procurement

Property & Supply Management(w/ introduction to R.A. 9184)

BASIC PRINCIPLESPublic office is a Public Trust (Sec. 1 Art. 11 of the 1987 Philippine Constitution; RA 6713). Public officials and employees must be at all times accountable to the people, serve them with utmost honesty, responsibility, integrity, loyalty, and efficiently, act with patriotism and lead modest lives.

BASIC PRINCIPLESSection 2 of the PD no. 1445 otherwise known as the State Auditing of the Philippines states that all resources of the government shall be managed, expended or utilized in accordance with laws, rules, regulations, and safeguarded against loss or wastage through illegal or improper disposition with the view of ensuring economy, efficiency, and effectiveness in the operation of the government.

References:Republic Act No. 7160 Book II Title 6

Revised Implementing Rules and Regulations of Republic Act No. 9184, otherwise known as the Government Procurement Reform Act.

Course Objectives: To know and discuss Supply & Property Management; and to

Appreciate Provisions under Republic Act. No. 9184 and its Implementing Rules and Regulations

SUPPLY AND PROPERTY MANAGEMENT

*SECTION 356 GENERAL RULE IN PROCUREMENT AND DISPOSAL Except as otherwise provided herein, acquisition of supplies by local government units shall be through COMPETITIVE PUBLIC BIDDING. Supplies which become unserviceable or no longer needed shall be SOLD, whenever applicable, at PUBLIC AUCTION, subject to applicable rules and regulations

PROCUREMENT

DEFINITION OF TERMS (R.A. 7160 & 9184)Lowest Complying and Responsible Bid proposal of one who offers the lowest price; meets all the technical specifications and requirements of the supplies desired;as a leader in the line of supplies involved; maintains a regular establishment; andhas complied consistently with previous commitments;

Suitable Substitute refers to the kind of article which would serve substantially the same purpose or produce substantially the same results as the brand, type, or make of article originally desired or requisitioned. Supplies include everything, except real propertyTerms & Conditions refers to other requirements not affecting the technical specifications and requirements of the required supplies desired

Approved Budget for the Contract budget for the contract duly approved by the HOPE.

Fund InstrumentalityNational Government Agencies (NGAs)General Appropriations Act (GAA)GOCCs, GFIs, SUCsCorporate budget for the contract approved by the governing boardLocal Government Units (LGUs)Budget Approved by SanggunianForeign Funded ProcurementTreaty, International or Executive Agreement

Bid equivalent to Proposal and TenderBidder eligible contractor, manufacturer, supplier, distributor and or consultantBidding Documents documents issued by the P.E. as basis for bids, furnishing all information necessary for a prospective bidder to prepare a bid.Common-Use supplies goods, materials and equipment that are used in the day-to-day operations of the PE in the performance of their duty

Competitive Bidding method of procurement which is open to participation by an interested party which consists of processes.

Expendable Supplies articles which are normally consumed in use within one (1) year or more than a year but which shall have decreased substantially in value after only one year in use

Goods all items except consulting services and infrastructure projects which may be needed in the transaction of public businesses including related or analogous services. Head of the Procuring Entity (HOPE) the head of the Agency. Infrastructure Projects civil worksNon-Expendable Supplies - articles which retain their identity during the period of use whose serviceable life is more than one year.

PhilGEPS Philippine Government Electronic Procurement System

Portal website

Procurement acquisition by the PE

Procuring Entity (PE) refers to branch, offices, agencies, bureau of the GOP, incl. GOCC, GFI, SUC, LGU.

SECTION I SHORT TITLE AND PURPOSE OF RA 9184Purpose of the IRR of R.A. 9184: ModernizationStandardizationRegulation of the procurement activities of the GOP

SECTION 2 DECLARATION OF POLICYModernizationStandardizationRegulation of Procurement Activities TransparencyAccountabilityEquityEfficiencyEconomy

SECTION 3 GOVERNING PRINCIPLESTransparency Competitiveness Streamlined procurement process System of AccountabilityPublic monitoring

SECTION 4 SCOPE AND APPLICATIONBranch, agency, department, bureau, office or instrumentality of GOP, incl. GOCCs, GFIs, SUCs, & LGUsAny Treaty or International or Executive Agreement to which the GOP is signatory

Procurement funded by foreign grantsAcquisition of real propertyThis IRR shall not apply to the following: Public Private sector infra or development projects and other procurement covered by R.A 6957

DUTIES OF THE PMO / End-user(s)

Duties of the PMO/End-user(s)To provide the technical specifications of the goods it will procure To conduct a market survey that will include a study of the available products or services, industry developments

To recommend the ABCTo provide technical adviceTo assist in the preparation of bidding documents

Duties of the PMO/End-user(s)To attend all stages of the procurement To determine the period of contract implementation during the procurement planning stage, and include it in the PPMP. To ensure that the Chief Accountant of the procuring entity issues a CAF for the project.Only with a CAF can the contract be valid.The Chief Accountant must also sign the contract as a witness. (Sec. 5 GPM) Fund availability is an indispensable prerequisite to the execution of any government contract involving the expenditure of public funds by all government agencies at all levels.

Duties of the PMO/End-user(s)To determine the existence of condition/s that require an amendment to order.To determine the existence of a force majeure or fortuitous event that will be the basis for the issuance of a suspension order.To either approve or disapprove the request for extension.

PROCUREMENT PLANNING

What is Planning? The act or process of making or carrying out plans.

The establishment of goals, policies, and procedures for a social or economic unit.

It involves resource allocation and scheduling.

Through plans, a PE is able to effectively manage and track procurement all the way to contract performance.

Allows managers to determine how to allocate limited cash and other appropriate resources under a given time line, identify choke-points, weaknesses, and delays in the entire activity that can be addressed or eliminated.

