BIDDING PROCEDURES FOR

THE PROCUREMENT
OF GOODS AND
INFRASTRUCTURE PROJECTS

1
GENERAL MODE OF PROCUREMENT

 Procurement is done through

Competitive Bidding. (Sec. 10)

 Exception: Alternative Methods of

Procurement.

2
 COMPETITIVE BIDDING

Garcia vs. Burgos (291 SCRA 546)

“By its nature and characteristics, a competitive public

bidding aims to protect public interest by giving the
public the best possible advantages through open
competition”

COA vs. RTC-NCRJR (GR NO. 85285, 7/7/89)

“Purpose is to avoid/preclude suspicion of favoritism

and anomalies in the execution of public contracts.”

3
 COMPETITIVE BIDDING

WHAT IS COMPETITIVE BIDDING?

- method of procurement which is open to
participation by any interested party and
which consists of the following processes:
advertisement, pre-bid conference, eligibility
screening of prospective bidders, receipt and
opening of bids, evaluation of bids, post-
qualification, and award of contract.
(Section 5(h), IRR of RA 9184)

4
STANDARD BIDDING PROCEDURE FOR
GOODS AND INFRASTRUCTURE
Pre-Procurement Pre-Bid
Advertisement
Conf. Conference

Opening of
Submission of Opening of 2nd
1st Env. - Eligibility
Bids Envelope – Financial
Docs & Technical
Proposal
Proposal

Bid Evaluation Post-qualification Award of

& Ranking Contract

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6
7
8
9
I. PRE-PROCUREMENT CONFERENCE (S20)
a) Confirm description and scope of contract, ABC, and
contract duration;

b) Ensure procurement is in accordance with PPMP/APP

c) Determine the readiness of procurement - including

i. availability of budget;
ii. completeness of Bidding Docs & adherence to general
procurement guidelines;
iii. Infra - completion of detailed engineering;
iv. confirmation of availability of right-of-way site or
location, and possession of affected properties

10
I. PRE-PROCUREMENT CONFERENCE (S20)

d) Review, modify and agree on criteria for eligibility screening,

evaluation, and post-qualification;

e) Review and adopt procurement schedule, deadlines and

timeframes, for the different activities; and

f) Reiterate and emphasize importance of confidentiality

(Section 19) & applicable sanctions and penalties and how to
comply

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 I. PRE-PROCUREMENT CONFERENCE

 Conducted prior to advertisement/posting of the

Invitation to Bid

 Mandatory for projects with ABC above PhP 2M

(Goods) or 5M (Infra)

 Attended by the following:

a) BAC
b) BAC Secretariat
c) TWG
d) Hired Consultants
e) End-user unit/Other officials PRE-PROCUREMENT

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 REFERENCE TO BRAND NAMES

Sec. 18 of RA 9184 and its IRR

 The prohibition applies to the procurement of goods,
and goods component of Infrastructure Projects and
Consulting Services.

 Specifications should be based on relevant

characteristics, functionality and performance
requirements, except for items r parts that are compatible
with the existing fleet or equipment of the same make and
brand, and to maintain the performance, functionality and
useful life of the equipment.

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 REFERENCE TO COUNTRY OF ORIGIN

 Prohibition includes reference to country of origin

pursuant to Sec. 43.1.1 of the IRR of RA 9184.
- PEs are precluded from requiring specific country of
origin as part of the technical specifications for the
project.
- Specifications shall be based on the performance
requirements and recognized industry standards and
not on the basis of country of origin.

NPM 22-2013

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II. ADVERTISEMENT/POSTING OF THE
INVITATION TO BID
SIGNALS the:

 START of the bidding process.

 AVAILABILITY of the bidding documents to the

prospective bidders. (if not mentioned in the Invitation
to Bid) (Sec. 17.3)

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 II. ADVERTISEMENT & POSTING OF
THE INVITATION TO BID (S21)
 At least once in one (1) newspaper of general nationwide
circulation, which has been regularly published for at
least two (2) years before advertisement date.

 Not required for projects with ABC of 2M 10M and

below for Goods or 5M 15M and below for
Infrastructure Projects. (Sec. 21.2.1.c)

Two (2) years after the effectivity of the IRR,

advertisement shall no longer be required unless the PE cannot
post its opportunities in the PhilGEPS for justifiable
reasons.

16
II. ADVERTISEMENT/POSTING OF THE
INVITATION TO BID (S21)
 Posted continuously for 7 calendar days
(cd):

1. PhilGEPS;
2. Website of the PE, if any;
3. Website of IFI, if applicable; and
4. At any conspicuous place in the
premises of the PE.

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II. ADVERTISEMENT/POSTING OF THE
INVITATION TO BID (S21)
2M 10M for
Above 2M 10M for
Goods/ 5M 15M
Medium Goods/
for Infra
5M 15M for Infra
and below
Newspaper of General Nationwide
Circulation  

PhilGEPS website
 
PE’s Website, if available
 
Conspicuous Place  
Website prescribed by the foreign
government/foreign or international
funding institution, in case of  
foreign funded procurement

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 III. PRE-BID CONFERENCE (S22)
 Forum where PE’s representatives & the bidders discuss
the different aspects of the procurement project

 Open to prospective bidders but attendance is not mandatory.

(Sec. 22.3)

 At least 1 conference
 Mandatory –with ABC > 1M; Discretionary – ABC
less than 1M
 Approved by BAC or held upon prospective bidder
written request
 Held at least 12 cd before deadline for bid
submission but not earlier than seven (7) cd from the
PhilGEPS posting of the Invitation to Bid or Bidding
Documents.
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 III. PRE-BID CONFERENCE (S22)
 May be held at least 30 cd before the deadline for the
submission and receipt of bids considering the
following:

a) Method, nature, and complexity of contract

b) International participation is more advantageous

 Shall discuss, clarify and explain, among other things,

the eligibility requirements and technical and financial
components of the contract to be bid including questions
and clarifications raised by the prospective bidders
before and during the Pre-Bid Conference. (Sec. 22.3)

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 III. PRE-BID CONFERENCE

 Pre-bid conference may be conducted:

 in person or face-to-face
through videoconferencing, webcasting, or similar
technology, or
 a combination thereof.

 PEs with videoconferencing capabilities that have

manufacturers, suppliers, distributors, contractors
and/or consultants that also have videoconferencing
capabilities may conduct their pre-bidding
conferences electronically.
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 III. PRE-BID CONFERENCE
 Minutes shall be recorded and prepared not later than 5
calendar days (CD) after the pre-bid conference, and
shall be made available to prospective bidders not later
than 5 days upon written request.

 Secretariat prepares
 Chair/Vice chair (presiding officer approves or all BAC
members)
 Issue Supplemental/Bid Bulletin if BAC decides to
amend any provision of the Bidding Documents at least
seven (7) calendar days before the deadline of the
submission and receipt of bids.

