PD 1594

AND ITS IMPLEMENTING

RULES AND
REGULATIONS
 Presidential Decree
No.1594
Prescribing Policies, Guidelines,
Rules and Regulations for
Government Contract
I. DETAILED ENGINEERING
 No bidding and/or award of
contract for a construction project
shall be made unless the detailed
engineering investigations, surveys
and designs for the project have
been sufficiently carried out and
approved.
DETAILED ENGINEERING
ACTIVITIES
 Survey
 Site Investigation
 Soil and Foundation Investigation
 Construction Materials Investigations
 Preparation of Design Plans
 Preparation of Technical
Specifications
 Preparation of Quantity and Cost
Estimates
 Preparation of Program of Work
 Preparation of Proposed
Construction Schedule (and
Estimated Cash Flow for projects
with schedule over 6 months)
 Preparation of Site or Right-of-Way
plans including Schedule of
Acquisition
 Preparation of Utility Relocation Plan
 Preparation and Submission of Design
Report
 Environmental Impact Statement for
Critical Projects
 Preparation of Bid/Tender Documents
 Preparation of Minimum
Requirements for a Construction
Safety and Health Program for the
Project being Considered.
 Works under DETAILED
ENGINEERING
 Design standards
 Field Surveys and Investigation
 Contract Plans
 Site Development Plan
 Plans and profile sheet
 Typical sections and details
  Drainage details where applicable
 Structural plans at appropriate scales
indicating all details necessary in order
that the complete structure can be
set out and constructed
 Other details which may be required
 Quantities
 SpecialProvisions
 Unit Prices
 Budget for the Contract
 Bid/Tender Documents
 Instruction to Bidders
 General Conditions
 Addenda
 Itemized Bill of Quantities
 Day Work Schedule
 Form of Bid Security
 Performance Security
 Bidding Documents
R.A 9184
 Approved Budget for the Contract;
 Instructions to Bidders, including
criteria for eligibility, bid evaluation
and post-qualification, as well as the
date, time and place of the pre-bid
Conference (where applicable),
submission of bids and opening of
bids;
 Terms of Reference;
 Eligibility Requirements;
 Plans and Technical Specifications;
 Form of Bid, Price Form, and List of
Goods or Bill of Quantities;
 Delivery Time or Completion Schedule;
 Form and Amount of Bid Security;
 Form and Amount of Performance
Security and Warranty; and,
 Form of Contract, and General and
special Conditions of Contract.
  Contract Plans and Specifications
 Draft Contract including price escalation
clause
 All other information required for local and
international bidding procedures
 Program of Work
 Estimates of the work items
 Quantities and costs
 PERT/CPM (Programme Evaluation Review
Technique/ Critical Path Method) network of
the project
 II. INSTRUCTION TO
BIDDERS
Who may allow to bid?
 Filipino
- Citizens (Single Proprietorship)
- Partnership or corporation duly organized
under the laws of the Philippines, and at
least 75% of the capital stock of which
belongs to Filipino citizens
 Contractors forming themselves into a
joint venture
 Foreign contractors for internationally
bid foreign-assisted projects
Organizations of the BAC
Bid and Award Committee
(BAC) or Designated
Procurement Unit
Functions
1. Conduct of Eligibility Screening
2. Bidding
3. Evaluation of the Bids
4. Post-qualification
5. Recommending award of contracts
BAC Composition
 Chairman
- at least third ranking of the office
 Executive Officer and Secretary
- Legal Officer of the office
- Administrative Officer of the
agency(when does not have a legal
officer)
 Member (regular)
- Technical member
 Member (provisional)
- At least two, with experience in
the type of contract to be bid
and in project management
 Members from the private
sector
- On qualified representative from
constructors’ association recognized
by CIAP (Construction Industry
Authority of the Philippines)
- One qualified representative from
any of the ff. organizations:
1.) End – User group or non –
governmental organizations
2.) Project-related Professional
associations (accredited by
Professional Regulation
Commission or Supreme Court)
(They are non-voting members)

