In Vietnam’s public procurement system, legal clarity regarding the roles and responsibilities of bidders is essential to ensure compliance, transparency, and fair competition. The Law on Bidding 2023, as amended in 2024 (hereinafter referred to as the “Law on Bidding”), provides detailed definitions and conditions applicable to contractors and investors participating in procurement activities. This paper outlines the legal distinctions between main contractors and subcontractors, the eligibility conditions for contractors, and their statutory obligations under the current legal framework.
1. Distinction between Main Contractors and Subcontractors
Under the Law on Bidding 2023 (as amended in 2024), the differences between a main contractor and a subcontractor are summarized as follows:
| Criteria | Main Contractor | Subcontractor |
| Definition | An organization, individual, or a consortium of organizations or individuals participating in bidding, named in the bid, and directly signing and executing the contract upon award (Clause 26, Article 4). | An organization or individual that enters into a contract with a main contractor to perform part of the work in a package, including construction, consultancy, non-consulting services, or goods supply. A “special subcontractor” is one performing critical tasks proposed in the bid, based on required capacity and experience (Clauses 27 and 28, Article 4). |
| Responsibility | Bears primary responsibility for executing the entire package, ensuring quality, schedule, and efficiency. | Responsible for completing the specific portion of the work as agreed with the main contractor. |
| Contractual Basis | Signs contract directly with the project owner (employer). | Signs contract with the main contractor. |
| Role in Bidding and Contract | Plays a central role in bidding and contract execution; submits bids in its name and signs the contract directly. | Plays a supporting role in contract performance, assisting the main contractor in fulfilling obligations. |
| Relationship with Employer | Maintains a direct contractual relationship with the employer; rights and obligations are governed by the main contract. | Has no direct contractual relationship with the employer; obligations arise from the contract with the main contractor. |
| Liability | Fully liable to the employer for the entire package, including parts performed by subcontractors. | Only permitted to perform tasks declared in the bid as intended for subcontracting. |
| Classification | Classified by: – Relationship with procuring entity: independent contractor, consortium member – Scale: small, large contractor – Field: construction, equipment supply, specialized works | Classified by: – Relationship with main contractor: direct or indirect subcontractor – Scale: small, large subcontractor – Field: construction, equipment supply, specialized works |
2. Eligibility Requirements for Contractors
Pursuant to Article 5 of the Law on Bidding, a contractor or investor is considered legally eligible if they satisfy the following conditions:
For domestic entities, this includes being duly registered and operating under Vietnamese law, including enterprises, cooperatives, public service units, and foreign invested economic organizations.Foreign bidders must be legally established under foreign laws and registered accordingly.
They must operate with independent financial accounting, not be in the process of dissolution or under bankruptcy procedures, and must not be suspended or prohibited from tender participation under any competent authority’s decision as stipulated in Clause 3, Article 87 of the Law.
Eligible contractors must also be listed on the National E-Procurement System prior to approval of bid results, comply with the competitive bidding provisions under Article 6, and must not be under criminal investigation.
In cases where a shortlist exists, eligible contractors must be listed therein. Foreign contractors must either form a joint venture with domestic entities or engage domestic subcontractors, except when no qualified domestic contractors are available for any part of the package.
Special provisions apply to household businesses. To qualify, they must possess a household business registration certificate, not be under dissolution or criminal investigation, and must comply with conditions specified in Points d, đ, e, and h of Clause 1, Article 5.
This represents a significant departure from the 2013 Law on Bidding, which did not specifically address eligibility conditions for household business entities.
For individuals to be deemed eligible contractors or investors, they must possess full civil act capacity in accordance with the laws of their home country and, where required, appropriate professional certification. They must also meet the conditions outlined in Points e and g, Clause 1, Article 5.
Legally eligible contractors and investors as defined in Clauses 1, 2, and 3 of Article 5 may participate independently or in a joint venture.
3. Statutory Responsibilities of Contractors and Investors
Under Article 82 of the Law on Bidding, contractors and investors are subject to a set of responsibilities aimed at ensuring transparency and integrity throughout the bidding and contract implementation process.
They are obligated to request clarifications of the invitation for interest, prequalification documents, bidding documents, and request for proposals where necessary.
Contractors must provide relevant information and explanations upon request by competent authorities, project owners, procuring entities, and inspection bodies involved in procurement oversight.
Contractors and investors participating in the National E-Procurement System must also establish appropriate IT infrastructure and bear full legal responsibility for the accuracy and authenticity of the data registered or uploaded onto the system.
Additionally, they are required to perform all obligations under the signed contract and fulfill any other responsibilities stipulated in the Law and relevant legal instruments.
In conclusion, the legal framework governing public procurement in Vietnam under the Law on Bidding 2023 (amended 2024) reflects a structured and rigorous approach to defining the roles, qualifications, and responsibilities of contractors and investors. Understanding the distinctions between main contractors and subcontractors, the eligibility conditions for participation, and the obligations that follow from engagement in procurement processes is essential for lawful and effective participation. These legal requirements serve not only to safeguard the integrity of the bidding process but also to ensure the efficient implementation of public investment projects.
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Dinh Phuong Thao