The Public Procurement (Amendment) Ordinance, 2025 (Ordinance No. XVI of 2025), promulgated on 4 May 2025, introduces substantial amendments to the Public Procurement Act, 2006 (Act No. XXIV of 2006). These changes aim to foster greater transparency, accountability, value for money, efficiency, ethics, quality, and sustainable procurement practices in Bangladesh.
The Ordinance significantly expands and refines key definitions within Section 2 of the Act, laying the groundwork for the substantive changes that follow. Notable new definitions include:
- “Procurement Strategy” (Section 2(9Ka)): This is defined as a strategy and methodology adopted for a procurement process and contract implementation, considering project concepts, work environment, stakeholder and market analysis, sustainability, risk management, etc., to ensure best value for money. This introduces a formal requirement for strategic planning in procurement.
- “Sustainable Public Procurement” (Section 2(9Kha)): This refers to a process or strategy that integrates sustainable public procurement demands, technical specifications, and standards to protect the environment, support social progress, and promote economic development by enhancing resource efficiency, product quality, service standards, and overall cost coordination. This is a critical addition, aligning Bangladesh’s procurement framework with global sustainability agendas.
- “Disposal” (Section 2(14Ka)): This term is now formally defined to mean the removal or transfer of public property by a procuring entity through sale, auction, or processes described in relevant government policies.
- “Framework Agreement” (Section 2(21)): The definition is revised to mean an agreement made with one or more tenderers or consultants by one or more procuring entities for a specific period for the procurement of goods, common works, physical services, or intellectual and professional services, under stipulated conditions regarding price and, where applicable, quantity or estimated quantity. This provides greater clarity on a flexible procurement tool.
- “BPPA” (Section 2(21Ka)): This introduces the Bangladesh Public Procurement Authority (BPPA), established under the Bangladesh Public Procurement Authority Act, 2023 (Act No. XXXII of 2023), as a key regulatory body.
- “Service Provider” (Section 2(38)): A new definition for a person who enters into a contract with a procuring entity to provide physical services under the Act.
Strategic Enhancements: Procurement Planning, Sustainability, and Documentation
The Ordinance places increased emphasis on strategic procurement planning and sustainability. Section 11, dealing with procurement plans, is amended to explicitly require such plans to be prepared “following a procurement strategy” and approved by the government. This links operational procurement planning directly to the newly defined strategic considerations.
Section 12 is modified to mandate that procuring entities, when preparing pre-qualification, tender, quotation, or proposal documents, must use standard documents prescribed by the BPPA from time to time, considering sustainable procurement and ensuring best value for money. A new sub-section (3) allows the use of standard documents published by development partners or internationally recognised organisations, with prior BPPA approval, if BPPA has not published a relevant standard document. This ensures consistency while allowing for flexibility where necessary.
The concept of Sustainable Procurement is further embedded through the replacement of Section 16. The new Section 16 stipulates that the government shall take all necessary actions in the interest of sustainable procurement. Crucially, sub-section (2) prohibits procuring entities from including in procurement documents any conditions that hinder the financial objectives of the procurement, have adverse environmental impacts, or are inconsistent with provisions related to workers’ wages and social benefits, occupational health and safety, and the prohibition of child labour.
Technical specifications and descriptions for goods, works, and physical services, as per the amended Section 15(1), must now provide a correct and complete description of expected performance levels, characteristics, quality, and, where necessary, sustainable procurement elements, ensuring they are not restrictive. This promotes fair competition based on comprehensive and clear requirements.
The Ordinance introduces several procedural changes aimed at enhancing efficiency and accommodating modern procurement practices. Section 21(1) is amended to require procuring entities to publish contract award information, including beneficial ownership details of the successful tenderer or consultant for contracts above a prescribed value, on the BPPA’s website or web portal, in addition to their own notice boards or websites. This significantly enhances transparency regarding ultimate beneficiaries of public contracts.
The conditions for applying the Open Tendering Method (Section 31) are refined. While it remains the preferred method for goods, related services, works, or physical services, the amended section emphasises pre-qualification where applicable, non-discriminatory opportunity for tenderers, advertisement as per Section 40, minimum time for tender submission and execution, and award to the lowest responsive evaluated tender. A key proviso is added: if a tenderer quotes a “significantly low price” compared to the official cost estimate, such a low bid must be evaluated according to a method prescribed by rules.
The provisions for Limited Tendering Method (Section 32) are updated to include “physical services.” A notable addition to Section 32 is the introduction of the Reverse Auction method (new clause (e) under sub-section (1) of Section 32). A reverse auction is defined as a procurement method where a procuring entity initiates the process by inviting tenders for specific goods or services, and potential suppliers then compete by submitting progressively lower bids in real-time.
Framework Agreements receive expanded treatment under the replaced Section 36. Procuring entities can now enter into framework agreements with one or more tenderers or consultants for regularly required, commonly used goods, general works, or recurring physical or intellectual/professional services, using a competitive procurement method. Furthermore, one procuring entity can utilise a framework agreement already established by another procuring entity for similar needs. The government will issue instructions and standard documents for using framework agreements. This promotes efficiency for routine purchases.
Joint Venture Requirement for International IT Service Procurement
A noteworthy condition is added to Section 39(2) concerning the invitation of international proposals for IT services procured with the government’s own funds: if international proposals are deemed essential, domestic consulting firms must be included as joint venture partners.
Enhanced E-Procurement and Oversight
The Ordinance reinforces the move towards electronic government procurement (e-GP). The amended Section 65(1) mandates that all public procurement processable through the e-GP portal under the Act must be conducted electronically. Exceptions, where a procuring entity is unable to process procurement electronically, will require prior approval from the BPPA.
It should be noted that the Ordinance will require the approval of the Parliament. Thus, while current procurement activities must adhere to the Ordinance, its long-term status will depend on subsequent parliamentary action.