Revised IRR RA 9184 Presentation

10/30/2009
Revised Implementing
Rules and Regulations
Republic Act No. 9184

1
IRR Revisions
z
Background
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Harmonization
z
Application of Domestic Preference

z
Alignment with International Best Practices
AO 227, Flag Law
Learning from Experience

z
Concerns raised by procuring entities, bidders and

observers
2
10/30/2009
IRR Revisions
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Scope and Application (Sec. 4)

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All domestically-funded procurement activities
All foreign-funded procurement activities, unless

otherwise stated in the treatyy or international or
executive agreement
z
But procurement funded through foreign grants are

excluded
3
IRR Revisions
z
Scope and Application (Sec. 4)

z
GOP negotiating panels shall:

z
z
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, and foreign loans and
grants
4
10/30/2009
IRR Revisions
z
Procurement Planning (Sec. 7)

z
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,
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
z
Procurement Planning (Sec. 7)

z
Upon approval of GAA/corporate budget/ordinance, enduser 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
10/30/2009
IRR Revisions
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Bids and Awards Committee (Sec. 11)

z
Alternate BAC member allowed:

z
z
z
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
z
Observers (Sec. 13)

z
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
10/30/2009
IRR Revisions
z
Advertising of Invitation to Bid (Sec. 21)

z
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
z
Pre-Bid Conference (Sec. 22)

z
May be extended at least 30 cd before bid

submission
z
z
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
10/30/2009
IRR Revisions
z
Eligibility Requirements (Secs. 23 & 24)

z
Reduced to 5-6 documents
Others to be submitted during

z Post-qualification
z Prior
P i tto Award
A
d off C
Contract
t t
11
IRR Revisions:
z
Eligibility Requirements Goods and Infra (Sec. 23)

Class A
z Legal Documents
z DTI / SEC / CDA Registration
z Mayors permit for principal place of business
z
Technical Documents
z Statement of all on-going and completed contracts
z PCAB license and registration (Infra only)
Unless otherwise stated in treaty or international or executive

agreement
12
10/30/2009
IRR Revisions:
z
Eligibility Requirements Goods and Infra (Sec. 23)

Class A
z
Financial Documents
z Audited Financial Statement received by the BIR
z NFCC computation or Credit Line Commitment from a
universal or commercial bank
For LGUs,
LGUs other banks authorized by BSP to issue said instrument
13
IRR Revisions
z
Eligibility Requirements Goods and Infra

(S
(Secs.
23-24)
23 24)
z
Class B Documents: If Joint Venture z JVA

z 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
10/30/2009
IRR Revisions:
z
Eligibility Criteria Goods (Sec. 23)

z
Legal Eligibility - Goods

z
z
General rule: 60% Filipino

Foreign bidders eligible allowed
If stated in treaty or 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:
z
Eligibility Criteria (Sec. 23)

z
Legal Eligibility - Infra

z
z
General rule: 75% Filipino (LOI 630)

Foreign contractors allowed if stated in treaty or
international or executive agreement
If joint venture,
venture less than 75% is allowed if
Structures to be built require techniques not possessed by

75% Filipinos
Not less than 25% Filipino
16
10/30/2009
IRR Revisions
z
Eligibility Requirements (Sec. 23)

z
If foreign bidder
z
Submit equivalent documents issued by country
Accompanied by English translation certified by appropriate

embassy or consulate in the Philippines
17
IRR Revisions
z

z
Technical Eligibility (Goods) - Single Largest Contract

General Rule
1. Expendable
Supplies
25% of the ABC
2. Services and NonNon

expendable
Supplies
50% of the ABC
Exceptions
Then require the ff.:
If, at the outset and

a) At least 2 similar
after market research,
contracts
applying the general
aggregate amount
rule will likely result to:
at least equivalent
t required
to
i d
1.Failure of bidding; or
percentage; and
b) Largest of the
2.Monopoly
similar contracts
amounts to at least
50% of required
percentage
18
10/30/2009
IRR Revisions
z

z
Expendable Supplies (Sec. 5 [m])

z
Articles normally consumed within 1 year or value is

substantially decreased after 1 year
Examples: medicines, stationery, fuel, and spare
parts
19
IRR Revisions
z

z
Non-expendable Supplies (Sec. 5 [w])

z
z
z
Not consumed in use

Serviceable life more than 1 year
Examples: furniture, fixtures, transport, and other
equipment
20
10
10/30/2009
IRR Revisions
z

