joint venture guidelines - commission on audit of the ... · joint venture guidelines 2.0...
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JointVentureGuidelines
1.0LegalBasis2.0Principles3.0Purpose4.0Coverage5.0DefinitionofTerms6.0GeneralGuidelines7.0ProcessforEnteringintoJVAgreements8.0ReportingRequirement9.0Amendments10.0Separability11.0Effectivity12.0TransitoryProvisionAnnexAAnnexB
JointVentureGuidelines
1.0LegalBasis.TheserevisedGuidelinesarebeingissuedpursuanttoSection8(JointVentureAgreements)ofExecutiveOrder(EO)No.423dated30April2005,whichmandatestheNationalEconomicandDevelopmentAuthority(NEDA),inconsultationwiththeGovernmentProcurementPolicyBoard(GPPB),toissuethenecessaryguidelinesonJointVentures(JVs).
TheOfficeoftheGovernmentCorporateCounsel(OGCC)andtheGovernanceCommissionforGovernment-Ownedand/orControlledCorporations(GCG)werelikewiseconsultedintherevisionoftheGuidelines.TheproposedrevisionsweredeliberatedandsubsequentlyapprovedbytheNEDABoardCommitteeonInfrastructure(INFRACOM)andtheEconomicDevelopmentCluster(EDC).
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JointVentureGuidelines
2.0Principles.TheGovernmentshallenterintoaJVarrangementconsistentwiththefollowingprinciples:
2.1ThecreationoftheJVshouldnotpreventpotentialplayersfromprofitablyenteringintobusinessventure/market;
2.2Thecostofproducingtheparticularproduct,activity,orserviceshouldbeefficientorpotentiallyefficienttowardsearningpotentialprofitsforgovernmentandthemarketplayer/privatesectorpartner;
2.3TheroleofgovernmentasregulatorofthebusinessoftheJVshouldbeclearlyandexplicitlydelineatedfromitsroleasimplementerofthebusinesstoavoidconflictsofinterest;
2.4AsdifferentiatedfromprojectsprocuredunderOfficialDevelopmentAssistance(ODA),GovernmentProcurementReformAct(GPRA),andBuild-Operate-and-Transfer(BOT)LawexceptfortheBuild-Operate-and-Own(BOO)schemeandsimilarschemesundertheBOTLaw,wheregenerallyownershipoftheasset/businesswillstaywiththegovernment,JVAgreementsallowtheprivatesectortotakeovertheundertakingoftheprojectsinitsentiretyafterthegovernmentdivestsitselfofanyinterestintheJV;and
2.5AccountabilityfortheJVprojectultimatelydevolvesontheHeadoftheGovernmentEntityinvolvedintheJVAgreementsandtheimplementationoftheJVproject.TheprivatepartiesdealingwiththeGovernmentaresimilarlyheldaccountableforalltheiractionsrelativethereto.
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JointVentureGuidelines
3.0Purpose.
3.1Toprescribetherules,guidelinesandproceduresforgingJVAgreementsbetweengovernmentcorporationsasdefinedunderSection4.0below,andprivateentities;
3.2ToencouragepoolingofresourcesandexpertisebetweengovernmentandprivatesectorentitiesthroughJVsasaviable,efficient,andpracticalalternativeinpursuingdevelopmentgoalsofthegovernment;and
3.3ToensurethatallJVAgreementsareenteredintounderthepolicythatallgovernmentcontractsshallbeawardedthroughatransparentprocess.
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JointVentureGuidelines
4.0Coverage.
4.1Theseguidelinesshallapplytoallgovernment-ownedand/orcontrolledcorporations(GOCCs),governmentcorporateentities(GCEs),governmentinstrumentalitieswithcorporatepowers(GICPs),governmentfinancialinstitutions(GFIs),stateuniversitiesandcolleges(SUCs),asdefinedunderSection5.0.
4.2TheseGuidelinesshallnotapplytothefollowing:
1. TransactionsofGFIsintheordinarycourseofbusinessaspartoftheirnormalandordinarybanking,financialorportfoliomanagementoperations;
2. JVactivitiesofgovernmentcorporateentitiesintheexerciseoftheirprimarymandatetodisposegovernmentassetsorproperties;and
3. JVactivitiesorundertakingsoftheLocalGovernmentUnits(LGUs).
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JointVentureGuidelines
5.0DefinitionofTerms.
5.1CompetitiveChallenge5.2CompetitiveSelection5.3ContractualJV5.4CostofJVActivity/Project5.5GovernmentEntity5.6HeadofGovernmentEntity5.7JointVenture(JV)5.8JVCompany5.9InfrastructureorDevelopmentProjects5.10NegotiatedJV5.11PublicUtility
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5.0DefinitionofTerms.
5.1CompetitiveChallenge.AnalternativeselectionprocesswhereinthirdpartiesshallbeinvitedtosubmitcomparativeproposalstoanegotiatedJVeitherinitiatedbyaprivatesectorproponentor,bythegovernmentincaseithasfailedtoidentifyaneligibleprivatesectorpartnerforadesiredactivityaftersubjectingthesametoacompetitiveselectionasprovidedunderSectionVIII.9ofAnnex"A"hereof.
Accordingly,theprivatesectorentitythatsubmittedthenegotiatedproposalisaccordedtherighttooutbid,throughasuperiorfinancialbid,anycomparativefinancialoffersgivenbycomparativeprivatesectorparticipantswhohavemettheeligibilityrequirementsandhavepassedthetechnicalqualificationprocess.
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5.0DefinitionofTerms.
5.2CompetitiveSelection.ReferstoaprocessofselectionbyaGovernmentEntityofaJVPartner(s),basedontransparentcriteria,whichshouldnotconstrainorlimitcompetition,andisopentoparticipationbyanyinterestedandqualifiedprivateentity.
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5.0DefinitionofTerms.
5.3ContractualJV.AlegalandbindingagreementunderwhichtheJVPartnersshallperformtheprimaryfunctionsandobligationsundertheJVAgreementwithoutformingaJVCompany.
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5.0DefinitionofTerms.
5.4CostofJVActivity/Project.ReferstothetotalamountofthecontributionsofthepartiestotheJVactivity/projectinpresentvaluewithdiscountrateasprescribedbytheappropriateApprovingAuthority.
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5.0DefinitionofTerms.
5.5GovernmentEntity.ReferstoGOCCs,GCEs,GICPs,SUCs,andGFIs,createdbylaw,executiveissuances,orpursuanttoBatasPambansaBilang68,otherwiseknownastheCorporationCodeofthePhilippines,asamended,anddefinedunderRepublicAct(RA)No.10149,otherwiseknownastheGOCCGovernanceActof2011,amongothers.
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5.0DefinitionofTerms.
5.6HeadofGovernmentEntity.ReferstothegoverningboardoritsdulyauthorizedofficialforGOCCs,GCEs,GICPs,SUCs,andGFIs..
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5.0DefinitionofTerms.
5.7JointVenture(JV).Anarrangementwherebyaprivatesectorentityoragroupofprivatesectorentitiesononehand,andaGovernmentEntityoragroupofGovernmentEntitiesontheotherhand,contributemoney/capital,services,assets(includingequipment,land,intellectualpropertyoranythingofvalue),oracombinationofanyoralloftheforegoingtoundertakeaninvestmentactivity.
Theinvestmentactivityshallbeforthepurposeofaccomplishingaspecificgoalwiththeendviewoffacilitatingprivatesectorinitiativeinaparticularindustryorsector,andeventuallytransfertheactivitytoeithertheprivatesectorundercompetitivemarketconditionsortothegovernment.
TheJVinvolvesacommunityorpoolingofinterestsintheperformanceoftheinvestmentactivity,andeachpartyshallhavetherighttodirectandgovernthepoliciesinconnectiontherewithwiththeintentiontosharebothprofitsand,risksandlossessubjecttoagreementbytheparties.AJVmaybeaContractualJVoraCorporateJV(JVCompany).
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5.0DefinitionofTerms.
5.8JVCompany.AstockcorporationincorporatedandregisteredinaccordancewiththeprovisionsofBatasPambansaBilang68,otherwiseknownastheCorporationCodeofthePhilippines,asamended,andbasedontheprevailingrulesandregulationsoftheSecuritiesandExchangeCommission(SEC)ofwhichfiftypercent(50%)orlessoftheoutstandingcapitalstockisownedbythegovernment.
TheJVCompanyshallberegisteredbytheJVpartnersthatshallperformtheprimaryfunctionsandobligationsoftheJVasstipulatedundertheJVAgreement.TheJVCompanyshallpossessthecharacteristicsstipulatedundertheseGuidelines.
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5.0DefinitionofTerms.
5.9InfrastructureorDevelopmentProjects.Include,butnotlimitedto,powerplants,highways,ports,airports,canals,dams,hydropowerprojects,watersupply,irrigation,telecommunications,railroadandrailways,transportsystems,landreclamationprojects,industrialestatesortownships,commercial/realestates,housing,governmentbuildings,tourismprojects,publicmarkets,slaughterhouses,warehouses,solidwastemanagement,informationtechnologynetworksanddatabaseinfrastructure,educationandhealthfacilities,sewerage,drainage,dredgingandotherinfrastructureanddevelopmentprojectsasmaybeauthorizedbytheGovernmentEntitypursuanttotheseGuidelines.
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5.0DefinitionofTerms.
5.10NegotiatedJV.Referstoaproposalinitiatedbyaprivatesectorproponentor,bythegovernmentincaseithasfailedtoidentifyaneligibleprivatesectorpartnerforadesiredactivityaftersubjectingthesametoacompetitiveselectionasprovidedunderSectionVIII.9ofAnnex"A"hereof.TheprocedurefornegotiatedproposalsisprovidedunderAnnex"B"oftheseGuidelines.
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5.0DefinitionofTerms.
5.11PublicUtilityProjects.ReferstoprojectsorfacilitiesthatprovidepublicservicesasdefinedundertheCommonwealthActNo.146(PublicServiceLaw),asamended,andforwhichafranchiseisrequired.
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JointVentureGuidelines
6.0GeneralGuidelines.
6.1JVAgreements6.2JVCompany6.3JVActivityImplementation6.4OwnershipoftheJVProject/Facility6.5ComplianceofProcurementActivities6.6JVActivitySubjecttoAuditExaminations6.7JVActivityEntitlementtoInvestmentIncentives6.8JVsInvolvingGovernmentAssetsorProperties6.9JVsunderMiningSector
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6.0GeneralGuidelines.
6.1JVAgreementsenteredintobytheGovernmentEntityconcernedwiththeprivatesectorpartner,whetherthroughcontractualagreementorthroughtheformationofaJVCompany(CorporateJV)asprovidedintheseGuidelines,shouldbeclearinitsintenttoundertakeaspecificactivitythatisresponsivetonationaldevelopmentgoalsandobjectives.
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6.0GeneralGuidelines.
