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PHILIPPINE ASSOCIATION OF GENERAL SERVICES OFFICERS (PAGSO) 7 TH Annual Convention Bacolod Pavilion Hotel, B acolod C

PHILIPPINE ASSOCIATION OF GENERAL SERVICES OFFICERS (PAGSO) 7 TH Annual Convention Bacolod Pavilion Hotel, B acolod City May 23-26, 2012. Department of Budget and Management Government Procurement Policy Board Technical Support Office. NON-POLICY MATTER OPINIONS (Updates).

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PHILIPPINE ASSOCIATION OF GENERAL SERVICES OFFICERS (PAGSO) 7 TH Annual Convention Bacolod Pavilion Hotel, B acolod C

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  1. PHILIPPINE ASSOCIATION OF GENERAL SERVICES OFFICERS (PAGSO) 7TH Annual Convention Bacolod Pavilion Hotel, Bacolod City May 23-26, 2012

  2. Department of Budget and Management Government Procurement Policy BoardTechnical Support Office NON-POLICY MATTER OPINIONS (Updates)

  3. BAC Composition • NPM 024-2011, NPM 034-2011, NPM 035-2011, NPM 28-2012 “Permanent” (Section 11, RA 9184) The term does not refer to whether the person holding the plantilla position is contractual, regular, or appointed; rather, this refers to whether the position exists within the organizational structure of the procuring entity or not. Therefore, a third ranking officer occupying a position, albeit in temporary capacity, is eligible to become the Chairman of the BAC for as long as the office he is currently occupying is an existing plantilla position. The same rule applies to the designation of alternate members.

  4. BAC Composition • NPM 024-2011 “Approving Authority” (Section 11.2.5, IRR) The prohibition stated in Section 11.2.5 of the IRR is intended to avoid any conflict of interest between the person who takes part in a procurement activity and the one approving the resulting transactions. Consequently, such prohibition does not apply to approving authorities where this conflict of interest is not present.

  5. Re-assignment of BAC member NPM 19-2012 The operations of the BAC will be hampered by the re-assignment of a member, whether provisional or regular, if such re-assignment results in the reduction of the BAC composition to less than five (5) members. It is imperative for the HOPE to immediately replace any vacant BAC position to maintain a valid constitution of the BAC and avoid a lull in its operation.

  6. Indemnification for BAC Members NPM 044-2011 “finally adjudged” Under Section 73 of RA 9184, in relation to the indemnification package of BAC members, the judgment contemplated therein, is a final, non-appealable and executory judgment.

  7. Legal Assistance and Indemnification Package The procuring entity shall, to the fullest extent permitted, indemnify a BAC member and/or any of its support staff who was or is a party to a pending or a completed action, suit or proceeding whether civil, criminal, or administrative in nature brought against him in the performance of his official functions as BAC member or support staff. (Section 4.1.1, Guidelines for Legal Assistance and Indemnification of Bids and Awards Committee and its Support Staff) The funds to be used for the grant of the free legal assistance, liability insurance, or medical assistance shall be taken from the agency’s annual appropriation, and augmented by other funds resulting from protest fees, sale of bidding documents, and other income-generating activities of the agency. (Section 6, Guidelines)

  8. Technical Working Group for the Bids and Awards Committee NPM 26-2012 Members of the BAC – Technical Working Group need not come from the procuring agency itself, as Section 12.1 merely mentions that the members of the TWG come from a pool of technical, financial and/or legal experts. Nowhere is it mentioned that members of the TWG should exclusively belong to the procuring entity itself.

  9. Advertising and Posting Requirements NPM 032-2011 Aside from the required advertisement in one (1) newspaper of general nationwide circulation and posting at any conspicuous place reserved for the purpose in the premises of the procuring entity, the Invitation to Bid/Request for Expression of Interest shall be posted continuously in the PhilGEPS website, the website of the procuring entity concerned, if available, and the website prescribed by the foreign government/foreign or international financing institution, if applicable, for seven (7) calendar days starting on date of advertisement. Non-compliance thereto is a material defect in the procurement process.

