Pro­cure­ment law ex­pands cov­er­age

Ap­proval to opt out on case-by-case ba­sis


The Gov­ern­ment Pro­cure­ment and Sup­plies Man­age­ment Act of 2017 has ex­tended adop­tion of the state pro­cure­ment process to over 9,000 state agen­cies in cen­tral, re­gional and lo­cal ar­eas from only 1,000 un­der the pre­vi­ous reg­u­la­tion.

The new law, which took ef­fect from Aug 23, re­quires cen­tral, re­gional and lo­cal state agen­cies, in­de­pen­dent bod­ies and or­gan­i­sa­tions un­der the con­sti­tu­tion to ap­ply the state pro­cure­ment process, said Sut­ti­rat Rat­tana­chot, direc­tor-gen­eral of the Comptroller-Gen­eral’s Depart­ment.

How­ever, 33 state en­ter­prises and some agen­cies have sought ap­proval from a com­mit­tee on state pro­cure­ment chaired by Fi­nance Min­is­ter Apisak Tan­tivo­ra­wong to is­sue their own reg­u­la­tions gov­ern­ing the pro­cure­ment process, with the goal of pro­vid­ing more flex­i­bil­ity.

Ms Sut­ti­rat used the For­eign Min­istry as an ex­am­ple. The min­istry has sought the ap­proval not to ap­ply the state pro­cure­ment process as the Con­sular Af­fairs Depart­ment is re­quired to com­ply with the reg­u­la­tions of each coun­try when it makes pro­cure­ments over­seas.

The new reg­u­la­tions must be in ac­cor­dance with state pro­cure­ment man­age­ment prin­ci­ples, mean­ing they must be worth­while, trans­par­ent and with mea­sur­able ef­fi­cacy.

Ms Sut­ti­rat said per­mis­sion for state en­ter­prises to is­sue their own reg­u­la­tions con­cern­ing pro­cure­ment can be given only to those en­ter­prises that must com­pete with op­er­a­tors in the same busi­ness to en­hance com­pet­i­tive­ness, but these will be looked at on a case-by-case ba­sis, not for all pro­cure­ment trans­ac­tions.

For in­stance, PTT makes oil trade trans­ac­tions and their price varies ac­cord­ing to the global mar­ket, so it can­not set a ref­er­ence price as re­quired by law.

The 33 state en­ter­prises in­clude the na­tional oil and gas con­glom­er­ate PTT Plc, the na­tional car­rier Thai Air­ways In­ter­na­tional Plc, the Elec­tric­ity Gen­er­at­ing Au­thor­ity of Thai­land, the Met­ro­pol­i­tan Elec­tric­ity Au­thor­ity, the Pro­vin­cial Elec­tric­ity Au­thor­ity, TOT Plc, MCOT Plc, Gov­ern­ment Sav­ings Bank, GH Bank and the Bank for Agri­cul­ture and Agri­cul­tural Co­op­er­a­tives.

The Gov­ern­ment Pro­cure­ment and Sup­plies Man­age­ment Act of 1997 that re­placed pro­cure­ment reg­u­la­tions of the Of­fice of the Prime Min­is­ter in 1992 al­lows peo­ple to par­tic­i­pate as ob­servers ev­ery step of the process, from draft­ing the terms of ref­er­ence to com­plet­ing the pro­cure­ment process, as well as set­ting penal­ties for au­thor­i­ties, of­fi­cials or the ac­com­plices who take bribes or fail to per­form their du­ties in good­will. Of­fend­ers are sub­ject to one to 10 years im­pris­on­ment and/or a fine of 20,000-200,000 baht.

For the 2017 fis­cal year, the gov­ern­ment’s in­vest­ment bud­get amounts to 548 bil­lion baht and state en­ter­prises’ in­vest­ment bud­get to­tals 370 bil­lion.


The new law re­quires 9,000 state agen­cies to ap­ply the state pro­cure­ment process, ac­cord­ing to the ComptrollerGen­eral’s Depart­ment.

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