Procurement

All procurement shall be within the approved budget of the Procuring Entity and should be meticulously and judiciously planned by the Procuring Entity. Consistent with government fiscal discipline measures, only those considered crucial to the efficient discharge of governmental functions shall be included in the Annual Procurement Plan (APP).

For purposes of this IRR, a procurement project shall be considered crucial to the efficient discharge of governmental functions if it is required for the day-to-day operations or is in pursuit of the principal mandate of the Procuring Entity concerned.

The APP shall include provisions for foreseeable emergencies based on historical records. In the case of Infrastructure Projects, the APP shall consider the appropriate timing/phasing of related project activities, such as, engineering design and acquisition of right-of-way site or location, to reduce/lower project costs.

No procurement shall be undertaken unless it is in accordance with the approved APP, including approved changes thereto. The APP must be consistent with the duly approved yearly budget of the Procuring Entity and shall bear the approval of the HoPE or second-ranking official designated by the HoPE to act on his behalf

Upon issuance of the budget call in the case of NGAs, SUCs, Constitutional Commissions or Offices, or similar document for GOCCs, GFIs and LGUs, the Procuring Entity shall prepare its indicative APP for the succeeding calendar year to support its proposed budget taking into consideration the budget framework for that year in order to reflect its priorities and objectives.

Changes to the individual PPMPs and the consolidated APP may be undertaken every six (6) months or as often as may be required by the HoPE. The respective end-user
or implementing units of the Procuring Entity shall be responsible for the changes to the PPMPs, while the BAC Secretariat shall be responsible for the consolidation of these PPMPs into an APP, which shall be subject to the approval of the HoPE.

Changes in the APP, if any, for the budget year shall be submitted to the GPPB in July of the current budget year, and in January of the following budget year.

Refers to the budget for the contract duly approved by the HoPE, as provided for in the General Appropriations Act (GAA), continuing, and automatic appropriations, in the case of national government agencies (NGAs); the corporate budget for the contract approved by the governing board, pursuant to Executive Order (E.O). No. 518, s. 1979, in the case of GOCCs and GFIs, and R.A. 8292 in the case of SUCs; the budget approved by the Sanggunian through an appropriations ordinance in the case of LGUs. For multi-year contracts, for which a Multi Year Obligational Authority (MYOA) or an equivalent document is required, the ABC shall be that incorporated in the project cost reflected in the MYOA or equivalent document. 

For Foreign-funded Procurement, the ABC refers to the cost estimate prepared by the Procuring Entity and approved by the foreign government/foreign or international financing institution as specified in the Treaty or International or Executive Agreement.

The HoPE shall create a Secretariat which will serve as the main support unit of the BAC. An existing organic office within the Procuring Entity may also be designated to serve as Secretariat.

To strengthen and promote the professionalization of the organizations’ procuring unit, the HoPE may create procurement units that may serve concurrently as BAC Secretariat in accordance with the guidelines issued by DBM. The Secretariat shall have the following functions and responsibilities:

1. Provide administrative support to the BAC and the TWG;
2. Organize and make all necessary arrangements for BAC and the TWG meetings and conferences;
3. Prepare minutes of meetings and resolutions of the BAC;
4. Take custody of procurement documents and other records and ensure that all procurements undertaken by the Procuring Entity are properly documented;
5. Manage the sale and distribution of Bidding Documents to interested bidders;
6. Advertise and/or post bidding opportunities, including Bidding Documents, and notices of awards;
7. Assist in managing the procurement processes;
8. Monitor procurement activities and milestones for proper reporting to relevant agencies when required
9. Consolidate PPMPs from various units of the Procuring Entity to make them available for review as indicated in Section 7 of this IRR and prepare the APP; and
10. Act as the central channel of communications for the BAC with end-user or implementing units, PMOs, other units of the line agency, other government agencies, providers of goods, infrastructure projects, and consulting services, observers, and the general public

In case of an existing ad hoc Secretariat, the HoPE shall assign full-time support staff to their BAC Secretariat. The head of the Secretariat in central offices shall be at least a fifth (5th) ranking permanent employee or, if not available, a permanent employee of lower rank; or shall be at least a third (3rd) ranking permanent employee in bureaus, regional offices and sub-regional/ district offices, or if not available, a permanent employee of lower rank. In addition to integrity, Heads of Procuring Entities shall consider procurement proficiency as a factor in designating the head of the Secretariat and Procurement Unit.

To expedite the procurement process, the HoPE shall ensure that the members of the BAC, its Secretariat and TWG, shall give utmost priority to BAC assignments over all other duties and responsibilities, until the requirements for the said assignments at hand are completed.