6.2TheJVCompanyshallbeformedbytheGovernmentEntityandtheprivatesectorentityunderthefollowingparameters:
1. TheJVCompanyshallbeincorporatedandregisteredasastockcorporationinaccordancewiththeprovisionsofBatasPambansaBilang68,otherwiseknownastheCorporationCodeofthePhilippines,asamended,andtheprevailingandapplicablerulesandregulationspromulgatedbytheSEC;
2. OwnershipandnationalityrequirementsundertheConstitutionandotherpertinentlawsshouldbecompliedwith;provided,thattheGovernmentEntitysequitycontributionintheJVCompanyshallbefiftypercent(50%)orlessoftheoutstandingcapitalstockofthelatter.Governmentscontributionmaybethroughassets(includingmoney,equipment,land,intellectualpropertyoranythingofvalue)whichshallbesubjecttoathirdpartyindependentvaluation.ForaslongastheGovernmentEntityisinvolvedintheJVundertaking,theprivatesectorpartyshallnotsell/transferitsinterestintheJVCompanywithouttheexpresswrittenconsentoftheGovernmentEntity;
3. TheGovernmentEntityshallberepresentedintheBoardoftheJVCompanyinproportiontoitsinvestment;
4. TheJVCompanyshallbepermittedtoderiveincomefromtheactivitiesauthorizedundertheJVAgreementduringthetermthereof.TheGovernmentEntityandtheprivatesectorpartnershallbeentitledtoreceivedividendseachyearfromthenetprofitsthatwouldconstituteportionoftheunrestrictedretainedearningsofthecompanyineachyearinaccordancewiththeJVAgreement;
5. TheJVCompanyshouldstipulateafixedperiodfortermofexistencenottoexceedamaximumoffifty(50)yearspursuanttotheCorporationCodeofthePhilippines,asamended,fortheparticipationoftheGovernmentEntityasdeterminedbytheattainmentoftheGovernmentEntitysobjectiveinpursuingtheinvestment,uponwhichtheGovernmentEntitymaydivestitsinterestintheJVCompanybasedonexistinglaws,rulesandregulations.Further,thewithdrawaloftheGovernmentEntityscapitalcontributionbeforetheexpirationofthesaidperiodislikewiseencouraged;provided,thatthedivestmentismadethroughcompetitiveselection,initialpublicoffering(IPO),oranyothermeansthatpromotecompetition,fairnessandtransparency;and
6. IndraftingtheincorporationdocumentsoftheJVCompanyandothercontractsgoverningtherelationshipbetweentheGovernmentEntityandtheprivatesectorparticipant,thepartiesshouldconsiderthefollowingguidelines,amongothers:(1)clearlydefinedbusinessobjectives;(2)specifieddegreeofparticipationandthemanagementrolesofeachpartyintheJVactivity;(3)definedcontributionofcapitalandownershiprightstoproperty;(4)specifieddivisionoftheprofits,risksandlosses;(5)identifieddisputemechanismtoavoidmanagementimpassesthatmayproducedeadlockorlitigation;(6)specifiedtermination/liquidationoftheJVCompanyandindicatebuy-outprovisions;(7)specifiedconfidentialityterms;and(8)stipulatedindemnificationmechanisms.
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6.0GeneralGuidelines.
6.3IftheformationofaJVCompanyisnotthebestmodetoimplementaJVactivityasdeterminedbytheGovernmentEntity,itmayopttoimplementtheJVprojectthroughacontractualagreement.PriortoenteringintoaContractualJV,theparameterssimilartothosegoverningJVCompaniesunderSection6.2.fhereinaretobeobserved.
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6.0GeneralGuidelines.
6.4TheownershipoftheJVproject/facilitymaybetransferredtoeithertheGovernmentEntityortheprivatesectorpartneraftertheexpirationoftheJVAgreementdependingonthetermsstatedtherein;providedthat,pursuanttoSection7.2.aoftheseGuidelines,JVprojectswhichinvolvefulldivestmentortransferofownershipofgovernmentassetsorpropertiestoaprivatesectorpartneroraprivatesector/entityshallbeapproved/clearedbythePrivatizationCouncil(PC),andJVprojectswhichinvolvedivestmentofgovernmentequitythatisnotintheformofassetorpropertyshallbeapproved/clearedbytheGCG.
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6.0GeneralGuidelines.
6.5Asmaybeapplicable,theprocurementactivitiesfinancedbytheGovernmentEntityorGovernmentofthePhilippines(GOP)regardlessofsourceoffunds,whetherlocalorforeign,shallcomplywithRANo.9184,otherwiseknownastheGPRAanditsRevisedImplementingRulesandRegulations(IRR).TheJVactivityshallalsocomplywithotherlaws,rulesandregulations,guidelines,andlegalissuancesonprocurement,asmaybeapplicable.
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6.0GeneralGuidelines.
6.6AJVactivityshallbesubjecttoauditexaminationunderexistinglaws,rulesandregulations,andotherlegalissuances.
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6.0GeneralGuidelines.
6.7AJVactivitymaybeentitledtoinvestmentincentivesasmaybeapprovedbytheBoardofInvestments(BOI)asprovidedforunderEONo.226,otherwiseknownas"TheOmnibusInvestmentCodeof1987".Asmaybeapplicable,aJVactivitymayalsobeentitledtoinvestmentincentivesunderotherexistinglaws.
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6.0GeneralGuidelines.
6.8ForJVsinvolvinggovernmentassetsorproperties,theJVcontract/agreementmaybeterminated/rescindediftheprivatesectorpartnerfailstodeliverorperformanymajorobligation/sprescribedintheJVcontract/agreement,e.g.,constructionoftheproposedbuilding/swithintheperiodspecifiedintheJVcontract/agreement.Insuchcases,theGovernmentEntityconcernedmaylikewiseforfeittheperformancesecurityoftheprivatesectorpartner.
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6.0GeneralGuidelines.
6.9ConsistentwithEONo.79dated06July2012,JVsundertheminingsectorshallbeundertakenthroughcompetitivepublicbidding.
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JointVentureGuidelines
7.0ProcessforEnteringintoJVAgreements.
7.1Requirements/ConditionsforJVProposals7.2ApprovalofJVProposals7.3Clearance/ApprovalofDOFandDBM7.4ApprovalforRegistrationofJVCompany7.5ModesofSelectingaJVPartner7.6ApprovaloftheJVAgreement7.7DeviationsandAmendmentstotheJVAgreement
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7.0ProcessforEnteringintoJVAgreements.
7.1Requirements/ConditionsforJVProposals.JVproposalsshallcomplywiththefollowingrequirements/conditions:
1. TheJVactivityiswithinthemandateandcharteroftheGovernmentEntityconcerned;
2. TheJVactivityisresponsiveinmeetingnationalorspecificdevelopmentgoalsandobjectives;
3. TheJVproposalclearlydescribestheproposedinvestment,includingitstotalcost,activities,objectives,sourcesoffunding,extentandnatureoftheproposedparticipationoftheGovernmentEntityconcerned,andtherelevanttermsandconditions;
4. TheJVproposalestablishesallthecomponentsindeterminingtheover-allfeasibilityoftheJVproposalwhichinclude,amongothers,thetechnical,financial,economic,andlegalaspects;and
5. ThetermsandconditionsoftheapprovalofthePC,ifapplicable.
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7.0ProcessforEnteringintoJVAgreements.
7.2ApprovalofJVProposals.TheapprovalofJVproposalsshallbeinaccordancewiththefollowing:
a.PriortoSubmissionofaJVProposalb.NEDABoardICCasApprovingAuthorityforSpecifiedProjectsc.HeadofGovernmentEntityConcernedasApprovingAuthorityforSpecifiedProjectsd.ContentsofProjectProposalstobesubmittedtoNEDAICCe.EnactmentuponJVProposal
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7.2ApprovalofJVProposals.
a.PriortosubmissionofaJVproposaltotheApprovingAuthorityasindicatedinthisSection,approvalfromconcernedentitiesshallbesecuredasindicatedbelow:
1. Projectswhichinvolvedivestmentortransferofgovernmentassetsorpropertiestotheprivatesectorpartneroraprivatesector/entityshallberequiredtosecureapproval/clearancefromthePCpursuanttoEONo.12dated14August1998,asamendedbyEONo.323dated06December2000;
2. ProjectswhichinvolvetheformationofaJVcompanyshallberequiredtosecureapprovalfromGCGpursuanttoRANo.10149,otherwiseknownastheGOCCGovernanceActof2011;and
3. ProjectswhichinvolvedivestmentofgovernmentequitythatisnotintheformofassetorpropertyshallberequiredtosecureapprovalfromGCGpursuanttoRANo.10149,otherwiseknownastheGOCCGovernanceActof2011.
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7.2ApprovalofJVProposals.
b.Forthefollowingprojects,theApprovingAuthorityshallbetheNEDABoardInvestmentCoordinationCommittee(ICC):
1. InfrastructureprojectsasdefinedunderSection5.9oftheseGuidelineswithgovernmentcontributionamountingOneHundredFiftyMillionPesos(PhP150Million)andabove;
2. ProjectsthatarepublicutilitiesasdefinedunderSection5.11oftheseGuidelineswithgovernmentcontributionamountingOneHundredFiftyMillionPesos(PhP150Million)andabove;
3. NegotiatedJVsthatareinitiatedbyaprivatesectorproponentwithgovernmentcontributionamountingOneHundredFiftyMillionPesos(PhP150Million)andabove;and
4. ProjectsthatarenotrelatedtoprimarycorporatemandatewithgovernmentcontributionamountingOneHundredFiftyMillionPesos(PhP150Million)andabove.
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7.2ApprovalofJVProposals.
c.Forthefollowingprojects,theApprovingAuthorityshallbetheHeadoftheGovernmentEntityconcerned:
1. ProjectsthatarerelatedtoprimarycorporatemandateandnotinvolvinginfrastructureprojectsasdefinedunderSection5.9oftheseGuidelines;and
2. ProjectsnotcoveredunderSection7.2.boftheseGuidelines.
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7.2ApprovalofJVProposals.
d.ProjectproposalsthatshallbesubmittedtoNEDAICCforapprovalasindicatedinthisSectionshouldincludethefollowing:
(i)endorsementoftheJVproposalbytheHeadoftheGovernmentEntityconcerned;
(ii)projectdetails;
(iii)draftJVAgreement;and
(iv)otherdocumentsandrequirementsasmaybedeterminedbytheNEDAICCpursuanttoitsguidelines.TheGovernmentEntityconcernedshallfurnishtheDepartmentofFinance(DOF)allthedocumentssubmittedtotheNEDAICCfortheapprovalofaJVproposal;
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7.2ApprovalofJVProposals.
e.TheApprovingAuthorityshallactontheJVproposalwithinaperiodofthirty(30)calendardaysuponsubmissionofcompletedocuments.
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7.0ProcessforEnteringintoJVAgreements.
7.3Clearance/ApprovalofDOFandDepartmentofBudgetandManagement(DBM).ForJVactivitythatwillrequirenationalgovernmentundertakings,subsidiesorguarantees,clearance/approvaloftheDOFand/ortheDBM,asthecasemaybe,shallbesecured.
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7.0ProcessforEnteringintoJVAgreements.
7.4ApprovalforRegistrationofJVCompany.AllJVproposalswhichinvolvethepursuitoftheprojectthroughaJVCompanyshallbesubmittedtotheGCGforreviewandrecommendationtothePresidentofthePhilippinesforapprovalbeforeregisteringthesamewiththeSECpursuanttoSection27ofRANo.10149.
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7.0ProcessforEnteringintoJVAgreements.
