How to determine similar contracts of construction and installation packages?

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Wednesday, 20 September 2023 10:49 AM

The similar contract evaluation for the construction and installation bidding document template not only causes the contractors but also the expert team and the bidding party themselves to encounter a lot of confusion. So what is the experience in handling these cases? Readers, please join DauThau.info to find out through the article identifying similar contracts of construction packages below.

How to determine similar contracts of construction and installation packages?

Nhấn VÀO ĐÂY để chuyển bài viết sang bản tin tiếng Việt

In all construction tenders, in addition to meeting all financial capacity criteria as required by the Bidding Documents, experience in performing similar construction contracts is mandatory. pass the assessment of experience qualifications and proceed to assess the next steps. However, many expert groups and bidding parties have encountered a lot of confusion, not knowing how to properly understand this issue, especially many contractors when reading the conditions of similar construction contracts (contracts). similar to construction) also thought they were not responsive and regrettably excluded themselves from the bidding.

Learn about contract regulations similar to construction and installation packages

According to the Construction Bidding Documents Form issued with Circular No. 03/2015/TT-BKHDT as well as Form No. 01/04 issued with Circular No. 04/2017/TT-BKHDT (Currently these forms have been replaced by the bidding document templates attached to Circular No. 08/2023/TT-BKHDT, however the concepts below are still appropriate) when reading and applying, we need to pay attention to four groups of related issues to similar contracts of construction and installation packages as follows:

First: Expand similar contract objects of construction and installation packages

For contracts, the requirement to be performed by the contractor is "Specific experience in managing and implementing construction contracts" and not "General experience in construction", this means that when determining Determining similar contracts that the contractor has performed for a specific contract does not necessarily mean that the contractor must directly be the contractor performing all the work under the contract, but the above concept has been expanded to "Business". specific experience in management", which means that the contractor can be the general contractor, or the contractor managing that construction contract as long as the contractor is responsible to the contract awarding party for the entire content of that contract. .
At the same time, in Forms 1A and 1B issued with Circular No. 08/2023/TT-BKHDT, there has been an expansion in the nature of work of similar contracts, thereby allowing 3 subjects of similar contracts. including:

In case the bidding package includes only 01 independent project (A)
In case the bidding package includes a combination of many works (for example, a combination of 3 works: A1, A2, A3): It is allowed to determine similar properties for each contract corresponding to A1, A2, A3.
In case the bidding package only includes work items A1, A2, A3... (not works according to construction law): Allow to identify similar contracts with similar properties to items A1, A2...

Second: The nature of the contract is similar to the construction package

The concept of similar contracts is guided in the direction of creating favorable conditions for newly established contractors with good capacity and experience. Accordingly, in note No. 10 of Clause 2.1, the above sample bidding documents clearly guide: Similar contracts are contracts that have been completely performed, in which the construction work has similar characteristics to the bidding package. under consideration, including: similar in nature and complexity; similar in scope of work. "Similar in scale of work" is understood as "having a value of construction work equal to or greater than 70% of the value of construction work of the bidding package under consideration". For specific jobs or in localities where the contractor's capacity in the area is limited, the value of the construction work portion of the contract may be required to be between 50% - 70% of the value of the work portion. construction and installation of the package under consideration, while still requiring the contractor to ensure that there is a construction contract similar in nature and complexity to the main items of the package.

*Identify similar construction and installation contracts for joint venture members*

Third: Regulations on quantity and value of similar construction contracts

According to regulations (usually in Clause 3 of Capacity and Experience Standards in the Bidding Document Forms)

Minimum number of similar contracts as described below which the contractor has completed in whole or substantially as main contractor (independent or joint venture member) or subcontractor within { Normally 3-5 years} years ago (up to the time of bid closing):
(i) the number of contracts is N, each contract has a minimum value of V (N x V = X) or
(ii) the number of contracts is less or more than N, of which at least 01 contract has a minimum value of V and the total value of all contracts ≥ X

This is the point where the Procuring Entity, the Expert Group and many contractors are confused in how to calculate construction contracts of similar scale according to the instructions. Analyzing the above requirements, the contractor is assessed to meet the experience of performing contracts of similar scale when it satisfies 1 of the following 3 cases, for example the number of similar contracts as required by the contractor. Bidding documents are N, each contract has a minimum value of V:

(1) Number of contracts = N, each contract has a minimum value = V, so the total value of similar contracts is X = NxV;
(2) The number of contracts is less than N, each contract has a minimum value = V and the total value of all similar contracts >= X;
(3) A contract has a minimum value = V and the total value of all similar contracts >= X.

Thus, according to the above instructions, case (1) is very common, easy to understand, easy to calculate but in reality does not create favorable conditions for new contractors. For example, the bidding documents require N = 03 contracts, the minimum value of each contract is at least V = 10 billion, which contractor has and provides more than 03 contracts of similar nature with each contract value? Minimum VND 10 billion is satisfactory. But if you just look at this content, it will be very sad for contractors who have less than 03 similar contracts worth 10 billion but have many other similar contracts worth less than 10 billion and think that I did not respond and disqualified myself from participating anymore. In this case, it is understood that if the bidding documents require that the contractor has performed two or more similar contracts, the contractor must meet at least one contract with a scale and nature similar to the bidding package under consideration; The scale of subsequent similar contracts is determined by adding up contracts with smaller scales but must ensure that those contracts are similar in nature to the basic items of the bidding package under consideration. For example, in the following case the contractor still responds:

(i) There is 01 similar contract worth 30.1 billion VND; or
(ii) Has completed more than 1 contract of similar technical nature to the package under consideration, of which at least 1 contract has a minimum value of 10 billion VND and the total value of similar works is not lower than 30 billion VND.

Fourth: Applies to joint venture contractors

The assessment of the capacity and experience of a member of the joint venture must be based on the work that member undertakes. In the above example, in case the contractor acts as a joint venture consisting of 2 members, each member undertakes to implement 50% of the contract value, then each joint venture member is assessed as meeting the business requirements. Experience performing similar contracts of construction and installation packages if:

(i) Each member of the joint venture has completed a contract of similar technical nature to the construction package under consideration, with a minimum value of 15 billion VND.
(ii) Each member of the joint venture carries out more than 1 contract of similar technical nature to the construction package, of which at least 1 contract has a minimum value of 5 billion VND and a total value of Similar projects of each member must not be less than 30 billion VND.
If any member of the joint venture does not meet the above qualifications and experience, the joint venture contractor will be assessed as not meeting the requirements.

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Author: Linh Hồ Thị

Tags: contractors, bidding experience, bidding situations

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