Albaytar, Mark Joseph A.

BSCE- V

Procurement – is the general term for the entire process of sourcing, selecting, and acquiring goods or
services, from conception to conclusion.

Why is it important?

Procurement is an important process that allows you to find the best supplier or supplies that best
matches your requirements which provides the best value for money and widens the scope of your
options and connections, it also improves the quality of work if done correctly since it allows you to get
the best materials you will need.

Government Rule on Budget Preparation and Procurement Process

All procurement shall be within the approved budget of the procurement entity and shall be carefully
and judiciously planned by the procurement entity. In line with the government's fiscal discipline
measures, only those considered crucial to the efficient performance of government functions are
included in the Annual Procurement Plan (APP). For this IRR, a procurement project is considered to be
crucial to the efficient performance of government functions if it is required for day-to-day operations or
if it is in pursuit of the main mandate of the procurement 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/phase of related project activities, such as
engineering design and right-of-way acquisition, to reduce / lower project costs.

Can Filipino firms bid in either procurement method? Based on the 2016 REVISED
IMPLEMENTING RULES AND REGULATIONS OF REPUBLIC ACT NO. 9184, OTHERWISE KNOWN AS THE
GOVERNMENT PROCUREMENT REFORM ACT

23.5. Eligibility Criteria

23.5.1. For the procurement of goods:

23.5.1.1. The following shall be eligible to participate in the bidding for the supply of goods:

a) Duly licensed Filipino citizens/sole proprietorships;

b) Partnerships duly organized under the laws of the Philippines and of which at least sixty
percent (60%) of the interest belongs to citizens of the Philippines;
 c) Corporations duly organized under the laws of the Philippines, and of which at least sixty
percent (60%) of the outstanding capital stock belongs to citizens of the Philippines;

d) Cooperatives duly organized under the laws of the Philippines, and of which at least sixty
percent (60%) belongs to citizens of the Philippines; or

e) Persons/entities forming themselves into a joint venture, i.e., a group of two (2) or more
persons/entities that intend to be jointly and severally responsible or liable for a particular
contract: Provided, however, That Filipino ownership or interest of the joint venture concerned
shall be at least sixty percent (60%). For this purpose, Filipino ownership or interest shall be
based on the contributions of each of the members of the joint venture as specified in their JVA.

Section 23. Eligibility Requirements for the Procurement of Goods and Infrastructure Projects
23.1. For purposes of determining the eligibility of bidders using the criteria stated in Section 23.5 of this
IRR, only the following documents shall be required by the BAC, using the forms prescribed in the
Bidding Documents:

a) Class “A” Documents

Legal Documents
i) Registration certificate from SEC, Department of Trade and Industry (DTI) for a sole
proprietorship, or CDA for cooperatives, or any proof of such registration as stated in the
Bidding Documents.

ii) Mayor’s permit issued by the city or municipality where the principal place of business of the
prospective bidder is located.

iii) Tax clearance per Executive Order 398, Series of 2005, as finally reviewed and approved by
the BIR.10
Technical Documents
iv) Statement of the prospective bidder of all its 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, within the relevant period as provided in the Bidding
Documents; and

A statement identifying the bidder’s single largest completed contract similar to the contract to
be bid, except under conditions provided for in Section 23.5.1.3 of this IRR, within the relevant
period as provided in the Bidding Documents in the case of goods.
All of the above statements shall include all information required in the PBDs prescribed by the
GPPB.11
v) In the case of procurement of infrastructure projects, a valid Philippine Contractors
Accreditation Board (PCAB) license and registration for the type and cost of the contract to be
bid.

Financial Documents
 vi) The prospective bidder’s audited financial statements, showing, among others, the
prospective bidder’s total and current assets and liabilities, stamped “received” by the BIR or its
duly accredited an authorized institutions, for the preceding calendar year which should not be
earlier than two (2) years from the date of bid submission.

vii) The prospective bidder’s computation for its Net Financial Contracting Capacity (NFCC).12

b) Class “B” Document

Valid joint venture agreement (JVA), in case the joint venture is already in existence. In the absence of a
JVA, duly notarized statements from all the potential joint venture partners stating that they will enter
into and abide by the provisions of the JVA in the instance that the bid is successful shall be included in
the bid. Failure to enter into a joint venture in the event of a contract award shall be ground for the
forfeiture of the bid security. Each partner of the joint venture shall submit the legal eligibility
documents. The submission of technical and financial eligibility documents by any of the joint venture
partners constitutes compliance.

Purpose

“This 2016 Revised Implementing Rules and Regulations, hereinafter called the IRR, is promulgated
under Section 75 of Republic Act No. (R.A.) 9184, otherwise known as the “Government Procurement
Reform Act,” to prescribe the necessary rules and regulations for the modernization, standardization,
and regulation of the procurement activities of the Government of the Philippines (GOP).”