Planning & budgeting linkagesPE Agency Budget Proposal by considering the budget framework

PMO/End-User prepares their respective WFP for their different PPAs as annex to Budget call.

Procuring Entitys Budget Proposal embodies the agency thrusts and the resources needed to produce the key services it delivers to the public.

Procurement planning should be done within this budgetary context, reflecting the Procuring Entitys priorities and objectives for the budget period.

Planning & budgeting linkagesThe WFP or the Work and Financial Plan

Contains the initial list of projects/requirements of each PMO/End-User unit and the corresponding estimated budgetary requirement.

Submitted by the PMOs or end-user units to the PEs Budget Office on or about May of each year, to coincide with the submission of their respective budget proposals. This will be evaluated and included in the PEs Budget Proposal .

This will support the Budget Proposal submitted to DBM and becomes the basis for the proposed PPMP.

The Budget Office shall furnish a copy of the WFPs and proposed PPMP to the BAC Sec for the consolidation of the initial list of items/projects for procurement into the proposed APP.

Planning & budgeting linkages When GAA becomes final (Nov. - Dec.), PMOs/End-User must refine the proposed PPMP.

Within 15 days from issuance of the Agency Budget Matrix (ABM) during the 1st quarter of the fiscal year, PMOs/End-User shall finalize the PPMPs to reflect the budgetary allocation for their respective PPAs as provided in the ABM.

The final PPMPs shall be submitted to the BAC Sec for the finalization of the proposed Procuring Entitys APP to be submitted to the HOPE for confirmation or approval.

Preparation of the Project Procurement Management Plan (PPMP)What is a Project Procurement Management Plan (PPMP)?

A Project Procurement Management Plan or PPMP, which is a component of the Project Management Plan, deals primarily with:planning for the procurement of project requirements;bidding or procurement strategy;source selection;delivery and payment schedules;contract administration;contract termination; andother major milestones; in an effort to obtain goods, infrastructure and services from suppliers, contractors and consultants.

Preparation of the Project Procurement Management Plan (PPMP) The PPMP serves as a guide document in the procurement and contract implementation process, as well as a vital reference in procurement monitoring.

It serves as an important tool in resource and financial management, allowing the Procuring Entity the flexibility to optimize the utilization of scarce resources.

Well-planned procurement will significantly minimize the practice of doing short-cuts to ensure that the Procuring Entity is able to purchase its requirements for the delivery of public services.

Preparation of the Project Procurement Management Plan (PPMP) Developing the Project Requirements:

The development of the project requirements should be done during the preparation of the proposed PPMP. At this stage of the procurement planning process, the PMO or end-user unit must:

a. Identify the need of the PMO or end-user unitWhat is the purpose of the procurement?What are the problem/s or needs that the project or procurement aims to address?

Preparation of the Project Procurement Management Plan (PPMP)Developing the Project Requirements:b. Identify the alternative solutions, products, and services.

What alternative solutions to the problem/s or need/s are available in the market?What is the profile of the supply market? Are they easily obtainable? How much is the cost of each alternative?

The PMO or end-user unit should conduct the market research at this point, and gather as much information about the Goods, Services or expertise required. At the end of this activity, it should know the market or the industry well enough to make an informed choice.

Preparation of the Project Procurement Management Plan (PPMP)Developing the Project Requirements:

c. Compare the alternatives (consider qualitative and quantitative factors)

Consider how the PMO or end-user unit would rate the various alternatives in terms of the following:

i. Value for moneyThe concept of value for money is not restricted to price alone. In addition to costs, other considerations are non cost factors like suitability or fitness to the purpose, quality, among others. In comparing costs, all relevant costs should be considered, e.g., acquisition costs, life-cycle costs (including maintenance and operating costs for goods and infrastructure, spare parts of goods, etc.).


ii. Risk assessment and management

Some risks that may be identified are: obsolescence of equipment, availability of support services, capacity of contractors to implement the project. It is recommended, especially for high-technology, complex, or high value procurement, that the PMO or end-user unit identifies the risks involved and come up with its own risk management plan. Or the bidders could be required to submit, as part of their technical document, a risk assessment and risk management plan.


iii. Government policies that have an impact on the project or procurement

Are there any restrictions on the procurement contemplated? What relevant government policies should be considered in determining the goods or services that will be purchased?

iv. Other relevant factors that may be identified by the PMO or end-user unit.

Preparation of the Project Procurement Management Plan (PPMP)Writing the Technical Specifications, Scope of Work (SOW) and Terms of Reference (TOR):

The Technical Specifications (for Procurement of Goods), Scope of Work (for Services and Infrastructure Projects) or Terms of Reference (for Consulting Services) is the document that provides the detailed description of the deliverables of the Supplier, Contractor or Consultant.


The following guidelines are, considered helpful in writing the TS/SOW/TOR:

Quality Assurance actually starts at this stage of the procurement cycle, considering that the deliverables are decided at this time. It is therefore important that all stakeholders are consulted, and the actual requirements of the PMO or end-user unit are determined and put in writing.

If the procurement is complex, highly technical, or high value, and the Procuring Entity does not have sufficient technical proficiency, it would be prudent to engage the services of technical experts who will serve as consultants in the preparation of the TS/SOW/TOR.



In engaging these consultants, the Procuring Entity shall follow the procedures for procurement of consulting services. Moreover, care should be taken that possible conflict of interest is avoided; that is, the consultant/s engaged should not be connected with the prospective bidders/contractors, and are barred from being engaged by the latter for any purpose related to the procurement at hand.



The description should be generic and flexible, not product-specific or seemingly tailored for a particular brand, product, contractor or consultant, unless the procurement involves products or services that have intellectual property rights attached to it, or are exclusively offered by a single source, and there are no suitable substitute products or services.