7.5ModesofSelectingaJVPartner
a.CompetitiveSelection-TheprocessfortheconductofCompetitiveSelection,contractawardandapprovalshallbestipulatedunderAnnex"A"oftheseGuidelines.IntheconductoftheCompetitiveSelectionprocess,theGovernmentEntityshallensurethefollowing:
1. Allactivitiesduringthecompetitiveselection,award,andapprovalareconductedinatransparentandcompetitiveprocessthatpromotesaccountabilityandefficiency;and
2. ThecompetitiveselectionparametersareclearlydefinedandshallincludetheparametersasapprovedbytheApprovingAuthority.
b.NegotiatedJVs-NegotiatedJVsmaybeenteredunderthecircumstancesstatedunderAnnex"B"oftheseGuidelines.
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7.0ProcessforEnteringintoJVAgreements.
7.6ApprovaloftheJVAgreement.UponapprovaloftheJVproposalbytheApprovingAuthority,theHeadoftheGovernmentEntityconcernedshallapprovethedraftcontractorJVAgreement.TheHeadoftheGovernmentEntityconcernedshallberesponsibleforensuringtheconsistencyofthetender/bidparametersandthedraftcontractorJVagreementwiththeparameters,termsandconditionssetforthbytheApprovingAuthority.
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7.0ProcessforEnteringintoJVAgreements.
7.7DeviationsandAmendmentstotheJVAgreement.TheconcernedGovernmentEntityshallnotproceedwiththeawardandsigningofthecontractiftherearematerialdeviationsfromtheparametersandtermsandconditionssetforthintheproposal/tenderdocumentsthattendtoincreasethefinancialexposure,liabilitiesandrisksofgovernmentoranyotherfactorsthatwouldcausedisadvantagetogovernmentandanydeviationthatwillcauseprejudicetolosingprivatesectorparticipants.
SaidmaterialdeviationsandamendmentsshallbesubjectedtotheapprovalrequirementsunderSections7.2,7.3,and7.4hereof.TheHeadoftheGovernmentEntityconcernedshallberesponsibleforcompliancewiththispolicy.Violationofthisprovisionshallrendertheawardand/orthesignedJVAgreementinvalid.
AnyamendmenttoaJVAgreementafterawardandsigningofcontractshallundergoapprovalbytheappropriateApprovingAuthorityasprovidedinSections7.2,7.3,and7.4oftheseGuidelines.Noncompliancewiththecorrespondingapprovalprocessstatedshallrendertheamendmentnullandvoid.
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JointVentureGuidelines
8.0ReportingRequirement.DuringthecourseofimplementationoftheJVAgreement,theconcernedGovernmentEntityshallsubmitanannualreportonthestatusofitsimplementationduringacurrentyeartotheDOFandGCGformonitoringpurposes.Theannualreportshallbesubmittedwithinthefirstquarterofthesucceedingyearandmaybeinanyformat,electronic/digitalcopyorhardcopy,asmayberequiredbyDOFandGCG.
ThereportshallusecurrentstandardsintheproductionofcorporateannualreportsandshallincludetheauditedfinancialstatementsoftheJV.Inaddition,thereportshallalsocontaintheJVsworkprogramforaperiodasspecifiedandrequiredbyDOFstartingfromtheyeartheannualreportisissued.
TheheadsofgovernmententitiesasdefinedinSection5oftheseGuidelines,shallsubmittoNEDA,DOFandGCGthesalientfeaturesandacopyofJVAgreementstogetherwithalldocumentsrequiredtheretoformonitoringofcompliancewithrelevantpolicies,proceduresandconditionsforapprovaloftheJVundertaking.
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9.0Amendments.TheseGuidelinesmaybeamendedand/ormodifiedfromtimetotimebyNEDAthroughitsDirector-General,inconsultationwiththeGPPB,theOGCC,andtheGCG.
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JointVentureGuidelines
10.0Separability.IfanyprovisionoftheseGuidelinesisheldordeclaredvoidorunenforceablebyfinaljudgmentofacourtofcompetentjurisdiction,theotherprovisionsunaffectedtherebyshallremaininfullforceandeffect.
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11.0Effectivity.TheseRevisedGuidelinesandanysubsequentamendmentormodificationshalltakeeffectfifteen(15)calendardaysfromthedateofitspublicationinanewspaperofgeneralcirculationortheOfficialGazetteorothermodeslegallyacceptable,andacopyofitshallbesubmittedtotheOfficeoftheNationalAdministrativeRegistry(ONAR)andtheUniversityofthePhilippines(UP)LawCenter.
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JointVentureGuidelines
12.0TransitoryProvision.ThefollowingshallbegovernedbytheoldGuidelines(2008JVGuidelines):(a)AllnegotiatedJVswhereinaJVcontract/agreementbetweenthewinningprivatesectorparticipantandtheGovernmentEntityconcernedhasbeenexecutedpriortoeffectivityoftheRevisedJVGuidelines;and,(b)AllJVsundertakenthroughcompetitiveselectionwhereinthebid/shavealreadybeenopenedpriortotheeffectivityoftheseRevisedJVGuidelines.
ForJVsnotcoveredunderitems(a)and(b)above,theseRevisedJVGuidelinesshallgovern,providedthattheRevisedGuidelinesshallnot,inanymanner,operatetoimpairvestedrightsalreadyaccruingtoaparty.
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ANNEXADETAILEDGUIDELINESANDPROCEDURESFORCOMPETITIVESELECTIONFORPUBLIC-PRIVATEJOINTVENTURES
I.TheJointVentureSelectionCommittee(JV-SC)II.Selection/TenderDocumentsIII.PublicationofInvitationtoApplyforEligibilityandtoSubmitaProposal(IAESP)IV.QualificationofPrivateSectorParticipantsV.SupplementalCompetitiveSelectionBulletinsandPre-SelectionConferencesVI.SubmissionandReceiptofProposalsVII.OpeningandEvaluationofProposalsVIII.AwardandApprovalofContractIX.AppealsMechanism
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I.TheJointVentureSelectionCommittee(JV-SC)
1.Composition2.Responsibilities3.Quorum
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1.Composition
RegularMembers(voting):
a.Chairman-AtleastathirdrankingofficeroftheGovernmentEntity;
b.Secretary-AnylegalofficeroftheconcernedGovernmentEntity;
c.One(1)officerknowledgeableinfinance;
d.One(1)officerknowledgeableinmanagement/operationoftheJV;and
e.One(1)officerknowledgeablewiththetechnicalaspectsorrequirementsoftheproject,dulydesignatedbytheHeadoftheGovernmentEntityconcernedonaproject-to-projectbasis.
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1.Composition
ProvisionalMembers(non-voting):
f.One(1)technicalofficerfromaconcernedregulatorybody,whenapplicable,knowledgeablewiththeprojectathand,tobeinvitedbytheGovernmentEntityconcernedonaproject-to-projectbasis;and
g.Observers:
1. One(1)representativefromtheGovernmentEntitysstatutorycounsel(OGCCortheOfficeoftheSolicitor-General[OSG]orasdesignatedbytheDepartmentofJustice[DOJ]);
2. Two(2)representativesfromtheprivatesector-one(1)representativefromadulyrecognizedassociationrelatedtotheprojectathand,andone(1)representativefromeitherthefacilityusers,ifapplicable,ordulyrecognizedaccountingassociations;and
3. One(1)representativefromtheCommissiononAudit(COA).
Observerswillbenotifiedatleasttwo(2)calendardaysbeforethefollowingstages:pre-selectionconference,openingoftechnicalandfinancialproposals,evaluationoftechnicalandfinancialproposals,contractaward,andspecialmeetingsoftheJV-SC.TheabsenceofobserverswillnotnullifytheJV-SCproceedings,providedthattheyhavebeendulyinvitedinwriting.
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I.TheJointVentureSelectionCommittee(JV-SC)
2.Responsibilities.TheJV-SCshallberesponsibleforallaspectsofthepre-selectionandselectionprocess,including,amongothers,thepreparationoftheselection/tenderdocuments,publicationoftheinvitationtoapplyforeligibilityandtosubmitaproposal,pre-qualificationofprospectiveprivatesectorparticipants,conductofpre-selectionconferencesandissuanceofsupplementalnotices,interpretationoftherulesregardingtheselectionprocess,theconductoftheselectionprocess,evaluationofthefinancialandtechnicalproposals,resolutionofdisputesbetweenprivatesectorparticipants,andrecommendationfortheacceptanceoftheproposaland/orfortheawardofthecontract.
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I.TheJointVentureSelectionCommittee(JV-SC)
3.Quorum.AquorumoftheJV-SCshallbecomposedofasimplemajorityofallvotingmembers.TheChairmanshallvoteonlyincaseofatie.
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II.Selection/TenderDocuments
1.Selection/TenderDocuments2.InstructionstoPrivateSectorParticipants3.MinimumDesigns,PerformanceStandards/SpecificationsandEconomicParameters4.DraftContract
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II.Selection/TenderDocuments
1.Selection/TenderDocuments.TheGovernmentEntityconcernedshallpreparetheselection/tenderdocumentswhichshallincludethefollowing:
1. InstructionstoPrivateSectorParticipants;
2. MinimumDesign,PerformanceStandards/Specifications,andotherFinancialandEconomicParameters,whereapplicable,amongothers;
3. FeasibilityStudyoraBusinessCase/Pre-feasibilityStudyoftheProject;
4. DraftContract(asapprovedinaccordancewithSection7.6oftheseGuidelines)reflectingthetermsandconditionsinundertakingtheJVactivityincluding,amongothers,thecontractualobligationsofthecontractingpartiesandtheownershipoftheJVactivity,project,orpropertyaftertheterminationoftheJVAgreement;
5. SelectionFormreflectingtherequiredinformationtoproperlyevaluatethetechnicalandfinancialproposal;
6. Formsoftechnicalandfinancialproposalsandperformancesecurities;and
7. OtherdocumentsasmayberequiredbytheGovernmentEntityconcernedandotherrequirementsofconcernedregulatoryagenciesasmaybepertinentorapplicabletotheJVactivity.Thedocumentsenumeratedabovearejustforguidance/reference.TheGovernmentEntityconcernedisgivenfulldiscretiontoselecttheappropriateprovisionsastheymaydeemsuitableforaparticularcontract/project.
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II.Selection/TenderDocuments
2.InstructionstoPrivateSectorParticipants.Theinstructionstoprivatesectorparticipants,whichestablishtherulesoftheselectionprocess,shallbeclear,comprehensiveandfairtoallprivatesectorparticipantsandshall,asfarasnecessaryandpracticable,includethefollowinginformation:
1. GeneraldescriptionandobjectivesoftheJVactivity;
2. Proposalsubmissionproceduresandrequirements,whichshallincludeinformationonthemannerofproposalsubmission,thenumberofcopiesofthetechnicalandfinancialproposaltobesubmitted,wheretheproposalsaretobesubmitted,thedeadlineforthesubmissionofproposals,permissiblemodeoftransmissionoftechnicalandfinancialproposals,etc.;
3. Amountandformofproposalsecurityandproposalsecurityvalidityperiod;
4. Milestones;
5. Method,parametersandcriteriafortheevaluationoftheproposals;
6. MinimumamountofequityoftheprospectiveJVPartner;
7. Requirementsofconcernedregulatorybodies/agenciesasmaybepertinentorapplicabletotheJVactivity;
8. Revenuesharingarrangement,ifany;and
9. Nationalityandownershiprequirementsasrequiredbylaw.
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II.Selection/TenderDocuments
3.MinimumDesigns,PerformanceStandards/SpecificationsandEconomicParameters.Minimumdesignandperformancestandards/specifications,includingappropriateenvironmentalstandardsbytheDepartmentofEnvironmentandNaturalResources(DENR),andstandardsbyconcernedregulatoryagenciesasmaybepertinentorapplicabletotheJVactivity,shallbeclearlydefinedandshallrefermoretothedesiredquantityandqualityoftheoutputsoftheJVactivityandshouldstatethatnon-conformitywithanyoftheseminimumrequirementsshallrendertheproposalsasnon-responsive.