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 CLARIFICATION OF BIDDING
DOCUMENTS
 Supplemental/Bid Bulletins is issued by BAC to:
 answer requests for clarification (query submitted 10 cd before
deadline) or interpretation, and
 upon BAC’s initiative to clarify or modify any provision of
Bidding Docs. (at least 7 cd before deadline for bids submission).

 Posted in PhilGEPS and PE’s website, and at any

conspicuous place within the premises of the Procuring
Entity. (Sec. 22.5.3)

 Bidders who have submitted bids before issuance of

Supplemental/Bid Bulletin must be informed in writing
and allowed to modify or withdraw their respective bids

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 ADDITIONAL REQUIREMENTS

 PE cannot compel prospective bidders or the winning bidder to

submit or comply with requirements not initially provided in
the Bidding Documents or through any Supplemental/Bid
Bulletin issued by the PE for the project that must be posted at the
PhilGEPS’ and the PE’s website.

 If no Supplemental/Bid Bulletin is issued to reflect changes in the

Bidding Documents, or even if the same was issued but not posted
at the PhilGEPS’ and PE’s websites, the original provisions
contained in the Bidding Documents remain and the prospective
bidder, including the winning bidder cannot be compelled to abide
or comply with the changes made by the PE.

NPM 24-2013
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 IV. SUBMISSION AND
RECEIPT OF BIDS

 Re-scheduling of bid opening due to justifiable

reasons, i.e lack of quorum, cancellation of
office work due to bad weather
 In case bids cannot be opened as scheduled due to
justifiable reasons, the BAC shall take custody of the
bids submitted and reschedule the opening of bids on
the next working day or at the soonest possible
time through the issuance of a Notice of
Postponement to be posted in the PhilGEPS website
and the website of the PE (Sec. 29)
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 IV. SUBMISSION AND
RECEIPT OF BIDS (S 25)
 Two-Envelope System
 1st Envelope – Eligibility Requirements and
Technical Component
 2nd Envelope – Financial Component
 Submitted to the BAC on the date, time, and place
specified in the Invitation to Bid. Bids submitted after the
deadline should not be accepted.
 Date of submission should not be later than the
following period from the last day of posting of the
Invitation to Bid (Sec. 25.5)
Category Maximum Period (cd)
Goods 45
Infra (50M and below) 50
Infra (above 50M) 65

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 IV. SUBMISSION AND
RECEIPT OF BIDS
The practice of pre-qualification has been abandoned in
RA 9184 and its IRR. The results of a pre-qualification
have no legal force and effect, bearing or weight, and
cannot preempt the findings of the BAC during the
preliminary examination of bids conducted during the
opening of bids. Hence, a bidder may still be declared
ineligible during the opening of bids despite a finding of
qualification during the purported pre-qualification
exercise.

NPM 54-2013

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 V. OPENING AND EVALUATION OF
1ST ENVELOPE
CONTENTS:
1. Eligibility requirements (Legal, financial and technical)
2. Bid Security
3. Technical specifications (Goods) / Project
requirements(Infra)
 Non-inclusion
4. Omnibus in blacklist
sworn  Responsibilities
statement (New of bidders
Form, Sec. 25.3)
 Authenticity of documents  Labor laws and standards
 Verification authority  Non-payment (directly or
indirectly) any commission,
 Signatory’s authority amount, fee, or any form of
consideration in relation to any
 Disclosure of relations procurement project or activity

DOH COBAC Additional Requirement to facilitate process: The Bidder shall

submit the following Eligibility and Technical Documents(Financial
Documents) arranged numbered and tabbed as enumerated below:
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 V. OPENING AND EVALUATION OF
BIDS
 Preliminary examination of bids is conducted by merely
checking for the presence or absence of documentary
requirements using a non-discretionary “pass/fail”
criterion (S30).
 However, BAC has the right to review the qualifications of
a bidder at any stage of the procurement process if it has
reasonable grounds to believe that a misrepresentation has
been made or there has been changes in the bidder’s
capability to undertake the project, may consider bidder
ineligible and then disqualify (Section 23.6[goods & infra]&
24.7[Consulting])
 BAC opens a reconsidered bid under the same
circumstances as it opened the bids that were not
disqualified, i.e., upon a duly scheduled opening of bid with
proper notices to the concerned entities. NPM 69-2013
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 ELIGIBILITY REQUIREMENTS

GOODS INFRASTRUCTURE
Class A Documents
LEGAL: 1. PhilGEPS Certificate of Registration
1. PhilGEPS Certificate of Registration and and Membership (Also represents AFS
Membership (Also represents AFS in and PCAB License in addition to legal
addition to legal documents) documents)
GPPB Resolution 26-2017: Approving the Issuance of a Circular on the Deferment of the Implementation of the Mandatory
Submission of Philippine Government Electronic Procurement System (PhilGEPS) Certificate of Registration and Membership in
Competitive Bidding (July 31, 2017)

1. DTI/SEC/CDA Registration 1. DTI/SEC/CDA Registration

2. Mayor’s permit or equivalent document for
Exclusive Economic Zones or Areas
3. Tax clearance per Executive Order 398,
series of 2005, as finally reviewed and
approved by the BIR.
2. Mayor’s permit or equivalent document for
Exclusive Economic Zones or Areas
3. Tax clearance per Executive Order 398,
series of 2005, as finally reviewed and
approved by the BIR.

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 ELIGIBILITY REQUIREMENTS
GOODS INFRASTRUCTURE
Class A Documents
TECHNICAL:
1. Statement of all ongoing contracts. 1. Statement of all ongoing contracts.
2. Statement of SLCC 2. Statement of SLCC
3. PCAB License & Registration or Special
PCAB License & Registration for JV)
FINANCIAL:
1. NFCC computation or committed Line of 1. NFCC
Credit 2. AFS
2. Audited Financial Statement (AFS)

Class B Document
JVA or notarized statement from the In case of JV, JVA entered into by the parties.
partners that they will enter into joint
venture if awarded the contract.
JV partner(s): Each submits PhilGEPS registration
 Technical & financial eligibility docs by one partner constitute compliance;
 Partner submitting NFCC, also submits Statement of On-going Contracts and AFS

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 ELIGIBILITY REQUIREMENTS

Submission of PhilGEPS Certificate of Registration and

Membership in lieu of the Class “A” eligibility documents under
Sections 23.1(a) and 24.1(a)

Section 8.5.2, - All bidders shall upload and maintain in PhilGEPS

a current and updated file of the following Class “A” eligibility
documents under Sections 23.1(a) and 24.1(a):
a) Registration Certificate;
b) Mayor’s/Business Permit or its Equivalent Document;
c) Tax Clearance;
d) Philippine Contractors Accreditation Board (PCAB) license and
registration; and
e) Audited Financial Statements.
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 ELIGIBILITY REQUIREMENTS

 GPPB Circular 03-2016, dated 27 October 2016

The implementation of the mandatory submission of

PhilGEPS Certificate of Registration and Membership under
Platinum category for Competitive Bidding has been deferred
to May 1, 2017. From 28 October 2016 until 30 April
2017, bidders may still submit their Class “A” Eligibility
Documents under Sections 23.1(a) and 24.1(a).