If the procurement involves products or services that have intellectual property rights attached, or are exclusively offered by a single source without any suitable substitute, then the PMO or end-user unit must be able to satisfactorily justify the need for such a product or service.The description should be clear and unambiguous, to avoid confusion and to facilitate the evaluation process. It is noted that the TS/SOW/TOR is also the basis of the evaluation or, when applicable, the testing parameters.



Considering that planning is done sometime before actual procurement and even farther from the date of actual delivery or project implementation, changes in technology or changes in the concerned industry or field of expertise should already be taken into account in writing the TS/SOW/TOR.

This will allow the Procuring Entity to procure the latest products and/or services available in the market.

What is an ABC?

The ABC refers to the budget for the contract duly approved by the Head of the Procuring Entity, as provided for in the GAA and/or continuing appropriations, in the case of NGAs; the corporate budget for the contract approved by the governing board, pursuant to E.O. No. 518 series of 1979 in the case of GOCCs and GFIs, and R.A. 8292 in the case of SUCs; and the budget approved by the Sanggunian in the case of LGUs. (IRR-A Section 5)

What is an ABC?

The ABC, insofar as National Government Agencies are concerned, refers to the budget for the contract duly approved by the Head of the Procuring Entity which is contained in the Agency Budget as reflected in the GAA or to be proposed in succeeding GAAs. Thus, the ABC referred to in the R.A. 9184 and its IRR-A basically refers to the proposed budget for the project approved by the Head of the Procuring Entity based on the APP as consolidated from various PPMPs. (GPPB Resolution 011- 2005 dated 26 May 2005)

Determining the Approved Budget for the Contract (ABC):

In determining the ABC, the PMO or end-user unit has to consider several factors, namely:

the appropriation for the project or procurement (whether taken from the current years appropriations or continuing appropriations),

the market price of the goods and/or services being procured, inflation and cost of money which are directly related to the procurement time table.

FORMAT OF THE PPMP

The PPMP shall contain the following information:

The name of the project/procurement;General description of the project/procurement;The extent/size of contract scopes/packages; (This refers to the general description of the lot to be included in a particular contract, i.e. the goods, infrastructure project or services, or a combination of any two or three of these types of procurement, including quantities where applicable.)

FORMAT OF THE PPMP

The PPMP shall contain the following information:

The procurement methods to be adopted, and indicating if the procurement tasks are to be outsourced as provided in Section 53(e) of the IRR-A;The time schedule for each procurement activity; andThe ABC.

Preparation of the Annual Procurement Plan (APP)

The APP is the document that consolidates the various PPMPs submitted by the various PMOs and end-user units within the Procuring Entity.

It reflects the entirety of the procurement activities that will be undertaken by the Procuring Entity within the calendar year.

The APP is prepared by the BAC through the BAC Secretariat upon submission by the PMOs and end-user units of their respective PPMPs and finalized after the ABM has been approved by the DBM.

Preparation of the Annual Procurement Plan (APP)The APP shall subsequently be re-submitted by the BAC for approval to the Head of the Procuring Entity or a second-ranking official designated by the Head of the Procuring Entity to act on his behalf.

In preparing the APP, the BAC shall take into consideration the following factors:

a. The APP should include all procurement activities planned for the year. The approved APP shall be the basis for the Procuring Entitys procurement, and only those projects / procurement included therein shall be undertaken.

Preparation of the Annual Procurement Plan (APP)b. The APP shall include only those procurements that are considered crucial to the efficient discharge of governmental functions. The IRR-A considers a procurement crucial to the efficient discharge of governmental functions if:i. it is required for the day-to-day operations of the Procuring Entity; orii. it is in pursuit of the principal mandate of the Procuring Entity concerned.

c. The APP shall include provisions for foreseeable emergencies based on historical records. The BAC, through the BAC Secretariat, shall include therein a lump sum to cover for these emergencies or contingencies, which amount shall not be more than four percent (4%) of the Procuring Entitys total appropriations for MOOE.

d. Scheduling of procurement activities should be done in such a manner that the BAC and the other offices/units in the Procuring Entity that are involved in the procurement process are able to efficiently manage the conduct of procurement.

What is a Procurement Strategy? The procurement strategy refers to the approach that will be adopted by the BAC in the procurement of the goods, infrastructure projects and consulting services included in the APP.

It reflects the entirety of the procurement activities that will be undertaken by the Procuring Entity within the calendar year.

In the review and consolidation of the PPMPs, the BAC will be able to determine the extent of diversity, quantities, quality, cost, the supply market, and other characteristics of the Procuring Entitys requirements for the year.

The profile of the procurement is a major determinant in the choice of procurement strategy to be employed, as well as in the scheduling of procurement activities.

What is a Procurement Strategy?

There may be common requirements for the various PPMPs. For example, three projects require the purchase of five (5) units of laptop computers for each project office, or a total of fifteen (15) laptop computers. Obviously, it will be more cost effective and efficient if the BAC will procure the 15 laptop computers in one bidding exercise and as one bid lot.

The individual PPMPs sometimes reflect a mix of procurement types, for example, an ICT project might involve the procurement of goods (e.g., workstations, network equipment and peripherals), procurement of civil works (e.g., the installation of cables might involve the repair of some offices and other related civil works) and procurement of consulting services (e.g., design and development of information systems).

What is a Procurement Strategy? In similar cases, the BAC will have to exercise judgment in determining the bid lots and contract package.

There are two approaches to this case:

1. the project could be bid out as one package, or 2. it could be divided into several bid lots (i.e. supply of hardware, supply and installation of cables, design and development of information systems, and repair of facilities).

There are advantages and disadvantages to both approach, and the BAC, through the help of the TWG and the Secretariat, shall determine which is the best option for the Procuring Entity.

