Japanese competitive bid entry qualifications: an examination of public works

Abstract

This study summarises the independent competitive bid entry qualifications examination of public works in Japan. Contractors who wish to undertake public works must be scored by a nationwide standardised objective examination called Keiei Jikou Sinsa or Keisin in Japanese. They must be graded on the basis of the score of not only the objective examination but also an independent assessment by the orderers. This study explains the calculation of Keisin using a virtual contractor. This study also discusses the effectiveness of Keisin and the efficiency of the grading system. Keisin is used not only for bid entry qualifications in public works, but also to evaluate construction companies by the orderers of private works and financial institutions. Additionally, the Ministry of Land, Infrastructure, Transport and Tourism uses Keisin to promote subscription to social insurance and thus contribute to improve workers’ lifelong protection. The Japanese grading system in public bids underpins competitive bidding among firms of similar scale and capability, while providing opportunities for SMEs in every industry class to obtain construction contracts as prime contractors.