Article 25(Cases where negotiated contracts may be used) #
(1) In any of the following cases, the head of a local government or a contracting officer may enter into a negotiated contract under the proviso of Article 9 (1) of the Act: <Amended on Sep. 15, 2011; Oct. 28, 2011; Nov. 23, 2011; May 23, 2012; Oct. 8, 2012; Mar. 23, 2013; Nov. 20, 2013; May 22, 2014; Nov. 19, 2014; Aug. 19, 2015; Jan. 15, 2016; Sep. 13, 2016; Sep. 29, 2016; Jul. 26, 2017; Jul. 24, 2018; 24. Jun. 25, 2019; Sep. 17, 2019; Jul. 14, 2020; Sep. 29, 2020; Nov. 3, 2020; Dec. 8, 2020; Jan. 5, 2021; Feb. 2, 2021; Dec. 16, 2021; Jan. 25, 2022; Sep. 20, 2022; Jan. 3, 2023; Apr. 11, 2023; Feb. 13, 2024; May 7, 2024>
1. Where a natural disaster, the outbreak or spread of an infectious disease, the transfer of military personnel in military operations, emergency events, price fluctuations of raw materials, or other similar circumstances exist, there is no insufficient time to call for tenders;
2. In cases of recovery from disasters, etc. prescribed by Decree of the Ministry of the Interior and Safety, such as a disaster, etc. requiring emergency recovery, which result in no sufficient time to call for tenders;
3. Where contracts are entered into with State agencies and other local governments (including associations of local governments pursuant to Article 176 of the Local Autonomy Act);
4. The following cases where it is impossible to compete due to a specific person's skills or services or a specific location, structure, quality, performance, efficiency, etc.:
(a) Where it is impracticable to divide responsibilities for defects in future facilities in construction works, and where a contract is entered into with the immediately preceding or current contractor who meets the standards prescribed by the Minister of the Interior and Safety;
(b) Where two or more contractors are unable to perform construction works at a single site due to work congestion, etc., and where a contract is entered into with the current contractor who meets the standards prescribed by the Minister of the Interior and Safety;
(c) Where a contract is entered into for finishing work with the immediately preceding or current contractor who meets the standards prescribed by the Minister of the Interior and Safety;
(d) Where competition is practically impossible as construction works are carried out in a special area, such as a border area;
(e) Where competition is practically impossible as construction works are performed based on a patented method, a new technology designated and publicly notified pursuant to Article 14 of the Construction Technology Promotion Act, a new technology certified pursuant to Article 7 of the Environmental Technology and Industry Support Act, a new technology certified pursuant to Article 7 of the Environmental Technology and Industry Support Act, or a new disaster safety technology designated pursuant to Article 14 of the Disaster Safety Industry Promotion Act (limited to within the protection period or validity period designated pursuant to each relevant statute);
(f) Where a person who manufactures or supplies the relevant goods directly installs, assembles (including testing and operation) or maintains such goods;
(g) Where goods for which a patent has been obtained or utility model or design has been registered and where there is no appropriate substitute or replacement;
(h) Where there is only one producer or holder of the relevant goods, and where it is impossible to achieve the business purpose by having other goods manufactured or purchased;
(i) Where a contract is entered into for survey, design, supervision, special survey, training, facility management, education, event, use of information, or purchase of clothes (clothing) which requires technology, quality, experience, or qualification of a specific person, or where a contract for design services is entered into with a person who has won a design competition in accordance with the relevant statutes or regulations;
(j) Where it is necessary to enter into a service contract for academic research with a specific person;
(k) Where the real estate of a specific person, such as land and buildings is purchased or the property of a specific person is leased;
(l) Where goods are procured for the purpose of exchanging parts of the goods, etc. already procured or expanding facilities, etc. and where such goods, etc. are not compatible with goods to be manufactured or supplied from persons other than those who manufactured or supplied the relevant goods, etc.
