Public Procurement (Amendment) Ordinance made a law to integrate sustainability, e-bidding

Parliament has passed the Public Procurement (Amendment) Bill, 2026 to modernise the government's procurement framework.

Finance Minister Amir Khasru Mahmud Chowdhury placed the bill in parliament today (9 April), and it was subsequently approved by voice vote.

The objective of the amendment is to reform the nearly two-decade-old law in line with international standards, with a focus on sustainability, transparency and value for money.

With the passage of the bill, the Public Procurement (Amendment) Ordinance, 2025, issued during the interim government period, has now received parliamentary approval.

Under the amendment, the concept of sustainable public procurement has been introduced into the law for the first time. This means the government must consider environmental protection, social progress and economic development when procuring goods or services. According to the newly added Section 16, tender documents cannot include conditions that harm the environment or violate labour rights, including wages, social protections and the prohibition of child labour.

The bill also introduces technological advancements such as "reverse auction" – a real-time electronic bidding process in which suppliers compete by progressively lowering their prices. This is expected to reduce government expenditure, particularly for standard goods. Additionally, the use of the electronic government procurement (e-GP) portal has been made mandatory for all public procurement. Any exception will now require prior approval from the Bangladesh Public Procurement Authority.

Structural reforms include formally recognising the Procurement Authority as the primary regulatory authority and defining physical services as a separate procurement category. The law also expands the use of framework agreements, allowing multiple government entities to procure goods from pre-selected suppliers over a specified period.

To facilitate procurement for Bangladeshi embassies and missions abroad, the law allows them to follow local laws or international standards of the host country, subject to prior approval from the Cabinet Committee on Economic Affairs.

To protect domestic industries, the bill stipulates that in internationally tendered technology service procurements funded by the government, a local consulting firm must be included as a joint partner.

Explaining the purpose of the amendment, the finance minister said the Public Procurement Act, 2006, enacted on 6 July 2006, was designed to ensure fairness, accountability, timeliness and open competition in public procurement.

He noted that the law had been amended five times up to 2016 to improve efficiency. However, recent needs—such as ensuring efficiency, ethics, quality and optimal use of public funds—have made further reforms necessary.

He added that a price ceiling introduced in the fifth amendment of the 2006 law had significantly reduced competition in domestic procurement, creating the need for alternative mechanisms. The new amendment addresses this by incorporating international best practices, including sustainable procurement, asset disposal, reverse auctions and the classification of infrastructure services as a separate procurement category.

It may be noted that the President promulgated the Public Procurement (Amendment) Ordinance, 2025 on 4 May 2025, which came into effect through a gazette notification on 28 September the same year.