1.  Republic Act No. 9184

2.  Background o Harmonization Alignment with International Best Practices o Application of Domestic Preference AO 227, Flag Law o Learning from Experience Concerns raised by procuring entities, bidders and observers

3.  Scope and Application (Sec. 4) o All domestically-funded procurement activities o All foreign-funded procurement activities, unless otherwise stated in the treaty, international or executive agreement But procurement funded through foreign grants are excluded o 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 o IRR now includes definition of treaty, international or executive agreements, foreign loans & grants

4.  Procurement Planning (Sec. 7) End UserBudget OfficeBAC Sec / BAC Approving Authority Prepare PPMP Evaluate PPMP and include in budget proposal Review and consolidate into APP Approve GAA/ Corporate Budget/ Ordinance Revise PPMP Finalize procurement mode HOPE or 2 nd in rank approves APP 1 2

5.  Bids and Awards Committee (Sec. 11) o Alternate BAC member allowed: Same qualification and term as principal Attend meetings and receive honoraria Accountability limited to their acts and decisions o Honoraria for BAC Secretariat subject to DBM Rules

6.  Observers (Sec. 13) o Allows observers from cooperatives o Requires 3 days’ prior written notice for invitation of observers o Requires observers to inhibit in case of actual or potential conflict of interest o Access to documents upon signing of a confidentiality agreement

7.  Advertising of Invitation to Bid (Sec. 21) o IAEB to Invitation to Bid (goods and infra) or Request for Expression of Interest (consulting) o Includes posting in the website prescribed by the foreign government/foreign or international financing institution, for foreign-funded procurement

8.  Pre-Bid Conference (Sec. 22) o May be extended up to 30 cd before bid submission Method, nature and complexity of contract International participation is more advantageous o Option to limit participation in pre-bid conference to those bidders who purchased bid documents

9.  Eligibility Requirements (Secs. 23 & 24) o Reduced to 5-6 documents o Others to be submitted during – Post-qualification Prior to Award of Contract

10.  Eligibility Requirements (Secs. 23 & 24) GOODSINFRASTRUCTURECONSULTING Class A Documents 1.DTI/SEC/CDA Registration 2.Mayor’s permit 3.Statement of ongoing & completed contracts 4.Audited financial statement 5.NFCC or CLC 6.PCAB license and registration 5.Statement on nationality and professional eligibility (includes CV) Class B Document JVA or notarized statement from the partners that they will enter into joint venture if awarded the contract

11.  Eligibility Requirements (Secs. 23-24) o Class “A” Documents Legal, Technical, and Financial o Class “B” Documents: 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 o If foreign bidder – Submit equivalent documents issued by country Accompanied by English translation certified by appropriate embassy or consulate in the Philippines

12.  Eligibility Requirements (Secs. 23 & 24) o Registry System Manual or electronic Class “A” documents (legal, technical, & financial) Maintained current and updated Certification in lieu of eligibility documents o Letter of Intent/Application for eligibility or updates Deadline stated in bid documents Not later than date of bid submission Documents submitted after shall not be considered

13.  Eligibility Criteria (Secs. 23 & 24) o Defines foreign eligible bidders o Government corporate entities eligible only if – Legally and financially autonomous Operate under commercial law Not dependent agencies of GOP or procuring entity

14. General RuleExceptionsThen require the ff.: 1.Expendable SuppliesExpendable Supplies 25% of the ABC 2.Services and Non- expendable SuppliesNon- 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; or 2.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  Eligibility Criteria (Goods - Single Largest Completed Contract)

15.  Expendable Supplies (Sec. 5 [m])  Articles normally consumed within 1 year or value is substantially decreased after 1 year  Examples: medicines, stationery, fuel, and spare parts  Non-expendable Supplies (Sec. 5 [w])  Not consumed in use  Serviceable life more than 1 year  Examples: furniture, fixtures, transport, and other equipment

16.  Eligibility Criteria (Infra - Single Largest Completed Contract) o Track record: 50% of the ABC o For foreign funded procurement, a different track record may be agreed upon