What is a Procurement Strategy? In IRR-A, Section 5(p), in case of projects involving mixed procurements, the nature of the procurement, i.e. goods, infrastructure projects, or consulting services, shall be determined based on the primary purpose of the project.

This is helpful in determining which type of procurement procedure to apply. However, there may be instances when the PMO, end-user unit or the Procuring Entity itself may have difficulty determining or agreeing upon the primary purpose. In these cases, ascertaining the component with the highest price may be useful as an indicator of purpose, though not necessarily as a determining factor.

Format of the APPThe BAC may prepare three APPs, one each for Goods, Infrastructure Projects, and Consulting Services or a consolidated APP for all procurement activities.

The APP shall contain the following information:a. Name of the project/procurement;b. PMO or end-user unit;c. General description of the project/procurement (general description of requirements and quantities, where applicable);d. The procurement methods to be adopted, and indicating if the procurement tasks are to be outsourced as provided in Section 53(e) of the IRR-A;e. The time schedule for each procurement activity; andf. The ABC.

PE shall prepare its proposed budget for the succeeding calendar yearThe end-user units of the PE shall prepared their respective PPMPThe PPMP shall be submitted to PE budget office for evaluation, if warranted, include it in the PE budget proposal for approval by the HOPE PE budget office shall furnish the PE budget proposal as well as the PPMP to the BAC Secretariat for its review and consolidation into proposed APPFinal GAA, corporate budget, or appropriation ordinance The End-user units shall revise and adjust the PPMP to reflect the budgetary allocation for their respective PAPs. The revised PPMP shall be submitted to the BAC, for finalization and mode of procurement under the proposed APP. (The APP shall bear the approval of the HOPE or its designated representative)Updating of individual PPMP and the consolidated APP for each PE shall be undertaken every 6 months or as often as may be required by the HOPE.

SECTION 7 PROCUREMENT PLANNING & BUDGETINGAll procurement shall be within the Approved Budget of the PENo procurement shall be undertaken unless it is in accordance with the approved APP of the PE

Major functions of the Property and Supply Division

Major Functions of the Property & Supply Div.Prepares Agency Procurement Request (APR) for all items to be procured from the DBM-PS Accept deliveries of supplies, materials, and equipment based on the APR, Purchase Order (P.O), Contract, and request for the conduct of the inspectionIssues and distributes available supplies, materials, and equipment to requesting offices of the Procuring Entity.Prepares and maintains Inventory Custodian Slip (ICS) for all inventory items, Report of Supplies and Materials Issued (RSMI), Stock Cards for supplies and materials and Property Card for all Property, Plant and Equipment (PPE)

Major Functions of the Property & Supply Div.Prepares Acknowledgement Receipt of Equipment (ARE) for all (PPE)Conduct physical inventory for all PPE and consolidate the same for the preparation of Annual Inventory ReportDisposes waste materials and all unserviceable equipment in accordance with applicable laws, rules, and regulations.Issues clearance from property accountability of all officials and employeesMaintains and updates master lists of inventories of all PPE and inventory items

THE BIDS & AWARDS COMMITTEE (Procurement)

The PhilGEPS (Philippine Government Electronic Procurement Systems)A central Portal that serve as the primary source of information on all government procurement.

Main features of PhilGEPSThe Electronic Bulletin BoardCentralized electronic bulletin board for posting procurement opportunities, awards, results of bidding and other related information. Registry of Manufacturers, Suppliers, Distributors, Contractors, and ConsultantsThe Electronic CataloguePE shall procure common use goods, supplies, materials and equipment from the Electronic Catalogue of PhilGEPS

*Section 364 The Committee on AwardsThere shall be in every province, city or municipality a Committee on Awards to decide the winning bids and questions on awards on procurement and disposal of property

BAC CompositionThe Head of the Procuring Entity shall designate at least five (5) but not more than seven (7) members to the BAC

BAC Composition for NGAs, departments, bureaus, offices, judicial and legislative branches, commissions, SUCs, GOCCs, & GFIsRegular Members: Chairman, who is at least a third ranking permanent officials of the PE An officer, who is at least a fifth ranking permanent officials who shall represents the legal / admin. Area of PE. (bureaus, offices, BAC members shall be at least third ranking permanent personnel)An officer, who is at least a fifth ranking permanent officials who shall represents the finance area. (bureaus, offices, BAC members shall be at least third ranking permanent personnel)

BAC Composition for NGAs, departments, bureaus, offices, judicial and legislative branches, commissions, SUCs, GOCCs, & GFIsProvisional Members:An officer who has technical expertise relevant to the procurement at handA representative from the end user unit who has knowledge of procurement laws and proceduresThe Chairman and the Vice-Chairman shall also be designated by the HOPE. Moreover, the Vice-Chairman shall be a regular member of the BAC.

BAC Composition for Local Government Units (LGU)One representative each from the regular offices under the Office of the Local Chief Executive; andA representative from the end-user unitThe HOPE may designate alternate members to the BAC whenever their principals are absentTERMS OF OFFICE 1 YEAR (RENEWABLE)

Sec. 354 (RA 7160) The Committee on Awards shall be composed of the Local Chief Executive as Chairman; Sec.11.2.5 (RA 9184) In no case shall the HOPE and/or the approving authority be the Chairman or a member of the BAC

FUNCTIONS OF THE BACAdvertise the invitation to bid/request for exp. Of interest;2. Conduct pre-proc. and pre-bid conferences; 3. Determine the eligibility of bidders; 4. Receive bids and conduct evaluation of bids; 5. Undertake post-qualification proceedings; 6. Receive motion for reconsideration; 7. Recommend awards of contract to the HOPE ; 8. Creation of Technical Working Group (TWG); 9. Responsible for ensuring that the PE abides by the standard set forth by the Act and this IRR;