(m) Where a contract is entered into for the manufacture, purchase or service of goods for which it is impracticable to achieve the purpose of the contract with a person who has a place of business located in a specific place or location, unless the contract related to the use of the place of business is entered into;
(n) Where there is an urgent reason, such as an expected delay in the ongoing construction works for excavation (survey) of buried heritage under Article 11 of the Act on Protection and Inspection of Buried Heritage, or where it is necessary to maintain continuity in the excavation of buried heritage as a trial excavation survey is converted to an in-depth excavation survey;
5. Any of the following contracts:
(a) A contract for construction works under the Framework Act on the Construction Industry (excluding specialized construction works under that Act), the estimated price of which does not exceed 400 million won, specialized construction works, the estimated price of which does not exceed 200 million won under that Act or other construction works under other statutes or regulations related to construction works, the estimated price of which does not exceed 160 million won;
(b) A contract for the manufacture or purchase of goods or services whose estimated price is not more than 20 million won;
(c) A contract for the manufacture or purchase of goods or a service contract concluded with a small enterprise defined in Article 2 (2) of the Framework Act on Small and Medium Enterprises or a micro enterprise defined in Article 2 of the Framework Act on Micro Enterprises, the estimated price of which exceeds 20 million won but does not exceed 100 million won; provided, in cases falling under Article 30 (1) 3 and the proviso of paragraph (2) of that Article, a contract for the manufacture or purchase of goods or a service contract concluded with a person other than a small enterprise or micro enterprise shall be included therein;
(d) A contract for the manufacture or purchase of goods or a service contract for which special knowledge, technology, or qualifications are required as a contract related to academic research, cost accounting, construction technology, etc., among contracts whose estimated price exceeds 20 million won but does not exceed 100 million won
(e) In cases of an enterprise or cooperative falling under any of the following enterprises or cooperatives whose estimated price is more than 20 million won but not more than 100 million won, which falls under a contract for the manufacture or purchase of goods or a service contract for goods concluded with any of the following enterprises or cooperatives (3) through (6); Provided, That such enterprise or cooperative shall satisfy the employment ratio of vulnerable social groups determined and publicly notified by the Minister of the Interior and Safety:
1) Female-owned businesses defined in subparagraph 1 of Article 2 of the Act on Support for Female-Owned Businesses
2) Enterprises owned or operated by a person with a disability defined in subparagraph 2 of Article 2 of the Act on the Promotion of Entrepreneurial Activities of Persons with Disabilities;
3) Social enterprises defined in subparagraph 1 of Article 2 of the Social Enterprise Promotion Act
4) Social cooperatives defined in subparagraph 3 of Article 2 of the Framework Act on Cooperatives;
5) A self-support enterprise under Article 18 of the National Basic Living Security Act;
6) A community company defined in Article 2 (1) 9 of the Special Act on Promotion of and Support for Urban Regeneration, which meets the standards determined by the Minister of the Interior and Safety;
(f) A lease contract, etc. the estimated price of which does not exceed 50 million won (the estimated price shall be calculated based on an annual amount or total amount), which is not a contract for construction works, a contract for manufacturing or purchasing goods, or a contract for services;
6. Where a specific business operator is required to purchase or manufacture special goods, property, etc. under other statutes as follows:
(a) Where defense materials under the Defense Acquisition Program Act are manufactured or purchased from defense contractors;
(b) Where goods directly produced by a factory (including a Saemaeul factory) moving into an agro-industrial complex under the Agricultural and Fishing Villages Improvement Act are manufactured or purchased from such factor;
(c) Where goods directly produced by a factory moving into a special support area for small and medium enterprises under the Act on the Fostering of Local Small and Medium Enterprises and Promotion of Their Innovation are purchased from such factory
(d) Where goods produced by a small or medium entrepreneur defined in subparagraph 1 of Article 2 of the Small and Medium Enterprises Promotion Act are manufactured or purchased by such producer and where the period of validity certified or designated by the competent Minister falls (where the period of validity certified or designated by the competent Minister has been extended, including the extended period; hereafter the same shall apply in this item); provided, where the period of validity exceeds six years, six years shall apply:
1) Products whose performance has been certified pursuant to Article 15 of the Act on Facilitation of Purchase of Small and Medium Enterprise-Manufactured Products and Support for Development of Their Markets;
2) A product that has obtained quality certification under Article 20 of the Software Promotion Act;
3) Products certified as new products under Article 16 of the Industrial Technology Innovation Promotion Act;
4) Products manufactured based on new technologies certified or designated and publicly notified in accordance with the following statutes, the performance of which has been confirmed by the competent Minister at the commercialization stage;
5) Products designated and publicly notified as excellent procurement goods under Article 30 of the Enforcement Decree of the Government Procurement Act;
