Instructions for Purchasing Imported Products in Chinese Government Procurement
If the government purchases imported products, can the brand be specified in the bidding documents? Since the purchase of imported goods requires authorization from foreign manufacturers, whether the bidding of domestic enterprises is invalid? If the equipment purchase does not require the import of equipment, how to identify the imported equipment to bid?
Here are 12 questions about purchasing imported products：
Q: Can brands be specified in the bidding documents for government procurement of imported products?
A: No.
As long as it is a government procurement project, whether it is the purchase of imported products or domestic products, it is not allowed to designate a brand, otherwise it will impose differential or discriminatory treatment on suppliers under unreasonable conditions.
Legal basis: Article 20 of the Regulations on the Implementation of the Government Procurement Law stipulates that if the purchaser or procurement agency has one of the following circumstances, it belongs to the application of differential or discriminatory treatment to suppliers under unreasonable conditions: defining or designating specific patents, trademarks, brands or suppliers.
Q: Since the procurement of imported goods requires authorization from foreign manufacturers, is the bid of domestic enterprises invalid?
A: No invalidation can be made.
According to Article 5 of the Notice of the General Office of the Ministry of Finance on Issues Related to the Management of Government Procurement of Imported Products (C.B K [2008] No. 248), if the financial department approves the purchase of imported products, it shall clearly stipulate in the procurement documents that imported products can be purchased. However, if there are still domestic products meeting the demand to participate in the procurement competition due to information asymmetry and other reasons, the purchaser and its entrusted procurement agency shall not restrict it, and shall conduct procurement in accordance with the principle of fair competition.
Legal basis: Article 5 of the Circular of the General Office of the Ministry of Finance on issues related to the Administration of Government Procurement of imported products (C.K.B (2008) No.248) stipulates that when purchasing imported products, procurement activities can only be carried out after applying to the financial department and obtaining the examination and approval of the financial department before the procurement activities begin.
If a procurement activity is carried out without the consent of the financial department before the commencement of the procurement activity, it shall be regarded as a refusal to purchase imported products, and it shall be clearly stipulated in the procurement document that imported products are not allowed to participate.
If it is not clearly stated in the procurement document that imported products are not allowed to participate, it shall also be deemed to refuse the participation of imported products.
If the financial department approves the purchase of imported products, it shall clearly stipulate in the procurement documents that imported products can be purchased. However, if there are still domestic products that meet the needs to participate in the procurement competition due to information asymmetry and other reasons, the purchaser and its entrusted procurement agency shall not restrict them, and shall purchase in accordance with the principle of fair competition.
Q: If imported equipment is not required for equipment procurement，how to identify imported equipment for bidding?
A: The bid shall be deemed as invalid.
When purchasing imported products, the purchaser must submit an application to the financial department and obtain the approval of the financial department before the commencement of procurement activities. Those who have not obtained the consent of the financial department shall be regarded as refusal to purchase imported products; If there is no special indication in the procurement documents that “imported products” can be purchased, it shall be deemed as a response to the rejection of imported products, and domestic products must be purchased.
Legal basis: Article 5 of the Notice of the General Office of the Ministry of Finance on Issues Related to the Administration of Government Procurement of Imported Products (C. B. K [2008] No. 248).
Q: Can imported products be purchased by means other than public bidding?
A: The procurement of imported products shall be based on public bidding.
If it falls within the catalogue of centralized procurement or the amount of public bidding in the procurement budget is above the standard, public bidding must be carried out; if the amount of public bidding is below the standard and the procurement limit is above the standard, other procurement methods shall be used; imported products below the purchase quota can be purchased by themselves under the internal control system.
Legal basis: Article 14 of the Measures for the Administration of Government Procurement of Imported Products” (C.B. K [2007] No. 119) stipulates that public bidding shall be the main way for government procurement of imported products. If it is necessary to adopt procurement methods other than public bidding due to special circumstances, the relevant provisions on government procurement shall be implemented.
Q: The bidding documents stipulate that only imported brands are allowed to bid for elevators. Is it legal?
A: If the qualification condition setting violates the compulsory stipulation, bidding activity shall be stopped , bidding document shall be revised ，and the bidding shall be restarted.
Legal basis: Article 10 of the Government Procurement Law and article 5 of the Notice of the General Office of the Ministry of Finance on Issues Concerning the Administration of Government Procurement of Imported Products” (C. B. K [2008] No. 248).
Q: If hospitals want to purchase imported equipment through competitive negotiation, can they only accept imported products?
A: No, this is illegal.
Even for imported product procurement projects approved by the Ministry of Finance, procurement shall be carried out in accordance with the principle of fair competition. Domestic product bids and responses cannot be rejected, domestic products cannot be discriminated against in the review, and domestic products cannot be excluded from winning bids and transactions.