Refers to a signed offer or proposal to undertake a contract submitted by a bidder in response to and in consonance with the requirements of the Bidding Documents.

For purposes of, and throughout the IRR, the term “Bid” shall be equivalent to and be used interchangeably with “Proposal” and “Tender."

Bid Securing Declaration is an undertaking which states, among others, that the bidder shall enter into contract with the Procuring Entity and furnish the required performance security within ten (10) calendar days, as indicated in the Bidding Documents, from receipt of the Notice of Award, and commits to pay the corresponding amount as fine and be automatically disqualified from bidding of any procurement contract of any Procuring Entity for a period of time, upon receipt of the Blacklisting Order, in the event it violates any of the conditions stated therein as required in the guidelines issued by the GPPB.

Refers to a contractor, manufacturer, supplier, distributor and/or consultant who submits a bid in response to the requirements of the Bidding Documents.

Refer to the documents issued by the Procuring Entity as the basis for bids, furnishing all information necessary for a prospective bidder to prepare a bid for the Goods, Infrastructure Projects and/or Consulting Services required by the Procuring Entity.

The HoPE shall designate at least five (5) but not more than seven (7) members to the BAC of unquestionable integrity and procurement proficiency

BAC for NGAs

The BAC for NGAs, departments, bureaus, offices, or instrumentalities of the GoP, including the judicial and legislative branches, constitutional commissions, SUCs, GOCCs, and GFIs shall be composed of the following: 

Regular Members:

1. Chairperson, who is at least a third (3rd) ranking permanent official of the Procuring Entity;
2. An officer, who is at least a fifth (5th) ranking permanent official, or if not available, an officer of the next lower rank with knowledge, experience and/or expertise in procurement who, to the extent possible, represents the legal or administrative area of the Procuring Entity: Provided, That in the case of bureaus, regional offices and sub-regional/district offices, BAC members shall be at least a third (3rd) ranking permanent personnel or if not available, an officer of the next lower rank;
3. An officer, who is at least a fifth (5th) ranking permanent official, or if not available, an officer of the next lower rank with knowledge, experience and/or expertise in procurement who, to the extent possible, represents the finance area of the Procuring Entity: Provided, That in the case of bureaus, regional offices and sub-regional/district offices, BAC members shall be at least a third (3rd) ranking permanent personnel or if not available, an officer of the next lower rank. 

Provisional Members:

1. An officer who has technical expertise relevant to the procurement at hand, and, to the extent possible, has knowledge, experience and/or expertise in
   procurement; and
2. A representative from the end-user or implementing unit who has knowledge of procurement laws and procedures, subject to existing laws, rules and regulations.

The Chairperson and the Vice-Chairperson shall also be designated by the HoPE. Moreover, the Vice-Chairperson shall be a regular member of the BAC. For purposes of this IRR, the term “permanent” shall refer to a plantilla position within the Procuring Entity concerned.

BAC for LGUs:

Provinces, Cities, and Municipalities

1. One representative each from the regular offices under the Office of the Local Chief Executive such as, but not limited to, the following: Office of the Administrator, Budget Office, Legal Office, Engineering Office, General Services Offices; and
2. A representative from the end user unit.  The Chairperson and Vice-Chairperson shall be designated by the Local Chief Executive. The Chairperson of the BAC shall be at least a third (3rd) ranking permanent official of the Procuring Entity. The members of the BAC shall be personnel occupying plantilla positions of the Procuring Entity concerned. 

For Barangays:

1. The BAC shall be composed of at least five (5), but not more than seven (7) regular members of the Sangguniang Barangay, except the Punong Barangay.
2. The Punong Barangay, being the Local Chief Executive, shall designate the Chairperson, Vice-Chairperson, and members of the BAC.

The HoPE may designate alternate BAC members, who shall have the same qualifications as that of the members originally designated. The alternate members shall attend meetings of the BAC and receive the proportionate honoraria, whenever the original members are absent. The alternate members shall have the same term as the original members.

In no case shall the HoPE and/or the approving authority be the Chairperson or a member of the BAC.

Unless sooner removed for a cause, the members of the BAC shall have a fixed term of one (1) year reckoned from the date of appointment, renewable at the discretion of the HoPE. Upon expiration of the terms of the current members, they shall continue to exercise their functions until new BAC members are designated. In case of resignation, retirement, separation, transfer, reassignment, removal, or death, the replacement shall serve only for the unexpired term: Provided, however, That in case of leave or suspension, the replacement shall serve only for the duration of the leave or suspension. For justifiable causes, a member shall be suspended or removed by the HoPE.

