1.

REFERENCES
2. COMMON TERMS IN FMS
3. SOURCES OF FUNDS
4. FMS PROCEDURE
5. FMS FLOWCHART
1. R.A. 9184 or the Government Procurement
Reform Act and its Revised IRR / Section
53.8, Defense Cooperation Agreement
2. RP-US Military Assistance Agreement 1953
3. Security Assistance Management Manual,
Defense Cooperation Assistance Manual
5104.38-M
4. GHQ SOP # 12 dated 15 September 2016
1. Foreign Military Sales (FMS)
2. Foreign Military Financing (FMF)
3. Letter of Request (LOR)
4. Letter of Offer and Acceptance (LOA)
5. LOA Case Identifier
Ex. PI-P-SCF
1. Foreign Military Financing
2. Republic Funds or Host Nation Funds
- MOOE
- AFP Modernization Funds
1. Requirements Determination
2. Preparation and Submission of LOR (LOA or P&A)
3. US Legislative/Executive Review
4. USG Provides LOA
5. PAF review the LOA
6. Acceptance/Declination
7. Transfer of Funds
8. LOA implementation
9. Case Reconciliation
10. Case Closure
1. Requirements Determination & Approval of Annual FMF Fund Allocation
If disapproved

Senior
J4, J5, MS 4s & MS 5s Leaders J4 JUSMAG-Phil

Determines essential requirements to be If approved, J4 submits the identified Submits recommendations to US

funded out of the annual FMF fund for Approves or disapproves the requirements to JUSMAG-Phil. Congress and advises the Philippine
presentation to the Senior Leaders during identified requirements Embassy in the US once
Senior Leaders Round-Table Discussion for recommendations have been sent to US
approval Congress for their monitoring
¼ mo ¼ mo ¼ mo ¼ mo

FMF Spend Plan

J4 JUSMAG-Phil US Congress

J4 informs the Major Services and Upon approval by the US Congress,

concerned GHQ Offices regarding
the Spend Plan and requires the
immediate submission of LORs
¼ mo
Deliberates the approval of the
JUSMAG-Phil transmits the approved
recommendations and the
Spend Plan to J4 to start the
corresponding fund
procurement procedure.
requirements. (This shall be
closely monitored by the
Philippine Embassy.)
3 - 6 mos
2. Pre-Case Development: Crafting and Processing of LOR for LOA

FMF Spend Plan END-USER

Prog 1-3: MS4s; Prog 4 - J4
J4 JUSMAG-Phil

Reviews the completeness of LOR Reviews the completeness of LOR

Prepares LOR for LOA and
and transmits it to JUSMAG-Phil and submits it to concerned USG
transmits it to J4
for processing Agency for processing

¼ – ½ mo ¼ mo ¼ mo

LOA USG
JUSMAG-Phil
Agency
Reviews and processes the LOR and craft Reviews the completeness of LOR and submits
corresponding LOA. Response time to the LOR it to concerned USG Agency for processing
depends on the type and complexity of cases see
Para 7.2) b of the SOP.
1 - 2 mos
3. Case Development: Offer and Acceptance

END-USER
USG Agency JUSMAG-Phil J4 Prog 1-3: MS4s; Prog 4 - J4
and Concerned Office/Unit
Transmits the LOA to J4 for Transmits the LOA to the End- Reviews the LOA and recommend for
LOA transmittal to the End-User User for their review & acceptance, amendment or declination
recommendation (whichever is applicable)