Likewise,forthepurposeofevaluatingproposals,thefollowingeconomicparameters,amongothersandwhereapplicable,shallbeprescribed:
1. Discountrate,foreignexchangerateandinflationfactor;
2. Maximumperiodofprojectconstruction;
3. Fixedtermandpriceindicestobeusedintheadjustmentsoftolls/fees/rentals/charges,ifapplicable;and
4. Minimumperiodofrepayment,ifapplicable.
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II.Selection/TenderDocuments
4.DraftContract.ThedraftcontractshouldclearlydefinethebasicandlegalrelationshipbetweenthepartiesandtheirrightsandresponsibilitiesincludingspecificGovernmentUndertakingstobeprovidedbytheGovernmentEntityrelativetotheJVactivity,ifany.Specifically,thedraftcontractshallalsocontainprovisionsonthefollowingmatters,asfaraspracticable:
a.Thedateonwhichtheagreementisestablished,executed,andconsideredeffective;
b.Thenames,addressesandidentificationoftheparties,includingthetypeofbusinessofeachmemberoftheJV;
c.ThenameunderwhichtheJVwilldobusiness;
d.TheprincipalplaceofbusinessoftheJV;
e.Clearlydefinedpurposeandobjective/s,contractual/agreementmode(whetherJVCompany/CorporateJVorcontractualJV),termandscopeoftheJV.Thetermshouldbeafixedperiodnottoexceedamaximumoffifty(50)yearsfortheparticipationoftheGovernmentEntityasdeterminedbytheattainmentoftheGovernmentEntitysobjectiveinpursuingtheinvestment;
f.TotalcostoftheJVactivity,projectspecificationsandfeatures;
g.Therelationshipbetweentheparties,managementrolesofeachpartyintheJVactivity,andastatementthatthepartiesareactuallyco-venturersfortheproject,whetherornotthecontractisinthenameofallmembers;
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III.PublicationofInvitationtoApplyforEligibilityandtoSubmitaProposal(IAESP)
1.Priortoissuance/publicationoftheIAESP,theGovernmentEntityconcernedshallsubmitacopyofthedraftJVagreement,instructionstoprivatesectorparticipants,andminimumdesigns,performancestandards/specificationsandeconomicparameterstoNEDA,DOFandGCGforinformation.
2.TheIAESPsshallbeadvertisedonceinanewspaperofgeneralnationwidecirculation,andpostedcontinuouslyforaperiodofseven(7)calendardays,startingondateofadvertisement,atthefollowing:
1. WebsiteoftheGovernmentEntityconcerned,ifavailable;2. WebsiteoftheGovernmentEntitysserviceprovider,ifany;and3. Anyconspicuousplacewithinthepremisesoftheprocuringentity.
3.Privatesectorparticipantsshallbegivenatleastthirty(30)calendardaysfromthelastdateofpublicationoftheIAESPtoapplyforeligibilityandtosubmitaproposal.Notwithstanding,theGovernmentEntityconcernedmayadjustsaidperiodasmaybeappropriateforthenature,scope,sizeandcomplexityoftheproposedJVactivity.Provided,thattheprinciplesoftransparency,competitionandaccountabilityareobserved.
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IV.QualificationofPrivateSectorParticipants
1.WhomayParticipate2.EligibilityRequirements3.EligibleandIneligible4.IssuanceofTenderDocuments
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IV.QualificationofPrivateSectorParticipants
1.WhomayParticipate.Anyindividual,partnership,corporationorfirm,orconsortium,whetherlocalorforeign,subjecttothelimitssetherein.
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IV.QualificationofPrivateSectorParticipants
2.EligibilityRequirements.
a.LegalRequirementsb.TechnicalRequirementsc.FinancialCapabilityd.Consortiae.AcceptanceofCriteriaandWaiverofRightstoEnjoinJVActivity
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2.EligibilityRequirements
a.LegalRequirements.IftheJVactivityrequiresapublicutilityfranchise,theprivatesectorparticipantmustbedulyregisteredwiththeSECandbeatleastsixtypercent(60%)Filipino-owned.Forprojectsotherthanthese,prospectiveprivatesectorparticipantshallcomplywithnationalityandownershiprequirementsundertheConstitutionandotherapplicablelawsandissuances.
ForJVactivitiestobeoperatedbytheprospectiveJVPartnerorafacilityoperatorwhereoperationofthefacilitydoesnotrequireapublicutilityfranchise,theJVpartnerorfacilityoperatororconcessionairemaybeFilipinoorforeign-owned,asmaybeallowedunderapplicablelaws,rules,andregulations.
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2.EligibilityRequirements
b.TechnicalRequirements.TheprospectiveJVPartnermusthavecompletedaprojectsimilarorrelatedtotheJVactivitywhosevalue,adjustedtocurrentpricesusingtheNationalStatisticsOffice(NSO)ConsumerPriceIndex(CPI),mustbeatleastfiftypercent(50%)ofthecostoftheJVactivitysubjectoftheselectionprocesswithintherelevantperiodasdeterminedbytheGovernmentEntity.
TheprospectiveJVPartnershallsubmitastatementofallitsongoingandcompletedgovernmentandprivatecontractssimilarorrelatedtotheJVactivitysubjectoftheselectionprocess,includingcontractsawardedbutnotyetstarted,ifany.
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2.EligibilityRequirements
c.FinancialCapability.TheGovernmentEntityshalldeterminebeforeevaluationofeligibility,theminimumamountofequityneededfortheJVactivity.
ThefollowingdocumentsshallbesubmittedbytheprospectiveJVPartner:
1. Auditedfinancialstatementsforthepastthree(3)calendaryears.IftheprospectiveJVPartnerisFilipino,theauditedfinancialstatementstobesubmittedmustbestamped"received"bytheBureauofInternalRevenue(BIR)oritsdulyaccreditedandauthorizedinstitutions;and
2. Latesttaxreturns,iftheJVPartnerisFilipino.
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2.EligibilityRequirements
d.Incaseofconsortia,allmember-entitiesoftheprospectiveJVPartnershallalsosubmittheabovelegal,technicalandfinancialeligibilityrequirementstodeterminetheoverallcapabilityoftheconsortiafortheJVundertaking
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2.EligibilityRequirements
e.AcceptanceofCriteriaandWaiverofRightstoEnjoinJVActivity.Inadditiontotheabove,allprospectiveprivatesectorparticipantsshallberequiredtosubmit,aspartoftheirqualificationdocuments,astatementstipulatingthattheprivatesectorparticipant:
(i)hasacceptedthequalificationcriteriaestablishedbytheJV-SCoftheGovernmentEntityconcerned;and
(ii)waivesanyrightitmayhavetoseekandobtainawritofinjunctionorprohibitionorrestrainingorderagainsttheconcernedGovernmentEntityoritsJV-SCtopreventorrestrainthequalificationproceedingsrelatedthereto,theawardofthecontracttoasuccessfulprivatesectorparticipant,andthecarryingoutoftheawardedcontract.Suchwaivershall,howeverbe,withoutprejudicetotherightofadisqualifiedorlosingprivatesectorparticipanttoquestionthelawfulnessofitsdisqualificationortherejectionofitsproposalbyappropriateadministrativeorjudicialprocessesnotinvolvingtheissuanceofawritofinjunctionorprohibitionorrestrainingorder.
Financialcapabilityshallbemeasuredintermsof:
i)proofofabilityoftheprospectiveJVPartnertoprovideaminimumamountofequitytotheJVactivity,measuredintermsofthenetworthofthecompany,oradepositequivalenttotheminimumequityrequiredsetasideorear-markedfortheproposedJVactivity;and
ii)aletterfromadomesticuniversal/commercialbank,oraninternationalbankwithasubsidiary/branchinthePhilippines,oranyinternationalbankrecognizedbytheBangkoSentralngPilipinas(BSP),attestingthattheprospectiveJVPartnerisoneofitscurrentclients,andisingoodfinancialstanding.
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IV.QualificationofPrivateSectorParticipants
3.EligibleandIneligible.TheGovernmentEntity,throughitsJV-SC,shallwithinaperiodoffifteen(15)calendardaysafterthedeadlinesetforthesubmissionoftheeligibilitydocuments,completetheevaluationoftheeligibilitydocumentsoftheprospectiveJVPartners,anddeterminewhichamongthemare"eligible"and"ineligible".Accordingly,theJV-SCshalldulyinformtheeligibleJVPartnerswithinseven(7)calendardaysafterapprovalthereof.Ineligibleprivatesectorparticipantsshallbesimilarlygivennoticeofsuchineligibility,statingthereinthegroundsforineligibilitywithinthesameperiod.
ThoseineligiblemayappealtheirineligibilitytotheHeadoftheGovernmentEntityorhisauthorizedrepresentative,withinseven(7)calendardaysfromreceiptofthenoticeofineligibility.Theselectionprocesswillbesuspendedforamaximumperiodofthirty(30)calendardayswhiletheappealisbeingevaluated.TheHeadoftheGovernmentEntityorhisauthorizedrepresentativeshallactontheappealwithinthethirty(30)-calendardayperiodofsuspensionoftheselectionprocess.
ThedecisionoftheHeadoftheGovernmentEntity,orhisauthorizedrepresentative,ontheappealshallbefinalandimmediatelyexecutory.Iftheappealisnotresolvedwithinsaidperiod,theappealisdeemeddenied,andtheselectionprocesswillproceed.
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IV.QualificationofPrivateSectorParticipants
4.IssuanceofTenderDocuments.TheGovernmentEntityconcernedshallmakeavailabletherelatedcompetitiveselectiondocumentstoalleligibleprivatesectorparticipantsassoonaspracticabletoproviderespectiveprivatesectorparticipantsampletimetoexaminethesameandtopreparetheirrespectiveproposalspriortothedateofopeningoftheproposals.
Thetimeperiodfromthelastdayoftheissuanceoftenderdocumentstothedateofopeningoftheproposalshallnotexceedsixty(60)calendardaysforJVfacility/projectcostingFiveHundredMillionPesos(PhP500Million)andabove,andthirty(30)calendardaysforJVfacility/projectcostinglessthanFiveHundredMillionPesos(PhP500Million).
TheproposalparametersfortheproposedJVactivityshouldbetransparentandfair.Itshouldnot,inanyway,betailor-madeforormeanttofavororgiveadvantagetoaparticularprivatesectorparticipant.
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V.SupplementalCompetitiveSelectionBulletinsandPre-SelectionConferences
1.ResponsibilityofthePrivateSectorParticipant2.SupplementalNotices3.Pre-SelectionConference
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V.SupplementalCompetitiveSelectionBulletinsandPre-SelectionConferences
1.ResponsibilityofthePrivateSectorParticipant.Theprospectiveprivatesectorparticipantshallbesolelyresponsibleforhavingtakenallthenecessarystepstocarefullyexamineandacquainthimselfwiththerequirementsandtermsandconditionsoftheselectiondocumentswithrespecttothecost,durationandexecution/operationoftheprojectasitaffectsthepreparationandsubmissionofitsproposal.