Section 13 - Observers1. Commission on Audit (COA) Representative2. At least one (1) shall come from a duly recognized private group in a sector relevant to the procurement at hand, for example:For Infrastructure projects, national associations of constructors duly recognized by the Construction Industry of the Philippines (CIAP), such as but not limited to the following:Philippine Constructors Associations, Inc.;Natl Constructors Assoc. of the Phil., Inc.; &Phil. Institute of Civil Engineers(PICE)

Section 13 - Observersc) For consulting services, a project-related professional organization accredited or duly recognized by the Professional Regulation Commission or the Supreme Court, such as but not limited to: PICE;Phil. Inst. Of Certified Public Accountants; Confederation of Filipino Consulting Organizations; andb) For goods, a specific relevant chamber-member of the Philippine Chamber of Commerce and Industry.3. Non-government organization (NGO)

FUNCTIONS & RESPONSIBILITIES OF THE BAC SECRETARIAT1. Provide administrative support to the BAC;2. Organize and make all arrangement for the BAC meetings; 3. Prepare minutes of meetings and resolutions of the BAC; 4. Take custody of procurement documents and records; 5. Distribution of BidDocs to the interested bidders; 6. Advertise opportunities, incl. BidDoc,and notice of awards; 7. Managing the procurement processes; 8. Consolidate PPMPs9. Act as the central of communications for the BAC with end users, PMOs, other units, and providers of services & public

The HOPE shall ensure that the members of the BAC and TWG shall give UTMOST PRIORITY to BAC assignments over all other duties and responsibilities, until the requirements for the said assignments at hand are completed.

AVAILABILITY OF BIDDING DOCUMENTSFor the procurement of goods and infrastructure projectsFrom the time the Invitation to Bid (ITB) is first advertised or posted until the deadline for the submission and receipt of bids. For the procurement of consulting servicesFrom the time the Request for Expression of Interest is first advertised until the deadline for the eligibility check, and the Bidding Documents, from the determination of the short list until the deadline for the submission and receipt of bids.

Bidders may be asked to pay for the Bidding Documents to recover the cost of its preparation and development

Agencys websitePhilGEPSBidding Documents shall be posted at:Prospective bidders may download the Bidding Documents from any of the said websites; provided that, bidders shall pay the fees for the Bidding Documents upon submission of their bids. Conspicuous placesNewspaper; if applicable

(Purchase Request) Reference to brand names shall not be allowedNo aspects of the Bidding Documents shall be divulged or released to any prospective bidder or person having direct or indirect interest in the project to be procured, or to any party, except those officially authorized in the handling of the documentsPoints to Remember

SECTION 20 - Pre-Procurement Activities1. Confirm the description and scope of the contract, the ABC, and contract duration. 2. Ensure that the procurement is in accordance with the project and annual procurement plans; 3. Determine the readiness of the procurement at hand4. Review, modify, and agree on the criteria for eligibility, screening, evaluation and post-qualification5. Review and adopt the procurement schedule, incl. deadlines, and timeframes for the different activities; and 6. Reiterate and emphasize the importance of confidentiality

The holding of a pre-procurement conference may not be required for:Procurement of Goodscosting Two Million Pesos (Php2, 000,000.00) and belowInfrastructure Projectscosting Five Million Pesos (Php5, 000,000.00) and below Consulting Servicescosting One Million (Php1, 000,000.00) and below

SECTION 2 Pre-bid ConferenceFor contracts to be bid with an ABC of One Million Pesos (P1, 000, 000.00) or more, the BAC SHALL CONVENE at least (1) pre-bid conference to clarify, and/or explain any of the requirements, terms, conditions, and specifications stipulated in the Bidding Documents. P1MPre-bid Conference is requiredAt the discretion of the BAC

SECTION 2 Pre-bid ConferencePre-bid ConferenceOpening & submission of bidsAt least 12 cd. The minutes of the pre-bid conference shall be recorded and made available to all participants not later than (3) calendar days after the pre-bid conference. Warning!Statement made at the pre-bid conference shall not modify the terms of the BidDocs, unless such statement is specifically identified in writing as an amendments thereto and issued as a Supplemental / Bid Bulletin.

Receipt and Opening of Bids Class A documentsLegal Documents1. Registration Certificate from SEC, Department of Trade and Industry (DTI) for sole proprietorship, 3. Cooperative Development Authority (CDA) for cooperatives

Technical Documents2. Mayors permit where the principal place of business of the prospective bidder is located.

1. Statement of the pros. Bidder of all its ongoing and completed government and private contracts, incl. Contracts awarded but not yet started.

2. Philippine Contractors Accreditation Board (PCAB) for Infrastructure projects

Class B documents

Receipt and Opening of Bids Financial DocumentsAudit Financial Statement showing total current assets and liabilities. Stamped RECEIVED by the BIR 2. NFCC or a commitment from a Universal or commercial bank to extend a credit line. (CLC) 3. Bill of Quantities/ Materials and Bid Form

Eligibility CriteriaNFCC = [(current assets minus current liabilities) (K)] minus the value of all going outstanding or uncompleted portions of the project under ongoing projects, including awarded contracts to be started .Where; K=