¼ mo ¼ mo ½ - 1 mo

Signed LOA J4 J4
SND
Recommends for the SND’s approval of the
If approved, J4 signs the LOA and
Approves or disapproves LOA. Letter request to SND (Attn: ASAIL,
transmits it to JUSMAG-Phil for
the LOA for signature of J4 DND) shall be signed by the CSAFP
implementation by the concerned
USG Agency
¼ mo ¼ mo ¼ - ½ mo
USG
Agency
4. Case Implementation and Delivery
USG Agency
Implements the LOA and
commences the procurement in
accordance with the existing US
laws & regulations
6 – 10 mos
*if application for Authority to Import apply
USG Agency/
MS4s & J4 JUSMAG-Phil/Freight
Forwarder
While awaiting the delivery , the End- Facilitates the delivery of equipment
User’s MS4 shall coordinate with OJ4 based on the Delivery Term Code
and submit all requirements to facilitate indicated in the LOA ; provides a Notice
the approval and issuance of the EUC for of Arrival and a copy BL/AWB and DD
them to facilitate the issuance of the Form 1348 to the End-User (cc: OJ4)
Authority to Import from the PNP
½ mo 3 – 4 mos
Cert of Tax
Exemption DAO, DND
Facilitates the request for tax
exemption with the DOF
¼ mo
Fund END-USER
Prog 1-3: MS4s; Prog 4 - J4 and
Concerned Office/Unit
Facilitates the availability of funds
¼ mo
END-USER
Prog 1-3: MS4s; Prog 4 - J4 and
Concerned Office/Unit
Directs respective THUs to facilitate
the release of the shipment from the
BOC. *If request for tax exemption
applies, submits request to DAO, DND
(thru J4).
¼ mo
J4
*Submits request for tax exemption to
DAO, DND for processing with the DOF
¼ mo
THUs
Computes the total fund requirements
for the release of FMS items from the BOC
including Duties and Tax.
¼ mo
4. Case Implementation and Delivery (cont’n…)

Fund THU SU THU

Cert of Tax
Exemption Prepares the warehouse ,
Upon receipt of funds and certificate of tax Advises End-User 4s once the
receives the items and store it properly articles/items have been withdrawn
exemption, THU, GHQ & HSC shall coordinate with
the BOC for the withdrawal of items and advises and delivered to the SU.
concerned SU of the incoming delivery. ¼ mo
¼ mo

within 1 yr If case of discrepancies…

Supply Discrepancy Report

End-User’s Major Service 4

submits SDR to JUSMAG-Phil thru Inspection & END-USER
Prog 1-3: MS4s; Prog 4 - J4 and
J4 for requisitioning Inventory Concerned Office/Unit

OJ4; JUSMAG-Phil; End-User 4s; SAO, AFP; Informs J4 and JUSMAG-Phil that the
½ mo If items are complete… concerned SU; and Major Service SAO (for items have been delivered and are ready
Inventory Report items for use of the Major Service); shall for inventory and inspection
conduct inventory and inspection of the
delivered items
¼ mo ¼ mo
4. Case Implementation and Delivery (cont’n…)

Inventory and Inspection Major Service/GHQ

Report J4 SAO, AFP SAO

Prepares and release Issuance Directive to Facilitates issuance of items to the SAO, Facilitates the issuance of
SAO, AFP End-User who shall prepare Requisition and items to the SAO, End-User
Issue Slip (RIS)/ Inventory Receipt of
Property (IRP) and submit it to the SU (P)
for the issuance and release of the items
¼ mo ¼ mo ¼ mo

After-Withdrawal SAO, End-

Report End-User SAO, SU
User
The End-User shall submit an After-
issues the items to the End-User and prepares Requisition and Issue
Withdrawal Report to OJ4 (thru MS4s
submits a copy of the RIS/IRP to SAO, Slip (RIS)/ Inventory Receipt of
for MS items).
AFP for recording purposes. Property (IRP) and submit it to
½ mo the SU.
¼ - ½ mo ½ mo
Covered Period: Major Service/AFP SAO
18 – 30 mos
1. Requirements Determination & Approval of Procurement through US FMS Program: LOR for P & A Data
(Market Research)
A. For AFP Modernization Program Acquisition Projects

END-USER USG
Prog 1-3: MS4s; Prog 4 - J4
J4 JUSMAG-Phil
Agency

Prepares LOR for P & A data as part of Reviews and submits the Transmits the LOR to the Processes the LOR & sends reply to
Market Research (if deemed necessary) LOR to JUSMAG-Phil if concerned USG Agency for P & A data to JUSMAG-Phil within 45 days
complete processing
¼ mo ¼ mo 1 - 3 mo

