Reed Smith Client Alerts

Exciting developments continue to come out of Saudi Arabia. A new Government Tenders and Procurement Law was approved by the Saudi Arabian Council of Ministers on 16 July 2019 and came into force on 1 December 2019 (the New GTPL). The New GTPL replaces the previous Government Tenders and Procurement Law issued in 2006 (the Old GTPL).

In line with Saudi Vision 2030, the New GTPL promotes economic development and encourages investment by promoting equality, increasing transparency and preventing the abuse of power. The New GTPL makes changes to the existing government tender and procurement framework, including establishing the ‘Entity Concerned with Unified Procurement’, the development of an online portal, new methods of contracting and the introduction of a standstill and protest mechanism.

Authors: Sachin Kerur Chris Edwards

Application

The New GTPL applies to procurement by Government Entities, which are defined as ministries, government agencies, authorities, departments, public institutions and agencies having an independent public legal personality. Works and procurements executed outside of Saudi Arabia are also included within the scope of the New GTPL.

Governance

The Ministry of Finance has a pivotal role under the New GTPL, which includes setting policies and issuing directives, collating and distributing information, maintaining a list of boycotts and approving tender and prequalification forms, contract forms, performance evaluation forms and other documents.

The New GTPL also establishes the ‘Entity Concerned with Unified Procurement’ to reduce costs and streamline procurement. In particular, it is tasked with identifying works and procurement required by multiple Government Entities, standardising their technical specifications, issuing tender procedures, receiving and examining bids, selecting bidders and concluding framework agreements with successful suppliers to be used by all Government Entities.

The portal

The Ministry of Finance is tasked with establishing, supervising and developing a unified e-portal for government procurement efforts. The procedures for all government tenders and procurements shall be announced on the portal, unless there are technical or national security issues.

The portal will include a register for each Government Entity, including all information, data and procedures related to contracts it concluded and the projects and works tendered. Electronic copies of tender documents shall be made available on the portal except where this is not possible due to technical reasons.