TheGovernmentEntityconcernedshallnotassumeanyresponsibilityregardingerroneousinterpretationsorconclusionsbytheprospectiveprivatesectorparticipantoutofdatafurnishedorindicatedinthecompetitiveselectiondocuments.
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V.SupplementalCompetitiveSelectionBulletinsandPre-SelectionConferences
2.SupplementalNotices.AprospectiveprivatesectorparticipantmaysubmitawrittenrequesttotheGovernmentEntityconcernedonorbeforethepre-selectionconferenceastothemeaningofanydataorrequirementsoranypartoftheselectiondocuments.AnysubstantiveinterpretationgivenbytheconcernedGovernmentEntityshallbeissuedintheformofaSupplementalNotice,andfurnishedtoallprospectiveprivatesectorparticipants.
TheGovernmentEntityconcernedmayalsoissueSupplementalNoticestoallprospectiveprivatesectorparticipantsatanytimeforpurposesofclarifyinganyprovisionsoftheselectiondocuments,providedthatthesameareissuedwithinareasonableperiodtoallowallprivatesectorparticipantstoconsiderthesameinthepreparationoftheirproposals.
ReceiptofallSupplementalNoticesshallbedulyacknowledgedbyeachprivatesectorparticipantspriortothesubmissionofhisproposalandshallbesoindicatedintheproposal.
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V.SupplementalCompetitiveSelectionBulletinsandPre-SelectionConferences
3.Pre-SelectionConference.ForJVactivitieswithfacility/projectcostamountingtolessthanFiveHundredMillionPesos(PhP500Million),pre-selectionconferenceshallbeconductedbytheGovernmentEntityatleastfifteen(15)calendardaysbeforethedeadlineforthesubmissionofproposals.
ForJVactivitieswithfacility/projectcostamountingtoFiveHundredMillionPesos(PhP500Million)andabove,thepre-selectionconferenceshallbeconductedatleastthirty(30)calendardaysbeforethedeadlineforthesubmissionofproposals.Notwithstanding,theGovernmentEntityconcernedmayadjustsaidperiodasmaybeappropriateforthenature,scope,size,andcomplexityoftheproposedJVactivity.Provided,thattheprinciplesoftransparency,competitionandaccountabilityareobserved.
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VI.SubmissionandReceiptofProposals
1.RequirementsforSubmissionofProposalsa.TechnicalProposalb.FinancialProposalc.SubmissionofLateProposals
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VI.SubmissionandReceiptofProposals
1.RequirementsforSubmissionofProposals.Privatesectorparticipantsshallberequiredtosubmittheirproposalsonorbeforethedeadlinestipulatedinthe"InstructionstoParticipants".Foreligibleparticipants,proposalsshallbesubmittedintwo(2)separatesealedenvelopes,thefirstbeingthetechnicalproposalandthesecondthefinancialproposal.
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1.RequirementsforSubmissionofProposals
a.Thetechnicalproposalshallcontainthefollowing,asapplicable:
1. Compliancestatementswithregardtothetechnicalparametersasstatedinthetenderdocuments;
2. Operationalfeasibility;
3. Technicalsoundness,includingproposedprojecttimeline;
4. Preliminaryenvironmentalassessment;
5. CostandfinancingplanoftheJVactivity;
6. Proposalsecurityintheformasrequiredbythegovernmententityconcernedwhichmaybeincash,certifiedcheck,manager scheck,letterofcredit,orbankdraft/guaranteeissuedbyareputablelocal/foreignbank,orasuretybondcallableondemandissuedbytheGovernmentServiceInsuranceSystem(GSIS)oranentitydulyregisteredandrecognizedbytheOfficeoftheInsuranceCommissioner,oranycombinationthereofpayabletotheGovernmentEntityconcernedinaccordancewiththefollowingschedule:
TotalContributionofthePrivateSectorParticipantAsEstimatedbytheGovernment
EntityRequiredProposalSecurity
LessthanPhP5.0Billion2.0%oftheprivatesectorparticipant's
contributionasestimatedbytheGovernmentEntity
PhP5.0BilliontolessthanPhP10.0Billion1.5%oftheprivatesectorparticipant's
contributionasestimatedbytheGovernmentEntity
PhP10.0Billionandmore1.0%oftheprivatesectorparticipant's
contributionasestimatedbytheGovernmentEntity
7. Otherdocumentstosupporttheprivatesectorparticipantstechnicalproposal,asmayberequiredbytheconcernedGovernmentEntity.
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1.RequirementsforSubmissionofProposals
b.Thefinancialproposalshallcontainthefollowing,asthecasemaybe:
1. Compliancestatementswithregardtothefinancialparametersstatedinthetenderdocuments;
2. ProposedcostoftheJVactivity,operationandmaintenancecost,theamountofequitytobeinfusedanddebttobeobtainedfortheproject,sourcesoffinancing,andallotherrelatedcosts;and
3. FinancialproposalcorrespondingtotheparameterssetbytheconcernedGovernmentEntity.
Fiftypercent(50%)oftheequitytobeprovidedbytheprivatesectorentityshouldasmuchaspossiblecomefromitsownresourcesandnotborrowed.TheGovernmentEntityconcernedisnotprecludedfromspecifyingotherrequirementsforthetechnicalandfinancialproposalsthatarebestsuitedforthespecificJVactivity.
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1.RequirementsforSubmissionofProposals
c.Submissionoflateproposals.Proposalssubmittedafterthedeadlineforsubmissionprescribedinthe"InstructionstoPrivateSectorParticipants"shallbeconsideredlateandshallbereturnedunopened.
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VII.OpeningandEvaluationofProposals
1.OpeningoftheenvelopefortheTechnicalProposal2.EvaluationoftheTechnicalProposal3.OpeningoftheEnvelopefortheFinancialProposal4.EvaluationoftheFinancialProposal5.SimultaneousevaluationoftheTechnicalandFinancialProposals6.PrescriptivePeriods7.RejectionofProposals8.Withdrawaland/orModificationofProposals9.RighttoRejectAllProposals10.BreakingTieBids
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VII.OpeningandEvaluationofProposals
1.Openingoftheenvelopeforthetechnicalproposal.Atthedateandtimeoftheproposalopeningstipulatedinthe"InstructionstoPrivateSectorParticipants",theJV-SCshallopenonlythefirstenvelopecontainingtechnicalproposalandascertain:
(a)whetherthesameiscompleteintermsofthedata/informationrequiredunderSectionVI.1(a)above;and
(b)whetherthesameisaccompaniedbytherequiredproposalsecurityintheprescribedform,amount,andperiodofvalidity.
Allprivatesectorparticipants,ortheirrepresentatives,presentattheopeningoftheenvelopescontainingthetechnicalproposalshallsignaregisteroftheproposalopening.
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VII.OpeningandEvaluationofProposals
2.Evaluationofthetechnicalproposal.Theevaluationofthefirstenvelopecontainingthetechnicalproposalshallinvolvetheassessmentofthetechnical,operational,environmental,andfinancingviabilityoftheproposal,vis-ŕ-vistheprescribedrequirementsandcriteria/minimumstandards,andbasicparametersprescribedinthecompetitiveselectiondocuments.
TheJV-SCoftheGovernmentEntityconcernedshallcompletetheevaluationofthetechnicalproposalwithinthirty(30)calendardaysfromthedatetheproposalsareopened.Onlythoseproposalsthathavebeendeterminedtohavepositivelypassedtheevaluationofthetechnicalproposalshallbequalifiedandconsideredfortheevaluationofthefinancialproposal.
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VII.OpeningandEvaluationofProposals
3.Openingoftheenvelopeforthefinancialproposal.OnlythefinancialproposalsofprivatesectorparticipantswhopassedtheevaluationdescribedunderSectionVII.2hereof,shallbeopenedforfurtherevaluation.ThefinancialproposalstenderedbyprivatesectorparticipantswhofailedthetechnicalproposalevaluationunderSectionVII.2hereof,shallnotbeconsideredfurther,andshallbereturnedunopened,togetherwithanoticestatingthereasonsfordisqualificationfromfurtherconsideration.
TheJV-SCshallnotifytheprivatesectorparticipantsqualifyingforthesecondstageofevaluationofthedate,timeandplaceoftheopeningoftheenvelopesforthefinancialproposal.Theopeningthereofshallfollowthesameprocedureprescribedfortheopeningoftheenvelopescontainingtechnicalproposals.
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VII.OpeningandEvaluationofProposals
4.Evaluationofthefinancialproposal.TheevaluationofthefinancialproposalshallinvolvetheassessmentandcomparisonofthefinancialproposalsagainstthefinancialparametersstatedinthetenderdocumentsandproposalparameterssetbytheGovernmentEntityconcerned.
TheproposedfinancingplanmustshowthatthesameadequatelymeetsthecostsrelativetotheJVactivity.TheevaluationoffinancialproposalsshallbecompletedbytheJV-SCoftheconcernedGovernmentEntitywithinfifteen(15)calendardays.
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VII.OpeningandEvaluationofProposals
5.Simultaneousevaluationofthetechnicalandfinancialproposals.SubjecttothedeterminationoftheHeadoftheGovernmentEntitywhereinthenatureoftheJVactivityshallwarranttheappreciationofboththetechnicalandfinancialproposalsasawholeinordertodeterminethebestproposal,simultaneousevaluationofthetechnicalandfinancialproposalsmayberesortedto.
Provided,that,saidevaluationprocedureshallbeexplicitlystatedintheproposaldocuments.Simultaneousevaluationofthetechnicalandfinancialproposalsshallbecompletedwithinthirty(30)calendardaysfromthedatetheproposalsareopened.
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VII.OpeningandEvaluationofProposals
6.Prescriptiveperiods.Theperiodsstatedfortheevaluationofthetechnicalandfinancialproposalsareprescriptive.
TheGovernmentEntityconcernedmayadjustsaidperiodsasmaybeappropriateforthenature,scope,size,andcomplexityoftheproposedJVactivity.Provided,thattheprinciplesoftransparency,competitionandaccountabilityareobserved.
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VII.OpeningandEvaluationofProposals
7.Rejectionofproposals.Non-compliancetotheinformationrequiredoneitherthefirstorsecondenvelopeshallbegroundsforrejectionofproposals.
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VII.OpeningandEvaluationofProposals
8.Withdrawaland/ormodificationofproposals.Withdrawaland/ormodificationofproposalsmaybealloweduponwrittennoticebytheprivatesectorparticipantconcerned,totheGovernmentEntitypriortothetimeanddatesetfortheopeningoftheenvelopecontainingthetechnicalproposalasspecifiedinthe"InstructionstoPrivateSectorParticipants".
Noproposalsshallthereafterbemodifiedorwithdrawn.Proposalmodificationsreceivedaftersaidperiodshallbeconsideredlateandwillbereturnedunopened.Withdrawalofproposalsaftertheproposalopeningdateshallcausetheforfeitureoftheprivatesectorparticipantsproposalsecurity.
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VII.OpeningandEvaluationofProposals
9.RighttoRejectAllProposals.TheGovernmentEntityconcernedreservestherighttorejectanyorallproposals,waiveanyminordefectsthereinandaccepttheofferitdeemsmostadvantageoustothegovernment.