Functions of the BAC

The BAC shall have the following functions:

1. advertise and/or post the invitation to bid/request for expressions of interest;
2. conduct pre-procurement and pre-bid conferences;
3. determine the eligibility of prospective bidders;
4. receive and open bids;
5. conduct the evaluation of bids;
6. undertake post-qualification proceedings;
7. resolve requests for reconsideration;
8. recommend award of contracts to the HoPE or his duly authorized representative;
9. recommend the imposition of sanctions;
10. recommend to the HoPE the use of Alternative Methods of Procurement;
11. conduct any of the Alternative Methods of Procurement;
12. conduct periodic assessment of the procurement processes and procedures to streamline procurement activities pursuant to Section 3(c) of this IRR; and m) perform such other related functions as may be necessary, including the creation of a Technical Working Group (TWG) from a pool of technical, financial, and/or legal experts. 

To the extent possible, the BAC in central offices shall render necessary assistance to its regional or lower office BACs to facilitate the conduct of procurement from preprocurement conference to the post-qualification stage.(a) 12.2 The BAC shall be responsible for ensuring that the Procuring Entity abides by the standards set forth by the Act and this IRR, and it shall prepare a Procurement
Monitoring Report (PMR) in the form prescribed by the GPPB. The PMR shall cover all procurement activities specified in the APP, whether ongoing and completed, from the holding of the pre-procurement conference to the issuance of notice of award and the approval of the contract, including the standard and actual time for each major procurement activity. The PMR shall be approved and submitted by the HoPE to the GPPB in electronic format within fourteen (14) calendar days after the end of each semester. The PMR shall likewise be posted in accordance with E.O. 662, s. 2007, as amended.

Refer to those goods, materials and equipment that are used in the day-to-day operations of Procuring Entities in the performance of their functions. For the purpose of the IRR, CSE shall be those included in the Electronic Catalogue of the PhilGEPS.

Refers to a 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. For purposes of, and throughout the IRR, the terms “Competitive Bidding” and “Public Bidding” shall have the same meaning and shall be used interchangeably.

Refer to services for infrastructure projects and other types of projects or activities of the GoP requiring adequate external technical and professional expertise that are beyond the capability and/or capacity of the GoP to undertake such as, but not limited to: (i) advisory and review services; (ii) pre- investment or feasibility studies; (iii) design; (iv) construction supervision; (v) management and related services; and (vi) other technical services or special studies.

Refers to any person or entity offering unmanufactured articles, materials or supplies of the growth or production of the Philippines, or manufactured articles, materials, or supplies manufactured or to be manufactured in the Philippines substantially from articles, materials, or supplies of the growth, production, or manufacture, as the case may be, of the Philippines.

Refers to an individual or a sole proprietor who is a citizen of the Philippines or a partnership, corporation, cooperative, or association duly organized under the laws of the Philippines and of which at least seventy five percent (75%) of the interest or outstanding capital stock belongs to citizens of the Philippines, habitually established in business and habitually engaged in the manufacture or sale of the merchandise covered by his bid, and the business has been in existence for at
least five (5) consecutive years prior to the advertisement and/or posting of the Invitation to Bid.

Refer to International Agreements except that they do not require legislative ratification. 

Refer to articles which are normally consumed in use within one (1) year or converted in the process of manufacture or construction, or those having a life expectancy of more than one (1) year but which shall have decreased substantially in value after being put to use for only one (1) year (e.g., medicines, stationery, fuel, and spare parts).

Refers to any offer of articles, materials or supplies not manufactured or not to be manufactured in the Philippines, substantially from articles, materials, or supplies of the growth, production, or manufacture, as the case may be, of the Philippines.

Refer to grants with no repayment obligations and are provided in monetary form, goods, works, and consultancy services, among others. 

Refer to loans, credits, and indebtedness with private foreign banks or with foreign governments, agencies, or instrumentalities of such foreign governments, foreign financial institutions, or other international organizations with whom, or belonging to countries with which, the Philippines has diplomatic relations, as may be necessary and upon such terms and conditions as may be agreed upon, to enable the GoP to finance, either directly or through any government office, agency or instrumentality or any government-owned and controlled corporation, industrial, agricultural or other economic development purposes or projects authorized by law. 

Refers to the acquisition of goods, consulting services, and the contracting for infrastructure projects by the GoP which are wholly or partly funded by Foreign Loans or Grants pursuant to a Treaty or International or Executive Agreement. For purposes of, and throughout this IRR, the term “foreign funded procurement” shall have the same meaning as and shall be used interchangeably with “foreign-funded projects” or “foreign-assisted projects.”