 Observers
- Commission on Audit (COA) of
the concerned agency
 Procurement Process for Government
Infrastructure Contracts

Eligibility Screening Pre-bid Conference

(For Prospective Bidders) (For Eligible Bidders)

Award of the Post- Bidding Process

Contract qualification (Choosing the
(For the lowest (For the chosen lowest possible
calculated responsive lowest calculated Bid)
bid) bid)
 INVITATION TO PRE-QUALIFY
((( (ADVERTISMENT)
For locally and Foreign funded CONTRACTS
1.) Newspaper (General Circulation)
 Contracts costing more than 5 million –
Advertisement shall be made at least 3
times within reasonable period
 Contracts costing 5 million and below –
Advertisement shall be made at least 2
times within 2 weeks
2. ) The same advertisement shall
be posted in the website of
the office concerned.
3.) Invitation may also be
advertised through televisions
and radio
ISSUANCE OF QUALIFICATION
STATEMENT/ FORMS
Notice for Pre-qualifications/
Eligibility Screening
a.) Name and location of project
b.) Project background and other
relevant information regarding the
proposed work
c.) Approved budget for the Contract
to be bid and source funding
d.) Criteria to be used by the office in:
- Prequalification or Eligibility
Screening of the contractors
- Evaluation of Bids
- Post-qualification of the lowest
calculated bid
e.) Cost and Place of issuance of
Eligibility Forms and Bid/Tender
documents
f.) Date, time and place of:
- Submission of accomplished
ELIGIBILTY forms
- Pre-bid conference
- Submission of bids
- Opening of bids
Eligibility Screening
Pre-qualification or Eligibility Statement To be
submitted by Contractors
Legal Documents
1.) Contractors valid PCAB license for
the type and cost of the contract to
be bid
2.) Valid Joint Venture Agreement in
the Case
3.) Letter Authorizing the Head of the
Office or his duly authorized
representatives to verify any or all
of the documents submitted for
Eligibility Screening
4.) Statement that his firm is not
included in the “Blacklist” of
Contractors issued by the
Construction Industry Authority of
the Philippines
Technical Documents
1.) A statement of all government and
private construction contracts,
completed in at least the last 3
years
2.) A statement of all ongoing
government and private
construction contracts awarded
but not yet started
3.) A statement that the contractor
has key personnel that may be
used for construction contracts

4.) A statement that the contractor

owns equipment that may be
used for construction contracts
Financial Documents
1) Audited financial statements for
at least the past 3 calendar years
2) Contractor’s net financial
contracting capacity
 Issuance of Plans,, Specifications,, Proposal
Book Forms and Draft Contract
(For Eligible Bidder)
ESTIMATED PROJECT COST Issuance of
( in Peso) Plans,Specifications,Proposal
Book Forms and Draft Contract
Up to 5 Million 15 days before bidding
Above 5 Million – 25 Million 30 days before bidding

Above 25 Million – 50 million 45 days before bidding

Above 50 Million – 100 Million 60 days before bidding

Above 100 Million 90 days before bidding

Bid Security
Original copy of the bid shall be
accompanied by a bid security, payable
to the procuring entity concerned as a
guarantee that the successful bidder
shall, within 30 calendar days or less,
from receipt of the notice of award, enter
into contract with the procuring entity
and furnish the performance security
allows a longer period.
Bid VALIDITY
Bids and bid securities shall be
valid for a reasonable period as
determined by the Head of the
Procuring Entity concerned, which
shall be indicated in the Bidding
Documents, but in no case shall
the period exceed one hundred
twenty (120) calendar days from the
date of the opening of bids.
 Submission,, Opening and
Abstracting of Bids/Tender
Bids in the prescribed bid form including
its annexes shall be submitted in two (2)
sealed envelopes with the name of the
CONTRACT to be bid and the name of
the BIDDER in capital letters addressed to
BAC of the office concerned. They shall be
marked by the bidder “DO NOT OPEN
BEFORE (date and time of opening of
bids)”.
FIRST ENVELOPE
• Technical Proposal
• Compliance (Pass or Fail)

