How does government procurement law affect bidding price competition in Taiwan?

To conform with the requirements of the international Government Procurement Agreement and the regulations of the World Trade Organization, the Taiwan Government Procurement Law (GPL) was enacted in 1999. The main points of the agreement and barriers affecting price competition are illustrated. Award prices for subcentral government civil engineering projects are compared before and after the law went into effect. The result suggests that civil engineering prices have decreased significantly since the introduction of the law, that the transparent and open-tendering system enforced by the law has led to an increase in competition, and that tender prices decreased during the initial period. During the same period, construction companies' average rate of profit on sales moved from positive to negative. It is concluded that severe bidding competition is expected after Taiwan completes accession to the agreement.