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VII.OpeningandEvaluationofProposals
10.BreakingTieBids.Incasetiebidsoccurundercompetitiveselectionorcompetitivechallenge,theprocedureforbreakingtiebidsshallbedonethroughdrawingoflotsorsimilarmethodsthatarenon-discretionaryandnon-discriminatorysuchthatitisbasedonsheerluckorchance.
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VIII.AwardandApprovalofContract
1.RecommendationtoAward2.DecisiontoAward3.NoticeofAward4.ValidityandReturnofProposalandPerformanceSecurities5.ExtensionofValidityofProposals6.SingleResponsiveBid7.ProspectiveBidder/sCompliantwiththeTechnicalRequirements8.NegotiationontheFinancialTerms/ProposalundertheCompetitiveSelectionProcess9.FailureofCompetitiveSelection10.Execution/ApprovaloftheJVAgreement11.OtherApprovalsforContract12.PresidentialApproval,whenRequired13.ContractEffectivity
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VIII.AwardandApprovalofContract
1.RecommendationtoAward.Withinseven(7)calendardaysfromthedatetheevaluationprocedureadoptediscompleted,theJV-SCshallsubmittherecommendationofawardtotheHeadoftheGovernmentEntityconcerned.
TheJV-SCshallincludeaspartofitsrecommendation,adetailedevaluation/assessmentreportonitsdecisionregardingtheevaluationoftheproposals,andexplainincleartermsthebasisofitsrecommendations.
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VIII.AwardandApprovalofContract
2.DecisiontoAward.Withinseven(7)calendardaysfromthesubmissionbyJV-SCoftherecommendationtoaward,theHeadoftheGovernmentEntityshallapproveorrejectthesame.Theapprovalshallbemanifestedbysigningandissuingthe"NoticeofAward"tothewinningprivatesectorparticipantwithinseven(7)calendardaysfromapprovalthereof.
Allparticipatingprivatesectorparticipantsshallbeinformedoftheawardinwriting.Suchdecisionshallbemadeavailabletothepublicuponrequest.
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VIII.AwardandApprovalofContract
3.NoticeofAward.The"NoticeofAward"tobeissuedbytheHeadofGovernmentEntityconcerned,shallcontainamongothers,aninstructiontothewinningprivatesectorparticipanttocomplywithconditionsprecedentfortheexecutionoftheJVAgreementandtosubmitcompliancestatementswithregardthereto,withinthirty(30)calendardaysfromreceiptofthe"NoticeofAward"unlessotherwisespecifiedorextendedbytheappropriateApprovingAuthority.ConditionsprecedentfortheexecutionofthecontractshallincludeamongothersthepostingofaperformancesecurityinfavoroftheGovernmentEntityconcerned.
TheGovernmentEntityconcernedshalldeterminewhichformofperformancesecurityitwillrequirewhichmaybeintheformofcash,bankdraftorguaranteeconfirmedbyalocalbank(inthecaseofforeignbiddersbondedbyaforeignbank),letterofcreditissuedbyareputablebank,suretybondcallableondemandissuedbyGovernmentServiceInsuranceSystem(GSIS)orbyasuretyorinsurancecompaniesdulyaccreditedbytheOfficeoftheInsuranceCommissioner,oracombinationthereof,inaccordancewiththefollowingschedules:
1. Cash,manager scheck,irrevocableletterofcredit,bankdraft-aminimumoftwopercent(2%)oftheprivatesectorparticipantscontributiontotheJVactivity.
2. BankGuarantee-aminimumoffivepercent(5%)oftheprivatesectorparticipantscontributiontotheJVactivity.
3. SuretyBond-aminimumoftenpercent(10%)oftheprivatesectorparticipantscontributiontotheJVactivity.
Failuretocomplywiththeconditionsprecedentfortheexecutionofthecontractwithintheprescribedthirty(30)-calendardayperiodorasspecifiedorextendedbytheappropriateApprovingAuthoritywillresultinconfiscationoftheproposalsecurity.
Withinseven(7)calendardaysfromreceiptofthecompliancestatementsfromthewinningprivatesectorparticipant,theHeadoftheGovernmentEntityshalldeterminethesufficiencyofthesame,andnotifythewinningprivatesectorparticipantaccordingly.
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VIII.AwardandApprovalofContract
4.ValidityandReturnofProposalandPerformanceSecurities.TheexecutionoftheJVAgreementshallbemadewithintheperiodofthevalidityoftheproposalsecurity.Therequiredproposalsecurityshallbevalidforareasonableperiod,butinnocasebeyondonehundredeighty(180)calendardaysfollowingtheopeningoftheproposals.ProposalsecuritiesshallbereturnedtothewinningbidderandunsuccessfulprivatesectorparticipantsuponsigningoftheJVAgreementbythewinningprivatesectorparticipant.
Theperformancesecurityshallbevalidwithintheperiodofone(1)yearaftertheexpirationoftheJVagreementorendoftheJVperiod,orasmaybestipulatedintheJVagreement.UponcertificationbytheHeadofGovernmentEntityconcernedthattherearenoclaimsfiledagainsttheprivatesectorpartneraftertheexpirationoftheJVagreementorendoftheJVperiod,theperformancesecurityshallbereleasedbytheformer.
AsmaybeagreeduponintheJVagreement,aportionoftheperformancesecurityshallbereleaseduponcompliancewithcorrespondingmilestones.
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VIII.AwardandApprovalofContract
5.ExtensionofValidityofProposals.Whenanextensionofvalidityofproposalsisconsiderednecessary,thosewhosubmittedproposalsshallberequestedinwriting,toextendthevalidityoftheirproposalsbeforetheexpirationdateofthesame.However,privatesectorparticipantsshallnotbeallowedtomodifyorrevisethepriceorothersubstantialaspectoftheirproposals.
Privatesectorparticipantsshallhavetherighttorefusesuchanextensionwithoutforfeitingtheirproposalsecurity.Asaconditionoftheextensionofthevalidityoftheirproposals,participatingprivatesectorparticipantsmustcorrespondinglyextendthevalidityoftheirproposalsecurity.
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VIII.AwardandApprovalofContract
6.SingleResponsiveBid.Asingleandresponsivebidshallbeconsideredforawardifitfallsunderanyofthefollowingcircumstances:
1. Ifafteradvertisement,onlyasinglepartysubmitseligibilitydocumentswithinthedeadlinestipulatedintheIAESP,anditmeetstheeligibilityrequirements,afterwhichitsubmitsabidwhichisresponsivetothetechnicalandfinancialrequirements;
2. Ifafteradvertisement,morethanoneprivatesectorparticipantorprospectivebiddersubmitseligibilitydocumentsinaccordancewiththeprovisionsoftheseGuidelines,butonlyonebiddermeetstheeligibilityrequirements,afterwhichitsubmitsabidwhichisresponsivetothetechnicalandfinancialrequirements;
3. Ifaftertheeligibilitycheck,morethanonebiddermeetstheeligibilityrequirementsbutonlyonebiddersubmitsabid,anditsbidisfoundtoberesponsivetothetechnicalandfinancialrequirements;or
4. Ifafterqualification/evaluationofproposals,onlyonebiddermeetsthetechnicalrequirementsbutisnotabletocomplywithfinancialrequirements,afterwhichanegotiationonthefinancialterms/proposalinaccordancewithSection8hereofisconductedandissuccessful.
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VIII.AwardandApprovalofContract
7.ProspectiveBidder/sCompliantwiththeTechnicalRequirements.Incaseofasingletechnicallyqualifiedprospectivebidderbutisnotabletocomplywithfinancialrequirementsor,incaseoftechnicallyqualifiedprospectivebiddersbutarenotabletocomplywithfinancialrequirements,theconcernedGovernmentEntitymayconductnegotiationonthefinancialterms/proposalinaccordancewithSection8hereof.
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VIII.AwardandApprovalofContract
8.NegotiationontheFinancialTerms/ProposalundertheCompetitiveSelectionProcess.Incasetheprivatesectorparticipantsorprospectivebidders,whosetechnicalproposalsarerated"passed",arenotabletocomplywiththefinancialrequirements,theconcernedGovernmentEntityshallrequestsaidprospectivebidderstosubmittheirnewfinancialproposals.Thereafter,concernedGovernmentEntityshallnotifyandnegotiatewiththeproponentonthefinancialproposal/termswiththemostadvantageousfinancialproposal.
Thetechnicalproposalshallremainvalidandbinding.IntheeventtheconcernedGovernmentEntityfailstosuccessfullynegotiatewithsaidproponentwithinthirty(30)calendardaysreckonedfromthedateofnotification,theGovernmentEntityshallnegotiatewiththenextrankedmostadvantageousfinancialproposal,andsoonandsoforth,untilasuccessfulnegotiationhasbeenconcluded.
Incaseofasingletechnicallyqualifiedprospectivebidder,concernedGovernmentEntitymayconductnegotiationonthefinancialtermsoronthefinancialproposalandshallconcludesaidnegotiationwithinthirty(30)calendardays.
Thetechnicalproposalshallremainvalidandbinding.Intheeventthatthereisnosuccessfulnegotiation,theconcernedGovernmentEntityshallconductanothercompetitiveselection.Incaseofsecondfailureofcompetitiveselection,theconcernedGovernmentEntitymayresorttonegotiatedJVpursuanttoAnnex"B"oftheseGuidelines.
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VIII.AwardandApprovalofContract
9.FailureofCompetitiveSelection.Thereshallbeafailureofcompetitiveselectioninanyofthefollowinginstances:
1. Noprospectivebidder/sis/areeligible;
2. Nobidsorproposalsarereceived;
3. Noprospectivebidder/sis/areabletocomplywithtechnicalrequirements;or
4. Nosuccessfulnegotiationonthefinancialterms/proposalasprovidedunderSection8hereof.
Intheeventofafailedcompetitiveselectionbroughtaboutbyinstancesstipulatedabove,theconcernedGovernmentEntityshallreviewtheTermsofReference(TOR)/biddingdocumentsandconductanothercompetitiveselection.Incaseofsecondfailureofcompetitiveselection,theconcernedGovernmentEntitymayresorttonegotiatedJVpursuanttoAnnex"B"oftheseGuidelines.
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VIII.AwardandApprovalofContract
10.Execution/ApprovaloftheJVAgreement.Theauthorizedsignatory(ies)ofthewinningprivatesectorparticipantandtheGovernmentEntityconcerned,shallexecuteandsigntheJVAgreement,withinseven(7)calendardaysaftertheHeadoftheGovernmentEntitynotifiesthewinningprivatesectorparticipantofitscompliancetotheconditionsorrequirementsprecedenttotheexecutionofthecontractasreferredtoinSectionVIII.3above.
ConsistentwithArticle1159oftheNewCivilCode,saidJVAgreementisconsideredthelawbetweentheparties,andthepartiesshallperformtheirrespectiveprestations,obligations,andundertakingsthereunderwithutmostgoodfaith,withaviewtoattainingtheobjectivethereof.
