Singapore
Answer ... When procurement is discussed in the sense of the process by which resources are gathered and used, and contracts are agreed for the purposes of implementing a project, the defining question is whether the project is a public one.
Public procurement is governed by:
- the Government Procurement Act;
- the Government Procurement (Application) Order;
- the Government Procurement (Challenge Proceedings) Regulations; and
- the Government Procurement Regulations 2014.
Pursuant to Regulation 23 of the Government Procurement Regulations 2014, public procurement must be by way of open tender or selective tender as prescribed, save in the exceptional situations provided for in Regulation 26 of the regulations, which permits limited tendering.
For private projects, the method of procurement is not mandated by law. Perhaps the most significant point to note is that it is fairly common for letters of intent to be issued by an employer/main contractor to a contractor/subcontractor.
Typically, such letters of intent will confirm the intent of the main contractor to engage the subcontractor, and provide for the subcontractor to commence some subcontract works while waiting for agreement to be reached on the actual contract.
The legal effect of such a letter of intent will turn on its individual provisions. Some letters of intent may have contractual effect, while others have no contractual effect at all.
For smaller construction projects, the employer may simply approach the desired contractor directly and negotiate with it on the terms – primarily pricing. In such cases, the tendering process is simple.
For larger and more sophisticated construction projects, employers may call for an open tender or a closed tender with pre-approved contractors.
Singapore
Answer ... Please see question 2.3. When it comes to public procurement, it is not meaningful to speak of advantages or disadvantages, given that the procurement method is prescribed by statute.
Singapore
Answer ... In general, under Singapore law, invitations to tender are merely invitations to treat: a binding contract is entered into only if the tender submission from the contractor is accepted by the owner.
Most comprehensive tenders do not envisage further contractual documentation to be agreed once a tender is accepted, as the tender documents will have already included all contract specifications, design intent drawings and the standard form of contract to be entered into.
While procurement issues are typically analysed from a contractual framework, it is important not to lose sight of the fact that other legislation may be potentially applicable.
For instance, the Competition Act regulates competition and abuse of dominant position in the market in Singapore. Contractors have been penalised by the Competition & Consumer Commission Singapore for bid rigging in tenders for maintenance services for swimming pools and other water features (see CCCS 500/7003/17), as well as for bid rigging in electrical and building works (see CCS 500/001/09).