 GPPB Resolution 26-2017: Approving the Issuance of a Circular

on the Deferment of the Implementation of the Mandatory
Submission of Philippine Government Electronic Procurement
System (PhilGEPS) Certificate of Registration and Membership
in Competitive Bidding ( dated July 31, 2017)
33
 ELIGIBILITY REQUIREMENTS

Submission of PhilGEPS Certificate of

Registration and Membership

 For foreign bidders participating in the

procurement by a Philippine Foreign Service Office
or Post, they shall submit their eligibility documents
under Section 23.1, 2016 IRR of RA 9184.
Provided, that the winning bidder shall register
with the PhilGEPS in accordance with Sec. 37.1.4
of the 2016 IRR of RA 9184.

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 MAYOR’S PERMIT

 Mayor’s Permit allows an entity to legally

perform the requirements and obligations
of the project and the resultant contract.

 Recently expired Mayor’s/Business permit

shall be accepted together with the official
receipt as proof that the bidder has applied for
renewal within the period prescribed by the
concerned local government unit: Provided,
that the renewed permit shall be submitted
as a post-qualification requirement in
accordance with Sec. 34.2

35
 TAX CLEARANCE (TC)
 Executive Order 398 requires that a bidder
has NO any tax liability with the
government from the time of submission of
its bid up to the time of contract award.
 Issued by the Accounts Receivable &
Monitoring Division of BIR attesting that
the bidder has no outstanding Final
Assessment Notice and/or delinquent
account.
 Submission of TC of the previous year and
application for TC cannot be considered as
compliance. NPM 02-2013
 In submitted TC expires prior to award of
contract, the bidder is obligated to renew
36
and update its Tax Clearance.NPM 02-2016
 TAX CLEARANCE
 Submission of BIR receipt for
renewal of Tax Clearance will not
suffice in lieu of a valid Tax Clearance
Requirement since substitution is not
allowed under Section 34.2 of the IRR
of RA 9184.

 Submission of Provisionary Tax

Clearance issued by the BIR for
bidding purposes is not acceptable
form of Tax Clearance. (GPPB
Resolution No. 01-2014)
37
 TAX DELINQUENCY VERIFICATION
CERTIFICATE
 Tax Delinquency Verification Certificate cannot be used as
a replacement thereto, except for Non-Resident Foreign
Corporations (NRFC) and Non-Resident Alien Not
Engaged in Trade or Business (NRANETB). NPM 39-2014
 TAX CLEARANCE FOR FOREIGN BIDDERS
A Delinquency Verification Certificate issued to Non-
Resident Foreign Corporations (NRFC)/Non-Resident
Aliens Not Engaged in Trade or Business (NRANETB)
pursuant to BIR RR 3-2005, attesting to the fact that the
taxpayer has no outstanding Final Assessment Notice
and/or delinquent account may be submitted as a form of
Tax Clearance required under Section 34.2 NPM 02-2013
38
 TECHNICAL ELIGIBILITY CRITERIA
NET FINANCIAL CONTRACTING CAPACITY (NFCC)

 For goods and infrastructure projects, the NFCC’s K factor

shall be fixed at 15, regardless of contract duration

 The values of the domestic bidder’s current assets and current

liabilities shall be based on the latest Audited Financial
Statements submitted to the BIR .

 For purposes of computing the foreign bidder’s NFCC, the

value of the current assets and current liabilities shall be based
on their Audited Financial Statements prepared in
accordance with international financial reporting
standards.
39
 TECHNICAL ELIGIBILITY CRITERIA
COMMITTED LINE OF CREDIT (for goods only)

 Procurement of Goods, a bidder may opt to submit a

committed Line of Credit (CLC) from a universal or
commercial bank, in lieu of its NFCC computation. (Sec.
23.1.a.viii)

 CLC does not apply to procurement of Infrastructure

Projects.

 If the bidder submits a CLC, it must be at least equal to ten

percent (10%) of the ABC to be bid: Provided, that if the same
is issued by a foreign Universal or Commercial Bank, it shall be
confirmed or authenticated by a local Universal or Commercial
Bank.
40
 TECHNICAL ELIGIBILITY CRITERIA
STATEMENT OF ON-GOING AND CONTRACTS

ALL ongoing government and private

contracts, including contracts awarded but
not yet started, if any,

Whether similar or not similar in nature

and complexity to the contract to be bid.
(Sec. 23.1.a. iv)

41
TECHNICAL ELIGIBILITY CRITERIA
SINGLE LARGEST COMPLETED CONTRACT (SLCC)

 similar to the contract to be bid, except

under conditions provided for in Sections
23.4.1.3 and 23.4.2.4
 within the relevant period as provided in
the Bidding Documents in the case of
Goods.
 value, adjusted to current prices using the
Philippine Statistics Authority (PSA)
consumer price indices
42
 TECHNICAL ELIGIBILITY CRITERIA
SINGLE LARGEST COMPLETED CONTRACT - GOODS

General Rule Exceptions Then require the ff.:

1. Expendable If, at the outset and after a) At least 2 similar
Supplies market research, contracts aggregate
• 25% of the ABC applying the general amount at least
rule will likely result to: equivalent to required
2. Services and Non- percentage; and
expendable 1. Failure of bidding; or
supplies b) Largest of the similar
• 50% of the ABC 2. Monopoly contracts amounts to
at least 50% of
required percentage

Expendable Supplies - Articles which are normally consumed in use within 1 year or converted in the process of
manufacture or construction, or those having a life expectancy of more than 1 year but which shall have decreased
substantially in value after being put to use for only 1 year ( e.g. , medicines, stationery, fuel, & spare parts).
Non - expendable Supplies -Articles which are not consumed in use and ordinarily retain their original identity
during the period of use, whose serviceable life is more than 1 year and which add to the assets of the GoP ( e.g. ,
furniture, fixtures, transport and other equipment); Include semi-expendable property. 43
 TECHNICAL ELIGIBILITY CRITERIA
GOODS – SINGLE LARGEST
(Illustration)
Expendable Goods
ABC = P100,000,000.00
GR: 25% of the ABC
THUS: Previous contract should be at least
P25,000,000.00 (required percentage)
EXCEPTION: The aggregate amount of at
least 2 similar contracts is at least equivalent
to the required percentage; and Largest of
the similar contracts amounts to at least 50%
of required percentage.
THUS: 1st contract = P10,000,000.00
2nd contract = P20,000,000.00
COMPLETED CONTRACT
Non-expendable Goods
ABC = P100,000,000.00
GR: 50% of the ABC
THUS: Previous contract should be at least
P50,000,000.00 (required percentage)
EXCEPTION: The aggregate amount of at least
2 similar contracts is at least equivalent to
required percentage; and Largest of the similar
contracts amounts to at least 50% of required
percentage.
THUS: 1st contract = P30,000,000.00
2nd contract = P40,000,000.00
44
 TECHNICAL ELIGIBILITY CRITERIA
SINGLE LARGEST COMPLETED CONTRACT
INFRASTRUCTURE PROJECTS

