Nepal's Public Procurement Act Was Amended in 2026: What Bidders Need to Know
By Tender in Nepal team · Published · Last checked
Nepal amended its Public Procurement Act in 2026 for the first time in about twenty years. The Public Procurement (Second Amendment) Act 2083 follows an ordinance gazetted on 30 April 2026 and is dated 25 Asar 2083 (about 9 July 2026). The changes affect how you find notices, how long you have to bid, how you price and what happens after you win.
This article reads the amended Act as consolidated by the Nepal Law Commission. Section numbers (दफा) are given so you can check them. It is general information, not legal advice. The PPMO has said it will prepare regulations and procedures under the amended Act, so details can still change. Independent service, not affiliated with the Government of Nepal or PPMO. Last checked: 17 October 2026.
1. You have less time to bid (दफा 14, 40)
| Situation | Minimum period now | Before |
|---|---|---|
| National tender | 21 days | 30 days |
| International tender | 30 days | 45 days |
| Re-invitation, national | 7 days | 15 days |
| Re-invitation, international | 15 days | 21 days |
| Further re-invitation, national (with approval of an officer one level higher) | 3 days | — |
| Sealed quotation notice | 7 days | 15 days |
These are minimums. The dates printed on the notice govern. The practical lesson: a re-bid can close in a week, and sometimes in three days, so finding the notice early now decides whether you can bid at all. You can follow re-bids on our re-bid notices page.
2. Some notices may not appear in a newspaper (दफा 14(1), 40(3))
If an entity calls a tender or sealed quotation through the e-procurement system (e-GP), the notice does not have to be published in any other medium. If it does not use e-GP, the notice goes on the PPMO website and the entity's own website or notice board (दफा 14(2)). Electronic bids follow the e-procurement system approved by the PPMO (दफा 18(3)).
So newspapers are a major source of tender notices, but not the only one. Check the PPMO site as well, and e-GP whenever it is carrying tenders. Tender in Nepal shows notices published in newspapers; it does not claim to show every tender.
3. The lowest price no longer wins automatically (दफा 25, 27)
- In a single-envelope tender, the entity works out the average of the bid amounts of the bidders who pass examination, and selects the bid closest to that average that is not substantially above the cost estimate (दफा 25(5क)). In a two-envelope tender, the same is done among the bidders who are substantially responsive after the technical evaluation (दफा 25(7क)).
- Ties: if two or more bids are exactly at the average, the choice is made by lottery. If two are equally near, one below and one above the average, the one below the average is selected (दफा 27(1क), (1ख)).
- If the selected bidder does not furnish performance security, its bid security is forfeited and the bid next closest to the average is selected (दफा 27(5), (6)).
What it means: competing to be the cheapest is no longer the strategy. Knowing where the average is likely to fall, and whether your price is credible there, is.
4. The 30% cut-off (दफा 25(7ख))
A bidder who quotes more than 30 percent below the approved cost estimate is removed from the evaluation. An earlier ordinance in April 2026 said the entity should instead ask for a rate analysis; the Act replaced that with removal. Keep a detailed rate analysis anyway: it shows your price is sound before you submit.
5. After you win
- Notice of intent and the 7-day window (दफा 27). The entity serves a notice of intent within seven days of selecting a bid and tells the other bidders the winner's name, address and amount. If no application is made under दफा 47 within seven days of that notice, the bid is accepted and the winner has fifteen days to furnish performance security and sign the contract.
- Performance security equal to 5 percent of the quoted amount (दफा 27(4)).
- Challenging a decision (दफा 47, 49, 50). Apply to the chief of the entity within seven days of becoming aware of an error; late applications are not processed. The Review Committee can be approached within seven days in the cases covered by दफा 49(क), and within thirty days of the contract date for a concluded contract (दफा 49(ख)).
6. Advances, variations, price adjustment and penalties
- Advance (दफा 52क): up to 20 percent of the contract, against an advance bank guarantee, with the first instalment capped at half the approved advance, held in a separate bank account. Work must start within 30 days of the first instalment; unused advance means forfeiture of the guarantee.
- Criminal liability (दफा 58क(3)): diverting advances or contract funds, submitting false documents to get paid, or abandoning work after payment can be prosecuted under the criminal laws on fraud and forgery.
- Variation orders (दफा 54): up to 5 percent can be approved by a third-class gazetted (or equivalent) officer, up to 10 percent by second-class, up to 15 percent by first-class; above 15 percent by the department head.
- Price adjustment (दफा 55): applies to contracts running longer than twelve months unless the contract says otherwise. News reports describe extra provision for extraordinary circumstances such as pandemics and blockades; read the contract and the text before you rely on it.
- Entity responsibilities (दफा 58क): entities must provide the construction site, access, utility relocation, permits and coordination so that work is not needlessly delayed, and officials who delay required decisions can face departmental action.
7. Other changes worth knowing
- Reverse auction (दफा 8): a procurement method in which the cost estimate is the ceiling and bidders lower their offers within a fixed time; the lowest offer in that time is selected.
- Domestic goods (दफा 2, 14(8क)): goods with at least 30 percent domestic value addition count as domestic, and entities must give them the prescribed priority.
- News reports also mention a Government Procurement Service under the Prime Minister's Office.
A bidder's checklist
- Count the days from the publication date to the deadline. Is it a re-bid?
- Read the evaluation method in the bidding document: average-based, reverse auction or another?
- Prepare a rate analysis and compare your price with the estimate: are you within 30%?
- Check newspapers and the PPMO site for notices, and e-GP whenever it is carrying tenders; set a daily routine.
- Check for amendments and extensions: see amendments and deadline extensions.
- Mark seven days after the notice of intent in your calendar.
- Keep any advance in the separate account and use it for the contract only.
Help us keep this accurate
Seen a bidding document that applies the new method, or a notice that cites the amended Act? Send it (without confidential bid data) to info@tenderinnepal.com and we will update this article and log it on our corrections page.
Source: Public Procurement Act 2063 as amended through the Public Procurement (Second Amendment) Act 2083, consolidated text published by the Nepal Law Commission; Public Procurement (Second Amendment) Ordinance 2083 (gazetted 17 Baisakh 2083). News coverage: Kathmandu Post, 16 July 2026.