GoodsInfrastructure/civil worksConsulting servicesDuly licensed FilipinoDuly licensed FilipinoDuly licensed FilipinoDuly organized partnership (60%)Duly organized partnership (75%) Duly organized partnership (60%)Duly organized corporation(60% Outstanding Capital Stock) Joint venture (75%) /(ownership of the Filipino shall not be less than25%)Duly organized corporation(60% Outstanding Capital Stock) Duly organized cooperatives (60%)Project is under Treaty or International AgreementDuly organized cooperatives (60%)Joint venture (60%) Licensed by PCABJoint venture (60%) The bidder have completed at least two (2) similar contracts and the aggregate contract shall be equivalent to at least the percentage of the ABC as required. (50% / 25 % for expendable supplies)Constructors Performance Evaluation Summary rating and or certificate of completion and owners acceptance of the contract must be satisfactoryThe largest of these similar contract must be equivalent to atleast half of the percentage of ABCThe bidder must have an experience of having completed 10 years from the date of submission and receipt of bidsIf, NFCC atleast equal to the ABC to be bid; orIf, NFCC atleast equal to the ABC to be bid; orIf, CLC must be atleast equal to 10% of the ABC to be bid If, CLC must be atleast equal to 10% of the ABC to be bid

One year or lessMore than one year 2 years More than 2 years 101520

Submission and Receipt of BidsFirst envelope Eligibility requirementsAnd technical componentsSecond envelopeFinancial ComponentDont open before the scheduled opening date & timeSEALEDBAC

For the procurement of GOODSSubmission and Receipt of BidsFirst envelope Eligibility requirementsAnd technical componentsEligibility requirementsThe bid security in the prescribed form, amount and validityTechnical specifications production/delivery schedule manpower requirements; and/or after-sales services/parts, if applicableSworn statement It is not blacklisted all copies submitted are authentic, original, complete and are true and correct authorizing the HOPE to verify all the documents submitted; the signatory is the duly authorized representatives It complies with the responsibilities of a prospective or eligible bidder provided in the PBD; andIt complies with existing laws and standards, in the case of procurement of services For the procurement of CIVIL WORKSFor the procurement of CONSULTING SERVICES

For the procurement of GOODSSubmission and Receipt of BidsFirst envelope Eligibility requirementsAnd technical componentsEligibility requirementsThe bid security in the prescribed form, amount and validityProject Requirements Organizational chart for the contract to be bid; List of contractors personnel, to be assigned to the contract to be bid, with their complete qualification experience data; List of contractors equipment units, which are owned, leased, and / or under purchase agreements supported by certification of availability of equipment from the equipment lessor/vendor for the duration of the project; and For the procurement of CIVIL WORKSFor the procurement of CONSULTING SERVICESSworn statement It is not blacklisted all copies submitted are authentic, original, complete and are true and correct authorizing the HOPE to verify all the documents submitted; the signatory is the duly authorized representatives It complies with the responsibilities of a prospective or eligible bidder provided in the PBD; andIt complies with existing laws and standards, in the case of procurement of services

For the procurement of GOODSSubmission and Receipt of BidsFirst envelope Eligibility requirementsAnd technical componentsThe bid security in the prescribed form, amount, and validity period;Organizational chart for the contract to be bid; List of completed and on-going projects; For the procurement of CIVIL WORKSFor the procurement of CONSULTING SERVICESApproach, work plan, and scheduleList of key personnel to be assigned to the contract to be bid, with their complete qualification and experience data; andSworn statement It is not blacklisted all copies submitted are authentic, original, complete and are true and correct authorizing the HOPE to verify all the documents submitted; the signatory is the duly authorized representatives It complies with the responsibilities of a prospective or eligible bidder provided in the PBD; andIt complies with existing laws and standards

Submission and Receipt of BidsSecond envelopeFinancial Information/documents

Submission and Receipt of BidsBids shall be received by the BAC on the date, time, and place specified in the ITB/RFEI.Bids incl. eligibility requirements submitted after the deadline SHALL NOT BE ACCEPTED by the BAC.

Bid Security All bids shall be accompanied by a bid securityBid security shall be in an amount equal to a percentage of the ABC in accordance with the following:

FORM OF BID SECURITY AMOUNT OF BID SECURITY (Equal to Percentage of the ABC) a) Cash or cashiers/managers check issued by a Universal or Commercial Bank

Two per cent (2%)b) Bank draft/ guarantee or irrevocable letter of credit issued by a Universal or Commercial Bank; provided, however, that it shall be confirmed or authenticated by a Universal or commercial Bank, if issued by a foreign bank. c) Surety bond callable upon demand issued by a surety or insurance company duly certified by the Insurance Commission as authorized to issue such security

Five per cent (5%)d) Any combination of the foregoingProportionate to share of form w/ respect to total amount of security

When the Bid Security shall be returned?After the bidder with the LCRB or HCRB has signed the contract and furnish performance securityBidders declared by the BAC as failed or post-disqualified and upon submission of a written waiver of their right to file a motion for reconsideration and / or protest.

Bid ValidityShall in no case exceed the period of one hundred twenty (120) c.d. from the date of opening of bids.

Bid OpeningThe BAC shall open the bids at the;Time,Date,Place specified in the BidDocs

The BAC shall adopt a procedure ensuring the;Integrity,Security,confidentiality

Preliminary Examination of BidsThe BAC shall check the submitted documents of each bidder against a checklist required documents to ascertain if they are all present Using a non-discretionary PASS/FAIL criterionFirst envelopeEligibility requirementsAnd technical components

Preliminary Examination of BidsThe BAC shall check the submitted documents of each bidder against a checklist required documents to ascertain if they are all present Using a non-discretionary PASS/FAIL criterionSecond EnvelopeFinancial ComponentSAMPLE CHECKLIST

Ceiling of Bid PricesThe ABC shall be the upper limit or ceiling for acceptable bid prices

Bid Evaluation for goods/InfrastructureThe BAC shall immediately conduct a detailed evaluation of bids using non discretionary criteria in considering the following: Completeness of the bid.Responsive bill of Quantities/MaterialsNon-responsive bill of Quantities/MaterialsResponsive bill of Quantities/Materials (free)Arithmetical corrections

The BAC shall evaluate on an equal footing to ensure fair and competitive bid comparison. For this purpose, all bidders shall be required to include the cost of all taxes.