 At least 50% of the ABC

 Similar to the contract to be bid, except under conditions
provided for in Sec. 23.4.1.3 of the IRR
 Based on the value of the previous completed contract, as
adjusted to current prices using the Phil.Statistical Authority
consumer price index.
 For foreign funded procurement, a different track record may be
agreed upon
 Supported by an Owner’s Certificate of Final Acceptance issued
by the project owner other than the contractor or a final rating of
at least Satisfactory in the Constructors Performance Evaluation
System (CPES). In case of contracts with the private sector, an
equivalent document shall be submitted.
45
 TECHNICAL ELIGIBILITY CRITERIA
SINGLE LARGEST COMPLETED CONTRACT
INFRASTRUCTURE PROJECTS

Exception:
 Contractors under Small A and Small B categories without
similar experience on the contract to be bid may be allowed to bid
if the cost of such contract is not more than the Allowable
Range of Contract Cost (ARCC) of their registration based on
the guidelines as prescribed by the PCAB.

 A contract shall be considered “similar” to the contract to be bid

if it has the same major categories of work.

 The PE may clarify in the Bidding Documents what is regarded as

major categories of work.

46
 TECHNICAL ELIGIBILITY CRITERIA
Philippine Contractors Association Board
(PCAB) License -INFRA Projects
 Valid at the time of the deadline for the submission
and opening of bids.

 Submission of a PCAB license with validity period after

the date of the opening of the bids is a ground for the
prospective bidder’s disqualification. (NPM 71-2013)

 As such, the submission of a PCAB License and

Registration cannot be dispensed within the
procurement of infrastructure projects. (NPM 126-2014)

47
 TECHNICAL ELIGIBILITY CRITERIA

Construction experience/track record of a sole

proprietor, cannot be carried over to a
corporation despite the fact that the sole
proprietor’s assets, personnel and other resources
have been infused into the corporation inasmuch
as the latter has a separate and distinct juridical
personality from the former.

NPM 31-2013

48
 ELIGIBILITY REQUIREMENTS FOR
FOREIGN BIDDERS
 Appropriate equivalent documents issued by the
country of the foreign bidder under Class “A”
Documents shall be submitted, provided that:
 Documents are in English, or
 Documents submitted are in a foreign language other
than English, it must be accompanied by a translation
of documents in English by any of the following:
a) relevant foreign government agency;
b) foreign government agency authorized to
translate documents, or
c) a registered translator in the foreign bidder’s
country.

49
 ELIGIBILITY REQUIREMENTS FOR
FOREIGN BIDDERS
 Shall be authenticated by the appropriate Philippine
foreign service establishment/post or the equivalent
office having jurisdiction over the foreign bidder’s affairs
in the Philippines.

 Only upon actual determination and confirmation of this

equivalence through post qualification by the BAC may
it be categorically resolved that the foreign documents
submitted are acceptable substitutes of the required
eligibility documents (NPM 42-2013)

50
 ELIGIBILITY REQUIREMENTS FOR
GOVT. CORPORATE ENTITIES

GOCCs may be eligible to participate only if they

can establish that they:

1. are legally and financially autonomous,

2. operate under commercial law, and

3. are not attached agencies of the PE

(Sec. 23.5)

51
 ELIGIBILITY REQUIREMENTS FOR
JOINT VENTURES
INFRASTRUCTURE
GOODS
PROJECTS
WITH AN EXISTING JOINT VENTURE: JV bidders shall submit a
submission of a valid joint venture JVA in accordance with R.A.
agreement 4566 and its IRR
("Contractors' License Law.“)
WITHOUT AN EXISTING JOINT
VENTURE: submission by each of the *Submission of a duly
potential JV members of a duly notarized notarized statement is not
applicable.
statement stating that they will enter into
and abide by the provisions of the joint
venture in case their bid is successful.
 Failure to enter into a joint venture in the
event of a contract award shall be ground for
the forfeiture of the bid security. (Sec.
23.1.b)

52
 ELIGIBILITY REQUIREMENTS FOR
JOINT VENTURES

SUBMISSION OF ELIGIBILITY REQUIREMENTS:

 All co-venturers shall submit their legal documents,

while any of the co-venturers shall submit technical and
financial documents.

 Each partner of the joint venture shall submit the PhilGEPS

Certificate of Registration in accordance with Sec. 8.5.2

53
 ELIGIBILITY REQUIREMENTS FOR
JOINT VENTURES
• JV Bidders are required to submit a Joint License issued by
the PCAB in compliance with the eligibility requirement for a
“valid PCAB license and registration”.

• Sec. 38 of RA 4566 prohibits 2 or more contractors from jointly

submitting a bid without first securing a Joint License to
engage or act in the capacity of such a joint venture.

• Failure of the JV Bidder to submit a Joint License may be a

ground for its disqualification despite the submission of the
individual licenses of each joint venture partner.

NPM 17-2013

54
 LEGAL ELIGIBILITY CRITERIA
GOODS
• General rule: 60% Filipino
• Foreign bidder allowed if:
1) Stated in treaty or international or
executive agreement;
2) National of a country offering
reciprocity rights to Filipinos;
3) Goods not available from local
suppliers; or
4) To prevent situations that defeat
competition or restrain trade
INFRASTRUCTURE
• General rule: 75% Filipino
• Foreign contractors allowed if stated
in treaty or international or executive
agreement
• If joint venture, less than 75% Filipino-
owned is allowed if -
1. Structures to be built require
techniques not possessed by 75%
Filipino-owned contractors; and
2. Should not be less than 25%
Filipino ownership
55
 FINANCIAL ELIGIBILITY CRITERIA

 Audited Financial Statement (showing

prospective bidder’s total and current
assets and liabilities. )
 NFCC or CLC for Goods, and NFCC for
Infra is at least equal to ABC.
 NFCC establishes bidder’s financial liquidity
& absorptive capacity in carrying out
contractual obligations required by the lots to
which it participated in.

