Government Tenders and Procurement Law - 1448

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  • With the help of Almighty God

  • We, Salman bin Abdulaziz Al Saud

  • King of the Kingdom of Saudi Arabia

  • Pursuant to Article (Seventy) of the Basic Law of Governance, issued by Royal Order No. (A/90) dated 27/8/1412 AH.

  • Pursuant to Article (Twenty) of the Law of the Council of Ministers, issued by Royal Order No. (A/13) dated 3/3/1414 AH.

  • Pursuant to Article (Eighteen) of the Law of the Shura Council, issued by Royal Order No. (A/91) dated 27/8/1412 AH.

  • Having reviewed Shura Council Resolution No. (373 /31) dated 1/12/1447 AH.

  • Having reviewed Council of Ministers Resolution No. (199) dated 21/2/1448 AH.

  • We hereby order as follows:

  • First: Approval of the Government Tenders and Procurement Law, in the form attached hereto.

  • Second: Requests for the extension of contracts and the handling of cases of delay in the execution of cases preceding the effective date of the Government Tenders and Procurement Law, issued by Royal Decree No. (M/128) dated 13/11/1440 AH, shall be considered in accordance with its provisions.

  • Third: Subject to the provisions of Item (Second) of this Decree, and without prejudice to the provisions of Item (Fifth) of Royal Decree No. (M/128) dated 13/11/1440 AH, the Government Tenders and Procurement Law, issued by Royal Decree No. (M/128) dated 13/11/1440 AH, shall apply to government works and procurements tendered during the validity of that Law. By way of exception, the Minister of Finance may apply certain provisions of the Law—referred to in Item (First) of this Decree—to works and procurements tendered during the validity of the Law issued by Royal Decree No. (M/128) dated 13/11/1440 AH, in accordance with a mechanism established by him, without prejudice to the procedures taken in respect of such works and procurements before the effective date of the Law referred to in Item (First) of this Decree.

  • Fourth: The exemptions granted to government entities from the Government Tenders and Procurement Law—issued by Royal Decree No. (M/128) dated 13/11/1440 AH—in accordance with Article (Ninety-Five) thereof shall remain in force, as shall exemptions limited to a specific period or related to a particular project until its completion, as well as the exemptions granted to each of: (the Public Investment Fund and SAMA).

  • Fifth: The regulations referred to in Article (Ninety-Six) of the Government Tenders and Procurement Law—issued by Royal Decree No. (M/128) dated 13/11/1440 AH—and for which Council of Ministers Resolutions No. (245) dated 29/3/1441 AH and No. (537) dated 21/8/1441 AH were issued shall remain in force.

  • Sixth: Item (Third) of Royal Decree No. (M/128) dated 13/11/1440 AH, as amended by Royal Decree No. (M/123) dated 9/7/1445 AH, shall remain in force.

  • Seventh: The Minister of Finance is granted the authority to exempt from the provisions of the Law referred to in Item (First) of this Decree that cannot be applied when applying the income-sharing rules referred to in Item (First) of Royal Decree No. (M/33) dated 13/4/1443 AH, for a period of (three) years.

  • Eighth: Subject to the provisions of Article (Forty-Three) of the Law referred to in Item (First) of this Decree, the owner of the strategy or initiative may participate in discussions for the examination of bids in competitions for projects and programs financed through the financial allocations for strategies, programs, plans, and transformational initiatives affiliated with the Council of Economic and Development Affairs, and shall have the powers vested in the members of the Bid Opening and Examination Committee.

  • Ninth: His Royal Highness the Prime Minister, the ministers, and the heads of the relevant independent bodies—each within his respective jurisdiction—shall implement this Decree.

  • Salman bin Abdulaziz Al Saud

  • The Council of Ministers

  • Having reviewed the transaction received from the Royal Court under No. 99344 dated 12/12/1447 AH, including the letter of His Excellency the Minister of Finance No. 10087 dated 11/10/1444 AH, concerning the draft Government Tenders and Procurement Law.

  • Having reviewed the aforementioned draft Law.

  • Having reviewed Royal Decrees No. (M/128) dated 13/11/1440 AH, and No. (M/33) dated 13/4/1443 AH, and No. (M/123) dated 9/7/1445 AH.

  • Having reviewed the Government Tenders and Procurement Law, issued by the aforementioned Royal Decree No. (M/128).

  • Having reviewed Council of Ministers Resolution No. (650) dated 13/11/1440 AH.

  • Having reviewed the Regulation Governing Preference for Local Content, Local Small and Medium Enterprises, and Companies Listed on the Financial Market in Works and Procurements, issued by Council of Ministers Resolution No. (245) dated 29/3/1441 AH.

  • Having reviewed the Regulation Governing Conflicts of Interest in the Application of the Government Tenders and Procurement Law and its Implementing Regulations, and the Regulation Governing the Conduct and Ethics of Persons Responsible for Applying the Government Tenders and Procurement Law and its Implementing Regulations, both issued by Council of Ministers Resolution No. (537) dated 21/8/1441 AH.