17.  Submission and Receipt of Bids (Sec. 25) o Two-envelope system 1 st Envelope – Eligibility Documents and Technical Proposal 2 nd Envelope – Financial Proposal o Date of submission should not be later than the following period from the last day of posting of the Invitation to Bid CategoryMaximum Period (cd) Goods45 Infra (50M and below)50 Infra (above 50M)65 Consulting75

18.  Submission and Receipt of Bids (Sec. 25) o Project related statements lumped into one document (Omnibus Sworn Statement) o Harmonize with blacklists of recognized IFIs

19.  Bid and Performance Securities (Secs. 27 & 39) o Bidder has option to choose among acceptable forms of security o Procuring entity may not limit options available to bidders o In general, bank issued securities must be issued by a universal or commercial bank However, in biddings conducted by LGUs, securities may be issued by banks certified by BSP as authorized to issue said instruments o Surety Bonds must be accompanied by certification from Insurance Commission that issuer is authorized to issue such security

20.  Bid and Performance Securities (Secs. 27 & 39) FORM OF SECURITY AMOUNT Bid Security (% = ABC) Performance Security (% = Contract Price) a)Cash or cashier’s/manager’s check 2% 5% (Goods & Consulting) 10% (Infrastructure) b)Bank guarantee/draft or Irrevocable LC c)Surety bond callable upon demand 5%30% d)Combination of the foregoing ProportionProportionate to share of form with respect to the total amount of security

21.  Sample Computation Cash (60%)Surety Bond (40%) ABC1,000,000 % Required x.02 x.05 20,00050,000 Share of form x.60 x.40 Amount12,00020,000 Total32,000

22.  Ceiling for Bid Prices (Sec. 31) o Enumerated conditions for application of ABC as ceiling for foreign-funded procurement o Definition of ABC includes estimated contract cost in the case of foreign-funded procurement [Sec. 5(b)]

23.  Failure of Bidding (Sec. 35) o Mandatory review after each failed bidding o Based on findings Revise terms, conditions, specifications Adjust ABC, subject to required approvals o Rebid Invite previous bidders

24.  Post-qualification (Sec. 34) o Submission of the ff 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.

25.  Notice of Award (Sec. 37) o 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

26.  Notice to Proceed (Sec. 37.4) o Issued to the successful bidder together with the copy of the approved contract within 3 cd from date of approval o For infrastructure projects with ABC of 50M and below, the maximum period is 2 cd o Contract effectivity date should be provided in the NTP, which should not be later than 7 cd from its issuance o BAC Secretariat should post a copy of the NTP and the approved contract in the PhilGEPS or PE’s website within 15 cd from issuance of NTP

27.  Disclosure of Relations (Sec. 47) o Relatives within the third civil degree of the following shall be disqualified: Head of the procuring entity Members of the BAC, Secretariat and TWG Head of the end-user unit or project management office Project consultants

28. TypePeriodForm Percentage of Contract Price Expendable3 mos., unless earlier consumed Special bank guarantee or Retention money 10% Non- expendable 1 year ServiceNone Infrastructure1 yearCash/LC5% Bank guarantee10% Surety bond30%  Warranty Security (Sec. 62)

29.  Alternative Methods of Procurement (Secs. 48 to 53) o Alignment with international best practices Recognized additional instances of Negotiated Procurement (e.g., procurement from UN Agencies, Community Participation) o Address concerns raised by stakeholders Clearer rules on negotiated procurement due to 2-failed bidding Increase in thresholds Lease of venue

30.  Effectivity o 2 September 2009 30 days from publication in the Official Gazette (3 August 2009)  Transitory o When was Invitation to Bid/Request for Expression of Interest published?

31.  Comments? Questions? Dennis Lorne S. Nacario Deputy Executive Director G OVERNMENT P ROCUREMENT P OLICY B OARD – T ECHNICAL S UPPORT O FFICE Address:Unit 2506 Raffles Corporate Center, F. Ortigas Jr. Road, Ortigas Center, Pasig City Telephone: (+632) 9006741 to 44 Website:www.gppb.gov.ph Email: gppb@gppb.gov.ph