56
 NFCC COMPUTATION

Net Financial Contracting Capacity (NFCC)

= [(Current assets minus current liabilities) (15)] minus the
value of all outstanding or uncompleted portions of the
projects under ongoing contracts, including awarded
contracts yet to be started, coinciding with the contract to
be bid.
= Values of domestic bidder’s current assets and current
liabilities shall be based on latest AFS submitted to BIR.
For foreign bidders' NFCC, value of the current assets
and current liabilities shall be based on their AFS
prepared in accordance with international financial
reporting standards.
57
 BID SECURITY
 Only 1 form of Bid Security is required to be submitted

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

 Bidders have the option to choose their preferred form of bid

security (Sec. 27.2)
58
 BID SECURITY
Amount
Form of Bid Security Bid Security
(% = ABC)
a) Cash or cashier’s/manager’s check
b) Bank guarantee/draft or 2%
Irrevocable LC
c) Surety bond callable upon
5%
demand
d) Combination of the foregoing Proportionate to share of form
with respect to the total amount
of security
e) Bid Securing Declaration No percentage required

59
 BID SECURITY

 Bid securities shall be returned only after the bidder

with the Lowest Calculated Responsive Bid has signed
the contract and furnished the performance security,
except to those declared by the BAC as failed or post-
disqualified in accordance with this IRR, upon
submission of a written waiver of their right to file a
request for reconsideration and/or protest.

60
 BID SECURING DECLARATION

Bid Securing Declaration

 an additional form of bid security

 A document/undertaking signed by the bidder

committing to pay the corresponding fine and be
suspended for a period of time from being qualified
to participate in any government activity in the event
of violation of any of the conditions stated therein as
required by the GPPB Guidelines. (GPPB Resolution
No. 03-2012, 27 January 2012)

61
 BID SECURING DECLARATION

Conditions:
 BSD is enforced when the bidder commits any act
resulting to the forfeiture of bid security under:

- Section 23.1(b) – failure to enter into a joint venture in

the event of contract award
- Section 34.2 – failure to submit post-qualification
requirements on time or a finding against the veracity of
such
- Section 40.1 – failure to enter into a contract with the PE
- Section 69.1 – administrative sanctions

(GPPB Resolution No. 15-2014, 20 June 2014)

62
 V. OPENING AND EVALUATION OF
1ST ENVELOPE

To ensure transparency and accurate representation of

the bid submission, the BAC Secretariat shall notify
in writing all bidders whose bids it has received
through its PhilGEPS-registered physical address
or official e-mail address. The notice shall be issued
within seven (7) cd from the date of the bid opening.
(Sec. 25.7)

63
 V. OPENING AND EVALUATION OF
1ST ENVELOPE – GOODS
No. Document (minimum Requirements) Present Absent
1. PhilGEPS Certificate of Registration
2. Statement of ALL on-going government and private contracts
3. Statement of SLCC
4. NFCC computation or Committed Line of Credit
5. JVA or Duly Notarized Statement to enter JVA in case of award
6. Bid Security
7. Technical Specification
8. Omnibus Sworn Statement
9. If Foreign Bidder claiming reciprocal rights to Filipinos,
Certificate from relevant government office of their country
stating that Filipinos are allowed to participate in government
procurement ctivities for same item or product
10. + Duly notarized authority of the signatory based on the above using
the COBAC’s Standard Forms provided in Section VIII. Bidding Forms: Secretary’s Certificate (i.e.
Corporation; Joint Venture Agreement); or Special Power of Attorney (i.e Sole Proprietorship;
Partnership)

64
Signed: Pass: Fail
 V. OPENING AND EVALUATION OF
1ST ENVELOPE - INFRA PROJECTS
No. Document (Minimum Requirements) Present Absent
1. PhilGEPS Certificate of Registration
2. PCAB License & Registration
3. Statement of ALL on-going government and private contracts
4. Statement of SLCC
5. NFCC computation or Committed Line of Credit
6. JVA if applicable + CPES rating and/or certificate of completion and owner’s
acceptance of contract must be AT LEAST satisfactory;
7. Bid Security
8. Project Requirements
8.a. Organizational Chart for contract to bid
8.c List of contractor’s personnel ( e.g. , Project Manager, Project Engineers,
Materials Engineers, and Foremen), to be assigned to the contract to be
bid, with their complete qualification and experience data;
8.c List of contractor’s major equipment units, which are owned, leased, and/or
under purchase agreements, supported by proof of ownership or certification of availability of
equipment from the equipment lessor/vendor for the duration of the project, as the case may be;

9. Omnibus Sworn Statement 65

 V. OPENING AND EVALUATION OF
1ST ENVELOPE ++- INFRA PROJECTS
No. Document (DOH Requirements) Present Absent
8. Duly accomplished and signed Project Requirements, which shall
include the following:
1.  Organizational chart for the contract to be bid;
2. List of contractor’s and joint venture contractor’s personnel to
be assigned with their complete qualification and experience data, shown in matrix with CV including
copy of updated licenses or proof of renewal of their licenses, if expired. The list must contain the
name, educational attainment, training, professional license and work experience of personnel;
3. List of contractor’s equipment units, which are owned, leased, and/or under
purchase agreements, supported by proof of ownership certification of availability of equipment from
the equipment lessor/vendor for the duration of the project;
4. Construction Schedule and s-curve;
5. Manpower Schedule;  
6. Construction Methodology in narrative form;  
7. Equipment Utilization Schedule;  
8. Construction Safety and Health Program;  
9. PERT/CPM;  
10. Affidavit of Site Inspection;  
11. Detailed Architecture and Engineering Plans, Scope of Works
and Technical Specifications (if design and build)
12. Planned subcontracted work, if any of not more than 50%
10. Duly notarized authority of the signatory based on the above using the COBAC’s
Standard Forms provided in Section VIII. Bidding Forms: Secretary’s Certificate (i.e. Corporation; Joint
Venture Agreement); or Special Power of Attorney (i.e Sole Proprietorship; Partnership)

66
 V. OPENING AND EVALUATION OF
1ST ENVELOPE

 Original copy of bid form shall be typed or written in ink

and shall be signed by the bidder or its duly authorized
representative (Sec. 25.8)

 Unsealed or unmarked bid envelopes shall be rejected.

However, bid envelopes that are not properly sealed and
marked, as required in the Bidding Documents, shall be
accepted, provided that the bidder or its duly authorized
representative shall acknowledge such condition of the bid as
submitted. The BAC shall assume no responsibility for the
misplacement of the contents of the improperly sealed or marked
bid, or for its premature opening. (Sec. 25.9)

67
VI. OPENING AND EVALUATION OF
2ND ENVELOPE

CONTENTS:

1. Financial Bid Form (includes bid prices and bill of

quantities, as well as applicable price schedules)

2. In case of Goods, Certification from the DTI if

claiming preference as Domestic Bidder (RA 10667)
3. Other documents required in the bidding
documents

NOTE: Only the 2nd envelope of eligible bidders whose

1st envelope have been rated “passed” shall be opened.
68
VI. OPENING AND EVALUATION OF 2ND
ENVELOPE - GOODS

The Bidder shall submit the following

Financial Proposal documents arranged,
numbered and tabbed as enumerated
below:

a) Duly accomplished and signed Bid

Form;
b) Duly accomplished and signed Price
Schedule based on ITB 15.
69
VI. OPENING AND EVALUATION OF 2ND
ENVELOPE - INFRA PROJECTS
The 2nd (Financial Proposal) shall contain all the required
documents for infrastructure projects under Section 25.3 of
the IRR of R.A. 9184, such as but not limited as follows and
arranged, numbered and tabbed as enumerated: 
a) Financial Bid Form in accordance with the form prescribed
in Section IX, Bidding Form;
b) Bid prices in Bill of Quantities in the prescribed Bid Form;
Bid Prices should be supported by signed detailed estimates
with corresponding prices;
c) Detailed estimates of project including a summary sheet
indicating the unit prices of construction materials, labor
rates and equipment rentals used in coming up with the
Bid; and
d) Cash Flow by quarter or payments schedule. 70
 BID VALIDITY PERIOD (S 28)

 Bids and bid securities (including bid securing

declaration) shall be valid for a reasonable period as
determined by the HOPE as indicated in the Bid Docs.