  • Having reviewed Minutes No. (30) dated 9/2/1446 AH, and Memoranda No. (2073) dated 10/6/1446 AH, No. (3674) dated 7/11/1446 AH, No. (3844) dated 22/11/1446 AH, No. (1385) dated 14/4/1447 AH, No. (2668) dated 30/7/1447 AH, and No. (211) dated 21/1/1448 AH, prepared by the Bureau of Experts at the Council of Ministers.

  • Having reviewed the recommendation of the Council of Economic and Development Affairs No. (1-9 /47/T) dated 2/9/1447 AH.

  • Having considered Shura Council Resolution No. (373 /31) dated 1/12/1447 AH.

  • Having reviewed the recommendation of the General Committee of the Council of Ministers No. (1556) dated 11/2/1448 AH.

  • Hereby resolves as follows:

    • First: Approval of the Government Tenders and Procurement Law, in the form attached hereto.

      • Second: Requests for the extension of contracts and the handling of cases of delay in the execution of cases preceding the effective date of the Government Tenders and Procurement Law, issued by Royal Decree No. (M/128) dated 13/11/1440 AH, shall be considered in accordance with its provisions.

      • Third: Subject to the provisions of Item (Second) of this Resolution, and without prejudice to the provisions of Item (Fifth) of Royal Decree No. (M/128) dated 13/11/1440 AH, the Government Tenders and Procurement Law, issued by Royal Decree No. (M/128) dated 13/11/1440 AH, shall apply to government works and procurements tendered during the validity of that Law. By way of exception, the Minister of Finance may apply certain provisions of the Law—referred to in Item (First) of this Resolution—to works and procurements tendered during the validity of the Law issued by Royal Decree No. (M/128) dated 13/11/1440 AH, in accordance with a mechanism established by him, without prejudice to the procedures taken in respect of such works and procurements before the effective date of the Law referred to in Item (First) of this Resolution.

      • Fourth: The exemptions granted to government entities from the Government Tenders and Procurement Law—issued by Royal Decree No. (M/128) dated 13/11/1440 AH—in accordance with Article (Ninety-Five) thereof shall remain in force, as shall exemptions limited to a specific period or related to a particular project until its completion, as well as the exemptions granted to each of: (the Public Investment Fund and SAMA).

      • Fifth:

        • 1- The regulations referred to in Article (Ninety-Six) of the Government Tenders and Procurement Law—issued by Royal Decree No. (M/128) dated 13/11/1440 AH—and for which Council of Ministers Resolutions No. (245) dated 29/3/1441 AH and No. (537) dated 21/8/1441 AH were issued shall remain in force.
        • 2- The Ministry of Finance and the Local Content and Government Procurement Authority—each within its respective jurisdiction—shall verify that the regulations—referred to in Paragraph (1) of this Item—are consistent with the provisions of the Law referred to in Item (First) of this Resolution, and shall submit any matter requiring action.

      • Sixth: Item (Third) of Royal Decree No. (M/128) dated 13/11/1440 AH, as amended by Royal Decree No. (M/123) dated 9/7/1445 AH, shall remain in force.

      • Seventh: Pending works and claims that have not been finally decided by the committees formed pursuant to Articles (Eighty-Six) and (Eighty-Eight) of the Government Tenders and Procurement Law, issued by Royal Decree No. (M/128) dated 13/11/1440 AH, shall be referred, according to jurisdiction, to the committees to be formed pursuant to Articles (Eighty-Four) and (Eighty-Seven) of the Law referred to in Item (First) of this Resolution.

      • Eighth: Council of Ministers Resolution No. (650) dated 13/11/1440 AH is hereby repealed.

      • Ninth:

        • 1- The Minister of Finance is granted the authority to exempt from the provisions of the Law referred to in Item (First) of this Resolution that cannot be applied when applying the income-sharing rules referred to in Item (First) of Royal Decree No. (M/33) dated 13/4/1443 AH, for a period of (three) years.
        • 2- The Ministry of Finance—in coordination with the relevant entities—shall study suitable alternatives to requesting an exemption from the Law—referred to in Item (First) of this Resolution—before the expiry of the period stipulated in Paragraph (1) of this Item.

      • Tenth: The entity responsible for unified procurement referred to in the Law mentioned in Item (First) of this Resolution shall be:

        • 1- The General Authority for Military Industries, with respect to military and security procurements.
        • 2- The Expenditure and Projects Efficiency Authority, with respect to government procurements other than military and security procurements.

      • Eleventh: The Ministry of Finance shall undertake the following:

        • 1- Coordinate with the Ministry of Justice, the Board of Grievances, and other relevant entities to carry out technical integration between the electronic portal of the Government Tenders and Procurement Law and those entities, in order to ensure the application of the provisions of the Law and alignment between the application of its provisions and the decisions issued by those entities concerning the legal status of competitors and contractors with government entities.
        • 2- Coordinate with the Local Content and Government Procurement Authority, the Research Development and Innovation Authority, the Secretariat of the Higher Committee for Research, Development and Innovation, and the Higher Committee for Energy Mix Affairs for Electricity Generation and Enabling the Renewable Energy Sector when preparing the regulation referred to in Subparagraph (c) of Paragraph (1) of Article (Ninety-Eight) of the Law referred to in Item (First) of this Resolution.

