02 In practice, the biggest mistake in identifying “interest” is to understand “interest” and “related relationship” equally.
In understanding this article, there is little dispute about the determination of the “subordination” specified therein, but there are many views on the determination of the “interest”.
The second paragraph of Article 34 of the Construction Law stipulates that “the project supervision unit shall carry out the supervision task objectively and impartially according to the entrustment of the construction unit.” It can be seen from the relationship between the supervision unit and the construction unit, as well as the requirements for the supervision unit to perform the supervision task, that the “interest relationship” referred to in Paragraph 2 of Article 34 of the Construction Law should be the relationship that “will affect the supervision unit to perform the supervision task objectively and impartially”.
At the same time, Article 3 of the Accounting Standards for Business Enterprises No.
This article mainly analyzes the main factors that should be considered in the identification of “interest” from the two dimensions of legislation and practice.
Affiliated relationship, as defined in Article 216 of the Company Law, refers to the relationship between the controlling shareholders, actual controllers, directors, supervisors and senior managers of the Company and the enterprises directly or indirectly controlled by them, as well as other relationships that may lead to the transfer of the Company’s interests.
36 – Disclosure of Related Parties defines the relationship between enterprises as “a related party if one party controls, jointly controls or exerts significant influence on the other party, and two or more parties are under the control, joint control or significant influence of one party.” Therefore, according to the current law, it is possible to accurately define whether an association exists between enterprises.
National Development and Reform Commission, Ministry of Industry and Information Technology Article 1.4.2 of the “Instructions to Bidders” in the concise standard construction bidding documents of the People’s Republic of China issued by the Ministry of Finance, etc.
Paragraph 3 of Article 34 of the Construction Law stipulates that the project supervision unit and the contractor of the project under supervision shall not have any affiliation or other interests, which is determined by the relationship between the supervision unit and the construction unit.
03 How to judge whether it constitutes an “interest”? In the absence of laws and regulations to define the interest, the “associated relationship” cannot be cited to understand the “interest”, so how to understand the “interest” stipulated in Article 34 of the Construction Law becomes a more difficult problem, The author analyzes it from the following aspects: (1) The legislative purpose of Paragraph 3, Article 34 of the Construction Law – the basic professional standards that the project supervision unit should follow in the implementation of supervision activities, and the objective and notarized implementation of supervision tasks.
stipulates that “the bidder shall not have one of the following circumstances:……
However, Article 34 of the Construction Law does not use the expression of “association”, but uses the concept of “interest”.
(6) the same legal representative as the supervisor or agent of the bidding project or the bidding agency; (7) mutual holding or participation with the supervisor or agent of the bidding project or the bidding agency; (8) Mutual employment or work with the supervisor or agent of the bidding project or the bidding agency; ” With reference to the Bidding Document, it can be seen that at least when the supervision unit has the first three relationships with the construction unit, it is very easy to be identified as constituting an “interest relationship”, which is likely to affect the supervision unit’s objective and fair implementation of the supervision task..
It can be seen that “interest relationship” and “related relationship” cannot be confused at the legal level.
Article 3 of the Provisions on Engineering Construction Supervision (which has expired) stipulates that “the engineering construction supervision referred to in these Provisions refers to the supervision and management of engineering construction carried out by the supervision unit under the entrustment of the project legal person and in accordance with the engineering project construction documents approved by the state, laws and regulations related to engineering construction, engineering construction supervision contracts and other engineering construction contracts.” It can be seen that the supervision unit and the construction unit are actually the relationship between supervision and being supervised, management and being managed.
This article is not only important in determining the effectiveness of the Construction Project Entrusted Supervision Contract, but also important for determining the bid winning candidates of the supervision unit.
（2） The qualification requirements set for the construction bidder in the model text of the Bidding Document – there is no shareholding or employment relationship.
01 The emergence of “interest relationship” Article 34, paragraph 3 of the Construction Law stipulates that “the project supervision unit shall not have any subordinate relationship or other interest relationship with the contractor of the project under supervision and the supplier of building materials, building components and equipment.” Article 4 (4) of the Guiding Opinions of the Ministry of Construction on Fostering and Developing EPC and Project Management Enterprises “A general contracting enterprise may accept the entrustment of the owner to undertake the project management business in accordance with the contract, but it shall not undertake the general contracting and project management business at the same time on the same project, nor shall it have any affiliation or other interest relationship with the other party undertaking the general contracting or project management business.” Paragraph 1 of Article 34 of the Regulations on the Implementation of the Bidding Law stipulates that “legal persons, other organizations or individuals who have an interest in the tenderee and may affect the fairness of bidding shall not participate in bidding.” In addition to the foregoing provisions, in the field of construction projects, the term “interest” also appears in other departmental rules or local regulations, and local government rules, but there are no clear laws and regulations that clearly define the meaning of “interest” and the circumstances that can be identified as constituting “interest”, resulting in more disputes over whether the two companies constitute “interest” in practice.
Paragraph 3 of Article 34 of the Construction Law clearly stipulates the prohibited relationship between the supervision unit and the construction unit.