 Not to exceed 120 cd

 If the period is extended, PE shall request in writing all

those who submitted bids for such extension before the
expiration date. However, bidders have a right to refuse
to grant such extension without forfeiting their bid
security.

71
 DISCLOSURE OF RELATIONS

Relatives within the third civil degree, by affinity or

consanguinity of the following shall be disqualified:

 HOPE
 Members of the BAC, Secretariat and TWG
 Head of the end-user unit or project management
office or implementing unit
 Project consultants

72
 VII. DETAILED EVALUATION
OF BIDS
 Purpose is to determine the Lowest Calculated Bid (LCB)
by:
1. Establishing correct calculated prices of bids; and
2. Ranking calculated total bid prices from lowest to
highest

 A non-discretionary criterion shall be used, which shall

include consideration of:
1. Completeness of bids; and
2. Minor arithmetical corrections

73
 VII. DETAILED EVALUATION
OF BIDS (S 32)
 No Contact Rule - prohibition on communication with bidders
from bid evaluation until award of contract (S 32.1)

 “No contact” rule applies only to those whose bids are being
evaluated by the BAC after passing the preliminary examination
until the issuance of Notice of Award.

 BAC through Secretariat may ask Bidder for clarification in

writing

 Bidders who waived their right to utilize the protest mechanism

or those whose request for reconsideration and/or protest were
subsequently denied are not covered by the prohibition under
Sec. 32.1 of RA 9184 IRR. (NPM 07-2013)
74
 VII. DETAILED EVALUATION
OF BIDS
 BAC evaluates financial component of bids to determine
the Lowest Calculated Bid using the following steps
using non-discretionary criteria below:

a) Completeness of the bid.

b) Arithmetical corrections.

75
 VII. DETAILED EVALUATION
OF BIDS
BAC evaluates financial component of bids to determine
the Lowest Calculated Bid using the following steps using
non-discretionary criteria below:
a) Completeness of Bid (S 32.2.1)
 Unless the ITB specifically allows partial bids, those not
providing all required items shall be considered non-
responsive

 Placing no price is considered as non-responsive

 Specifying a “0” or “-” means it is offered for free

76
 VII. DETAILED EVALUATION
OF BIDS
b) Arithmetical corrections.

• Consider computational errors and omissions to

enable proper comparison of all eligible bids.
• It may also consider bid modifications if
expressly allowed in the Bidding Documents.
• Any adjustment shall be calculated in monetary
terms to determine the calculated prices.

77
 VII. DETAILED EVALUATION
OF BIDS

S 32.2.2.
 All bids evaluated on an equal footing to ensure fair and
competitive bid comparison.
 For this purpose, all bidders shall be required to include the cost
of all taxes, such as, but not limited to, value added tax (VAT),
income tax, local taxes, and other fiscal levies and duties which
shall be itemized in the bid form and reflected in the detailed
estimates.
 Such bids, including said taxes, shall be the basis for bid
evaluation and comparison.

78
 VII. DETAILED EVALUATION OF BIDS
CHECK & CORRECT discrepancies (S32.2.3) between:
DISCREPANCY WHAT PREVAILS
a) bid prices in figures and in words In Words
b) total price per item and unit price for Unit Price
the item as extended or multiplied by
the quantity of that item
c) stated total price and the actual sum Actual sum of
of prices of component items price components
d) unit cost in the detailed estimate and unit cost in the bill
unit cost in the bill of quantities of quantities

79
 VII. DETAILED EVALUATION OF BIDS
 RANK Bids (S32.2.4) in ascending order of Bidders total
calculated bid prices, as evaluated and corrected for
computational errors, & other bid modifications, to identify
LCB.
 DISQUALIFY Total calculated bid prices > ABC , as evaluated &
corrected for computational errors, & other bid modifications

 PREPARE ABSTRACT OF BIDS after all bids have been received,

opened, examined, evaluated, and ranked
 All BAC members sign
 Attach corresponding bid securities and minutes or proceedings of the bidding.
 Abstract of Bids shall contain the following:
a) Name of the contract and its location, if applicable;
b) Time, date and place of bid opening; and
c) Names of bidders and their corresponding calculated bid prices arranged
from lowest to highest, the amount of bid security and the name of the issuing
entity.

80
 DOMESTIC PREFERENCE

 Applicable only for GOODS

 Applies where the lowest bid has a foreign component

(foreign bid) and the next lowest bid has a domestic
component (domestic bidder)

 Requires PE y to give preference to domestic bidder

PROVIDED that:

1. The lowest foreign bid is increased by 15%; and

2. The lowest domestic bidder matches the lowest bid
of the foreign bidder

81
 DOMESTIC PREFERENCE
SAMPLE COMPUTATION
Next Lowest Calculated
Lowest Calculated Bid
Bid
Foreign Bidder Domestic Bidder
Bid 2,653,360.00 3,009,492.00
% Preference x 15%
398,004.00
+ 2,653,360.00
Bid as increased 3,051,364.00 3,009,492.00

Award to Domestic Bidder at 2,653,360.00, or

Result Award to Foreign Bidder if Domestic Bidder refuses

82
 VIII. POST-QUALIFICATION (Rule X)
 To determine whether bidder with LCB complies with
and is responsive to all requirements and conditions of
eligibility and the bidding of the contract – to be
declared the Lowest Calculated and Responsive Bid
(LCRB)
 LCB to submit post-qulification documents within 5
cd from receipt of notice.
 Failure to submit any of the post-qualification
requirements on time, or a finding against the veracity
thereof, shall disqualify the bidder for award. Should
there be a finding against the veracity of any of the
documents submitted, the Bid Security shall be forfeited in
accordance with Sec. 69.
83
 VIII. POST-QUALIFICATION
CRITERIA
A non-discretionary pass/fail criterion shall be used to “Verify,
Validate and Ascertain” all statements and documents
submitted by the LCB
A. LEGAL REQUIREMENTS --- verify, validate, and ascertain licenses,
certificates, permits, and agreements submitted by the bidder,
and if in the “blacklist”
B. TECHNICAL REQUIREMENTS -- determine compliance of offer or
bid or proposal with the requirements specified in the Bidding
Documents, including, where applicable:
i) Verification and validation of the bidder’s stated competence and
experience, and the competence and experience of the bidder’s
key personnel to be assigned to the project, for the procurement
of Infrastructure Projects and Consulting Services;
84
 VIII. POST-QUALIFICATION