Refers to a written agreement between a procuring entity and a supplier or service provider that identifies the terms and conditions, under which specific purchases, otherwise known as “Call-Offs,” are made for the duration of the agreement. It is in the nature of an option contract between the procuring entity and the bidder(s) granting the procuring entity the option to either place an order for any of the goods or services identified in the Framework Agreement List or not buy at all, within a minimum period of one (1) year to a maximum period of three (3) years. (GPPB Resolution No. 27-2019)

Refer to all items, supplies, materials and general support services, except Consulting Services and infrastructure projects, which may be needed in the transaction of public businesses or in the pursuit of any government undertaking, project or activity, whether in the nature of equipment, furniture, stationery, materials for construction, or personal property of any kind, including non-personal or
contractual services, such as, the repair and maintenance of equipment and furniture, as well as trucking, hauling, janitorial, security, and related or analogous services, as
well as procurement of materials and supplies provided by the Procuring Entity for such services. The term “related” or “analogous services” shall include, but is not
limited to, lease of office space, media advertisements, health maintenance services, and other services essential to the operation of the Procuring Entity.

Refers to: (i) the head of the agency or body, or his duly authorized official, for NGAs and the constitutional commissions or offices, and other branches of government; (ii) the governing board or its duly authorized official, for GOCCs, GFIs and SUCs; or (iii) the local chief executive, for LGUs: Provided, however, That in an agency, department, or office where the procurement is decentralized, the head of each decentralized unit shall be considered as the HoPE, subject to the limitations and authority delegated by the head of the agency, department, or office.

The Procuring Entity may grant payment of honoraria to the BAC members in an amount not to exceed twenty five percent (25%) of their respective basic monthly salary subject to availability of funds. For this purpose, the DBM shall promulgate the necessary guidelines. The Procuring Entity may also grant payment of honoraria to the BAC Secretariat and the TWG members, subject to the relevant rules of the DBM. 

Include the construction, improvement, rehabilitation, demolition, repair, restoration or maintenance of roads and bridges, railways, airports, seaports, communication facilities, civil works components of information technology projects, irrigation, flood control and drainage, water supply, sanitation, sewerage and
solid waste management systems, shore protection, energy/power and electrification facilities, national buildings, school buildings, hospital buildings, and other related construction projects of the government. For purposes of, and throughout the IRR, the term “Infrastructure Projects” shall have the same meaning as, and shall be used interchangeably with, “civil works” or “works.” 

Refers to a contract or understanding, regardless of nomenclature, entered into between the GoP and another government or foreign or international financing institution in written form and governed by international law, whether embodied in a single instrument or in two (2) or more related instruments. 

Refer to articles which are not consumed in use and ordinarily retain their original identity during the period of use, whose serviceable life is more than one (1) year and which add to the assets of the GoP (e.g., furniture, fixtures, transport and other equipment). For this IRR, the term non-expendable supplies shall include semi expendable property.

To enhance the transparency of the process, the BAC shall, during the eligibility checking, shortlisting, pre-bid conference, preliminary examination of bids, bid evaluation, and post-qualification, invite:

1. Representative of the COA
2. At least two (2) observers, who shall not have the right to vote, to sit in its proceedings

• • At least one (1) shall come from a duly recognized private group in a sector or discipline relevant to the procurement at hand, for example:
    • For Infrastructure Projects, national associations of constructors duly recognized by the Construction Industry Authority of the Philippines (CIAP), such as, but not limited to the following: (1) Philippine Constructors Association, Inc.; or (2) National Constructors Association of the Philippines, Inc.
    • For Goods, a specific relevant chamber-member of the Philippine Chamber of Commerce and Industry.
    • For Consulting Services, a project-related professional organization accredited or duly recognized by the Professional Regulation Commission or the Supreme Court, such as, but not limited to: (1) Philippine Institute of Civil Engineers (PICE); (2) Philippine Institute of Certified Public Accountants (PICPA); or (3) Confederation of Filipino Consulting Organizations;
  • The other observer shall come from a non-government organization (NGO).

The observers shall come from an organization duly registered with the Securities and Exchange Commission (SEC) or the Cooperative Development Authority (CDA), and should meet the following criteria:

1. Knowledge, experience or expertise in procurement or in the subject matter of the contract to be bid;
2. Absence of actual or potential conflict of interest in the contract to be bid; and
3. Any other relevant criteria that may be determined by the BAC.

Observers shall be invited at least five (5) calendar days before the date of the procurement stage/activity. The absence of observers will not nullify the BAC proceedings: Provided, That they have been duly invited in writing. The Procuring Entities should ensure that the invitation is received at least five (5) calendar days before each procurement activity. In the event that a procurement activity has to be postponed, the observers shall be notified immediately of the change in schedule.

