explanation of those contents of the bid documents whose meaning is not clear. However, such clarification or explanation may not exceed the scope of the bid documents or change the substantive contents of the bid documents.

Article 40

The bid evaluation committee shall evaluate and compare the bid documents according to the evaluation standards and methods determined in the bid invitation documents. If a reserve price has been set, reference shall be made thereto. After the bid evaluation committee has completed the evaluation, it shall submit a written bid evaluation report to the bid inviting party and recommend qualified candidates for the status of winning bidder.

The winning bidder shall be determined by the bid inviting party on the basis of the written bid evaluation report submitted, and the candidates for the status of winning bidder recommended, by the bid evaluation committee. Alternatively, the bid inviting party may authorize the bid evaluation committee to directly determine the winning bidder.

If the State Council has special provisions concerning the evaluation of bids for special projects, such provisions shall prevail.

Article 41

The bid of the winning bidder shall meet the following conditions:

(1)

It conforms to the greatest possible extent with all of the overall evaluation standards specified in the bid invitation documents;

(2)

It satisfies the substantive requirements of the bid invitation documents and its bid price is the lowest among those evaluated, except for bid prices below cost.

Article 42

If, upon evaluation, the bid evaluation committee consider that none of the bids to meet the requirements of the bid invitation documents, it may reject all of the bids.

If all the bids for a project, which legally requires the invitation of bids, are rejected, the bid inviting party shall invite bids anew according to this Law.

Article 43

Until the winning bidder has been determined, the bid inviting party may not hold negotiations with bidders on substantive contents such as bid price, bid plans, etc.

Article 44

The members of the bid evaluation committee shall perform their duties in an objective and impartial manner, observe their professional ethics and bear personal liability for the evaluation opinions put forward by them.

The member of the bid evaluation committee may not have private contacts with bidders or accept property or other benefits from bidders.

The members of the bid evaluation committee and the relevant working personnel participating in the evaluation may not disclose details of the evaluation and comparison of the bid documents, details of the recommendation of candidates for the status of winning bidder and other relevant details of the bid evaluation.

Article 45

After the winning bidder has been determined, the bid inviting party shall issue a letter of acceptance to the winning bidder and simultaneously inform all the losing bidders of the result of the determination of the winning bidder.

The letter of acceptance shall be legally binding on the bid inviting party and the winning bidder. If the bid inviting party changes the result of the determination of the winning bidder, or the winning bidder renounces the project, which it has won, after the letter of acceptance has been issued, it shall assume legal liability therefore according to law.

Article 46

The bid inviting party and the winning bidder shall conclude a written contract according to the bid invitation documents and the winning bidder's bid documents within 30 days of the date of issuance of the letter of acceptance. The bid inviting party and the winning bidder may not subsequently conclude other agreements, which contravene the substantive terms of the contract.

The winning bidder shall pay a performance bond if the bid invitation documents require the winning bidder to do so.

Article 47

For projects which legally requires the invitation of bids, the bid inviting party shall submit a written report on the invitation and submission of bids to the relevant administrative supervision department within 15 days of the date of determination of the winning bidder.

Article 48

The winning bidder shall perform its obligations, and complete the project, which it has won, according to the contract. The winning bidder may not assign the project that it has won to a third party, or break up the project, which it has won and subsequently assign the parts to third parties.

Subject to the provisions of the contract or the consent of the bid inviting party, the winning bidder may subcontract out the completion of some of the non-principal, non-key parts of the work for the project that it has won. The subcontractors shall possess the appropriate qualifications required and may not subcontract its project.

The winning bidder shall be accountable to the bid inviting party for the subcontracted projects, and the subcontractors shall bear joint and several liabilities for the subcontracted projects.

Chapter 5 Legal Liability

Article 49

Anyone who violates the provisions of this Law by failing to invite bids for a project for which bids must be invited, or by breaking up a project for which bids must be invited into several small parts or by otherwise avoiding the invitation of bids, shall be ordered to make amends within a specified time limit, and may be imposed a fine of mot less than 0.5% nor more than 1% of the amount of the project contract; if the project is entirely or partially funded with State-owned funds, the implementation of the project or allocation of funds may be suspended. The persons in charge directly responsible and the other directly responsible persons of the unit shall be disciplined according to law.

Article 50

If a bid invitation agency violates the provisions of this Law by disclosing details or materials which relate to the bid invitation and submission procedures and are subject to maintenance of confidentiality, or if it colludes with the bid inviting party or a bidder in order to harm the interests of the State, the public interest or the lawful rights and interests of a third party, it shall be imposed a fine of not less than 50,000 Yuan nor more than 250,000 Yuan, and the persons in charge directly responsible and the other directly responsible persons of the unit shall be imposed a fine of not less than 5% nor more than 10% of the amount of the fine imposed upon the unit; if there are illegal earnings, such illegal earnings shall also be confiscated; if the circumstances are serious, the agency's qualifications to act as bid invitation agent shall be suspended or revoked; if a crime is constituted, criminal liability shall be investigated according to law. If losses are caused to others, liability for compensation shall be assumed according to law.

