Thailand regulatory framework regarding the public procurement is provided by the Public Procurement and Supplies Administration Act B.E. 2560 (2017) (PPSA). This Act permits the public agency to procure the supplies through three methods, including the general solicitation, solicitation to selected trader, and contracting to specific trader.
Since 2010 our lawyers have advised in several infrastructure projects, and nowadays there is no doubt that this “know how” was an important asset for our corporate clients in Thailand.
PPSA requires the public agency to use general solicitation, which is eligible to all traders, as a primary method for the procurement. However, if the product or service is complicated, or the contract price is a small amount (500,000 to 5,000,000 THB depending on the type of products or services), the agency may procure the supplies by solicitation to the selected trader who meet standard qualifications, or by negotiation with one specific trader. But these two methods are exceptional and apply to only certain circumstances under section 56 of the PPSA.
The procurement by general solicitation in Thailand is conducted by e-bidding. The process begins with posting solicitation on the websites by each public agency. The solicitation specifies the type of products or services, budget, and the deadline for submission of documents.
Before bidding, the interested trader needs to register its business with E-GP system first and then submit the required information and documents such as corporation documents. In some project, especially the construction work, the trader is probably required to submit the experience proof and financial standing.
Once all information has been submitted, the system generates a proposal format to each applicant with OTP number for verification. After that, the applicant can submit that proposal and get the scheduled date for bidding. The public agency will announce the successful candidate and have an appointment to finalize the contract.
CONTRACTING WITH THE THAI GOVERNMENT
In general, the public agency must make the contract in accordance with the form provided by the Policy Commission which is announced in the government gazette. However, the awarded trader may request some adjustment if it does not affect to the essential part of the contract or public agency’s interests. Furthermore, if the contract form does not fit to the project, the parties may draft the new contract. Nevertheless, both amendment and draft must be approved by the Officer of the Attorney General as outlined in section 93 of the PPSA. After the contract is made and executed, the agency appoint the committee or one official to monitor the project and inspect the supplies.
In order to work with the Thai government, the trader should strictly follow the regulations. Because the violation can ruin the opportunity to work with any public agency in the future. For example, under section 109, the trader would be blacklisted if it abandons the proposal after it has been awarded the government contract; the trader or its subcontractor breach a contract; or any other actions stipulated in the announcement of Ministry of Finance.
If you need legal advice on public procurement in Thailand, please contact H&P Bangkok lawyers at [email protected]