If the government purchases imported equipment and needs to go through the import formalities at the national customs, the bidding and other relevant procedures shall comply with the Provisions of the Measures for the Implementation of International Bidding and Tendering of Mechanical and Electrical Products (Trial) (Order No. 1 of the Ministry of Commerce in 2014), and the commerce department shall be responsible for its supervision and management and supplier queries and complaints. The lowest bid evaluation method is generally used in the bid evaluation of international bidding for mechanical and electrical products. The bidding of large-scale or complete sets of equipment with high technical content and complex process or technical scheme can be evaluated by comprehensive evaluation method. A purchasing agency engaged in the international bidding agency business for mechanical and electrical products shall register free of charge in the bidding network, and shall fill in the registration form of the international bidding agency for mechanical and electrical products online at the time of registration.
If the government procures imported products and needs to go through the import formalities at the national customs (including those that need to go through the formalities of duty exemption), the procurement methods shall be public bidding, inviting tendering and handling bidding matters on their own, and there is no competitive negotiation procurement method. Therefore, if the government procures imported products and needs to go through the import formalities at the national customs, competitive negotiation procurement should not be adopted and should be prohibited and corrected.
Legal basis: Article 5 of the Notice of the General Office of the Ministry of Finance on Issues Related to the Administration of Government Procurement of Imported Products (C.B.K. [2008] No.248).
Q: The purchase of medical equipment requires that the whole machine is made in China and one part is imported. Does it need to be demonstrated by experts?
A: The whole machine is made in China, the parts are imported, and the whole product belongs to domestic medical equipment, which is not restricted by the relevant regulations on purchasing imported products, and does not need to be demonstrated by experts. However, the import of the part depends on whether the part is independent. If it is not independent, it may be suspected of specifying the product.
Legal basis: Article 8 of the Measures for the Administration of Government Procurement of Imported Products (C.B.K [2007] No.119) when submitting to the financial department for review, the purchaser shall issue the following materials: Expert Argumentation Opinions on Government Procurement of Imported Products issued by the expert group; Article 10 if the imported products to be purchased by the purchaser belong to the products restricted by national laws, regulations and policies, the purchaser shall issue the materials in paragraphs (1), (3) and (4) of Article 8 when submitting to the financial department for examination and approval.
Q: Can the price of imported products be agreed to be “no more than 15% within one year compared with other products”?
A project adopts competitive negotiation procurement. Is it allowed to import products and the same product within one year is not higher than 15% compared with other places?
A: Government procurement does not prohibit the procurement of imported products, but it shall be demonstrated and approved by the competent department and approved by the financial department, and the response and transaction of domestic products shall not be restricted. The agreement that “the same product shall not be higher than 15% compared with other places within a year” is not binding and unreasonable, because the price of the product is mainly determined by the supply and demand of the market.
Legal basis: Article 10 of the Government Procurement Law.
Q: Is it still approved by the commercial department to purchase pure imported medical equipment (Chinese agents)?
A.The health department is the competent department of the industry to which the imported medical equipment belongs. Therefore, the import of medical equipment requires the Opinions of the Competent Department of the Industry to which the Government Purchases the Imported Products issued by the competent department above the city divided into districts and autonomous prefecture (Health Department).
Legal basis: Article 8 of the Measures for the Administration of Government Procurement of Imported Products (C.B.K [2007] No. 119): when submitting to the financial department for review, the purchaser shall issue the following materials:
（1） Application Form for Government Procurement of Imported Products;
（2） Copies of national laws, regulations and policy documents on encouraging imported products;
（3） Opinions of the Competent Department of the Industry to which the Government Purchases Imported Products issued by the competent department of the city divided into districts and autonomous prefecture or above of the industry to which the imported products belong;
（4） Expert Demonstration Opinions on Government Procurement of Imported Products issued by the expert group.
Article 12: The expert group referred to in these measures shall be composed of an odd number of more than five people, including one legal expert. Product technical experts shall be experts who are not in the unit and are familiar with the product. The purchaser’s representative shall not participate in the demonstration as a member of the expert group.
Q: Is it impossible to purchase imported products without going through the formalities of verification of imported products?
A: Yes.
The expert argumentation opinion on government procurement of imported products is the material that the purchaser must issue when submitting to the financial department for review. Without this review procedure, imported products cannot be purchased.
Legal basis: Article 8 of the Measures for the Administration of Government Procurement of Imported Products (C K [2007] No. 119).
Q: Can experts participating in the demonstration of imported equipment procurement projects participate in the bid evaluation?
A: No.
Legal basis: Article 13 of the Measures for the Administration of Government Procurement of Imported Products (C.B.K [2007] No.119): experts participating in the demonstration shall not participate in the procurement review of the same project as procurement review experts.