  10. Supplemental/Bid Bulletin • NPM 021-2011 - Bid Opening and Supplemental/Bid Bulletin Postponing the opening of bids through the bid bulletin, without postponing the deadline for submission of bidding documents, is contrary to the bidding procedures prescribed by RA 9184 and its IRR. The opening of bids should be conducted within the same day as, and immediately after, the deadline for the submission and receipt of bids. While the BAC erred in changing the date for the opening of bid documents, nowhere is it stated in RA 9184 and its IRR that the re-scheduling of the opening of bids automatically results to the re-scheduling of the deadline for the submission of bids.

  11. Supplemental/Bid Bulletin • NPM 028-2011 - Modification of Bidding Documents In instances where the procuring entity sees the need to introduce any modifications or amendments to the bidding documents, it may do so motu proprio through the issuance of a supplemental/bid bulletin pursuant to Section 22.5.2 of the same IRR. Although the technical specifications were not discussed during the pre-bid conference, the procuring entity concerned is not precluded from requiring the same, provided the appropriate supplemental/bid bulletin is issued within the prescribed time frame.

  12. Accreditation System for Bidders NPM 033-2011 The creation of an accreditation system is not in accordance with the mandate of the present procurement law because it contravenes the very basic principles of competitive bidding. The establishment of an accreditation system within the agency would limit the participation of bidders only to the accredited suppliers, to the exclusion and prejudice of the bidders in the market.

  13. Attendance of Bidders or their Duly Authorized Representative During Bid Opening NPM 07-2012 The attendance of the bidders in the bid opening is optional. The proof of authorization is not necessary whenever a bidder’s representative, other than the one authorized in the Omnibus Sworn Statement,attends the bid opening.

  14. Submission of Photocopy of Documentary Requirements NPM 28-2011, NPM 09-2012 The IRR allows the submission of a copy of the original documents required, provided that the bidder certifies through the Omnibus Sworn Statement that the document submitted is an authentic copy of the original, that it is complete, and that the information and statements therein are true and correct. It must be stressed, however, that the authenticity of the submitted copy must be verified, validated, and ascertained by the procuring entity during the post-qualification as prescribed in Section 34 of the IRR of RA 9184.

  15. Who may request for a copy of the Minutes of the Opening of Bids? NPM 030-2011 “The minutes of the bid opening shall be made available to the public upon written request and payment of a specified fee” (Section 29, RA 9184). Participants or non-participants to the bidding may be given a copy of the minutes of the opening of bids upon compliance with the conditions provided by law.

  16. Additional Eligibility Requirements in Bidding Documents NPM 21-2012 Procuring entities are proscribed from requiring additional eligibility requirements. The list of minimum eligibility requirements under the Implementing Rules and Regulations (IRR) of Republic Act (RA) 9184 has been streamlined/simplified, such that only those requirements enumerated in Section 23.1, 24.1, and 25.1 of the IRR are necessary for purposes of determining bidder’s eligibility.

  17. Eligibility Requirements for Joint Venture Agreements NPM 24-2012 The documents to be submitted and evaluated should be those of the actual Joint Venture (JV) partners. In case one of the JV partners is also a JV, only the technical experience/capability and financial standing attributable to the JV shall be considered, and should not include those of its individual member entities.

  18. Counter-Offer/Counter-Proposal NPM 29-2012 Strict compliance with the eligibility, technical and financial requirements enumerated in the bidding documents must be observed. Bidders are left with no option but to provide an offer that complies with all the requirements. Compliance must be certain and absolute, otherwise, it takes the form of a counter-offer which is not allowed under RA 9184 and its IRR.

  19. Single Calculated and Responsive Bid • NPM 022-2011 - “most advantageous prevailing price for the Government” It is the the task of the procuring entity to ensure that in adopting an ABC, the contract cost or estimate must not be excessively high or unreasonably low to the detriment of government interest. It is not necessary to have many bidders in order to receive the most advantageous bid considering that any bid that is equal or lower than the ABC, and is technically and legally compliant, is deemed most advantageous to the Government.

