Laws of the People's Republic of China

Ministry of Commerce

Decree of Ministry of Commerce of the People's Republic of China

No. 6

Qualification Examination and Approval Measures on International Bidding Organs of Mechanical and Electrical Products was adopted by the First Ministerial Conference on January 1, 2005. The said Measures are hereby announced and come into effect on March 1, 2005.

Minister of Ministry of Commerce, Bo Xilai

February 5, 2005

Qualification Examination and Approval Measures on International Bidding Bodies of Mechanical and Electrical Products

Chapter I General Principles

Article 1

For the purposes of safeguarding open, fair and just of international bidding of mechanical and electrical products, making sure that it is going regularly and regulating qualification examination and approval of international bidding bodies of international mechanical and electrical products, these measures are formulated in accordance with Law of Inviting and Submitting a Tender of PRC, Administrative Law of PRC and administrative supervision responsibilities that State Council confers to relevant department for carrying out bid inviting and entering.

Article 2

International bidding bodies of mechanical and electrical products mean legal persons approved and conferred international bidding qualification by Ministry of Commerce and engaged in international bidding business of mechanical and electrical products.

Article 3

Ministry of Commerce is responsible for qualification examination and approval and annual qualification examination of international bid inviting and entering of mechanical and electrical products all over the country.

All provinces, municipalities under the Central Government, cities specifically designated in the state plan, coastal open cities, special economic zones, Xinjiang Production and Construction Corp., import and export management bodies of all mechanical and electrical products departments (hereinafter referred to as "competent department") are responsible for preliminary examination of qualification examination and approval and annual qualification examination of international bidding bodies of mechanical and electrical products of this area and this department.

Chapter II Application and Approval of the qualification

Article 4

Any enterprise that is engaged in international bidding business by means of making use of foreign loan and domestic funds to purchase mechanical and electrical products should obtain international bidding qualification of mechanical and electrical products.

The qualifications of international bidding bodies of mechanical and electrical products are divided into Grade A, Grade B and Grade Pre-B. International bidding bodies of Grade A are not restricted by sum of trust money when they are engaged in international bidding business of mechanical and electrical products. International bidding bodies of Grade B can only be engaged in international bidding business with only once trust money less than 40 million US dollars. International bidding bodies of Grade Pre-B can be only engaged in only once international bidding business of mechanical and electrical products with only once trust money less than 20 million US dollars.

Article 5

The legal person who has not obtained international bidding qualifications of mechanical and electrical products can only apply for international bidding qualification of Grade Pre-B of mechanical and electrical products.

Article 6

The legal person who applies for international bidding qualification of Grade Pre-B mechanical and electrical products should meet following requirements:

1.

Must not have relationship of administrative subordination and other interests with administrative organs and other state agencies;

2.

Have relevant funds;

3.

Have fixed business place (including the hall of opening sealed tenders) and the facilities needed by international bidding business and as well as modernized office equipment connecting professional information net; and

4.

Have relevant professional strength that have the ability to draw up bidding files and organize bid evaluation;

(1)

Have full-time bidding staffs higher than personnel titles of middle rank no less than 70 per cent of the total staffs engaged in bidding business; and

(2)

Have more than three years of international bidding experience of mechanical and electrical products, and have achievements of domestic open bidding of mechanical and electrical products more than 0.2 billion yuan in recent three years; or have been engaged in foreign trade business for more than three years and annual average total sum of import and export of mechanical and electrical products is more than 0.6 billion yuan in recent three years.

Article 7

The applicant should submit application materials to relevant competent department for preliminary examination during July 1 to 5 every year. Relevant competent department should show written certificate with affixed special seal of Ministry of Commerce and indication of date regardless it accepts or does not accept the application for the administrative permission. Relevant Competent department should put forward preliminary examination comments within 20 days as of the receipt of the application and submit its preliminary comments on the examination and the applicant's application materials to Ministry of Commerce during August 1 to 5 the same year.

The application materials the applicant provides should include following content:

1.

Letter of Application, including registered time of legal person, personnel structure of the workers and staff members, business place for bid, allocation of computers and information network and the summary of the achievements of international bidding or import and export of mechanical and electrical products;

2.

Company's regulations and rules;

3.

Legal person's business license (copy);

4.

Registration form of foreign trade managers for the record (copy);

5.

Registration Table of Import and Export Achievements of Mechanical and Electrical Products (Appendix I) or Table of Domestic Open Bidding Achievements of Mechanical and Electrical Products (Appendix Form II), Divisional Item Table of Domestic Open Bidding (Appendix Form III) and following materials (copy);

(1)

Deputy Contract of Bid Trust;

(2)

Published Bidding Announcement;

(3)

Record of Opening a bid; and

(4)

Notice of Winning a bid.

6.

Table of the Enterprises' setups; (Appendix IV); and

7.