z
Technical Eligibility (Infra)

z
Track Record: Single Largest Contract
Retain at 50%
But within a period of ten years
For foreign funded procurement

procurement, a different track
record may be agreed upon
21
IRR Revisions
z

z
Financial Eligibility (Goods and Infra)

z
z
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
11
10/30/2009
IRR Revisions
z
Eligibility Criteria (Secs. 23 & 24)

z
Government corporate entities eligible only if

z
z
z
Legally and financially autonomous

Operate under commercial law
Not dependent agencies of GOP or procuring entity
23
IRR Revisions
z
Submission and Receipt of Bids (Sec. 25)

z
Two-envelope system (Eligibility Documents

included in Technical Proposal)
Documentary requirements trimmed down
Project related statements lumped into one

document
24
12
10/30/2009
IRR Revisions
z

z
First Envelope
z
z
z
Eligibility requirements
Bid security
Technical specifications (Goods)/
Project requirements (Infra)
Omnibus sworn statement
25
IRR Revisions:
z

z
Second Envelope
z
Financial information/documents specified in the

Philippine Bidding Documents
26
13
10/30/2009
IRR Revisions
z
Bid & Performance Securities (Secs. 27 & 39)

z
Deleted certified check from acceptable forms
In general, bank issued securities must be issued

by a universal/commercial bank
z
However, in biddings conducted by LGUs, securities

may be issued by banks certified by BSP as
authorized
h
d to issue said
d instruments
Surety Bonds must be accompanied by certification from

Insurance Commission that issuer is authorized to issue
such security
IRR Revisions
Form of Bid and
Performance Security
a) Cash or
cashiers/managers
check
Amt of Bid Security

(% = ABC)
2%
5% (Goods & Consulting)

10% (Infra)
5%
30%
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
b) Bank guarantee/draft or
Irrevocable LC
c) Surety bond callable
upon demand
d) Combination off the
foregoing
Amt of Performance
Security
(% = Contract Price)
14
10/30/2009
IRR Revisions
z
Bid & Performance Securities (Secs. 27 & 39)

z
Bidder has option to choose among acceptable

forms of security
Procuring entity may not limit options available
to bidders
IRR Revisions
z
Ceiling for Bid Prices (Sec. 31)

z
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)]
15
10/30/2009
IRR Revisions
z
No Contact Rule (Sec. 32)

z
BAC, thru Secretariat, may request for clarification

of bid as long as it is in writing
31
IRR Revisions
z
Post-qualification (Sec. 34)

z
3 days from notice of lowest calculated/highest

rated bid, submit the following documents:
z
z
z
z
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
16
10/30/2009
IRR Revisions
z
Failure of Bidding (Sec. 35)

z
Mandatory review after each failed bidding
Based on findings
z
z
Revise terms, conditions, specifications

Adjust ABC, subject to required approvals
Rebid
IRR Revisions
z
Notice of Award (Sec. 37)

z
Conditioned on the following:

z
z
z
z
z
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
34
17
10/30/2009
IRR Revisions
z
Domestic and Foreign Goods (Sec. 43)

z
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)
35
IRR Revisions
z

z
Requires procuring entity to give preference to

domestic entities and to materials and supplies
produced, made, and manufactured in the
Philippines (domestic bidder).
z
Domestic entities can only claim preference if certified

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

by DTI
36
18
10/30/2009
IRR Revisions
z

z
Domestic entities (Sec. 5 [k])

z
z
75% Filipino
Habitually established in business and engaged in the
manufacture or sale of product to be bid
In existence for at least 5 consecutive years
Domestic entities can only claim preference if certified
by SEC/DTI/CDA
37
IRR Revisions
z

z
Domestic bidder (Sec. 5 [j])

z
z
Any person or entity

Offering articles/materials/supplies
If unmanufactured, grown or produced in the Philippines

If manufactured,
manufactured substantially from those grown or produced
in the Philippines
Domestic bidder can only claim preference if certified

by DTI
38
19
10/30/2009
SAMPLE APPLICATION OF PREFERENCE
Sample Computation
Lowest Calculated Bid
Next Lowest Calculated

Bid
Foreign Bidder
Domestic Bidder/Entity
Bid
2,653,360.00
% Preference
3,009,492.00
15%
398,004.00
+ 2,653,360.00
Bid as iincreased
d
Result
3 051 364 00
3,051,364.00
3 009 492 00
3,009,492.00
Award to Domestic Bidder/Entity at 2,653,360.00, or

