KUALA LUMPUR (Aug 25): The Government Procurement Bill 2025, which aims to standardise and close the loopholes in government procurement processes, was tabled for its first reading in the Dewan Rakyat on Monday.

The bill seeks to strengthen governance and transparency in government procurement and stop leakages through the cracks under the different processes practised in different levels of the government currently.

Key legislations will cement the approval thresholds for procurement and the approving authority, cover all government agencies including statutory bodies, and suspend problematic contractors and partners from participating in government procurement.

It also criminalises the provision of misleading, false and materially incomplete information in procurement processes, with fines up to RM500,000 and up to three years' imprisonment.

The bill applies procurement thresholds to total procurement value over a year, potentially closing the loophole used when contractors break down jobs into smaller portions to bypass approval from higher levels of authority.

It mandates compulsory registration by participating contractors and penalises undisclosed interest by contractors in another entity.

This includes barred registration that could be extended to identified individuals, as well as company directors, senior management, beneficial owners, partners in partnerships, and directors or managers of cooperative societies.

However, a clause allows a federal minister, state chief minister or menteri besar to allow certain exemptions via gazette.

This includes exempting statutory bodies, local authorities or other government entities from having to follow the proposed act.

The bill also empowers the finance minister, in consultation with the registrar, to exempt certain individuals or groups from the registration requirement under certain conditions.

Deputy Finance Minister Lim Hui Ying presented the bill, with its second reading scheduled for the current parliamentary session.

The approval thresholds proposed are largely in line with existing government practices.

Contracts exceeding RM50 million for goods and services, or RM100 million for works, require approval from the finance minister at the federal level, or from the chief minister or an authority designated by the state government at the state level.

For contracts valued between RM500,000 and RM50 million for goods and services, and between RM500,000 and RM100 million for works, the procurement board must grant approval.

Contracts ranging from RM50,000 to RM500,000 are handled by a designated committee, while smaller contracts below RM50,000 require approval from the controlling officer.

There is also a clause that allows for a suspension of up to two years for breach of procurement laws, being convicted of corruption locally or abroad, being found guilty of anti-competition practices, being in violation of registration conditions, or providing false information.

In states, suspension or revocation may occur on the recommendation of the state financial authority for proven non-compliance.

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