Revised Implementing Rules and Regulations

Republic Act No. 9184

1

IRR Revisions

Background Harmonization

Alignment with International Best Practices

Application of Domestic Preference AO 227, Flag Law

Learning from Experience Concerns raised by procuring entities, bidders

and observers

2

IRR Revisions

Scope and Application (Sec. 4)

All domestically-funded procurement activities

All foreign-funded procurement activities, unless otherwise stated in the treaty, international or executive agreement But procurement funded thru foreign grants are

excluded3

IRR Revisions

Scope and Application (Sec. 4)

GOP negotiating panels shall: Adopt as default position, use of the IRR or

selection thru competitive bidding Explain in writing if treaty, international or

executive agreement states otherwise

IRR now includes definition of treaty, international or executive agreements, foreign loans & grants

4

IRR Revisions

Procurement Planning (Sec. 7)

End-user units shall prepare their PPMP which shall be submitted to the budget office

Budget office to evaluate and include in budget proposal for approval of HOPE

Upon approval, budget office shall furnish a copy of budget proposal and PPMP to BAC Secretariat

BAC Secretariat shall review and consolidate into the proposed APP

5

IRR Revisions

Procurement Planning (Sec. 7)

Upon approval of GAA/corporate budget/ordinance, end-user shall revise/adjust PPMP and submit to BAC Secretariat

BAC shall finalize modes of procurement under the proposed APP

APP shall be approved by HOPE or 2nd ranking official designated by HOPE

6

IRR Revisions

Bids and Awards Committee (Sec. 11)

Alternate BAC member allowed: Same qualification and term as principal Attend meetings and receive honoraria Accountability limited to their acts and decisions

Honoraria for BAC Secretariat subject to DBM Rules

7

IRR Revisions

Observers (Sec. 13)

Allows observers from cooperatives

Requires 3 days prior written notice for invitation of observers

Requires observers to inhibit in case of actual or potential conflict of interest

Access to documents upon signing of a confidentiality agreement

8

IRR Revisions

Advertising of Invitation to Bid (Sec. 21)

IAEB to Invitation to Bid (goods and infra) or Request for Expression of Interest (consulting)

Includes posting in the website prescribed by the foreign government/foreign or international financing institution, for foreign-funded procurement

9

IRR Revisions

Pre-Bid Conference (Sec. 22)

May be extended at least 30 cd before bid submission Method, nature and complexity of contract International participation is more

advantageous

At the option of procuring entity, only bidders who purchased bid documents are allowed to attend or ask questions

10

IRR Revisions

Eligibility Requirements (Secs. 23 & 24)

Reduced to 5-6 documents

Others to be submitted during – Post-qualification Prior to Award of Contract

11

IRR Revisions: Eligibility Requirements – Goods and Infra (Sec.

23)

Class “A” Legal Documents

DTI / SEC / CDA Registration Mayor’s permit for principal place of business

Technical Documents Statement of all on-going and completed contracts PCAB license and registration (Infra only)

Unless otherwise stated in treaty or international or executive agreement

12

IRR Revisions:

Eligibility Requirements – Goods and Infra (Sec. 23)

Class “A”

Financial Documents Audited Financial Statement received by the BIR NFCC computation or Credit Line Commitment from a

universal or commercial bank

For LGUs, other banks authorized by BSP to issue said instrument

13

IRR Revisions

Eligibility Requirements – Goods and Infra (Secs. 23-24)

Class “B” Documents: If Joint Venture - JVA If no JVA, sworn statements by each partner that they

will enter into and abide by provisions of the JVA if awarded the contract

14

IRR Revisions:

Eligibility Criteria – Goods (Sec. 23) Legal Eligibility - Goods

General rule: 60% Filipino Foreign bidders eligible allowed –

If stated in treaty, international or executive agreement National of a country offering reciprocity rights to

Filipinos Goods not available from local suppliers To prevent situations that defeat competition or

restrain trade

15

IRR Revisions:

Eligibility Criteria (Sec. 23)

Legal Eligibility - Infra General rule: 75% Filipino (LOI 630) Foreign contractors allowed if stated in treaty or

international or executive agreement If joint venture, less than 75% is allowed if -

Not less than 25% Filipino Structures to be built require techniques not possessed

by 75% Filipinos

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IRR Revisions Eligibility Requirements (Sec. 23)

If foreign bidder –

Submit equivalent documents issued by country

Accompanied by English translation certified by appropriate embassy or consulate in the Philippines

17

IRR Revisions Eligibility Criteria (Sec. 23)

Technical Eligibility (Goods) - Single Largest Contract

General Rule Exceptions Then require the ff.:

1.Expendable Supplies

• 25% of the ABC

2.Services and Non-expendable Supplies

• 50% of the ABC

If, at the outset and after market research, applying the general rule will likely result to:1.Failure of bidding; or2.Monopoly

a) At least 2 similar contracts aggregate amount at least equivalent to required percentage; and

b) Largest of the similar contracts amounts to at least 50% of required percentage 18

IRR Revisions

Eligibility Criteria (Sec. 23)

Technical Eligibility (Infra) Track Record: Single Largest Contract

Retain at 50% But within a period of ten years

For foreign funded procurement, a different track record may be agreed upon

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IRR Revisions

Eligibility Criteria (Sec. 23)

Financial Eligibility (Goods and Infra) NFCC at least equal to ABC Credit Line Certificate at least equal to 10% of

ABC Issued by Universal or Commercial Bank For LGUs: other banks certified by BSP as authorized

to issued said CLC Option to submit cash deposit certificate deleted

22

IRR Revisions

Submission and Receipt of Bids (Sec. 25)

Two-envelope system (Eligibility Documents included in Technical Proposal)

Documentary requirements trimmed down

Project related statements lumped into one document

24

IRR Revisions

Submission and Receipt of Bids (Sec. 25)

First Envelope Eligibility requirements Bid security Technical specifications (Goods)/

Project requirements (Infra) Omnibus sworn statement

25

IRR Revisions:

Submission and Receipt of Bids (Sec. 25)

Second Envelope Financial information/documents specified in the

Philippine Bidding Documents

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IRR Revisions Bid & Performance Securities (Secs. 27 & 39)

Deleted certified check from acceptable forms

In general, bank issued securities must be issued by a universal/commercial bank

However, in biddings conducted by LGUs, securities may be issued by banks certified by BSP as authorized to issue said instruments

Surety Bonds must be accompanied by certification from Insurance Commission that issuer is authorized to issue such security

IRR RevisionsForm of Bid and

Performance SecurityAmt of Bid Security

(% = ABC)Amt of Performance

Security (% = Contract Price)

a)Cash, cashier’s/manager’s check, bank guarantee/ draft

2%5% (Goods & Consulting)

10% (Infra)b)Irrevocable LC

c)Surety bond callable upon demand

5% 30%

d)Combination of the foregoing

Proportionate to share of form with respect to

the total amount of security

Proportionate to share of form with respect to the total amount of security

IRR Revisions

Bid & Performance Securities (Secs. 27 & 39)

Bidder has option to choose among acceptable forms of security

Procuring entity may not limit options available to bidders

IRR Revisions

Ceiling for Bid Prices (Sec. 31)

Enumerated conditions for application of ABC as ceiling for foreign-funded procurement

Definition of ABC includes estimated contract cost in the case of foreign-funded procurement [Sec. 5(b)]

IRR Revisions

No Contact Rule (Sec. 32)

BAC, thru Secretariat, may request for clarification of bid as long as it is in writing

31

IRR Revisions

Post-qualification (Sec. 34)

3 days from notice of lowest calculated/highest rated bid, submit the following documents: Tax clearance Latest income and business tax returns Certificate of PhilGEPS registration Other appropriate licenses and permits required by

law and stated in the Bidding Documents.

