Salient IRR Revisions

Procurement of Goods
IRR Revisions: Goods
 Eligibility Requirements (Sec. 23)

 Legal Documents
 DTI / SEC / CDA Registration

 Mayor’s permit for principal place of business

 Technical Documents
 Statement of all on-going and completed contracts
IRR Revisions: Goods
 Eligibility Requirements (Sec. 23)

 Financial Documents
 Audited Financial Statement received by the BIR
 NFCC computation or Credit Line Commitment from a
universal or commercial bank
 For LGUs, other banks authorized by BSP to issue said instrument
IRR Revisions: Goods
 Eligibility Requirements (Sec. 23)

 If Joint Venture -
 JVA
 If no JVA, sworn statements by each partner that they will
enter into and abide by provisions of the JVA if awarded the
contract
IRR Revisions: Goods
 Eligibility Criteria (Sec. 23)

 Legal Eligibility
 General rule: 60% Filipino
 Foreign bidders eligible allowed –
 If stated in treaty, international or executive agreement
 National of a country offering reciprocity rights to Filipinos (RA 5183)
 Goods not available from local suppliers
 To prevent situations that defeat competition or restrain trade
IRR Revisions: Goods
 Eligibility Requirements for Foreign Bidders (Sec.
23)
 Submit equivalent documents issued by country

 Accompanied by English translation certified by

appropriate embassy or consulate in the Philippines
IRR Revisions: Goods
 Eligibility Criteria (Sec. 23)

 Single Largest Contract for Goods

General Rule Exceptions Then require the ff.:

1. Expendable Supplies If, at the outset and after a) At least 2 similar

• 25% of the ABC market research, applying contracts aggregate
the general rule will likely amount at least
1. Services and result to: equivalent to required
Non-expendable Supplies percentage; and
• 50% of the ABC 1.Failure of bidding; or
2.Monopoly b) Largest of the similar
contracts amounts to
at least 50% of
required percentage
IRR Revisions: Goods
 Eligibility Criteria (Sec. 23)

 Expendable Supplies (Sec. 5 [m])

 Articles normally consumed within 1 year or value is
substantially decreased after 1 year
 Examples: medicines, stationery, fuel, and spare
parts
IRR Revisions: Goods
 Eligibility Criteria (Sec. 23)

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

 Not consumed in use
 Serviceable life more than 1 year
 Examples: furniture, fixtures, transport, and other
equipment
IRR Revisions: Goods
 Eligibility Criteria (Sec. 23)

 Financial Eligibility
 NFCC at least equal to ABC
 Credit Line Certificate at least equal to 10% of ABC
 Issued/confirmed by Universal or Commercial Bank
 For LGUs: other banks certified by BSP as authorized to issued said
CLC
 Option to submit cash deposit certificate deleted
IRR Revisions: Goods
 Submission and Receipt of Bids (Sec. 25)

 Two-Envelope System (Eligibility requirements

included in the Technical Proposal)
IRR Revisions: Goods
 Submission and Receipt of Bids (Sec. 25)

 First Envelope
 Eligibility requirements
 Bid security
 Technical specifications
 Omnibus sworn statement
IRR Revisions: Goods
 Submission and Receipt of Bids (Sec. 25)

 Second Envelope
 Financial information/documents specified in the
Philippine Bidding Documents
IRR Revisions: Goods
 Bid Opening (Sec. 29)

 BAC shall adopt a procedure for ensuring the

integrity, security, and confidentiality of all
submitted bids
IRR Revisions: Goods
 No Contact Rule (Sec. 32)

 BAC, thru Secretariat, may request for clarification

of bid as long as it is in writing
IRR Revisions: Goods
 Post-qualification (Sec. 34)

 Submission of the ff documents within 3 calendar

days from receipt of notice that bidder is LCB:
 Tax clearance
 Latest income and business tax returns
 Certificate of PhilGEPS registration
 Other appropriate licenses and permits required by
law and stated in the Bidding Documents.
IRR Revisions: Goods
 Notice of Award (Sec. 37)

 Conditioned on the following:

 If joint venture, submission of JVA
 Posting of Performance Security
 Signing of Contract
 If required, approvals by higher authority
IRR Revisions: Goods
 Bid & Performance Securities (Secs. 27 & 39)
 Deleted certified check from acceptable forms

 In general, bank issued securities must be issued

by a universal/commercial bank

 For 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
IRR Revisions: Goods
Form of Bid and Performance Amt of Bid Security Amt of Performance
Security (% of the ABC) Security
(% of Contract Price)
a)Cash, cashier’s/manager’s
check, bank guarantee/ draft
2% 5%
b) Irrevocable LC

c)Surety bond callable upon 5% 30%

demand

d) Combination of the foregoing Proportionate to share of Proportionate to share of form

form with respect to the with respect to the total
total amount of security amount of security
IRR Revisions: Goods
 Domestic and Foreign Goods (Sec. 43)

 Requires procuring entity to give preference to

domestic entities and to materials and supplies
produced, made, and manufactured in the
Philippines (domestic bidder).
IRR Revisions: Goods
 Domestic and Foreign Goods (Sec. 43)

 Domestic entities (Sec. 5 [k])

 75% Filipino
 Habitually established in business and engaged in the
manufacture or sale of product to be bid
 In existence for at least 5 consecutive years

 Domestic entities can only claim preference if certified by

SEC/DTI/CDA
IRR Revisions: Goods
 Domestic and Foreign Goods (Sec. 43)

 Domestic bidder (Sec. 5 [j])

 Any person or entity
 Offering articles/materials/supplies
 If unmanufactured, grown or produced in the Philippines
 If manufactured, substantially from those grown or produced
in the Philippines

 Domestic bidder can only claim preference if certified

by DTI
IRR Revisions: Goods
 Domestic and Foreign Goods (Sec. 43)

 Provides procedures in determining entitlement to

domestic preference

 Applied only where the lowest bid has a foreign

component (foreign bid/entity) and the next lowest
bid has a domestic component (domestic
bidder/entity)
SAMPLE APPLICATION OF PREFERENCE
Sample Computation

Lowest Calculated Bid Next Lowest Calculated

Bid
Foreign Bidder Domestic Bidder/Entity
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

Result Award to Domestic Bidder/Entity at 2,653,360.00, or

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

 Expendable Supplies – 3 months, unless

consumed earlier

 Non-expendable Supplies – 1 year

IRR Revisions: Goods
 Advance Payment for Goods

 Goods supplied from abroad

 10% advance payment allowed
 Upon submission of a bank guarantee
 Equivalent amount
 Valid until goods are delivered
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