Anoriginalsignedcopyofthecontractshallbesubmittedto:
1. TheOfficeofthePresident(OP);
2. NEDA;
3. GCG;
4. StatutoryCounsel;and
5. DOFincaseofGOCCsandGFIs,andDBMincaseofotherentities.
Intheeventofrefusal,inabilityorfailureofthewinningprivatesectorparticipanttoenterintocontractwiththeGovernmentEntityconcerned,withinthetimeprovidedtherefore,saidGovernmentEntityshallforfeititsproposalsecurity.Insuchevent,theGovernmentEntityconcernedshallconsidertheprivatesectorparticipantwiththenextrankedcomplyingproposalasthewinningprivatesectorparticipant,andnotifysaidprivatesectorparticipantaccordingly.
IfthenextrankedcomplyingprivatesectorparticipantshalllikewiserefuseorfailtoenterintocontractwiththeGovernment,itsproposalsecurityshalllikewisebeforfeitedandtheGovernmentEntityconcernedshallconsiderthenextrankedcomplyingproposal,andsoon,untilacontractshallhavebeenenteredinto.
IntheeventthattheconcernedGovernmentEntityisunabletoexecutethecontractwithanyofthecomplyingprivatesectorparticipants,afailureofcompetitiveselectionwillbedeclaredandtheJVmaybesubjectedtoacompetitiveselectionagain.
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VIII.AwardandApprovalofContract
11.OtherApprovalsforContract.TheentitytaskedundertheJVAgreementshall,asmayberequiredunderexistinglaws,rulesandregulations,secureanyandallotherapprovalsforthecontract,ortheimplementationthereof,fromgovernmentagenciesorbodiesincludingtheregulator,inthecaseofpublicutilityprojects.ThisincludessecuringthenecessaryandappropriateenvironmentalclearancesfromtheDENRpriortoactualprojectimplementation.
TheDENRshallactontheenvironmentalclearanceoftheJVactivitywithinthetimeframeprescribedandfollowingtheguidelinesoftheDENRAdministrativeOrderNo.96-37andsubsequentguidelinesasmaybeissuedfromtimetotime.TheGovernmentEntitymayprovidethenecessaryassistancetoitsJVPartnerinsecuringalltherequiredclearances.
Thecontractshallprovidemilestonesinsecuringsuchotherapprovalsrequiredfortheimplementationofthecontract.PriortotheexecutionoftheJVAgreement,theOGCC,DOJ,orotherentityprescribedbylaw/issuancesasthestatutorycounselofGOCCs,GCEsandGICPs,shallissuethecorrespondingCounselsOpinion.
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VIII.AwardandApprovalofContract
12.PresidentialApproval,WhenRequired.SubjecttothecharteroftheGovernmentEntityconcerned,nofurtherhigherapprovalisnecessary,unlessthesameisrequiredbylawtobeacteduponbythePresidentofthePhilippines.Inwhichcase,asdeemedapplicable,theprovisionsofexistinglaws,guidelines,rulesandregulationsshallbefollowedandadheredtobytheGovernmentEntityconcerned.
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VIII.AwardandApprovalofContract
13.ContractEffectivity.ThecontractshallbeeffectiveuponsigningthereofbytheHeadofGovernmentEntityunlessanotherdateisstipulatedtherein.
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IX.AppealsMechanism
DecisionsoftheJV-SCwithrespecttoconductofthecompetitiveselectionprocessmaybeappealedinwritingtotheHeadoftheGovernmentEntityconcerned:Provided,however,thatapriormotionforreconsiderationshouldhavebeenfiledbythepartyconcerned,andthesamehasbeenresolvedbytheJV-SC.Theappealmustbefiledwithinseven(7)calendardaysfromreceiptbythepartyconcernedoftheresolutionoftheJV-SCdenyingitsmotionforreconsideration.
AnappealmaybemadebyfilingaverifiedpositionpaperwiththeHeadoftheGovernmentEntityconcerned,accompaniedbythepaymentofanon-refundableappealfee.Thenon-refundableappealfeeshallbeinanamountequivalenttonolessthanone-half(1/2)ofonepercent(1%)oftheprojectcost.
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ANNEXBDETAILEDGUIDELINESFORNEGOTIATEDJVANDCOMPETITIVECHALLENGEFOR
PUBLIC-PRIVATEJOINTVENTURES
I.NegotiatedJVsII.CompetitiveChallengeProcedureIII.Three-StageFramework
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I.NegotiatedJVs
I.NegotiatedJVs-AnyGovernmentEntitymaydirectlynegotiateaJVactivitywithaprivatesectorentityunderanyofthefollowingcircumstances:
1. WhenaGovernmentEntityreceivesaproposalfromtheprivatesectorforaproject;or2. WhenafterafailedcompetitiveselectionasprovidedunderSectionVIII.9ofAnnexAhereof,
theconcernedGovernmentEntityconductsanothercompetitiveselectionwhichagainfails.Inthiscase,theconcernedGovernmentEntitymayseekoutaJVPartnerandrequestthelattertosubmitaproposalfortheJVactivitymanifestlyadvantageoustogovernment,providedthatnegotiationsmustbeconcludedwithinone(1)yearfromdateofsubmissionofbidsforwhichtherewasasecondfailureofcompetitiveselection,andthatnegotiationshallonlybeonthefinancialtermsoraspect.
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II.CompetitiveChallengeProcedure
II.CompetitiveChallengeProcedure-InallcaseswheretheGovernmentEntitydirectlynegotiateswithaprivatesectorparticipantforaproposedJVundertaking,thenegotiatedtermsshallbesubjectedtoacompetitivechallengewhereinotherprivatesectorentitiesshallbeinvitedtosubmitcomparativeproposals,toensurethatJVAgreementsareenteredintounderatransparentandcompetitiveprocessthatpromotesaccountabilityingovernmenttransactions.
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III.Three-StageFramework
III.Three-StageFramework-NegotiatedJVshallbesubjectedtoathree-stageprocesssummarizedasfollows:
1.StageOne2.StageTwo3.StageThree
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III.Three-StageFramework
StageOne-InitialEvaluationofProposalsbyConcernedGovernmentEntityTheinitialevaluationshallbecompletedbytheconcernedGovernmentEntitywithinsixty(60)calendardaysuponsubmissionofcompletedocumentsbytheprivatesectorentity/iesincludingtheeligibilityrequirementsasprovidedunderSectionIVofAnnex"A"oftheseGuidelines.
Uponcompletionoftheinitialevaluation,theHeadoftheGovernmentEntityshalleitherissuealetterofacceptanceornon-acceptanceoftheproposal.AnacceptanceshallnotbindtheGovernmentEntitytoenterintotheJVactivity,but,shallmeanthatauthorizationisgiventoproceedwithdetailednegotiationsonthetermsandconditionsoftheJVactivity.
Incaseofnon-acceptance,theprivatesectorentityshallbeinformedofthereasons/groundsfornon-acceptance.
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III.Three-StageFramework
StageTwo-ConductofNegotiationbetweenConcernedGovernmentEntityandPrivateSectorEntity/ies,ConfermentofOriginalProponentStatus,andEvaluationbytheApprovingAuthorityThepartiesshallnegotiateonthetermsandconditionsoftheJVactivity.Thefollowingrulesshallbeadheredtointheconductofdetailednegotiations,andevaluationbytheApprovingAuthorityincaseofsuccessfulnegotiations:
1.Negotiation2.CompletionofNegotiation3.Compliance4.SimilarProposals5.GovernmentEntity6.HeadofGovernmentEntityasApprovingAuthority7.NEDABoardICCasApprovingAuthority8.AfterApproval
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StageTwo
Negotiation1.Bothpartiesshallnegotiateonthetermsandconditions,scope,aswellasalllegal,technical,andfinancialaspectsoftheJVactivity.
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StageTwo
CompletionofNegotiation2.Thenegotiationshallbecompletedwithinthirty(30)calendardaysuponacceptancebytheGovernmentEntityconcernedoftheproposalasprovidedinStageOneabove.
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StageTwo
Compliance3.Negotiationsshallcomplywiththeprocess,requirementsandconditionsasstipulatedunderSections6(GeneralGuidelines)and7(ProcessforEnteringintoJVAgreements)oftheseGuidelines.
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StageTwo
SimilarProposals4.Incasesimilarproposalsarereceivedpriortoacceptanceoftheproposalastheoriginalproponent,theGovernmentEntitymayrejectallsuchproposalsorinstead,subjectittocompetitiveselectionpursuanttoAnnex"A"oftheseGuidelines.Otherwise,theGovernmentEntityshallevaluatetheproposalsusingafirstintimeapproach.Underthisapproach,thefirstcompleteproposalisevaluatedanddecidedupon.
Thesecondcompleteproposalwillonlybeentertainedifthefirstoneisrejected.Otherwise,thesecondproposalwillbeconsideredonlyifthereisafailureinthenegotiationofthefirstproposal,orwhentheproponentofthesecondproposalappliesforeligibilityandsubmitsitscomparativeproposalbasedontheselection/tenderdocumentsduringtheinvitationtoapplyforeligibilityandtosubmitacomparativeproposalasprovidedinStageThreebelow.
Underthefirstintimeapproach,theHeadofGovernmentEntityconcernedshallacknowledgethesubmissionofotherprivatesectorproponentforthesameorsimilarprojectconcept,andadvisetheproponentonexistenceofsimilarprojectconceptanditsrank/positionbasedondateofsubmissionoftheproposals.
Ifacontractisawardedtoaprivatesectorproponent,theunopenedenvelope/sshallbereturnedtotherespectiveproponents.TheGovernmentEntityshallconductaninitialevaluationoftheproposalasprovidedinStageOneaboveandnegotiatewiththerespectiveproponent.
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StageTwo
GovernmentEntity5.Withinseven(7)daysafterthesuccessfulnegotiation,theHeadoftheGovernmentEntityandtheauthorizedrepresentativeoftheprivatesectorentityshallissueasignedcertificationthatanagreementhasbeenreachedbybothpartiesandbothagreetosubmittheproposaltocompetitivechallenge.SaidcertificationshallalsostatethattheGovernmentEntityhasfoundtheprivatesectorparticipanteligibletoenterintotheproposedJVactivityandshallconfertotheproponenttheoriginalproponentstatus.
However,shouldnegotiationsnotresulttoanagreementacceptabletobothparties,theGovernmentEntityshallhavetheoptiontorejecttheproposalbyinformingtheprivatesectorparticipantinwritingstatingthegroundsforrejectionandthereaftermayacceptanewproposalfromprivatesectorparticipants,ordecidetopursuetheproposedactivitythroughalternativeroutesotherthanJV.
Afterconfermentoftheoriginalproponentstatus,theconcernedGovernmentEntityshallendorsetheJVproposalandsubmitpertinentdocumentationtotheappropriateEntityandApprovingAuthoritypursuanttoSection7.2oftheseGuidelinesforapproval.TheappropriateApprovingAuthority,asprovidedinSections7.2.band7.2.coftheseGuidelines,shallapprovetheproposalwithinthirty(30)calendardays.TheconcernedGovernmentEntityshallnotentertainanyotherproposalaftersuchendorsementandsubmissiontotheApprovingAuthority.
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StageTwo
HeadofGovernmentEntityasApprovingAuthority6.ForprojectswhereintheApprovingAuthorityistheHeadoftheGovernmentEntityconcernedpursuanttoSection7.2.coftheseGuidelines,confermentoftheoriginalproponentstatusshallbedeemedanapprovaloftheprojectproposalsubjecttocomplianceoftheproposalwiththeconditionsstatedinSection7oftheseGuidelines.