Award to Foreign Bidder if Domestic Bidder/Entity refuses
39
IRR Revisions
z
Warranty Security Goods (Sec. 62)

z
Expendable Supplies 3 months, unless

consumed earlier
Non-expendable Supplies 1 year
40
20
10/30/2009
IRR Revisions
z
Warranty Security Infra (Sec. 62)

z
z
z
Warranty period vs. Warranty security period

Warranty security period reduced to 1 year
Liability per stage
z
z
z
From project construction to final acceptance

From project completion to final acceptance
From final acceptance to warranty security period
Bidding
Construction
Completion
Acceptance
Warranty
41
IRR Revisions
z
Alternative Methods of Procurement (Secs.

48 to 53)
z
Alignment with international best practices

z
Recognized additional instances of Negotiated

Procurement (e.g., procurement from UN Agencies,
C
Community
it P
Participation)
ti i ti )
Increase in shopping/small value procurement
thresholds
21
10/30/2009
IRR Revisions
z
Alternative Methods of Procurement (Secs.

48 to 53)
z
Address concerns raised by stakeholders

z
z
z
Clearer rules on negotiated procurement due to 2failed bidding

Increase in thresholds
Lease of venue
IRR Revisions
z
Limited Source Bidding (Sec. 49)

z
Procedure for pre-selection shall be outlined in

Generic Procurement Manual
z
z
Invitation shall be advertised

Those who meet specified criteria shall be preselected
l t d
List shall be updated periodically
22
10/30/2009
IRR Revisions
z

z
List to be maintained by relevant government

authority
z
Procuring entity may be the relevant government

authority
S b itt d tto GPPB
Submitted
IRR Revisions
z
Shopping and Small Value Procurement

(Secs. 52 & 53.9)
z
Higher thresholds set for shopping and small

value procurement
z Guidelines to follow
For Foreign-funded procurement, thresholds

shall be agreed upon between GOP and foreign
government/institution
23
10/30/2009
IRR Revisions
z
Higher Threshold Amount for Unforeseen

Contingencies
g
z
z
NGAs, GOCCs, GFIs, SUCs P100,000

LGUs
Classification
1st Class
2nd
Maximum Amount (in Philippine Pesos)

Province
City
Municipality
100,000
100,000
50,000
Class
100 000
100,000
100 000
100,000
50 000
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
In the case of Barangays, the maximum amount is P50,000
IRR Revisions
z
Higher Threshold Amount for Regular Office Supplies and Small

Value Procurement
z
z
NGAs, GOCCs, GFIs, SUCs P500,000

LGUs
Classification
1st
Class
2nd
Maximum Amount (in Philippine Pesos)

Province
City
Municipality
500,000
500,000
100,000
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
200,000
100,000
50,000
Class
In the case of Barangays, the maximum amount is P50,000
24
10/30/2009
IRR Revisions
z
Negotiated Procurement (Sec. 53)

z
Clearer rules on two-failed bidding
Additional instances of negotiated procurement
IRR Revisions
z
Recap: Failure of Bidding (Sec. 35)

z
Mandatory review after each failed bidding
Based on findings
z
z
Revise terms, conditions, specifications

Adjust ABC
ABC, subject to required approvals
Rebid
z
Invite previous bidders
25
10/30/2009
IRR Revisions
z
Two-Failed Bidding (Sec. 53.1)

z
Mandatory review and agree on the following:

z
z
Minimum technical specifications

ABC adjusted only up to 20%
Invite sufficient number to ensure competition
Information communicated on an equal basis
IRR Revisions
z
Two-Failed Bidding (Sec. 53.1, cont.)

z
Simultaneous negotiations
Submission of best and final offer on a specified

date
52
26
10/30/2009
IRR Revisions
z
Two-Failed Bidding (Sec. 53.1, cont.)

z
Successful offer to be selected:

z
z
Meet minimum technical specifications

Does not exceed ABC
Observers shall be invited in all stages
53
IRR Revisions
z
Distinction between the following:

z
Agency-to-Agency (Sec. 53.5)

z
z
GOCCs formed under the Corporation Code excluded

Implementing Guidelines on A2A
Procurement Agent (Sec. 53.6)
By Administration (Sec. 7.3.2[a])
27
10/30/2009
IRR Revisions
z
Additional instances of Negotiated