Name list of full-time bidding staffs higher than personnel titles of middle rank (Appendix Form V).

Article 8

Ministry of Commerce should examine and make administrative permission within 20 days at receipt of the application materials and preliminary comments transferred by relevant competent department and publish the results. If any one meets the provisions of these measures Ministry of Commerce should confer international bidding qualification of Grade Pre-B of mechanical and electrical products upon him and at the same time issue him Qualification Certificate of International Bidding Bodies (hereinafter referred to as "Qualification Certificate". The certificate should come into effect as of the issuing day and lose efficacy after the announcement of the examination result of next annual year.

Article 9

International bidding bodies of mechanical and electrical products of Grade Pre-B who meet the requirements stipulated in Article 5 of these measures may apply for international bidding qualification of Grade B. International bidding bodies of mechanical and electrical products of Grade B and Grade Pre-B that meet with the requirements stipulated in Article 16 of these measures may apply for international bidding qualification of Grade A.

Article 10

If any applicant provides false materials when they make application for international bidding qualifications of mechanical and electrical products, this application should be ineffective and its application for international bidding qualifications of mechanical and electrical products in the next annual year will not be accepted.

Chapter III Annual qualification examination

Article 11

Ministry of Commerce carry out annual qualification examination on international bidding bodies of mechanical and electrical products every year. International bidding bodies that obtained their international bidding qualification for less than one year do not need to attend the qualification examination in next annual year.

Article 12

International bidding bodies of mechanical and electronic products should submit their annual examination materials to relevant competent department for preliminary examination during January 1 to 10 every year. Relevant Competent department should submit preliminary examination comments and application materials to Ministry of Commerce during February 1 to 10 every year.

Article 13

International bidding bodies of mechanical and electrical products should submit following materials when they apply for annual qualification examination:

1.

The bidding achievements of international bidding bodies of mechanical and electrical products in the last annual year, taking the sum of winning bids in international bidding business of mechanical and electrical products through special network authorized by Ministry of Commerce as standard.

2.

Annual qualification examination application, including: the changes of organization structure, measures on regulating bidding, summary of international and domestic bidding achievements, etc.;

3.

Legal persons' business license (copy);

4.

Table of International Bidding Achievements of mechanical and electrical products (Appendix VI); and

5.

Duplicate of qualification certificate.

Article 14

If international bidding bodies of mechanical and electrical products meet following requirements, annual qualification examination should be passed and reissued the qualification certificate by Ministry of Commerce:

1.

Annual international bidding achievements of mechanical and electrical products of international bidding bodies of mechanical and electrical products of Grade A should be more than 80 million US dollars;

2.

Annual international bidding achievements of mechanical and electrical products of international bidding bodies of Grade B should be more than 50 million US dollars;

3.

Annual international bidding achievements of mechanical and electrical products of international bidding bodies of Grade Pre-B should be more than 30 million US dollars; and

4.

Whoever does not violate Law of Inviting and Entering a Bid, Implementation Measures on International Inviting and Entering a Bid of Chemical and Electrical Products, the said measures and other related regulations.

Article 15

When international bidding bodies of mechanical and electrical products of Grade Pre-B attend annual qualification examination, if annual bidding achievements have reached more than 50 million US dollars, they may make an application for going up a grade. Their grade of international bidding qualification may be gone up to Grade B.

Article 16

When international bidding bodies of mechanical and electrical products of Grade Pre-B or Grade B attend annual qualification examination, if they meet with one of following requirements, they may make application for going up a grade and their international bidding qualification may be going up to Grade A with the examination and approval of Ministry of Commerce:

1.

Annual bidding achievements of international bidding bodies of mechanical and electrical products of Grade B is more than 0.1 billion US dollars and the registered funds is more than 10 million dollars;

2.

Annual bidding achievements of International bidding bodies of mechanical and electrical products of Grade B is accumulatively more than 0.18 billion US dollars in two years since they obtained international bidding qualification of Grade B and have registered funds more than 10 million dollars;

3.

Annual bidding achievements of International bidding bodies of mechanical and electrical products of Grade B is accumulatively more than 0.25 billion US dollars in three years since they obtained international bidding qualification of Grade B and have registered funds more than 10 million dollars; and

4.

Annual bidding achievements of international bidding bodies of mechanical and electrical products of Grade B is accumulatively more than 0.2 billion US dollars since they obtained international bidding qualification of Grade B and have registered funds more than 10 million dollars;

Article 17

When international bidding bodies of mechanical and electrical products attend annual qualification examination, the grade of bidding qualification should be lowered in case of following circumstances, but if there is any special provisions specially stipulated by Ministry of Commerce, the standard of annual qualification examination may be relaxed properly:

1.

