Article 48 of the Saudi Government Tenders and Procurement Law
المادة 48 من نظام المنافسات والمشتريات الحكومية · الفصل الرابع: فحص العروض وصلاحية التعاقد
The Article bars excluding a bid for its low price unless it is 25% or more below the estimated cost and market prices, after discussing it in writing with its holder and the committee is not satisfied of his ability to perform.
Official text (Arabic)
This article has not been amended since the law was issued.
لا يجوز استبعاد أي عرض بسبب تدني أسعاره إلا إذا قل بنسبة (25%) فأكثر عن التكلفة التقديرية والأسعار السائدة في السوق، بشرط أن تقوم لجنة فحص العروض بعد مراجعة الأسعار التقديرية بمناقشة صاحب العرض المنخفض، وأن تطلب منه كتابياً تقديم تفاصيل للعناصر المكوّنة لعرضه وشرح أسباب انخفاضه، وفي حال عدم اقتناع اللجنة بمقدرته على تنفيذ العقد، فيجوز لها التوصية باستبعاد العرض.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 48 explained in plain English
This Article protects the bidder who submits a low price. The rule is that no bid may be excluded because of its low prices. The only exception requires several conditions together:
- The bid is 25% or more below the estimated cost and the prevailing market prices.
- The bid examination committee reviews the estimated prices.
- It discusses the matter with the holder of the low bid.
- It asks him in writing to provide details of the elements making up his bid and to explain the reasons for its low price.
- After that the committee is not satisfied of his ability to perform the contract.
Even when these conditions are met, the text says the committee may recommend excluding the bid; this is a recommendation, not an automatic exclusion.
In practical terms, a bid that is less than 25% below the estimates may not be excluded on the ground of its low price. If the difference reaches 25% or more, its holder is given a chance to justify his price before any recommendation is made.
This is the opposite of the case addressed by Article 47, which allows negotiation to reduce the price if the best bid is clearly higher than market prices or exceeds the approved amounts.
If you are asked to justify a low price or your bid is recommended for exclusion, consult a lawyer who specializes in administrative cases and government contracts.
Practical example
An establishment in Medina submitted a bid for cleaning work that was 30% below the estimated cost and prevailing prices. The committee discussed it with the establishment and asked it in writing for details of the elements of the bid and the reasons for its low price. The establishment provided a statement of its existing workforce and equipment, and the committee was satisfied of its ability to perform, so it did not recommend excluding it.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 48 of the Saudi Government Tenders and Procurement Law
Can my bid be excluded because its price is low?
Not unless it is 25% or more below the estimated cost and prevailing prices, and after you are consulted, your bid details are requested in writing, and the committee is not satisfied of your ability to perform.
What percentage of reduction allows a bid to be excluded?
25% or more below the estimated cost and prevailing market prices.
Does the committee exclude the low bid itself?
The text allows the committee to recommend excluding the bid, so it recommends and does not exclude automatically.
More articles on Examining Bids and Award
- Article 24
The article requires the government entity to set in the tender documents the criteria for evaluating, comparing and accepting bids, as the Implementing Regulations explain.
تحدد الجهة الحكومية في وثائق المنافسة معايير تقييم ومقارنة وقبول العروض وفقاً لما توضحه اللائحة.
- Article 25
The article requires non-price evaluation criteria to be objective, proportionate to the nature of the works and procurement, and quantifiable as far as practically possible.
يجب أن تكون معايير التقييم غير السعرية موضوعية وتتناسب مع طبيعة الأعمال والمشتريات المراد طرحها، وأن تكون -بالقدر الممكن عملياً- قابلة للتحديد الكمي.
- Article 43
The article provides for forming one or more bid-opening committees by decision of the head of the government entity or his delegate, as the Implementing Regulations explain.
تكوّن بقرار من رئيس الجهة الحكومية أو من يفوضه لجنة أو أكثر لفتح العروض، وفقاً لما توضحه اللائحة.
- Article 44
The article requires bids to be opened in the presence of all committee members when the receiving period ends, with minutes prepared, lets bidders attend, and requires referral to the examination committee within 3 days.
1- تفتح العروض بحضور جميع أعضاء اللجنة في موعد انتهاء مدة تلقي العروض، ويعَد محضر بذلك، وفي الحالات التي تتطلب تقديم عرض فني مستقل عن العرض المالي، تفتح العروض
- Article 45
The article governs forming the bid-examination committee, its tasks, the unified procurement entity's participation and recording its recommendations in minutes, and bars combining its chairmanship with award authority or with the opening committee.
1- تكوّن لجنة أو أكثر بقرار من رئيس الجهة الحكومية أو من يفوضه لفحص العروض، وفقاً لما توضحه اللائحة. وتتولى هذه اللجنة فحص العروض وتقديم توصياتها في الترسية على
- Article 46
The Article requires bids to be examined against the tender documents' criteria, non-compliant bids excluded and their guarantees returned; where bids are split, technical bids are examined first, then the financial bids of accepted technical bids.
1- تفحص العروض وفقاً للمعايير المنصوص عليها في وثائق المنافسة، وتستبعد العروض المخالفة، وترد الضمانات الابتدائية لأصحابها. 2- في حال قدمت العروض في ملفين إلكترو
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.