In case of discrepancies between:

AREAS OF DISCREPANCIESPREVAILING AREABid price in figuresBid price in wordsBid price in wordsTotal price per itemUnit price for the item as extended or multiplied by the quantity of that itemUnit price for the item as extended or multiplied by the quantity of that itemStated total price Actual sum of prices of component itemsActual sum of prices of component itemsUnit cost in the detailed estimate Unit cost in the bill of quantitiesUnit cost in the bill of quantities

Bids shall be ranked in the ascending order of their total calculated bid prices, as evaluated and corrected for computational errors. WARNING! total calculated bid prices, as evaluated and corrected for computational errors and other modifications, which exceed the ABC shall be disqualified.

After all bids have been received, opened, examined, evaluated, and ranked, the BAC shall prepare the corresponding abstract of bids. All members of the BAC shall sign the AoB and attach thereto all the bids with the corresponding bid securities and the minutes of the proceedings of the bidding. The Abstract shall contain the following: Name of the contract and its location, if applicable Time, date, and place of bid opening; and Names of bidders and their corresponding bid prices arranged from lowest to highest, the amount of bid security and the name of the issuing entity

REMEMBER!From submission and receipt of bids until the approval by the HOPE of the ranking of short listed bidders, those that have submitted their bids are PROHIBITED from making any communication with any BAC member, including its staff and personnel, as well as its BAC secretariat and TWG, regarding matters connected to their bids. However, the BAC, through its Secretariat, may ask in writing the bidder for clarification of its bid. All responses to requests for clarification shall be in writing.

Bid Evaluation of short listed bidders for consulting servicesThe purpose of bid evaluation is to determine the Highest Rated Bid (HRB) using the following steps:

Quality-Based Evaluation ProcedureA two-stage procedure shall be adopted whereby each consultant shall be required to submit his technical and financial proposals simultaneously in separate sealed envelopes.

After receipt of bids, the technical proposals shall first be opened and evaluated. The BAC shall rank the consultants in descending order based on the numerical ratings of their technical proposals and identify the HRB. Provided, however, that the HRB shall pass the minimum score indicated in the Bidding Documents.

Bid Evaluation of short listed bidders for consulting servicesThe HOPE shall approve or disapprove the recommendations of the BAC within two (2) calendar days after receipt of the results of the evaluation from the BAC.

After approval by the HOPE of the HRB, its financial proposal shall then be opened. The BAC shall, within three (3) cd. Notify and invite the consultant with the HRB for the opening of financial proposal for the purpose of conducting negotiations with the said consultants. In the letter of notification, the BAC shall inform the consultant of the issues in the technical proposal the BAC may wish to clarify during the negotiations.

The total contract amount shall not exceed the ABC as stated in the BidDocs.

Bid Evaluation of short listed bidders for consulting services (Graphic Presentation)Technical ProposalFinancial ProposalTechnical ProposalFinancial ProposalTechnical ProposalFinancial ProposalBACTechnical Proposal of Consultant ATechnical Proposal of Consultant BTechnical Proposal of Consultant B

Consultant A 85%

Consultant B 97.50%

Consultant C 80 %

Consultant A

Consultant B

Consultant C

THE BAC shall open the Technical Proposals

Arranged in Descending order based on numerical rating

Bid Evaluation of short listed bidders for consulting services (Graphical Presentation)

Consultant A 85%

Consultant B 97.50%

Consultant C 80 %HRBHEAD OF THE PROCURING ENTITY

Within two (2) days:

APPROVE

DISAPPROVE

The recommendations of the BACBIDS & AWARDS COMMITTEE

After 3 days, the BAC shall notify and invite the consultant with HRB for the opening of the

And for the NEGOTIATIONFinancial proposal of Consultant B

Arranged in Descending order based on numerical rating


BOpened by the BACACReturn to the respective consultants UNOPENED

FINANCIAL PROPOSALS

Bid Evaluation of short listed bidders for consulting servicesThe purpose of bid evaluation is to determine the Highest Rated Bid (HRB) using the following steps:

Quality-Cost Based Evaluation ProcedureThe technical proposal together with the financial proposal shall be considered in the evaluation of consultants. The technical proposals shall be evaluated first. The financial proposal of the consultants WHO MEET THE MINIMUM TECHNICAL SCORE shall then be opened.

The financial and technical proposal shall be given corresponding weights with the financial proposal given a minimum weight of fifteen percent (15%) up to a maximum of forty percent (40%). The weight of the technical criteria shall be adjusted accordingly such that their total weight in percent together with the weight given to the financial proposal shall add to one hundred percent (100%).

Bid Evaluation of short listed bidders for consulting servicesThe exact weight SHALL BE APPROVED BY THE HOPE upon the recommendation of the BAC and indicated in the BidDocs. The BAC shall rank the consultants in descending order based on the combined numerical ratings of their technical and financial proposals and identify the HRB.

The HOPE shall approve and disapprove the recommendations of the BAC within two (2) cd after receipt of the results of the evaluation from the BAC.

After approval by the HOPE of the HRB, the BAC shall within three (3) cd, notify and invite the consultant with the HRB for negotiation.

Bid Evaluation of short listed bidders for consulting services (Graphic Presentation)Technical ProposalFinancial ProposalTechnical ProposalFinancial ProposalTechnical ProposalFinancial ProposalBACTechnical Proposal of Consultant ATechnical Proposal of Consultant BTechnical Proposal of Consultant CFinancial Proposal of Consultant AFinancial Proposal of Consultant BFinancial Proposal of Consultant C

Consultant A

Consultant B

Consultant C


Afterwhich, the BAC shall open the Financial Proposals

Bid Evaluation of short listed bidders for consulting services (Graphic Presentation)Technical Proposal of Consultant ATechnical Proposal of Consultant BTechnical Proposal of Consultant CFinancial Proposal of Consultant AFinancial Proposal of Consultant BFinancial Proposal of Consultant C+++The highest rating after adding the scores of Technical and Financial proposals shall be recommended to the HOPE for HRB.