  20. Single Calculated and Responsive Bid II. NPM 038-2011 –Requiring a minimum number of bidders. Requiring a minimum number of bidders to participate in a public bidding is contrary to the mandate of Section 36 on Single Calculated/Rated and Responsive Bid (SCRB). The provision instructs a Procuring Entity to consider for award a bid submitted by the lone bidder if it successfully complied with and is responsive to bidding requirements. Hence, there is no need to have a minimum, so as long as the conditions under Section 36 are met.

  21. Single Largest Completed Contract NPM 20-2012 The SLCC criterion is so required in order to ensure that the Government is contracting with an entity that has accomplished at least one project with a value no less than fifty percent (50%) of the contract to be bid. This eligibility requirement cannot be dispensed with. Ongoing contracts cannot substitute for the requirement of completed contracts of similar nature to the contract subject for bidding.

  22. Nationality Preference NPM 15-2012 Although procuring entities are given leeway in formulating the specifications in the terms of reference, they cannot limit the origin of goods to their preferred countries of origin to the exclusion of other countries. Thus, procuring entities are precluded from requiring a specific country of origin as part of the technical specification for the project. Rather, the specifications shall be based on the performance requirements and recognized industry standards and not on the basis of country of origin.

  23. No Contact Rule NPM 03-2012 The “no contact rule” under Sec. 32.1 applies only to those whose bids are being evaluated by the BAC after passing the preliminary examination of bids. On the other hand, a disqualified bidder may provide valid, reasonable and lawful information on matters pertaining to the bids being evaluated, provided that such bidder has no pending request for reconsideration or protest relative to his/her disqualification.

  24. Audited Financial Statements NPM 12-2012 Financial statements audited by CPAs not accredited by the Board of Accountancy (BOA) cannot be considered for purposes of Sec. 23.1(a)(v) and Sec. 24.1(a)(v) of the IRR of RA 9184. Sections 26 and 28 of the IRR of RA 9298 (Phil. Accountancy Act of 2004) provides that no person shall engage in the practice of accountancy unless he/she is a CPA and possesses a certificate of accreditation from BOA.

  25. Bid Security I. NPM 23-2011 - Forfeiture Forfeiture of bid security grounded on non-compliance with the requirements under Sec. 34.2 of the IRR is mandatory and is not subject to the discretion of the procuring entity.

  26. Bid Security • NPM 043-2011 - Acceptable Forms Bidders have the option to choose from any of the acceptable forms of bid security enumerated under the IRR of RA 9184, and procuring entities may not limit the allowable forms of bid security nor prohibit bidders from submitting any of the acceptable forms of bid security. The BAC may not likewise require the same through verbal instructions during pre-bid conference. After all, no changes or modifications to the bidding documents may take effect unless identified in writing and issued through a Supplemental/Bid Bulletin.

  27. Validity of Bid Security after Issuance of Notice of Award NPM 18-2012 The validity of the bid security is material at the time of the issuance of the NOA since the validity of the bid security signifies that the bidder’s bid or offer still stands at the time the procuring entity awarded the contract. The validity of the bid or offer is vital because the NOA or the act of acceptance by the procuring entity will be rendered nugatory and ineffectual when there is no longer an “offer” to accept. If the NOA was issued and the winning bidder has submitted a performance security within the three-month period, the requirement that the bid security should remain valid no longer finds application considering that the act, i.e. the offer, which it guarantees has already been accepted.

  28. Certification issued by the Insurance Commission NPM 17-2012 The certification which must be submitted together with the surety bond must: • unequivocally state that the surety or insurance company is specifically authorized to issue surety bonds callable on demand; • must be issued by the Insurance Commission; and, • must be project specific. (Sections 27 and 39, IRR)

  29. Submission of Post-qualification Documents NPM 09-2012 I. Bidders are not precluded from submitting the post-qualification documents during the submission of bids. However, in case there is delay in the conduct of post-qualification, it is prudent for the Procuring Entity to request for the latest and current legal documents during post-qualification to ascertain, validate and verify the authenticity and currency of the documents and establish the eligibility and responsiveness of the bidder.