SECOND ENVELOPE
Price proposal
First Envelope
 Authority of the signing
official
 Construction Schedule and S-
curve
 Construction Methods
 Organizational Chart for the
contract to be bid
 List of Contractor’s Personnel
with their complete qualification
and experience data
 Personpower schedule
 List of Contractor’s Equipment
Units intended for use exclusively
in the contract to be bid
 Equipment Utilization Schedule
 Certificate of site inspection
 Bid Security
 Certification that the detailed
Estimates, Cash flow by quarter
and Payments Schedule are in
the second envelope
 Commitment from the
contractor’s bank to extend to
him a credit line if awarded the
contract to be bid
 Construction Safety and Health
Program
 Other non- discretionary criteria
Second Envelope
 Bid Prices in the Bill of Quantities
 Detailed Estimates
 Cash flow by Quarter and
Payments Schedule
 Bid shall be received on or before
designated time and date for eligible
considerations. Bids may be withdrawn
in writing 5 working days before the
deadline of submission of bids.
 Bids with submitted bid prices that
are higher than the approved budget
for the contract under bidding shall be
rejected outright
 After all the bids have been received
and opened, the corresponding
Abstract of Bids shall be prepared. It
includes:
- Name of the project and its location
- Time, date and place of bidding
- Name of the bidders and their
corresponding bids, the amount of
security and name of the issuing
entity
 Determination of the Lowest
Calculated Responsive Bid

Lowest Calculated Responsive Bid

- is the bid with the lowest price as
calculated and which complies with all the
requirements
- it is determined in two step:
1.) Detailed Bid Evaluation
2.) Post-qualification
Detailed Bid Evaluation
The BAC shall, within 7 days, conduct a
detailed evaluation of all bids.
Non-Discretionary Criteria:
1. Bid Security
2. Completeness of Bid
3. Major Deviations
4. Corrections for errors, discounts and
other modifications
5. Approved budget for the contract under
bidding
 The BAC of concerned government
offices should complete the evaluation
of bids not later than 30 calendar days
from the date of the opening of the
bids
 Post-qualification
(Contractor with the Lowest Calculated Bid)

This verifies and ascertain

whether the bidder with the lowest
calculated bid complies or is
responsive to all the requirements
of the contract
1. Legal Requirements
2. Technical Requirements
 The contractor’s stated experience
must be verified and validated by
the BAC to be relevant
 The experience of the contractor's
key personnel must be verified by
the BAC
 The equipment units listed by
the contractor must be
verified by the BAC
 The BAC shall check the
performance of the contractor
in his ongoing government and
private contracts
Financial Requirements
BAC must be verified the ff:
 The contractor’s stated net working
capital
 The value of all outstanding or
unfinished works under ongoing
contracts yet to be started
 The contractor’s net financial
contracting capacity
 The credit line commitment from the
contractor’s bank
 If the bidder passes all of the
above criteria, he shall be considered
post- qualified. If the bidder fails any
of the above criteria, he shall be
post-disqualified.
AWARDING OF CONTRACT
If the BAC finds that the
contractor with the lowest
calculated total bid prices passes the
post-qualification criteria, the office
shall award the contract to him.
AWARDING OF CONTRACT
If, however, the BAC finds that contractor
with the lowest calculated bid fails the post-
qualification criteria, the office shall
immediately notify him in writing that he is
post-disqualified, and the BAC, within 7
calendar days complete the same post-
qualification process on the second
contractor with the second lowest calculated
bid.
AWARDING OF CONTRACT
If the decision is to award the
contract, the Notice of Award shall be
issued normally within 7 calendar
days from the date the decision to
award is made.
 The successful bidder or his duly
authorized representative shall
execute the contract with the office
concerned normally 15 calendar
days from the receipt of the Notice
of Award
 The Government reserves the
right to reject any or all bids and to
declare a failure of bidding, or not to
award the contract if there is,
among others evidence of collusion
among contractors and other parties
resulting in no competition
Documents Comprising the
Contract
1. Contract Agreement
2. Conditions of the contract
3. Drawings/Plans
4. Specifications
5. Invitation to Bid
6. Instruction to Bidders
7. Addenda
8. Bid Form
9. Performance Statements
10. Credit Line issued by an authorized
bank in an amount equal to the
average operating expenses of the
project for 2months of 10% of the
total project cost
11. Notice of Award of Contract
12. Other contract documents may be
required
Supporting Documents
 Duly Approved Program of Work and Cost Estimates
 Certificate of Availability Of Funds
 Approved Budget for the Contract
 Abstract of Bids
 Resolution of the BAC or the BAC recommending
award
 Approval of Award by Approving Authority
 Other pertinent documents as may be reasonably
required by the existing laws
Approval of Contract
The approving authority for the
contract or his duly authorized
representative shall be given a
maximum of fifteen (15) calendar
days from receipt thereof to approve
or disapprove it.
Approval of Contract
For contracts requiring the approval
by the Office of the President, the
same should normally be
approved/disapproved within 30
calendar days from the date that
request for approval of such contracts
shall have been received by the Office
of the President.
Issuance of Notice to Proceed