6) Goods designated and publicly notified as an excellent procurement joint trademark designated and publicly pursuant to Article 31 of the Enforcement Decree of the Government Procurement Act (limited to where goods less than the amount publicly notified by the Minister of Economy and Finance pursuant to Article 26 (1) 3 (f) of the Enforcement Decree of the Act on Contracts to Which the State Is a Party are purchased);
7) Goods whose development has been completed with support under Article 9 (1) 3 of the Act on the Promotion of Technology Innovation of Small and Medium Enterprises, which have been agreed to be purchased by a person connected with the initial demand;
8) Deleted; <Nov. 3, 2020>
9) A product whose conformity has been certified under Article 16 (1) of the Act on Promotion of Disaster Safety Industry;
10) Green products certified as compliant pursuant to Article 60 (2) of the Framework Act on Carbon Neutrality and Green Growth for Coping with Climate Crisis;
11) Excellent products designated under Article 10 (1) of the Act on Development of Water Management Technologies and on Promotion of Water Industry;
12) Any new product of industrial convergence that has obtained certification of compliance pursuant to Article 13 (1) of the Industrial Convergence Promotion Act;
7. Where it is necessary to enter into a contract with a person who has special relationship, a local resident, a producer of specific goods, etc. or where any other ground equivalent thereto exists, as follows:
(a) Where materials for recovery owned by a local government are sold to a person suffering from a disaster where an emergency disaster occurs;
(b) Where it is necessary to have a large number of local residents participate in the development of local communities and where a contract is entered into directly with a resident or representative of the relevant area prescribed by Decree of the Ministry of the Interior and Safety for construction works the estimated price of which is less than 20 million won, or for seedling and seedling growth the estimated price of which is less than 50 million won;
(c) Where goods directly produced in a welfare factory of a self-supporting veterans village of persons of distinguished service to the State designated by the Minister of Patriots and Veterans Affairs are manufactured or purchased from such producer or where goods are directly sold or leased to them;
7-2. To provide jobs, merit rewards, welfare services, etc. to persons of distinguished service to the State, persons with disabilities, etc. as follows:
(a) Where goods directly produced by an organization comprised of wounded persons established pursuant to Article 1 of the Act on the Establishment of Associations by Persons of Distinguished Service to the State are manufactured or purchased from such organization or any service contract performed by the organization is entered into or where the goods are directly sold or leased to such organization;
(b) Where goods directly produced by a production facility for products manufactured by persons with severe disabilities designated pursuant to Article 9 (1) of the Special Act on the Preferential Purchase of Products Manufactured by Persons with Severe Disabilities, are manufactured or purchased from such facility or any service contract performed by the facility is entered into or where the goods are directly sold or leased to such facility;
(c) Where goods directly produced by a corporation established pursuant to the Social Welfare Services Act are manufactured or purchased from such corporation or any service contract performed by the corporation is entered into or where the goods are directly sold or leased to such corporation;
(d) Where goods directly produced by a standardized workplace for persons with disabilities certified under Article 22-4 (1) of the Act on the Employment Promotion and Vocational Rehabilitation of Persons with Disabilities are manufactured or purchased from such workplace or any service contract performed by the workplace is entered into or where the goods are directly sold or leased to such workplace;
8. Where it is deemed inefficient to enter into a contract through competition in light of the purpose, nature, etc. of the contract, as follows:
(a) Where goods used at an overseas office of a local government are purchased locally;
(b) Where it is deemed disadvantageous to call for tenders when processing, unloading, unloading, transporting, or storing goods;
(c) Where an innovative product under Article 27 (1) of the Government Procurement Act is to be purchased;
(d) Deleted; <Nov. 20, 2013>
(e) Deleted; <Nov. 20, 2013>
(f) Deleted; <Nov. 20, 2013>
(g) Where a contract for the relevant project is entered into with a person who is entrusted with the projects of the State or a local government or is allowed to perform such projects on behalf of the State or a local government pursuant to other statutes or regulations;
(h) Where it is necessary for a local government to confidentially conduct its activities, such as printing test papers and confidential documents, etc.;
(i) Where any products developed through research and development projects under related statutes or regulations, such as the Framework Act on Science and Technology, whose technology innovation is recognized in accordance with the standards and procedures determined by the head of each central administrative agency in consultation with the Minister of the Interior and Safety;
(j) Where a contract for digital services selected pursuant to Article 20 (3) of the Act on the Development of Cloud Computing and Protection of Its Users is entered into.
(2) Where the head of a local government or a contracting officer enters into a negotiated contract pursuant to paragraph (1) 6 (b), 7 (c), and 7-2, he or she shall verify the following matters: <Amended on Sep. 15, 2011; Nov. 20, 2013; Nov. 24, 2014>
1. Qualification requirements for persons eligible for a negotiated contract;
2. Whether it is possible to directly manufacture goods and directly perform services subject to a negotiated contract.
(3) Deleted. <Sep. 20, 2022>
[This Article Wholly Amended on Jul. 26, 2010]