The time also shows that many foreign companies have won bids to supply goods to Vietnam through international competitive bidding. This is a sign that Vietnam's regulations, as well as Vietnam's open economic and integration policies, have been greatly encouraged and supported by international companies and foreign sponsors. To achieve these successes, Vietnam has recently carried out many administrative reforms and built a legal system in accordance with international practices and rules in bidding. In addition, facing the demands of the market economy and international integration, Vietnamese enterprises are also gradually improving themselves to have more and more opportunities to participate in bidding not only domestically but also globally, such as equitization, independent operations, self-accounting, etc.
Thus, the harmonization between domestic laws and international regulations has made much progress, creating more favorable conditions for management and encouraging the participation of potential eligible contractors in bidding activities. The final result of this is economic growth, budget savings and social stability over the years.
In summary, the enforcement of bidding laws in recent times has achieved the following positive results:
- The bidding process is increasingly being improved towards simplicity, ease of implementation and harmonization with the regulations of international organizations, donors and other countries and regions in the world. The bidding process, as well as Vietnam's laws and institutions, have been assessed by donors and international public opinion as having many positive changes such as: rapid law-making, resolute fight against corruption and serious implementation of international bilateral and multilateral commitments;
- Through the application of bidding for goods procurement according to bidding regulations and laws, officials in state management agencies at ministries, branches, central and local levels have gradually improved their ideology and
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awareness. At the same time, they have gradually accumulated experience in organizing procurement bidding and implementing contracts according to the rules of the market mechanism. In order to better implement the law on bidding, the team of officers in charge of bidding is always strengthened in both quantity and quality through training and fostering knowledge of bidding law at most levels of the industry;
- Due to the continuous improvement of the legal system on bidding, bidding has become more orderly and in compliance with the law and policies. Negative aspects in bidding have been gradually limited and eliminated;
- Through international bidding, domestic contractors have the opportunity to compete, gain experience and learn to gradually compete with foreign contractors.
3.1.2. Problems and difficulties
3.1.2.1. About the law
Socio-economic form is a historical category, always changing. The State's promulgation of legal documents must also change to suit. Depending on each time, depending on the change of socio-economic form, the promulgation of legal regulations also has its own content. However, often the promulgation of legal documents in general and bidding law in particular is often slower than the change of society. That is the cause of the limitations of the current legal system.
Like other countries that have started to apply public procurement through bidding, they often lack the experience to anticipate, develop and promulgate standard regulations for international bidding in accordance with common rules, practices and international law. This is also what Vietnam has encountered in the process of reforming the economy towards socialism. As a result, every 2-3 years we have to amend the law on bidding.
Regarding objective causes, it can be considered the result of the subsidy period that lasted too long in Vietnam. The State's public procurement habits
Mainly designated or planned purchasing. In terms of subjective reasons, often the officials or agencies in charge of purchasing often have the idea of wanting to change gradually or even not wanting to change the form of designated purchasing to competitive bidding. They want to stick to the old purchasing mechanism to protect their interests, they even use their power and functions to react strongly to new purchasing policies and regulations.
Although the above reasons are theoretical and known, it is still difficult to come up with legal regulations that can be suitable for all changes in the socio-economic form. In particular, to have legal regulations suitable for the socio-economic situation that is constantly changing towards perfection as in Vietnam today is very difficult. In such constantly changing conditions, the forms of documents need to be introduced in a way that is easy to edit and supplement to suit reality. This is the reason why in the early stages of implementing the economic reform policy (from 1986) until recently, the system of legal documents regulating procurement and bidding in Vietnam has encountered the limitation of being unstable, frequently editing the content and form.
However, at some point in time, the bidding regulations in the form of regulations issued with the Decree are no longer suitable, because they do not create a stable legal environment. This will inevitably lead to the promulgation of a law on bidding.
The legal limitations analyzed above are more objective than subjective, so it is necessary to clearly understand the laws of development to overcome them.
3.1.2.2. On the mechanism of decentralized procurement management
Also due to the consequences of the long subsidy period that has been deeply ingrained in the perception, the provisions of the law on bidding still have a heavy emphasis on state management. This leads to the regulation that the buyer of goods is not the main user of those goods, because of the fear that if the goods are handed over to the using units, they will be in danger of being lost.
It will be difficult to ensure efficiency in procurement. Reality shows that there are too many cases of unnecessary, deep intervention by central government agencies.
Therefore, concentration or decentralization at different levels depends on the conditions of each place, each time and each industry. In some conditions, concentration may be necessary because it brings high efficiency, for example, purchasing with limited capital, purchasing for many places, while local purchasing capacity is poor, centralized purchasing for many small units will make the cost of goods lower and save the cost of organizing bidding. However, the above conditions may change over time, so the choice of decentralization or concentration must be flexible and suitable for each specific case. That new solution also only exists at a specific time and circumstance, inevitably will have to give way to a new, more effective solution.
In some countries, there has been a flexible application of centralization and decentralization of bidding to make this activity highly effective. For example, when the purchasing agency does not have the capacity to perform, they can hire a professional bidding unit (also known as "Bidding Agent") to perform for a fee permitted by law. With this method, the law on bidding is fully and professionally applied. On the other hand, it ensures the nature of decentralization and concentration in necessary cases. In addition, the model of decentralization of responsibility with sanctions for control, inspection, monitoring, reporting, and auditing is also applied by many countries.