B. TECHNICAL REQUIREMENTS (INFRA)

ii) Verification of availability and commitment, and/or inspection and
testing for required capacities and operating conditions, of
equipment units to be owned/leased/under purchase by the bidder
for use in the contract & checking the performance of the bidder in
its ongoing government and private contracts, if any of these
ongoing contracts shows:
a. Negative slippage of at least fifteen percent (15%) in any one
project or a negative slippage of at least ten percent (10%) in each
of two (2) or more contracts;
b. Failure of the contractor to commence repair works on ongoing
contracts within seven (7) calendar days and to complete them
within thirty (30) calendar days after receipt of the Procuring
Entity's notice of defects and deficiencies; 85
 VIII. POST-QUALIFICATION

B. TECHNICAL REQUIREMENTS (INFRA)

c. Failure of the contractor to commence repair works on
contracts with pending certificates of acceptance within thirty
(30) calendar days and complete them within ninety (90) days
after receipt of the Procuring Entity's notice of defects and
failures; or
d. Substandard quality of work as per contract plans and
specifications, or unsatisfactory performance of the contractor’s
obligations as per contract terms and conditions, at the time of
inspection.

If any of these deficiencies exist due to the contractor’s fault or

negligence, the PE shall disqualify the contractor from the award.
86
 VIII. POST-QUALIFICATION
B. TECHNICAL REQUIREMENTS (GOODS)
iii) Verification and/or inspection and testing of the goods/product, aftersales
and/or maintenance capabilities, in applicable cases, as well as checking the
following:
a. Delay in the partial delivery of goods amounting to ten percent (10%) of the
contract price in its ongoing government and private contracts;
b. If any of these contracts shows the bidder’s failure to deliver or perform any
or all of the goods or services within the period(s) specified in the contract or
within any extension thereof granted by the PE pursuant to a request made
by the supplier prior to the delay, and such failure amounts to at least ten
percent (10%) of the contract price; or
c. Unsatisfactory performance of the supplier’s obligations as per contract
terms and conditions at the time of inspection.
If any of these deficiencies exist due to the bidder's fault or negligence, the
BAC shall disqualify the bidder from the award.

87
 VIII. POST-QUALIFICATION

 PE may request for the submission of additional

documents from the bidder in support of the information
it has provided in the bidding documents.

 However, non-submission of the additional supporting

documents requested cannot be a ground for the
bidder’s post-disqualification, as a bidder may be post-
disqualified only upon ascertainment, validation, and
verification of its non-compliance with the legal, technical,
and financial requirements of the project as provided in
the bidding documents.

NPM 25-2013
88
 VIII. POST-QUALIFICATION
LCB POSTQUALIFIED LCB POST-DISQUALIFIED
Declare as lowest Immediately notify bidder in writing
calculated responsive bid and grounds for it
(LCRB)
Award contract Notwithstanding any request for
reconsideration, initiate and complete
post-qua process for 2nd LCB

2nd LCB post qualified 2nd LCB post disqualified

If request for Notwithstanding any request for
reconsideration of 1st LCB reconsideration, initiate and complete
denied, declare 2nd as post-qua process for next LCB if
LCRB available

89
 VIII. POST-QUALIFICATION

 Completed in not more than 7 cd 12 cd, or up to 30 cd 45

cd in exceptional cases, upon approval of the HOPE.

 In case of post-disqualification of the LCB, the BAC shall be

given the  same fresh period to conduct the post-
qualification of the next LCB. (Sec. 34.8)

 BAC will notify the Bidder with the Lowest Calculated

Bid that it was determined as such

90
 RECOMMENDATION OF AWARD

 The BAC shall recommend award of contract to the

LOWEST CALCULATED AND RESPONSIVE BID
(LCRB) at submitted price or calculated price, whichever is
lower. (S34.4) through a BAC resolution

 The HOPE (or delegated authority) has 7 cd 15 cd to

decide whether or not to approve or disapprove the
recommendation.
 The BAC shall notify all other bidders, in writing, of its
recommendation to HOPE of award of contract to
LCRB/HRRB within 3 cd from the issuance of the resolution
recommending award. (Sec. 37.1.1)
91
 FAILURE OF BIDDING (S35)

GROUNDS:

a) No bids received
b) Bids received but no one was eligible
c) All bids failed to post qualify
d) Someone post qualified but refused w/o justifiable
cause to accept the award.

92
 FAILURE OF BIDDING
WHAT TO DO:
1) BAC conducts Mandatory Review and Evaluation to
determine reason (s) of failure:
2) Based on findings, BAC shall:
 Revise terms, conditions, specifications
 Adjust ABC if needed, subject to required approvals
3) Re-bid
4) Re-advertise
 All bidders who have initially responded to Invitation
to Bid and have been declared eligible in previous
biddings shall be allowed to submit new bid.
 2nd failure of bidding, PE may resort to negotiated
procurement
93
 IX. NOTICE & EXECUTION OF AWARD
A. CONTRACT AWARD (S 37.1)
 BAC recommends to HoPE award of contract to
LCRB/SCRB
 BAC submits the following supporting documents to HoPE:
a) BAC Resolution recommending award;
b) Abstract of Bids;
c) Duly approved program of work or delivery schedule,
and Cost Estimates;
d) Document issued by appropriate entity authorizing PE to
incur obligations for a specified amount; and
e) Other pertinent documents required by existing laws,
rules, and/or the PE concerned.
 BAC notifies all other bidders, in writing, of its
recommendation within 3 calendar days from the issuance of
the resolution recommending award of contract
94
IX. NOTICE & EXECUTION OF AWARD

A. CONTRACT AWARD (S 37.1)

 HoPE or his duly authorized representative approves or

disapproves recommendation within a period not
exceeding fifteen (15) calendar days

 Approves -- HoPE immediately issues the Notice of

Award to the bidder with the LCRB/SCRB

 Disapproves -- HoPE notifies BAC and bidder in writing

of decision and grounds for it based on valid,
reasonable, and justifiable grounds under Section 41

95
IX. NOTICE & EXECUTION OF AWARD

A. CONTRACT AWARD (S 37.1)

 HoPE Disapproves recommendation to award

 Bidder may file a request for reconsideration to HoPE
within 3 calendar days from receipt of the notice of
disapproval.
 HoPE resolves with finality the request for reconsideration
within 7 CDs from the filing thereof and furnish the bidder
a copy of the resolution immediately from its promulgation.
 In no case shall the request for reconsideration stay or delay
the bidding process but request for reconsideration must
first be resolved before any award is made
 When applicable, the BAC shall conduct a post-qualification
of the bidder with the next LCB.