      • Twelfth: Subject to the provisions of Article (Forty-Three) of the Law referred to in Item (First) of this Resolution, the owner of the strategy or initiative may participate in discussions for the examination of bids in competitions for projects and programs financed through the financial allocations for strategies, programs, plans, and transformational initiatives affiliated with the Council of Economic and Development Affairs, and shall have the powers vested in the members of the Bid Opening and Examination Committee.

  • A draft Royal Decree has been prepared concerning the provisions of Items (First), (Second), (Third), (Fourth), (Sixth), and (Twelfth), Paragraph (1) of Item (Fifth), and Paragraph (1) of Item (Ninth) of this Resolution, the form of which is attached hereto.

  • Prime Minister

Chapter 1: General Provisions

Article 1

  • The following terms and expressions mean the meanings set forth opposite each of them wherever they appear in this Law, unless the context requires otherwise:

    • The Law: The Government Tenders and Procurement Law.
    • The Regulation: The Implementing Regulations of the Law.
    • The Preference Regulation: The Regulation on Preference for Local Content, Local Small and Medium Enterprises, and Companies Listed on the Financial Market in Works and Procurements.
    • The Minister: The Minister of Finance.
    • The Ministry: The Ministry of Finance.
    • The Authority: The Local Content and Government Procurement Authority.
    • The Authority Responsible for Unified Procurement: One or more entities designated by a resolution of the Council of Ministers.
    • Government Agencies: Ministries, government bodies, authorities, public institutions and establishments, and entities having independent public legal personality.
    • Head of the Government Agency: The Minister, the board of directors—or its equivalent—or the person delegated by it, or the highest-ranking official in a Government Agency that does not have a board of directors or its equivalent.
    • The Portal: A unified electronic portal for government procurement subject to the supervision of the Ministry.
    • The Supplier, Contractor, or Service Provider: Any actual or potential party to a contract with a Government Agency that performs works and secures procurements for consideration, whether a natural or legal person.
    • The Framework Agreement: An agreement between one or more Government Agencies and one or more suppliers, contractors, or service providers, containing the terms and conditions of contracts to be awarded during a specified period according to their nature, as determined by the Government Agency.
    • The Reverse Auction: A method of submitting successively reduced bids during a specified period for the purpose of selecting the lowest-priced bid.
    • Consulting Services: Services of a professional or advisory nature, including, without limitation, the preparation of studies and research, the development of specifications, plans, and designs, and the supervision of their implementation, such as the services of accountants, administrators, financial specialists, engineers, and attorneys.
    • Prequalification: The verification by the Government Agency, before competitors submit their bids, that the competitors possess the qualifications and capabilities necessary to perform the works and secure the procurements.
    • Post-qualification: The verification by the Government Agency—after selecting the best bid—that the bidder possesses the qualifications and capabilities necessary to perform the works and secure the procurements, before the contract is awarded to it.
    • Standstill Period: The period for considering appeals submitted by competitors whose bids were unsuccessful, commencing on the date on which they are notified of the successful bid.
    • Emergency: A situation in which a threat to public safety, public security, or public health is serious and unforeseeable, or in which there are indications of potential loss of life or property, and which cannot be addressed through ordinary tendering procedures.
    • Urgent Situation: A situation in which performing the works or securing the procurements within a short period is essential and necessary to ensure the safe and efficient continuity of operations at the Government Agency.
    • Estimated Cost: The prices determined by the Government Agency for the items of the works and procurements subject to the tender, the total of which represents the maximum limit of the expected total value of the contract.
    • Contingency Percentage: Percentages of the estimated cost, as specified by the Regulation.

Article: 2

  • The Law aims to achieve the following:

    • 1- Regulating the procedures related to the implementation of works and securing procurements, and preventing the abuse of influence and the impact of personal interests therein, thereby protecting public funds.
    • 2- Achieving the best value for public funds when contracting for and implementing works and procurements at fair, competitive prices, while taking into account life-cycle cost, quality of implementation, operational efficiency, and risk management.
    • 3- Promoting integrity and competition, achieving equality, and providing fair treatment to competitors, thereby realizing the principle of equal opportunities.
    • 4- Ensuring transparency in all procedures relating to works and procurements.
    • 5- Promoting economic development.

Article: 3

1- Government agencies shall, when carrying out their activities and procuring their purchases, deal with persons licensed for such purposes, in accordance with the applicable laws and regulations.

2- When a government agency deals with persons licensed outside the Kingdom to procure purchases or carry out works inside the Kingdom, it shall ensure that there is no more than one person licensed within the Kingdom who is qualified to procure the required purchases or carry out the required works. The Regulation shall specify the conditions and regulations necessary for applying the provisions of this paragraph.

3- Without prejudice to the provisions of paragraph (2) of this Article, the Regulation shall specify the provisions applicable to cases involving dealings with persons licensed outside the Kingdom to procure purchases or carry out works inside the Kingdom. In all other respects, the government agency shall apply the provisions of the Law to such cases.

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