If any international bidding body whose annual bidding achievements of mechanical and electrical products of Grade A is less than 80 million dollars but more than 50 million dollars, its grade should be lowered to Grade B;

2.

If any international bidding body whose annual bidding achievements of mechanical and electrical products of Grade A is less than 50 million dollars but more than 30 million dollars, it should be lowered to Grade Pre-B; and

3.

If any international bidding body whose annual bidding achievements of mechanical and electrical products of Grade B is less than 50 million dollars but more than 30 million dollars, it should be lowered to Grade Pre-B.

Article 18

If international bidding body of international mechanical and electrical products whose annual bidding achievements is less than 30 million dollars when it attends annual qualification examination it must not be passed annual qualification examination in this examination and must not carry out its international bidding business of mechanical and electrical products continuously as of the publication of the result of this annual qualification examination, and Ministry of Commerce should not handle its application for international bidding qualification of mechanical and electrical products within one year. But, if State Council has special provisions or other special reasons, the standard of annual qualification examination may be relaxed properly.

Article 19

If any international bidding body of mechanical and electrical products has been given a warning in the last annual year, its grade should be lowered one grade while annual qualification examination, and as for the international bidding body who meet the requirements of going up a grade should not be given the higher grade.

If any international bidding body of mechanical and electrical products has been given warnings twice in annual bidding examination last annual year, it must not attend annual qualification this annual year, and its bidding achievements of last annual year should be examined in next annual qualification examination, and from the date of the publication of annual qualification examination result of this year until the passing of annual bidding examination next year, it must not carry out international bidding business of mechanical and electrical products continuously.

If any international bidding body of mechanical and electrical products has been given warnings for three times in annual qualification examination last annual year, it must not attend annual qualification this annual year, and as of the date of the publication of annual qualification examination result of this year, it must not carry out international bidding business of mechanical and electrical products continuously, and Ministry of Commerce should not handle its application for international bidding qualification of mechanical and electrical products.

Article 20

If there are any changes of the name, legal persons, address of international bidding body of mechanical and electrical products, an application for changing the qualification certificate should be made to Ministry of Commerce. If there are any great changes in any international bidding bodies, such as amalgamation, division and etc., and it causes substantive changes to the original body, an application for international bidding qualification should be made again to Ministry of Commerce.

Article 21

If any international bidding body has not attended annual qualification examination in accordance with the provisions of these measures, its qualification certificate of international bidding loses its efficacy automatically at the expiring date.

Article 22

If any international bidding body submits false annual examination materials, it must not be passed the annual qualification examination and Ministry of Commerce should not handle its application for international bidding qualification.

Article 23

Ministry of Commerce is responsible for the publication of annual qualification examination.

Chapter IV Punishment Provisions

Article 24

International bidding bodies of mechanical and electrical products should be given warnings and imposed a fine of less than 30 thousand yuan in case of following circumstances:

1.

Alter qualification certificate;

2.

Transfer and lend qualification certificate;

3.

Revise bidding documents without permission;

4.

Bidding materials and bid evaluation report are not put on record in accordance with rules;

5.

Do not make bid evaluation in accordance with bid evaluation rules stipulated by relevant regulations;

6.

Bid evaluation report does not reflect the actual situation in the documents of inviting bid and entering bid;

7.

Do not form bid evaluation commission in accordance with rules;

8.

Authorize the body who has no international bidding qualification to carry out the substantive business in international bidding activities;

9.

Authorize branch body to carry out substantive business in international bidding activities;

10.

Revise bid result without permission; and

11.

Other activities that violate Law of Inviting and Entering a Bid, Implementation Measures on International Bid Inviting and Entering of Mechanical and Electrical Products, these measures and other relevant national laws and regulations of bid inviting and entering.

Article 25

International bidding body of mechanical and electrical products that has one of following activities should be imposed a fine of more than 50 thousand yuan and less than 250 thousand yuan, and the direct competent person who is in charge of the body and other direct responsible persons should be imposed a fine of more than 50 per cent and less than 10 per cent of the sum imposed on the body. If any body has illegal income, the illegal income should be confiscated. If the case is serious, its international bidding qualification of mechanical and electrical products should be suspended and cancelled.

1.

Act in collusion with the tenderer to make false bid inviting;

2.

Leak the situation and materials relating to bid inviting and entering that should be kept confidential; and

3.

Act in collusion with the tenderer to make substantive revision on business, technique and price in bid entering documents.

Chapter V Supplementary Provisions

Article 26

The interpretation of the said measures shall be vested in Ministry of Commerce.

Article 27

The said measures shall come into effect as of March 1, 2005. Former Qualification Approval Measures of International Bidding Body, Circular of Implementing Annual Examination on International Bidding Body of Mechanical and Electrical Products and Supplementary Circular of Qualification Approval and Annual Examination of International Bidding Bodies shall be abolished simultaneously.