Procurement:
z
Lease of Real Property (Sec. 53.10)

z
z
Include lease of venues

Guidelines to follow
IRR Revisions
z

Procurement:
z
Community Participation (Sec. 52.12)

z
Local community participation in service delivery
Project sustainability
M t social
Meet
i l objectives
bj ti
Procuring entity shall propose (procedures,

specifications and contract packaging)
Subject to GPPB approval
28
10/30/2009
IRR Revisions
z

Procurement:
z
United Nations Agencies (Sec. 52.13)

z
Small quantities of off-the-shelf goods (education and

health)
S
Specialized
i li d products
d t ((vaccines
i
or d
drugs))
IRR Revisions
z
Other Terms and Conditions

z
In all instances, the most advantageous price for

government should be obtained (Sec. 48.1)
Splitting
p
g of contracts is not allowed ((Sec. 54.1))
29
10/30/2009
IRR Revisions
z
Other Terms and Conditions (Sec. 54)

z
Posting not necessary, except:

z
z
z
shopping [Sec. 52.1(b)],

two-failed biddings [Sec. 53.1]
small value procurement [Sec. 53.9]
But all awards to be posted
IRR Revisions
z

z
Bid securities not necessary, except:

z
30
10/30/2009
IRR Revisions
z

z
Performance and Warranty Securities necessary,

except
z Shopping [Sec. 52]
z Emergency Cases [Sec. 53.2]
z Small value procurement [Sec. 53.9]
z Lease of real property [Sec. 53.10]
z Procurement from UN agencies [Sec. 53.13]
IRR Revisions
z
Effectivity
z
2 September 2009
z
30 days from publication in the Official Gazette (3

August 2009)
Transitory
z
When was Invitation to Bid/Request for

Expression of Interest published?
62
31
10/30/2009
Thank you
z
Comments, questions?
GPPB Online
z http://www.gppb.gov.ph
z http://gppb.topicsolutions.net
32

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10/30/2009

Republic Act No. 9184

Application of Domestic Preference

Alignment with International Best Practices

AO 227, Flag Law

Learning from Experience

Concerns raised by procuring entities, bidders and

Scope and Application (Sec. 4)

All domestically-funded procurement activities

All foreign-funded procurement activities, unless

But procurement funded through foreign grants are

Scope and Application (Sec. 4)

GOP negotiating panels shall:

Adopt as default position, use of the IRR or selection

IRR now includes definition of treaty, international

Procurement Planning (Sec. 7)

End-user units shall prepare their PPMP which shall be

Budget office to evaluate and include in budget proposal

BAC Secretariat shall review and consolidate into the

Procurement Planning (Sec. 7)

BAC shall finalize modes of procurement under the

APP shall be approved by HOPE or 2nd ranking official

Bids and Awards Committee (Sec. 11)

Alternate BAC member allowed:

Same qualification and term as principal

Honoraria for BAC Secretariat subject to DBM

Observers (Sec. 13)

Allows observers from cooperatives

Requires 3 days prior written notice for invitation of

Requires observers to inhibit in case of actual or potential

Access to documents upon signing of a confidentiality

Advertising of Invitation to Bid (Sec. 21)

IAEB to Invitation to Bid (goods and infra) or

Includes posting in the website prescribed by the

Pre-Bid Conference (Sec. 22)

May be extended at least 30 cd before bid

Method, nature, and complexity of contract

At the option of procuring entity, only

Eligibility Requirements (Secs. 23 & 24)

Reduced to 5-6 documents

Others to be submitted during

Eligibility Requirements Goods and Infra (Sec. 23)

Unless otherwise stated in treaty or international or executive

Eligibility Requirements Goods and Infra (Sec. 23)

Eligibility Requirements Goods and Infra

Class B Documents: If Joint Venture z JVA

Eligibility Criteria Goods (Sec. 23)

Legal Eligibility - Goods

General rule: 60% Filipino

If stated in treaty or international or executive agreement

Eligibility Criteria (Sec. 23)

Legal Eligibility - Infra

General rule: 75% Filipino (LOI 630)

Structures to be built require techniques not possessed by

Eligibility Requirements (Sec. 23)

Submit equivalent documents issued by country

Accompanied by English translation certified by appropriate

Eligibility Criteria (Sec. 23)

Technical Eligibility (Goods) - Single Largest Contract

2. Services and NonNon

Then require the ff.:

If, at the outset and

Eligibility Criteria (Sec. 23)

Expendable Supplies (Sec. 5 [m])