The Council of Ministers approved the Contractor Classification System, which included 19 articles, and the Umm Al-Qura newspaper today published details of the 19 articles of the new system as follows:
Article I:
Wherever used in these Regulations, the following words shall have the meanings indicated in front of them unless the context requires otherwise:
Ministry: Ministry of Municipal and Rural Affairs and Housing.
Minister: Minister of Municipal and Rural Affairs and Housing.
System: Contractor Classification System.
Regulation: The executive regulations of the system.
Categorization: Evaluating the contractor's capabilities: Financial, technical, administrative, and executive capabilities; to place it in the field, activity, and grade according to the provisions of the Law and Regulations.
Contractor: A natural or legal person authorized by law to carry out - individually or jointly - a contract in one of the fields specified in the regulation.
Domain: The type of work in which the contractor is categorized.
Activity: A type of subsidiary business in a field.
Grade: The score a contractor receives when they are rated.
Standard: The set of elements used for categorization.
Article II:
The Ministry, in coordination with the relevant authorities, is responsible for classification, issuing, modifying, suspending and revoking classification certificates, in accordance with the provisions of the Law and the Regulations, provided that the request for classification or modification is decided within a period specified by the Regulations.
Article III:
Government entities, bodies, institutions and agencies with public legal personality may not award or accept any offer or tender for any project subject to classification unless the contractor is classified, and the project is located in the field, activity and grade for which the contractor is classified.
Article IV:
The fields, activities and degrees of classification shall be determined and amended by a decision of the Minister, in accordance with the controls specified in the regulation, provided that the fields and activities of the classification shall be based on what is stated in the National Directory of Economic Activities.
Article V:
The financial limits for each grade shall be determined and amended by a decision of the Minister after agreement with the Minister of Finance and the Minister of Economy and Planning.
Article VI:
The contractor shall be classified in the grade it deserves in one or more areas or activities of the classification, according to the following criteria and conditions:
1- Financial capability: Financial statements.
2- Technical, administrative and executive capacity: Organizational structures, administrative and technical staff.
3- Total number, type, and value of projects.
and any other criteria or conditions specified in the regulation.
Article VII:
The contractor may request to amend his classification certificate by raising, adding or deleting any field (or activity), provided that he supports his request with the information and data supporting it, in accordance with the conditions specified by the regulation.
Article VIII:
The Minister or his delegate shall issue a decision to classify the contractor in the field (or fields) or activity (or activities), and the grade he deserves, based on the available information and data, and shall issue a certificate accordingly within the period specified in the regulation.
Article IX:
If two or more contractors join hands to execute a project, each of them must be classified in the field of executing the project and at least one of them must be classified in the field and grade required to execute it, and the remaining contractors must be classified at the same grade required to execute the project or only one grade lower.
Article X:
If there is any legal change in the contractor's status that affects his classification, he must apply to amend the classification certificate in accordance with the cases specified by the regulation.
Article XI:
A contractor licensed to work in accordance with the Foreign Investment Law shall be classified according to the procedures applicable to the classification of Saudi contractors. The Council of Ministers may exempt it in accordance with the regulations it establishes for that purpose.
Article XII:
The Ministry shall charge a financial remuneration for the services it provides in accordance with the provisions of the Law, provided that these services and the financial remuneration for them shall be determined in agreement with the Ministry of Finance.
Article XIII:
Government entities, bodies, institutions and agencies with public legal personality shall provide the Ministry with the information, data and notes it requires about contractors for classification purposes, as well as the projects executed by contractors or under implementation, as specified by the regulation.
Article XIV:
Inspectors - to be named by a decision issued by the Minister - shall collectively or individually identify violations of the provisions of the Law and the Regulations, record them, access records and information, and obtain copies of the necessary documents. The rules and procedures of their work shall be specified in the regulation.
Article XV:
1. Without prejudice to any more severe penalty prescribed by any other law, anyone who violates the provisions of the Law or the Regulations shall be punished by one or more of the following penalties:
A- Downgrading.
B- Suspending the rating and preventing its renewal for a period not exceeding (five) years.
C. Declassification.
2- The Minister shall, by decision, issue a classification table for violations and determine the penalties within the limits stipulated in the Law, taking into account the nature and gravity of each violation, and the aggravating and mitigating circumstances.
Article XVI:
1- A committee (or more) consisting of at least three members, one of whom must be a legal or statutory specialist, shall consider and adjudicate the contractors' objections to classification decisions and violations of the provisions of the Law and the Regulations, and approve the penalties stipulated in Article (Fifteen) of the Law.
2. The committee stipulated in paragraph (1) of this Article shall be formed by a decision of the Minister for a renewable period of three years. The decision shall specify who shall chair the committee, who shall be a specialist in Sharia law or regulations, and its decisions shall be issued by a majority, and its decisions shall be reasoned.
3- The regulation shall specify the rules and procedures for the work of the committee stipulated in paragraph (1) of this Article and the support team, and the remuneration of their members.
4- The decision of the committee stipulated in paragraph (1) of this Article may be appealed to the Administrative Court.
Article XVII:
The Minister shall issue the regulations within (ninety) days from the date of publication of the law in the Official Gazette.
Article XVIII:
The Law shall be published in the Official Gazette and shall enter into force ninety days after the date of its publication.
Article XIX:
The Law replaces the Contractor Classification Law issued by Royal Decree No. (M\/18) dated 20\/3\/1427H, and repeals all conflicting provisions
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