32

IRR Revisions

Notice of Award (Sec. 37)

Conditioned on the following: If joint venture, submission of JVA If foreign-funded and stated in treaty, international or

executive agreement, PCAB License Posting of Performance Security Signing of Contract If required, approvals by higher authority

33

IRR Revisions

Domestic and Foreign Goods (Sec. 43)

Provides procedures in determining entitlement to domestic preference

Applies only where the lowest bid has a foreign component (foreign bid/entity) and the next lowest bid has a domestic component (domestic bidder/entity)

34

IRR Revisions

Domestic and Foreign Goods (Sec. 43)

Requires procuring entity to give preference to domestic entities and to materials and supplies produced, made, and manufactured in the Philippines (domestic bidder).

Domestic entities can only claim preference if certified by SEC/DTI/CDA

Domestic bidder can only claim preference if certified by DTI

35

IRR Revisions

Warranty Security – Goods (Sec. 62)

Expendable Supplies – 3 months, unless consumed earlier

Non-expendable Supplies – 1 year

39

IRR Revisions

Warranty Security – Infra (Sec. 62) Warranty period vs. Warranty security period Warranty security period reduced to 1 year Liability per stage

From project construction to final acceptance From project completion to final acceptance From final acceptance to warranty security period

40

IRR Revisions

Alternative Methods of Procurement (Secs. 48 to 53)

Alignment with international best practices Recognized additional instances of Negotiated

Procurement (e.g., procurement from UN Agencies, Community Participation)

Increase in shopping/small value procurement thresholds

Higher Threshold Amount for Unforeseen Contingencies

NGAs, GOCCs, GFIs, SUCs – P100,000

LGUs –

In the case of Barangays, the maximum amount is P50,000

Shopping & Small Value Procurement

ClassificationMaximum Amount (in Philippine Pesos)

Province City Municipality

1st Class 100,000 100,000 50,000

2nd Class 100,000 100,000 50,000

3rd Class 100,000 80,000 50,000

4th Class 80,000 60,000 50,000

5th Class 60,000 50,000 50,000

6th Class 50,000 50,000 50,000

Higher Threshold Amount for Regular Office Supplies and Small Value Procurement

NGAs, GOCCs, GFIs, SUCs – P500,000

LGUs –

In the case of Barangays, the maximum amount is P50,000

Shopping & Small Value Procurement

ClassificationMaximum Amount (in Philippine Pesos)

Province City Municipality

1st Class 500,000 500,000 100,000

2nd Class 500,000 500,000 100,000

3rd Class 500,000 400,000 100,000

4th Class 400,000 300,000 50,000

5th Class 300,000 200,000 50,000

6th Class 200,000 100,000 50,000

IRR Revisions

Alternative Methods of Procurement (Secs. 48 to 53)

Address concerns raised by stakeholders Clearer rules on negotiated procurement due to 2-

failed bidding Increase in thresholds Lease of venue

IRR Revisions

Failure of Bidding (Sec. 35)

Mandatory review after each failed bidding

Based on findings Revise terms, conditions, specifications Adjust ABC, subject to required approvals

Rebid

IRR Revisions

Two-Failed Bidding (Sec. 53.1)

Mandatory review and agree on the following: Minimum technical specifications ABC adjusted only up to 20%

Invite sufficient number to ensure competition

Information communicated on an equal basis

IRR Revisions

Two-Failed Bidding (Sec. 53.1, cont.)

Simultaneous negotiations

Submission of best and final offer on a specified date

IRR Revisions

Two-Failed Bidding (Sec. 53.1, cont.)

Successful offer to be selected: Meet minimum technical specifications Does not exceed ABC

Observers shall be invited in all stages

IRR Revisions

Effectivity 2 September 2009

30 days from publication in the Official Gazette (3 August 2009)

Transitory When was Invitation to Bid/Request for

Expression of Interest published?

Thank you

Comments, questions?

GPPB On Line Forum http://gppb.topicsolutions.net/

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