If any of the acts mentioned in the preceding paragraph has an impact on the result of the determination of the winning bid, the acceptance of the winning bid shall be void.

Article 51

It the bid inviting party imposes unreasonable conditions to restrict or preclude potential bidders or if it discriminates against potential bidders, or if it imposes on bidders a mandatory requirement to organize a consortium or if it restricts the competition among the bidders, it shall be ordered to make amends and may be imposed a fine of not less than 10,000 Yuan nor more than 50,000 Yuan

Article 52

If the party inviting bids for a project which legally requires the invitation of bids discloses to others the names or number of potential bidders which have received bid invitation documents or other bid invitation and bid submission details which could affect fair competition, or if it discloses the reserve price, it shall be given a warning and may additionally be imposed a fine of not less than 10,000 Yuan nor more than 50,000 Yuan; the persons in charge directly responsible and the other directly responsible persons of the unit shall be disciplined according to law; if a crime is constituted, criminal liability shall be investigated according to law.

If any of the acts mentioned in the preceding has an impact on the determination of the winning bid, the acceptance of the winning bid shall be void.

Article 53

If a bidder colludes with one or more other bidders or with the bid inviting party in the submission of its bid, or if a bidder seeks to win the project by offering a bribe to the bid inviting party or one or more of the members of the bid evaluation committee, the acceptance of its bid shall be void, the bidder shall be imposed a fine of not less than 0.5% nor more than 1% of the amount of the project which it won and the persons in charge directly responsible and the other directly responsible persons of the unit shall be imposed a fine of not less than 5% nor more than 10% of the amount of the fine imposed upon the unit; if there are illegal earnings, such illegal earnings shall be confiscated; if the circumstances are serious, the bidder's bidding qualifications for projects which legally require the invitation of bids shall be suspended for one to two years and the same shall be publicly announced, or the administrative department for industry and commerce shall revoke its business license; if a crime is constituted, criminal liability shall be investigated according to law; if losses are caused to others, liability for compensation shall be assumed according to law.

Article 54

If a bidder submits its bid in the name of a third party or uses other fraudulent means to have its bid accepted, the acceptance of the bid shall be void; if losses are caused to the bid inviting party, it shall assume liability for compensation according to law; if a crime is constituted, criminal liability shall be investigated according to law.

If a bidder for a project which legally requires the invitation of bids commits any of the acts mentioned in the preceding paragraph but the circumstances are not serious enough to constitute a crime, it shall be imposed a fine of not less than 0.5% nor more than 1% of the amount of the project which it won and the persons in charge directly responsible and the other directly responsible persons of the unit shall be imposed a fine of not less than 5% nor more than 10% of the amount of the fine imposed upon the unit; if there are illegal earnings, such illegal earnings shall be confiscated; if the circumstances are serious, the bidder's bidding qualifications for projects which legally require the invitation of bids shall be suspended for one to two years and the same shall be publicly announced, or the administrative department for industry and commerce shall revoke its business license; if a crime is constituted, criminal liability shall be investigated according to law; if losses are caused to others, liability for compensation shall be assumed according to law.

Article 55

If the party inviting bids for a project which legally requires the invitation of bids violates the provisions of this Law by holding negotiations with bidders on substantive contents such as bid prices, bid plans, etc., it shall be given a warning and the persons in charge directly responsible and the other directly responsible persons of the unit shall be disciplined according to law.

If any of the acts mentioned in the preceding has an impact on the determination of the winning bid, the acceptance of the winning bid shall be void.

Article 56

If a member of the bid evaluation committee accepts property or other benefits form a bidder, or if a member of the bid evaluation committee or relevant working personnel participating in the evaluation discloses to others details of the evaluation and comparison of the bid documents, the recommendation of candidates for the status of winning bidder or other relevant details of the bid evaluation, he shall be given a warning and the property accepted shall be confiscated, and he may additionally be imposed a fine of not less than 3,000 Yuan nor more than 50,000 Yuan; a member of the bid evaluation committee who has committed any of the aforementioned acts shall be stripped of his qualifications for membership of bid evaluation committee and may never again participate in the evaluation of bids for projects which legally require the invitation of bids; if a crime is constituted, criminal liability shall be investigated according to law.