  30. Submission of Post-qualification Documents NPM 09-2012 II.The BAC cannot require submission of the Original Articles of Incorporation (AIs). Section 29.2 (d) speaks of licenses and permits required by law and stated in the Bidding Documents. Clearly, AIs do not fall in either type of documents since this is a corporate document submitted to the Securities and Exchange Commission as part of the registration requirements. Accordingly, if the requirement is merely to aid the Procuring Entity or the BAC in verifying the eligibility documents submitted, the bidder may simply submit copies of the AOI that is material to the post-qualification proceedings being conducted.

  31. Offenses and PenaltiesContract Award NPM 10-2012 Awarding of contracts beyond the prescribed period of action may be recognized for justifiable causes. (Section 65.1 (b), RA 9184) Although the periods of action under RA 9184 and its IRR are mandatory in character, penal sanctions or liability will not set in against the concerned public officers provided that valid, reasonable, and justifiable causes exist to warrant a delay.

  32. Surety Bond as Warranty Security NPM 29-2011 The acceptable forms of warranty security in the procurement of goods are limited to retention money and special bank guarantee (Section 62.1, IRR). Surety bond, as a form of warranty, is acceptable only in case of infrastructure projects. Thus, following the principle “expressiounius estexclusioalterius”, a surety bond cannot be considered an acceptable form of warranty security for the procurement of goods.

  33. Extension of Contracts for General Support Services NPM 031-2011 Procuring entities are allowed to extend the duration or effectivity of an ongoing contract about to expire subject to the condition that the contract extension shall not exceed one (1) year. (Section 4.1 GPPB Revised Guidelines on the Extension of Contracts for General Support Services)

  34. Warranty Security for Consulting Services NPM 11-2012 Sec. 62.2 of the IRR, insofar as it requires the posting of warranty security, does not apply to the procurement of consulting services. Procuring entities can require in consultancy contracts that the consultants warrant or ensure that they shall be liable in case of structural defects/failures under Sec. 62.2.3.1 and/or pecuniary civil liability and damages.

  35. Computation of Liquidated Damages and Net Amount of Retention Money NPM 01-2012, NPM 25-2012 The amount of the liquidated damages shall be at least equal to one-tenth of one percent (0.1%) of the cost of the unperformed portion for every day of delay for the procurement of goods, infrastructure projects, and consulting services.(Section 68, IRR, RA 9184)

  36. Blacklisting NPM 33-2012 In order to properly use the “Guidelines for Blacklisting of Manufacturers, Suppliers, Distributors and Consultants, as basis for Blacklisting”, the act committed should be of the same kind as those enumerated therein. Considering that the violation of the rules and procedure on the protest mechanism under RA 9184 and its IRR does not amount to an act tending to defeat the purpose of competitive bidding, the premature resort to judicial intervention will not be considered as a ground for blacklisting.

  37. Availment of Track Record under a Newly Registered Business Name NPM 37-2011 A newly registered sole proprietorship may use the experience of another sole proprietorship owned by the same individual. If one of the sole proprietorships is blacklisted, such blacklisting will extend to all sole proprietorships owned by the same individual.

  38. ALTERNATIVE METHODS 1. SHOPPINGExemption from Obtaining Three (3) PriceQuotations NPM 25-2011 It is beyond the power of the GPPB to grant exemptions from Republic Act No. 9184 and its Implementing Rules and Regulations as it does not have the power to legislate nor determine the coverage of the law. At most, the GPPB may only render contemporaneous construction of the provisions of the law pursuant to its quasi-legislative fiat, and issue rules and regulations pursuant to its rule-making power.

  39. NEGOTIATED PROCUREMENT2. Two Failed Biddings NPM 41-2011 There is nothing in the rules prohibiting bidders disqualified from previous failed biddings from participating in the same procurementactivity, albeit conducted through Negotiated Procurement (Two Failed Biddings).

  40. 3. Emergency Cases NPM 045-2011 Competitive bidding is the primary mode of procurement. Exceptions are allowed only if there is prior approval of the Head of the Procuring Entity (HOPE) and whenever it is justified by the conditions as well as to promote economy and efficiency. Prior approval of the GPPB in order to resort to alternative methods is not required under RA 9184 and its IRR.