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StageTwo
NEDABoardICCasApprovingAuthority7.ForprojectswhereintheApprovingAuthorityistheNEDABoardICCpursuanttoSection7.2.boftheseGuidelines,incasetheJVproposalisdisapprovedbytheNEDABoardICC,theconcernedGovernmentEntityshallinformtheoriginalproponentofsuchdisapprovalandthattheoriginalproponentstatusshallbewithdrawn.TheconcernedGovernmentEntitymayacceptotherproposals.
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StageTwo
AfterApproval8.AfterapprovalbytheApprovingAuthority,thedraftcontractincludingtheselectiondocumentsforthecompetitivechallengeareprepared.
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III.Three-StageFramework
StageThree-CompetitiveChallengeandReimbursementtotheOriginalProponenttheCostIncurredfromProducingtheJVProposalOncetheJVproposalisapprovedbytheApprovingAuthority,theJVactivityshallbesubjectedtoacompetitivechallengeasfollows:
1.PreparationofTenderDocuments2.ApprovalofTenderDocuments3.PublicationofInvitation4.InterestedPrivateProponents5.ProprietaryInformation6.ProposalSecurity7.ProspectiveComparativePrivateSectorParticipants8.DeterminationofEligibility9.ModifiedCompetitiveChallenge10.TieBidsbetweentheOriginalProponent&theChallenger(s)11.TieBidsbetweenChallengers12.SubmissionoftheRecommendationofAward
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StageThree
PreparationofTenderDocuments1.TheGovernmentEntityshallpreparethetenderdocumentsconsistentwiththetermsandconditionsapprovedbytheApprovingAuthorityandpursuanttoSectionII(Selection/TenderDocuments)ofAnnex"A"oftheseGuidelines.
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StageThree
ApprovalofTenderDocuments2.TheHeadofGovernmentEntity,throughtheJV-SC,shallapprovealltenderdocumentsincludingthedraftcontractbeforethepublicationoftheinvitationtoapplyforeligibilityandtosubmitacomparativeproposal.
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StageThree
PublicationofInvitation3.Withinseven(7)calendardaysuponapprovalbytheApprovingAuthorityoftheJVproposalasreferredtoinStageTwoabove,theJV-SCshallpublishtheinvitationtoapplyforeligibilityandtosubmitacomparativeproposalinaccordancewiththeproceduresunderSectionIIIofAnnex"A"oftheseGuidelines.
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StageThree
InterestedPrivateProponents4.InterestedprivateproponentsshallbequalifiedinaccordancewithSectionIV.2(EligibilityRequirements)underAnnex"A"oftheseGuidelines.ThetenderdocumentswhichshallbepreparedbytheGovernmentEntityshallonlybeissuedtoeligibleprivateproponents.
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StageThree
ProprietaryInformation5.Proprietaryinformationshall,however,berespectedandprotected,andtreatedwithconfidentiality.Assuch,itshallnotformpartofthetenderandrelateddocuments.
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StageThree
ProposalSecurity6.Theoriginalproponentshallposttheproposalsecurityatthedateofthefirstdayofthepublicationoftheinvitationtoapplyforeligibilityandtosubmitacomparativeproposalintheamountandformstatedinthetenderdocuments.
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StageThree
ProspectiveComparativePrivateSectorParticipants7.Prospectivecomparativeprivatesectorparticipantsorchallengersshallbegivenatleastonehundredtwenty(120)calendardaysorasmaybeapprovedbytheappropriateApprovingAuthorityfromtheissuanceoftender/biddingdocumentstodevelopandsubmitcomparativeproposals.
IfnocomparativeproposalisreceivedbytheGovernmentEntity,theJVactivityshallbeimmediatelyawardedtotheoriginalproponent.
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StageThree
DeterminationofEligibility8.Theprocedureforthedeterminationofeligibilityofcomparativeproponents/privatesectorparticipants,issuanceofsupplementalcompetitiveselectionbulletinsandpre-selectionconferences,submissionandreceiptofproposals,openingandevaluationofproposalsshallfollowtheprocedurestipulatedunderAnnex"A"oftheseGuidelines.Intheevaluationofthefinancialproposals,themodifiedcompetitivechallengeprocedureasdefinedhereundershallbeapplied.
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StageThree
ModifiedCompetitiveChallenge9.Underthemodifiedcompetitivechallenge,theoriginalproponentmayopttosubmitonorbeforethedateoftheopeningoffinancialproposalsitssecondfinancialproposal.Thefinancialproposal(s)ofthecomparativeprivatesectorparticipant(s)orthechallenger(s)whohavebeendeterminedtohavepassedthetechnicalevaluationandthesecondfinancialproposal,ifapplicable,oftheoriginalproponentshallbeopenedatthesametimeduringthescheduledopeningoffinancialproposals.
IftheGovernmentEntity,uponrecommendationoftheJV-SC,determinesthatanoffermadebythechallengerissuperiorormoreadvantageoustothegovernmentthanthefinancialproposaloftheoriginalproponent,theJVcontractshallbeawardedtothechallengerofferingthemostadvantageousprice.
Incasethechallenger(s)fail(s)tooutbidthefinancialproposaloftheoriginalproponentorincasethereis/arenochallenger/s,theJVcontractshallbeawardedtotheoriginalproponent.
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StageThree
TieBidsbetweentheOriginalProponent&theChallenger(s)10.Incasetiebidsoccurbetweentheoriginalproponentandchallenger(s),theJVcontractshallbeawardedtotheoriginalproponent.
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StageThree
TieBidsbetweenChallengers11.Incasetiebidsoccurbetweenthechallengersofferingbetterfinancialproposalsthanthesecondfinancialproposaloftheoriginalproponent,theprocedureforbreakingtiebidsshallbedonethroughdrawingoflotsorsimilarmethodsthatarenon-discretionaryandnon-discriminatorysuchthatitisbasedonsheerluckorchance.
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StageThree
SubmissionoftheRecommendationofAward12.Withinseven(7)calendardaysfromthedateofcompletionoftheCompetitiveChallenge,theJV-SCshallsubmittherecommendationofawardtotheHeadoftheGovernmentEntity.SucceedingactivitiesshallbeinaccordancewithSectionVIII(AwardandApprovalofContract)ofAnnex"A"oftheseGuidelines.
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I.TheJointVentureSelectionCommittee(JV-SC)
1.Composition.TheHeadoftheGovernmentEntityshallcreateaJV-SCforpurposesofselectingaprivatepartnerforaproposedJV.TheJV-SCshallbecomposedofthefollowing:
1.1RegularMembers(voting)1.2ProvisionalMembers(non-voting)
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h.Theestablishmentofafundbythepartiestofinancethework,togetherwiththeamount,type(cash,assets,etc.),andvaluationofcommittedcontributionsofeachpartyandwhensuchcontributionswillbemade,withthefundbeingdepositedinaspecialbankaccountunderdualcontrolandallprogresspaymentsandotherrevenuesbeingdepositedinsuchaccount.Iftheequity/contributionoftheprivatesectoristobeborrowed,astatementthatthereshallbenogovernmentguaranteeforsaidloan;
i.Procedureforadditionalcapitalinfusions,ifrequired,andastatementthatthereshallbenogovernmentguaranteeforloanstobeincurredbytheprivatesectorincasetheadditionalcontributionoftheprivatesectoristobeborrowed;
j.Adeclarationoftheparticipationofthepartiesandpercentageinwhichprofitsandlossesareshared,inproportiontothecontributionsofthepartytotheworkingfund.Theamountofcontributionoffundsbythepartiescanbeincreasedordecreased,dependingonthecontributionsofequipmentorexpertise;
k.Specifiedtermination/liquidationoftheJVCompany,buy-outprovisions,anddetailsonthetransferofownershipoftheJVactivity/facilitypursuanttoSection6.4oftheseGuidelinesincludingprovisionsonwhathappenstotheJVsassetsaftertheexpirationoftheJVagreementorendoftheJVperiod.Ifequityotherthancashistobecontributed,astatementastohowthepropertywillbevaluatedandtheownershipofthepropertyduringandaftertheeffectivityoftheJVAgreement;
l.Designationofoneofthepartiesasgeneralmanageroftheproject,withauthoritytobindtheJVCompany/Partnership/Parties;or,inthealternative,theconstitutionofamanagementcommittee,withaprovisionforremuneration.Managementduties,otherdutiesoftheco-venturersandprocedurestobefollowedindealingwithunusualsituationsorproblemsthatmaydevelopshouldbespecified;
m.Implementationmilestones,regularmeetingschedules,financialandperiodicJVandprogressreportingprocedure;
n.EstablishmentofaJVbankaccount,andtheappointmentofacharteredaccountantandlawyer;
o.ProvidefortheacquisitionoflicensesinthenameoftheJVoreachco-venturer,asrequired;
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p.TypeofinsurancecarriedbytheJVandclearlydefinedliabilitiestobeinsuredagainstbyeachparticipant;
q.DefinitionofitemswhicharetobeconsideredascoststotheJVforthepurposeofdeterminingprofitorlossandadescriptionofitemswhicharenotreimbursabletomembersoftheJVandspecifieddivisionoftheprofitsand,risksandlosses;
r.Confidentialityoftradeinformationpassedbetweentheco-venturers;
s.Ownershiporretentionofpatents,technology,andconsultantreports;
t.Performancesecurityrequirementsoftheprojectandthebondingobligationsoftheco-venturers;
u.Undividedpro-ratainterestsheldbytheco-venturersonallassetsoftheJV;
v.Restrictionregardingassignmentofprivatesectorparticipantsundividedpro-ratainterestsinassetsoftheJV;
w.Costrecoveryscheme,includingpaymenttothegovernmentofroyalties/rights,theform/descriptionandamountofearnings(cash,asset,etc.),whetheritisinabsoluteamountsorvariable,andtheperiodandtimingsuchearningsorpaymentshallbereceived.Incaseofnon-cashpaymentorpaymentinformofasset,astatement/provisiononhowitwillbevaluated,theminimumvalueoftheasset,andthedetermination/selectionofassetsuchashowandwhowilldetermine/selecttheasset;
x.Indemnificationandliquidateddamages;
y.Performanceandwarrantybonds;
z.Minimuminsurancecoverage;
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aa.Acceptancetestsandprocedures;
bb.Validityoftheperformancesecurity,warrantyperiodandprocedures;
cc.Groundsforandeffectsofcontracttermination/defaultincludingmodesforsettlingdisputes,procedureforhandlingguarantees,defectsandinsuranceaftertermination,andthreshold(intermsofamount,time/period,orboth)forwhichnon-paymentordelayinpaymentanddelayinstartingtheproject/sshallbegroundsfortermination/rescissionoftheJVcontract/agreement;
dd.Themannerandproceduresfortheresolutionofwarrantyagainstcorruption;
ee.Compliancewithallotherlaws,rulesandregulations;
ff.Procedureand/orperiodforwithdrawalbythegovernmententityofitscontributiontotheJV,orexitdivestmentbytheGovernmentEntityofitsinterestintheJV,andSubstitutionoradditionofparties;
gg.Payoutoffunds;
hh.AlternativeDisputeResolution(ADR)mechanismspursuanttoEONo.78dated04July2012toavoidmanagementimpassesthatmayproducedeadlockorlitigation;and
ii.Disputesarbitrationclause.
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