Article 57

If the winning bidder determined by the bid inviting party was not among the candidates lawfully recommended by the bid evaluation committee, or if all the bids for a project which legally requires the invitation of bids have been rejected by the bid evaluation committee but the bid inviting party subsequently and on its own authority determines a bidder to be the winning bidder, the acceptance of the winning bidder's bid shall be void, the bid inviting party shall be ordered to make amends and may be imposed a fine of not less than 0.5% nor more than 1% of the amount of the project for which it determined the winning bidder; the persons in charge directly responsible and the other directly responsible persons of the unit shall be disciplined according to law.

Article 58

If the winning bidder assigns the project which it has won to a third party, or break ups the project which it has won and subsequently assign the parts to third parties, or violates the provisions of this Law by subcontracting out some of the principal or key parts of the work for project which it has won, or if a subcontractor sub-contracts its project, the assignment, subcontracting or sub-contracting shall be void and the winning bidder or the subcontractor, as the case may be, shall be imposed a fine of not less than 0.5% nor more than 1% of the amount of the project assigned, subcontracted or sub-contracted; if there are illegal earnings, such illegal earnings shall be confiscated; the winning bidder or the subcontractor, as the case may be, may be ordered to suspend business and rectify the situation; if the circumstances are serious, its business license shall be revoked by the administrative department for industry and commerce.

Article 59

If the bidder inviting party and the winning bidder fail to conclude a contract according to the bid invitation documents and the winning bidder's bid documents, or if the bid inviting party and the winning bidder conclude an agreement which contravenes the substantive terms of the contract, they shall be ordered to make amends and may be imposed a fine of not less than 0.5% nor more than 1% of the amount of the project won.

Article 60

If the winning bidder fails to perform the contract concluded with the bid inviting party, the performance bond shall not be refunded; if the losses caused to the bid inviting party exceed the amount of the performance bond, the winning bidder shall also compensate for the excess; if the winning bidder did not pay a performance bond, it shall be liable for compensation of the losses suffered by the bid inviting party.

If the winning bidder fails to perform its obligation according to the contract concluded with the bid inviting party and the circumstances are serious, its bidding qualifications for projects which legally require the invitation of bids shall be suspended for two to five years and the same shall be publicly announced, or the administrative department for industry and commerce shall revoke its business license.

The preceding two paragraphs shall not apply if the non-performance of the contract was due to force majeure.

Article 61

The decision to impose administrative penalties under this Chapter shall be made by the relevant administrative supervision department designated by the State Council, except in instances where this Law has already designated the department to impose the administrative penalty.

Article 62

If, in violation of this Law, any unit restricts or precludes the participation in bid submission by legal persons or other organizations from outside its own region or network, or designates a bid invitation agency for the bid inviting party, or coerces a bid inviting party into appointing a bid invitation agency to carry out the bid invitation matters or otherwise intervenes in the bid invitation and bid submission activities, it shall be ordered to make amends; the persons in charge directly responsible and the directly responsible persons of the unit shall be given a warning and have a demerit or serious demerit recorded according to law; if the circumstances are serious, such persons shall be disciplined by being demoted, dismissed or expelled according to law.

If an individual abuses his powers to commit any of the illegal acts mentioned above, his liability should be investigated according to the provisions of the preceding paragraph.

Article 63

If working staff of the State organs legally charged with the duty to carry out administrative supervision of bid invitation and submission activities commit favoritism, graft, abuse of powers or dereliction of duties, thereby constituting a crime, their criminal liability shall be investigated according to law; if no crime is constituted, they shall be given administrative sanctions according to law.

Article 64

If the acceptance of the winning bidder's bid for a project which legally requires the invitation of bids is void due to violation of the provisions of this Law, the winning bidder shall be determined anew from the remaining bidders according to the conditions specified in this Law for determination of the winning bidder, or bids shall be invited anew according to this Law.

Chapter 6 Supplementary Provisions

Article 65

If a bidder or another interested party considers bid invitation and submission procedures not to be in conformity with the relevant provisions of this Law, it or he shall have the rights to lodge an objection with the bid inviting party or to complain to the relevant administrative supervision department according to law.

Article 66

Subject to the relevant provisions of the State, the invitation of bids shall not be required for projects with special circumstances not suited to the invitation of bids, such as those which involve State security, State secrets or emergency rescue, the use of poverty relief funds as remuneration for people in poor areas given employment rather than outright aid, or the need to use farmer workers.

Article 67

Where bids are invited for a project using a loan from an international organizations or foreign government or aid funds, and the lender or financier has different provisions in respect of the specific conditions and procedures for the invitation and submission of bids, its provisions may be applied, unless they are against the public interest of the People's Republic of China.

Article 68

This Law shall enter into force as of January 1, 2000.