If approved

BAC Resolution Senior END-USER

Leaders Prog 1-3: MS4s; Prog 4 - J4
J4 JUSMAG-Phil
ADM
Reviews and examines the P & A Data Transmits the P & A Data to Transmits the P & A Data to
Decides whether or not to procure and seeks approval for procurement End-User upon availability J4 upon availability
thru US FMS Program pursuant to through US FMS Program.
Sec. 53.8 of RA 9184

¼ mo ½ mo ¼ mo
1. Requirements Determination & Approval of Procurement through US FMS Program: LOR for P & A
Data (Market Research)
B. For MOOE-Funded Projects

END-USER J4 ASAIL, DND DNDBAC

Prog 1-3: MS4s; Prog 4 - J4

Facilitates the issuance of BAC Resolution for procurement Transmits request to Coordinates with the Facilitates the approval/disapproval of the
below the level of authority of the SND. For procurement under ASAIL, DND thru channel DNDBAC for the request for issuance of DNDBAC Resolution
the level of authority of the SND, submits request to J4 to (CSAFP). presentation of the project approving the procurement through US
facilitate the approval of procurement through US FMS Program for approval by the FMS Program pursuant to Sec. 53.8 of RA
pursuant to Sec. 53.8 of RA 9184. Required documents includes: DNDBAC. 9184.
TOR/TS, APP, BAC Reso issued by counterpart BAC (Major
Service BAC). ½ mo ¼ mo ¼ mo ¼ mo

BAC Resolution SND

¼ mo ¼ mo
2. Pre-Case Development: Crafting and Processing of LOR for LOA

END-USER
DND J4 Prog 1-3: MS4s; Prog 4 - J4
J4
For AFP Modernization
Program Projects: Transmits the ADM & BAC Reso/ Prepares LOR for LOA and Reviews the completeness of
ADM & BAC Resolution LOR and transmits it to JUSMAG-
and directs the submission of LOR transmits it to J4
For MOOE-funded for LOA to End-User Phil for processing
Projects: BAC
Resolution

¼ mo ¼ mo ½ - 1 mo ¼ mo

USG
LOA Agency
JUSMAG-Phil

Reviews and processes the LOR and Reviews the completeness of LOR
craft corresponding LOA. Response and submits it to concerned USG
time to the LOR depends on the Agency for processing
type and complexity of cases see
Para 7.2) b of the SOP.
2 – 3 mos ¼ mo
3. Case Development: Offer and Acceptance

END-USER
USG Agency JUSMAG-Phil J4 Prog 1-3: MS4s; Prog 4 - J4
and Concerned Office/Unit

LOA Transmits the LOA to J4

for transmittal to the
Transmits the LOA to the End-
User for their review &
Reviews the LOA and recommend for
acceptance, amendment or declination
End-User recommendation (whichever is applicable)

¼ mos ¼ mo ¼ mo ½ - 1 mo

Signed LOA J4
If approved, J4 signs the LOA and
transmits it to JUSMAG-Phil for
implementation by the concerned
USG Agency upon wire-transfer of
funds.
¼ mo
J4
SND
If recommended for acceptance, J4
Approves or disapproves recommends for the SND’s approval of
the acceptance of the LOA for the LOA and subsequent wire-transfer of
signature of J4 and wire-transfer funds (thru Channel). Letter request to
of fund. SND (Attn: ASAIL, DND) shall be signed
by the CSAFP.
¼ mo ¼ mo
2. Pre-Case Development: Crafting and Processing of LOR for LOA

END-USER
DND J4 Prog 1-3: MS4s; Prog 4 - J4
J4
For AFP Modernization
Program Projects: Transmits the ADM & BAC Reso/ Prepares LOR for LOA and Reviews the completeness of
ADM & BAC Resolution LOR and transmits it to JUSMAG-
and directs the submission of LOR transmits it to J4
For MOOE-funded for LOA to End-User Phil for processing
Projects: BAC
Resolution ¼ mo ½ mo ¼ mo