The concerned government office

should issue the Notice to Proceed (NTP)
to successful bidder not later than 15
calendar days from the date of approval
of the contract by the authorized
government official. The Effectivity date
for the NTP shall be specified by the
agency concerned.
 III. CONTRACT
IMPLEMENTATION
Advance payment

The Government shall make

an advance payment to the
contractor in an amount equal to
fifteen percent (15%) of the total
contract price.
Contract completion
Once the project reaches an
accomplishment of 95% of the total
contract amount, the government may
create an inspectorate team to make
preliminary inspection and submit a
punch-list to the contractor in preparation
of the final turnover of the project.
Punch-list
 Remaining works
 Work deficiencies for necessary
corrections
 Specific time to fully complete the
project, considering the approved
remaining contract time as of the
date of contract suspension
Suspension of work

1. The Government shall have

the authority to suspend
work wholly or partly due
to any fortuitous events
(force majeure).
Suspension of work
2. The contractor shall have the right to
suspend work operation on any or all
projects along the critical path of
activities after 15 calendar days from
date of receipt of written notice from
the contractor to the district
engineer/regional director/consultant,
due to the following:
1. Existence of right-of-way problems
2. Requisite construction plans are not
issued to the contractor
3. Peace and order conditions
4. Government failure to deliver
government-furnished materials and
equipment as stipulated in the contract
5. Delay in the payment of contractor’s
claim for progress billing
EXTENSION OF CONTRACT TIME

The Government shall determine

the amount of extension that a
contractor is fairly entitled to,
provided that the Government is
not bound to take into account any
claim for an extension of time
EXTENSION OF CONTRACT TIME
No extension of contract time shall be
granted to the contractor due to:
 Ordinary unfavorable weather conditions
 Inexcusable failure or negligence of the
contractor to provide the required
equipment, supplies or materials
 Other causes for which the Government
is not directly responsible
IV. EVALUATION OF
CONTRACTORS
PERFORMANCE
Subject and Scope
All contractors undertaking projects
with the government shall have their
performance evaluated by offices
concerned.
This evaluation shall be done during
construction and upon completion of
each government project.
Evaluation Guidelines
All offices concerned are mandated
to adopt the CPES Implementing
Guidelines as approved by the NEDA
Infracom.
 Implementation
Mechanism for CPES
Each agency shall establish a CPES
Implementing Unit (IU) which shall be
responsible for CPES guidelines
implementation, including but not limited to
the supervision of performance evaluators
accredited by the CIAP.
 Submission of
Evaluation Results
All offices concerned shall
submit the results of their
performance evaluation to the
CIAP within one week after
the conduct of final evaluation
Utilization of Evaluation
Results
The CIAP shall consolidate all of
the evaluation results received and
shall disseminate the same to all
offices concerned.
Such data shall be used in:
 Pre-qualification and blacklisting of
construction firms
 Adopting measure to further
improve performance of
contractors in the prosecution of
government projects
SALAMAT!!!