  41. 4. Adjacent or Contiguous NPM 22-2012 Section 53.4 of the IRR clearly states that it applies to infrastructure projects and consulting services. Said provision does not qualify or limit the term “consulting service” to those involving infrastructure projects. Hence, Negotiated Procurement (Adjacent or Contiguous) may be used to procure all types of consulting services as defined in Section 5(i) of the IRR.

  42. 5. Agency-to-Agency Agreements I. NPM 26-2011, NPM 16-2012 , NPM 30-2012 In cases where procurement from another agency of the government is more efficient and economical, Negotiated Procurement (Agency-to-Agency) may be used. This rule allows a government entity to procure from another government entity without need of public bidding, subject to compliance with the prescribed conditions and procedures under existing rules and the guidelines on Agency-to-Agency Agreements.

  43. Agency-to-Agency Agreements • NPM 04-2012 The government entity to be engagedmust have the mandate to deliver the required goods and services or to undertake the infrastructure project or consultancy required. In addition, it should have the necessary tools and equipment required for the project.

  44. 6. Procurement Agent NPM 34-2011, NPM 30-2012 In the event that a BAC cannot be created for lack of qualified personnel, Section 53.6 of the IRR of RA 9184 gives procuring entities the option, as determined by the HOPE, (1) to request other government agencies to undertake such procurement for them; or (2) to engage procurement agents to assist them directly and/or train their staff in the management of procurement function.

  45. 7. Small Value Procurement NPM 36-2011, NPM 34-2012 Small Value Procurement is allowed where the procurement does not fall under Shopping in Section 52 of the IRR, and the amount of the procurement must be within the threshold amount prescribed under Annex “H” of the IRR, subject to the procedural requirements under the Guidelines for Shopping and Small Value Procurement. However, if the goods to be purchased can be considered as “ordinary or regular office supplies” not available in the Procurement Service, then the alternative method of Shopping can be used subject to the prescribed thresholds and guidelines.

  46. NEGOTIATED PROCUREMENTExemption from Resort to Negotiated Procurement NPM 05-2012, NPM 14-2012 Since the general rule is public bidding, the procuring entity is not precluded from applying such method regardless of the existence of conditions warranting the use of any of the alternative methods of procurement.

  47. NEGOTIATED PROCUREMENTResolution of the BAC – When necessary? NPM 027-2011 Section 53.2 of the IRR allows procuring entities to directly negotiate with a technically, legally and financially capable supplier or contractor in emergency cases, provided that the required conditions or instances are present. The determination of existence of these instances lies within the discretion of the procuring entity. Accordingly, if the project was not included in the APP of the procuring entity, then it is essential that a BAC resolution recommending the use of alternative method be made; and a supplemental APP or an amendment thereto be issued before proceeding with the procurement.

  48. Infrastructure Projects by Administration NPM 32-2012 In case of Infrastructure Projects by Administration, the procuring entity acts as the contractor, hence, it is tasked to prepare the Program of Work, as provided under the Revised Guidelines for the Implementation of Infrastructure Projects by Administration. However, the cost of rental of construction equipment and tools to be used in the project should not form part of the Program of Work as it is a condition precedent that the procuring entity must own it.

  49. Procurement of Security and Janitorial Services and Multi-Year Contracts I. NPM 040-2011 - Coverage Section 2 of the Guidelines clearly indicates that it shall apply to all government agencies, without any distinction or qualification. Thus, following the well-recognized rule “ubi lex non distinguit, nec nos distinguire debemus”, the Guidelines also applies to GOCCs.

  50. Procurement of Security and Janitorial Services and Multi-Year Contracts • NPM 08-2012 – Applicability The Guidelines on the Procurement of Security and Janitorial Services, does not make any categorical pronouncement that multi-year contracts may be availed of only in the case of janitorial and security services contracts; rather, said Guidelines simply state that it shall be applicable to the procurement of janitorial and security services.

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