USG
LOA Agency
JUSMAG-Phil

Reviews and processes the LOR and
craft corresponding LOA. Response
time to the LOR depends on the
type and complexity of cases see
Para 7.2) b of the SOP.
2 - 3 mos
Reviews the completeness of LOR
and submits it to concerned USG
Agency for processing
¼ mo
 4. Case Implementation and Delivery
Bank Statement of
If necessary
Fund Transfer
USG Agency/
Quality Assurance END-USER
USG Agency Inspection
JUSMAG-Phil/Freight
Forwarder
Prog 1-3: MS4s; Prog 4 - J4 and
Concerned Office/Unit
Facilitates the delivery of equipment based
Implements the LOA and J4 coordinates with JUSMAG-Phil Directs respective THUs to facilitate the
on the Delivery Term Code indicated in the
commences the procurement in for conduct of QAI if deemed release of the shipment from the BOC. *If
LOA ; provides a Notice of Arrival and a copy
accordance with the existing US necessary prior to the delivery of request for tax exemption applies, submits
BL/AWB and DD Form 1348 to OJ4
laws & regulations items request to DAO, DND (thru J4).
6 – 12 mos ¼ mo 3 – 4 mos ½ mo

Cert of Tax
Exemption DAO, DND J4
Facilitates the request for tax *Submits request for tax exemption to
exemption with the DOF DAO, DND for processing with the DOF
¼ mo ¼ mo

Fund END-USER
Prog 1-3: MS4s; Prog 4 - J4 and THUs
Concerned Office/Unit

Facilitates the availability of funds Computes the total fund requirements for the release
of FMS items from the BOC including Duties and Tax.
¼ mo
¼ mo
4. Case Implementation and Delivery (cont’n…)

Fund THU SU THU

Cert of Tax
Upon receipt of funds and certificate of tax
Exemption
exemption, THU, GHQ & HSC shall coordinate with
the BOC for the withdrawal of items and advises
concerned SU of the incoming delivery.
¼ mo
Prepares the warehouse ,
Advises End-User 4s once the
receives the items and store it properly
articles/items have been withdrawn
and delivered to the SU.
¼ - ½ mo

If case of discrepancies…
within 1 yr Supply Discrepancy
Report
End-User’s Major Service 4 submits SDR to Inspection & END-USER
JUSMAG-Phil thru J4 for requisitioning Prog 1-3: MS4s; Prog 4 - J4
Acceptance
and Concerned Office/Unit
OJ4; JUSMAG-Phil; TIAC; End-User 4s; SAO, Informs J4 and JUSMAG-Phil that the
If items are complete… AFP; concerned SU; AFPMFO Representative; items have been delivered and are ready
½ mo TIAC Certificate and Major Service SAO (for items for use of for inventory and inspection
the Major Service); shall conduct inventory
TIAC submits Report and TIAC and inspection of the delivered items
Certificate of Acceptance to
DAO, DND
¼ - ½ mo ¼ mo
 4. Case Implementation and Delivery (cont’n…)

TIAC Report & Major Service/GHQ

Certificate DAO, DND J4 SAO, AFP SAO

Upon receipt of TIAC Report &
Certificate , DAO issues a Memo to
J4 to facilitate the Issuance
Directive for the release of the
items to the End-User
Prepares and release Facilitates issuance of items to the SAO, Facilitates the issuance of
Issuance Directive to SAO, End-User who shall prepare Requisition and items to the SAO, End-User
AFP Issue Slip (RIS)/ Inventory Receipt of
Property (IRP) and submit it to the SU (P)
for the issuance and release of the items

¼ mo ¼ mo ¼ - ½ mo ¼ mo

After-Withdrawal SAO, End-

Report End-User SAO, SU
User
The End-User shall submit an After- prepares Requisition and Issue
Withdrawal Report to OJ4 (thru MS4s issues the items to the End-User and Slip (RIS)/ Inventory Receipt of
for MS items). submits a copy of the RIS/IRP to SAO, Property (IRP) and submit it to
AFP for recording purposes. the SU.
½ mo
¼ - ½ mo ½ mo
Covered Period: Major Service/
AFP SAO
27 – 40 mos