The observers shall have the following responsibilities: 

1. To prepare the report either jointly or separately indicating their observations made on the procurement activities conducted by the BAC for submission to the HoPE, copy furnished the BAC Chairperson. The report shall assess the extent of the BAC’s compliance with the provisions of this IRR and areas of improvement in the BAC’s proceedings;
2. to submit their report to the Procuring Entity and furnish a copy to the GPPB and Office of the Ombudsman/Resident Ombudsman. If no report is submitted by the observer within seven (7) calendar days after each procurement activity, then it is presumed that the bidding activity conducted by the BAC followed the correct procedure; and
3. To immediately inhibit and notify in writing the Procuring Entity concerned of any actual or potential interest in the contract to be bid.

Observers shall be allowed access to or be provided with the following documents free of charge upon their request: (a) minutes of BAC meetings; (b) abstract of Bids; (c)
post-qualification summary report; (d) APP and related PPMP; and (e) opened proposals.

In all instances, observers shall be required to enter into a confidentiality agreement with the concerned Procuring Entity in accordance with the form prescribed by the GPPB.

To promote transparency and efficiency, information and communications technology shall be utilized in the conduct of procurement procedures. Accordingly, there shall be a single portal that shall serve as the primary source of information on all government procurement. The PhilGEPS shall serve as the primary and definitive source of information on government procurement.

For purposes of, and throughout this IRR, the term “PhilGEPS” shall have the same meaning as, and shall be used interchangeably with, “G-EPS” referred to in the Act.

Refers to an individual or a sole proprietor who is a citizen of the Philippines or a partnership, corporation, or association organized under the laws of the Philippines of which at least sixty percent (60%) of the capital or interest is owned by citizens of the Philippines, or cooperatives registered with the Cooperative Development Authority.

Refers to the acquisition of goods, consulting services, and the contracting for infrastructure projects by the Procuring Entity. In case of projects involving mixed procurements, the nature of the procurement, i.e., Goods, Infrastructure Projects or Consulting Services, shall be determined based on the primary purpose of the contract. Procurement shall also include the lease of goods and real estate. With respect to real property, its procurement shall be governed by the provisions of R.A. 10752 and other applicable laws, rules and regulations.

Refers to any branch, constitutional commission or office, agency, department, bureau, office, or instrumentality of the GoP (NGA), including GOCC, GFI, SUC and LGU procuring goods, infrastructure projects and consulting services. 

In the preparation of the indicative APP, the end-user or implementing units of the Procuring Entity shall formulate their respective Project Procurement Management Plans (PPMPs) for their different programs, activities, and projects (PAPs). The PPMP shall include: 

1. information on whether PAPs will be contracted out, implemented by administration in accordance with the guidelines issued by the GPPB, or consigned;
2. the type and objective of contract to be employed;
3. the extent/size of contract scopes/packages;
4. the procurement methods to be adopted, and indicating if the procurement tasks are to be outsourced;
5. the time schedule for each procurement activity and for the contract implementation; and
6. the estimated budget for the general components of the contract.

For purposes of this Section, consignment refers to an arrangement where the following requisites are present:

1. delivery of goods by their owner (consignor), without sale, to a government agency (consignee)
2. consignee must try to sell the goods and remit the price of the sold goods to the consignor
3. consignee accepts without any liability except for failure to reasonably protect them from damage
4. no disbursement of government funds is involved; and
5. at terms not disadvantageous to the GoP.

Based on the specific needs, the end-user or implementing units of the Procuring Entity shall be responsible for the preparation of all documents necessary for the procurement activity, including but shall not be limited to, the technical specifications, scope of work, or terms of reference.

A majority of the total BAC composition as designated by the HoPE shall constitute a quorum for the transaction of business, provided that the presence of the Chairperson
or Vice-Chairperson shall be required.

For purposes of determining a quorum, a member of the BAC, which include the Chairperson or the Vice-Chairperson, may be present, either in person or face-to- face through videoconferencing, webcasting or similar technology for procuring entities with such technology.

Created by the Bids and Awards Committee to:

1. Review of the Technical Specifications, Scope of Work, and Terms of Reference;
2. Review of Bidding Documents;
3. Shortlisting of Consultants;
4. Eligibility Screening;
5. Evaluation of Bids;
6. Post-Qualification; and
7. Resolution of Request for Reconsideration

Refer to international agreements entered into by the GoP which require legislative ratification after executive concurrence. 

Refer to universal or commercial banks duly authorized under R.A. 8791, otherwise known as “The General Banking Act of 2000.”