Can a Contractor Be Both a Main Contractor and a Subcontractor for Another Contractor in a Single Bidding Package?
- Monday, 20 November 2023 11:08 AM
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Contractors can act as both the main contractor and a subcontractor for another contractor in the same bidding package. Check the article below from DauThau.info for the most useful answer.
Can a contractor be both the main contractor and a subcontractor for another contractor in the same bidding package?
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Subcontractor and Main Contractor: Who are they?
Defined in clauses 35 and 36 of Article 4 of the Bidding Law 2013, main contractors and subcontractors are understood as follows:
35. The main contractor is the one responsible for bidding, submitting the bid, and directly signing and executing the contract if selected. The main contractor can be an independent contractor or a member of a partnership.
36. The subcontractor is a contractor participating in the package execution based on a contract signed with the main contractor. Special subcontractors are those undertaking significant work of the package as proposed by the main contractor in the bid documents based on the requirements in the bidding documents or request documents.
In simple terms: The main contractor is responsible for bidding, submitting the bid, and directly signing and executing the contract if selected. The subcontractor signs a contract with the main contractor to perform a part of the main contractor’s work in a specific package.
Comparison Table: Subcontractor vs. Main Contractor
| CRITERIA | MAIN CONTRACTOR | SUBCONTRACTOR |
| Contract Signing | Directly with the project owner | With the main contractor |
| Working with the Project Owner | Works directly with the project owner, rights and obligations established based on the agreement between the main contractor and the project owner | Does not work directly with the project owner but only performs the work within the relationship with the main contractor. |
| Responsibility | The main contractor is fully responsible to the project owner for quantity, quality, progress, and other obligations, including those parts executed by the subcontractor | Only performs the work declared in the bid documents regarding the use of subcontractors. The value of the work that the subcontractor is allowed to perform must not exceed a certain percentage of the contract value as stated in the specific conditions of the contract |
| Obligations | - Fully responsible for quantity, quality, progress, and other obligations as per the contract with the project owner. - Must commit to sending a representative with sufficient authority and capability to resolve any issues at any time upon request from the project owner; - Must provide all necessary documents for meetings, reports, appraisals in the required quantity |
- Ensure the completion of the assigned work as in the bid documents. - Must report the work status comprehensively for the main contractor’s awareness. |
Can a Contractor Be Both a Main Contractor and a Subcontractor for Another Contractor in a Single Bidding Package?
A customer asked the following question on DauThau.info's Support Group:"There are currently 2 service providers of dedicated data transmission lines in the area, namely X and Y. For a package of equipment and transmission lines, the Bidding Documents allow the use of subcontractors with a 10% ratio (aimed at main contractors participating but unable to provide transmission lines, then subcontracting this work to a subcontractor). However, after closing and opening the bids, the consultant discovered:
The first main contractor has a memorandum of cooperation and declares the provision of dedicated data transmission lines for Subcontractor X.
The second main contractor is X, participating with the ability to provide both equipment and transmission lines.
That is, here, X is both a main contractor and a subcontractor for another contractor in the same package. Does this violate the Bidding Law?"
Regarding this question, DauThau.info's Bidding Expert provided the following answer:
According to point Đ of clause 2 of Article 18 of Decree No. 63/2014/NĐ-CP, one of the conditions for the e-HSDT of the contractor to be evaluated as valid is:
Thus, in the above case, being both a main contractor and a subcontractor for another contractor in the same package does not violate the Bidding Law and can be implemented.đ) Not being named in two or more contractors as a main contractor (independent contractor or member of a partnership);
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