The Law of the People's Republic of China on Government Procurement was adopted by the Standing Committee of the National People's Congress on June 29, 2002. It was promulgated by President Jiang Zemin on the same date and will come into force on January 1, 2003.
"Government procurement" is defined to mean the procurement of goods, construction or services on lawfully formulated centralized procurement lists or which exceed procurement threshold standards by state agencies, institutional units and organizations at all levels with the use of government funds.
When carrying out government procurement, domestic goods, construction and services should be procured except in the following circumstances:
- The goods, construction or services which it is necessary to procure cannot be obtained in China or cannot be obtained on reasonable commercial terms in China.
- Procurement is effected for use outside of China.
- Other laws or administrative regulations contain different stipulations.
The following methods are used for government procurement;
- open tendering;
- tendering by invitation;
- competitive negotiations;
- single-source procurement;
- request for quotations; and
- other methods of procurement recognized by the government procurement regulatory department of the State Council.
The Law states that the primary method for government procurement shall be open tendering.