96
 IX. NOTICE & EXECUTION OF AWARD

A. CONTRACT AWARD (S 37.1)

 Award of contract is subject to the following conditions

within 10 cd from issuance of NOA:

a) If joint venture, submission of JVA

b) In the case of procurement by a Philippine Foreign Office
or Post, PhilGEPS Registration Number
c) If foreign-funded and stated in treaty, international
or executive agreement, PCAB License
d) Posting of Performance Security
e) Signing of Contract upon compliance with all
documentary requirements
f) If required, approvals by higher authority
97
IX. NOTICE & EXECUTION OF AWARD

A. CONTRACT AWARD (S 37.1)

 Contract shall be awarded to the bidder with the Lowest
Calculated and Responsive Bid (LCRB) at its submitted
price or total calculated bid price, whichever is lower.

 Notice of Award (NOA) is issued by the HOPE within

the following periods:

- NGAs and LGUs – 7 cd 15 cd

- GOCCs and SUCs – 15 cd

 BAC Sec posts NOA in the PhilGEPS and PE’s

websites, and in any conspicuous place within 3 cd
from its issuance.
98
IX. NOTICE & EXECUTION OF AWARD

B. CONTRACT SIGNING
 Winning posts security and enters into contract with PE with in 10
from receipt of NOA
 PE enters into a contract with PE with same 10 days provided all
documents are complied with :
a) Contract Agreement;
b) Bidding Documents;
c) Winning bidder’s bid, including the Eligibility requirements, Technical
and Financial Proposals, and all other documents/statements
submitted;
d) Performance Security;
e) Notice of Award of Contract; and
f) Other contract documents that may be required by existing laws
and/or the PE indicated in the Bidding Documents,

99
IX. NOTICE & EXECUTION OF AWARD

B. CONTRACT SIGNING By higher authority

 When required, the approving higher authority or his

duly authorized representative shall be given a
maximum of 15 cd 20 cd from receipt to approve or
disapprove the contract.

 In the case of GOCCs, the concerned board or its duly

authorized representative shall be given a maximum of
25 cd 30 cd from receipt to approve or disapprove the
contract.

100
 PERIOD TO COMPLETE
PROCUREMENT PROCESS (S 38)
• PROCUREMENT PROCESS
From Opening of Bids to Award of Contract shall
NOT EXCEED 3 MONTHS
• BAC Members on ‘JURY DUTY’ ( give utmost priority)

In the case of Jacomille v. Abaya, et al., the petitioner contends that

the public respondents failed to comply with the periods provided
by law, specifically the 3-month period from the opening of the bids
up to the award of the contract under Section 38 of RA 9184. The
Supreme Court held that “[t]he different periods provided by RA
9184 within which certain stages of the procurement process must
be completed is not merely directory but mandatory.” Thus, it
concluded that such irregularity rendered the procurement process
null and void. (G.R. No. 212381, 22 April 2015)
101
 PERFORMANCE SECURITY (S 39)
 Posted by winning bidder upon signing of contract to guarantee performance
of obligation, in such form and amount specified in the Bidding Documents.
Amount
Form of Performance Security Performance Security
(% equal to the Contract Price)
a) Cash or cashier’s/manager’s check
from Universal or Commercial
Bank (UCB) & authorized by BSP
5% (Goods ) & 10% (Infra)
b) Bank guarantee/draft or Irrevocable
LC from UCB
c) Surety bond callable upon demand,
authorized by Insurance 30%
Commission
• No combination

102
 PERFORMANCE SECURITY (S 39)
 In pesos
 Valid until PE issues Certificate of
Acceptance
 May be released after the issuance of the
Certificate of Final Acceptance, subject to the
following conditions:
a) Procuring Entity has no claims filed
against the contract awardee or the surety
company;
b) It has no claims for labor and materials
filed against the contractor; and
c) Other terms of the contract
103
 PERFORMANCE SECURITY (S 39)
 Infrastructure Projects additional performance security for additional
works
 winning bidder following the same schedule to cover any cumulative
increase of more than ten percent (10%) over the original value of the
contract as a result of amendments to order or change orders, extra work
orders and supplemental agreements, as the case may be.
 winning bidder shall cause the extension of the validity of the
Performance Security to cover approved contract time extensions.
 reduction in the contract value, or, in the case of Infrastructure Projects, for
partially completed works under the contract which are usable and accepted
by the GoP, and the use of which, in the judgment of the PE, will not affect
the structural integrity of the entire project:
 proportional reduction in the original PS:
 Provided , that any such reduction is more than ten percent (10%) and
that the aggregate of such reductions is not more than fifty percent
(50%) of the original PS
 104
 WINNING BIDDER FAILURE TO ENTER INTO
CONTRACT & POST PERFORMANCE SECURITY (S40)

1. Forfeiture of Bid Security

2. Imposition of appropriate sanctions
provided in the IRR and existing laws
3. Disqualification of Bidder Ground
4. Next-ranked LCB shall undertake post-
qualification process

105
 NOTICE TO PROCEED ( S37.4)
C. NOTICE TO PROCEED
 PE issues the Notice to Proceed (NTP) together with a
copy or copies of the approved contract to the
successful bidder within 3 cd 7 cd from the date of
approval of the contract by the appropriate government
approving authority.

 All notices called for by the terms of the contract shall be

effective only at the time of receipt thereof by the
successful bidder.

 BAC Sec posts the NTP and the approved contract in

the PhilGEPS and PE’s websites within 15 cd from the
issuance of the NTP.
106
 RESERVATION CLAUSE (S 41)
 HOPE reserves the right to:
◦ Reject any and all bids;
◦ Declare a failure of bidding; or
◦ Not award the contract.
 GROUNDS:
1. Prima facie evidence of collusion;
2. BAC is found to have failed in following the prescribed
bidding procedures;
3. For justifiable reasons, the award of contract will not redound
to the benefit of the Government:
 Physical and economic conditions have significantly
changed;
 Project is no longer necessary
 Source of funds for the project has been withdrawn/reduced.

107
 RETENTION MONEY

For Goods, retention money is 10% at

least 1% of contract price (Sec. 62)

For Infrastructure Projects, retention

money is 10% of contract price

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 LIQUIDATED DAMAGES

Once the cumulative amount of liquidated

damages reaches ten percent (10%) of the amount
of the contract, the PE shall may rescind or
terminate the contract, without prejudice to other
courses of action and remedies available under the
circumstances.

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 THANK YOU!!

Contact us:

Unit 2506 Raffles Corporate Center

F. Ortigas Road, Ortigas Center
Pasig City, Philippines 1605

TeleFax: (632)900-6741 to 44

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