Regardless of the level of decentralization or centralization, the highest requirement is clarity and transparency in the policies and regulations of bidding activities. Once decentralized, no interference or influence on the implementing agency from any side is allowed, and the implementing agency must strictly and fully comply with the provisions of the law. Up to now, research on the bidding management model in Vietnam has not been conducted.
seriously and fully to choose the most suitable model for the socio-economic and political conditions in Vietnam. The "Project Management Board" model such as PMU18 of the Ministry of Transport is the clearest evidence of an outdated model. This is not only existing in one ministry or sector but is also happening widely elsewhere. In which the buyer (management board) is considered both the investor and the manager, the project implementer without any legal sanctions to regulate this subject. This is also the reason for creating loopholes for corruption and commercial fraud to occur complicatedly in recent times. The actual application of regulations on management decentralization shows two opposite negative trends as follows:
Firstly , the superior state agency does not trust the capacity, qualifications and honesty of the purchasing unit, so it often intervenes deeply in the bidding process such as: procurement planning, technical standards of goods, evaluation standards, contractor selection process;
Second , taking advantage of the decentralization of the procurement unit to bid through authorization documents so that the relevant superior agencies can evade responsibility, not participate, or participate in a formal way in unimportant stages. This leads to the bidding activities being carried out without inspection, supervision and accountability.
The above negative phenomena appear in purchasing units or related agencies. Usually, it is due to incorrect perception of one's role. In some other cases, it is due to personal interests of the unit.
3.1.2.3. About policy
In general, the bidding regulations of each country try to facilitate domestic contractors to supply goods when participating in international competitive bidding. Domestic contractors are often weaker in competitiveness compared to international contractors. However, the priority and time
Priority time must be adjusted to suit reality. In the past, priority and incentives for Vietnamese enterprises when participating in international competitive bidding have caused the following difficulties and limitations:
- Excessive incentives for a long time for Vietnamese enterprises have reduced the competitiveness of domestic contractors in improving techniques, reducing product costs, and increasing after-sales services;
- For businesses in the industry, incentives further reduce the competitiveness in bidding. Especially state-owned companies, with their relationships, have exerted pressure to win bids in a non-transparent manner. This has created a closed and monopolistic phenomenon in bidding.
- Giving priority to domestic contractors also affects Vietnam's integration process and attracting foreign investment. Donors and investors will feel that the investment environment in Vietnam is unhealthy when they see that there are too many state-owned companies, military, and police that regularly win large contracts to supply goods invested by ministries and sectors.
The analysis of the limitations of the above unreasonable preferential policies shows that this is an issue that needs to be adjusted in the coming time to create a healthy competitive environment, promote internal strength and comply with international law.
3.1.2.4. Problems due to lack of publicity and transparency
The basic goal of international bidding is to combat negative behavior that causes loss of investment capital and low economic efficiency. To achieve this goal, the requirement of publicity and transparency is always put first. But this is also a complex issue and a challenge for any country or international donor. The reality is that when using state money, especially aid money and preferential loans, the view often arises that it is public money, money given by the state for free ... leading to negative behaviors from waste to embezzlement, corruption, and illegal profits. Experience in many countries shows that, no matter how strict the legal system is, it is only a necessary condition,
The sufficient condition is to regulate to the extent that bidding can be public and transparent, then the law can fully promote its positive effects in the fight against negativity.
What and how much disclosure is required needs to be studied in policy making and law making. Bidders have different and sometimes contradictory disclosure requirements. But the issue is how to make such regulations consistent with practical requirements and international rules and practices.
An example showing the limitations of Vietnam in the past when regulating this issue is: previously, the criteria for evaluating bid documents in Vietnam were considered secret . The criteria for evaluating bid documents were not made public in the bidding documents or allowed arbitrary additions and amendments to the criteria, reducing the competitiveness of international bidding. On the other hand, the more the criteria for evaluating bid documents are kept secret, the more bidders will find ways to know, leading to unhealthy behaviors in bidding. Currently, after the awareness process, the criteria for evaluating bid documents are no longer secret, they are made public in the bidding documents.
Thus, the requirement of publicity is a practice that has gradually been perfected after a certain development process of awareness of international bidding for goods procurement. However, not all publicity requirements must be accepted at all times and places. The issue is to base on the objective and subjective conditions of each country to apply effectively. For example, the issue of announcing the reasons for not winning the bid is a controversial issue and needs to be considered, researched and applied appropriately to the conditions of each country.
Publicity will limit the negative aspects and promote the positive aspects of bidding, but the level, timing and content of publicity must be carefully considered so that international competitive bidding activities can achieve the highest efficiency. The arising and inadequacies of public or non-public issues are the most effective basis for the law on bidding to be adjusted accordingly.
3.1.2.5. Limitations due to unfair competition
Competition is an important issue in international bidding. This is a requirement for legislators so that competition is both a driving force and a measure to enhance international trade. Countries or international organizations and donors that issue regulations on bidding believe that international open bidding will create healthy competition. In theory, this view is correct. Because if bidding is limited, it will create opportunities for a small number of contractors to collude to cheat, while designated bidding is completely uncompetitive. But in reality, there are many ways to neutralize the regulations of international open bidding, leading to restrictions in bidding. For example, technical standards are indicative in nature, lacking objectivity in international bidding for goods procurement.
Specifying detailed technical standards is necessary to ensure that the right goods are purchased for the tenderer. However, the line between this and being so detailed that only one bidder, one type of goods, or one origin of goods meets the requirements of the tender documents is a limitation on the competitiveness of international procurement bidding.
In addition to prescribing technical standards for designated goods, prescribing evaluation standards with the aim of having few contractors meet them also reduces competitiveness. Evaluation standards often used to limit contractors in the past in Vietnam include: the number of years of experience of the contractor, experience in providing similar goods, financial capacity, legal capacity, level of shares, type of enterprise, etc.
For example, the supply of certain goods only requires 3 years of experience, but the bidding documents specified in the evaluation criteria require up to 5 years. This provision is intended to eliminate many other competitive bidders due to lack of years of experience.