Afterwhich, the BAC shall open the Financial Proposals

WEIGHTSTechnical (dependent to the weight of the Financial)?Financial weights is within 15 % - 40 %15 % - 40 %TOTAL WEIGHT100%


Consultant A 85%

Consultant B 97.50%

Consultant C 80 %HRBHEAD OF THE PROCURING ENTITY

Within two (2) days:

APPROVE

DISAPPROVE

The recommendations of the BACBIDS & AWARDS COMMITTEE

After 3 days, the BAC shall notify and invite the consultant with HRB for NEGOTIATION

Rating(Technical + Financial)

Criteria in evaluating technical proposals of consultantsQuality of personnel to be assigned to the project which covers suitability of key staff to perform the duties of the particular assignments and general qualifications and competence including education and training of the key staffExperience and capability of the consultant which include records of previous engagement and quality of performance in similar and in other projects; relationship with previous and current clients; and overall work commitments, geographical distribution of current/impending projects and attention to be given by the consultantPlan of approach and methodology with emphasis to clarity, feasibility, innovativeness, and comprehensiveness of the plan approach, and the quality of interpretation of project problems, risks and suggested solutions

REMEMBER!All participating short listed consultants shall be furnished the results (ranking and total scores only) of the evaluation after the approval of the HOPE of the ranking. Said results shall be posted in the PhilGEPS and the website of the PE

What should be discussed in the Negotiation stage? Discussion and clarification of the TOR and Scope of Services; Discussion and finalization of the methodology and work program proposed by the consultant; Consideration of appropriateness of qualifications and pertinent compensation, number of man-months and the personnel to be assigned to the job, taking note of over-qualified personnel, to be commensurate with the compensation of personnel with the appropriate qualifications, and schedule of activities; Discussion on the services, facilities and data, if any, to be provided by the PE concerned; Discussion of financial proposal submitted by the consultant; and Provisions of the contractShall be completed within ten (10) calendar days. There should be no replacement of key personnel before the awarding of contract.

Objective and process of Post-qualificationThe LCB/HRB shall undergo post-qualification in order to determine whether the bidder concerned complies with and is responsive to all the requirements and conditions as specified in the BidDocs. Within three (3) cd from receipt by the bidder of the notice from the BAC that the bidder has the LCB or HRB, the bidder shall submit the following requirements to the BAC: Tax clearance; Latest income and business tax returns; Certificate of PhilGEPS registration; and Other appropriate license and permits required by law and stated in the BidDocs.

Objective and process of Post-qualificationThe post qualification shall verify, validate, and ascertain all statements made and documents submitted by the bidder with the LCB/HRB, using non-discretionary criteria. This criteria shall not be limited to, the following: Legal Requirements. To verify, validate, and ascertain licenses, certificates, permits, and agreements submitted by the bidder, and the fact it is not included in any blacklisted.

Technical Requirements. To determine compliance of the goods, infrastructure projects, or consulting services offered with the requirements specified in the BidDocs, including:

Verification and validation of the bidders stated competence and experience, and the competence and experience of the bidders key personnel to be assigned to the project, for the procurement of infrastructure projects and consulting services;

Objective and process of Post-qualification

Verification of availability and commitment, and / or inspection and testing for the required capacities and operating conditions, of equipment to be owned/leased;

Verification and/or inspection and testing of the goods/product, after-sales and / or maintenance capabilities, and;

Ascertainment of the sufficiency of the bid security as to type, amount, form and wording, and validity period;

Financial Requirements. To verify, validate and ascertain the bid price proposal of the bidder and, whenever applicable, the required CLC in the amount specified and over the period stipulated in the BidDocs, or the bidders NFCC to ensure that the bidder can sustain the operating cash flow of the transaction.

If the BAC determines that the bidder with the LCB/HRB passes all the criteria for post-qualification, it shall declare the said bid as the LCRB/HRRB, and recommend to the HOPE the award of contract, however, if the BAC determines that the bidder with the LCB/HRB fails the criteria for post-qualification, it shall immediately notify the said bidder in writing of its post-qualification and the grounds for it. Immediately after the BAC has notify the first bidder of its post-qualification, and notwithstanding any pending request for reconsideration thereof, the BAC shall initiate and complete the same post-qualification process on the bidder with the second lowest LCB/HRB. If the second passes the post-qualification, and provided that the request for reconsideration of the first bidder has been denied, the second bidder shall be post-qualified as the bidder with the LCRB/HRRB. If the second bidder, however, fails the post-qualification, the procedure for post-qualification shall be repeated for the bidder with the next LCB/HRB, and so until the LCRB/HRRB, as the case maybe, is determined for award.

The post-qualification process shall be completed in not more than seven (7) cd from the determination of LCB/HRB. In exceptional cases, the post-qualification period may be extended by the HOPE, but in no case shall aggregate period exceed thirty (30) cd.

FAILURE OF BIDDING The BAC shall declare the bidding of failure when: No bids are received; All Prospective bidders are declared ineligible; All bids fail to comply with all the bid requirements or fail-post qualification, or, in the case of consulting services, there is no successful negotiations; or The bidder with the LCRB/HRRB refuses, without justifiable cause, to accept contract, and no award is made in accordance with Section 40 (failure to enter into contract and post security ) of the act and this IRR

In order to determine the reason for the failed bidding, the BAC shall conduct a mandatory review and evaluation of the terms, conditions, and specifications in the BidDocs, including its cost estimates. Based on its findings, the BAC shall revise the terms, conditions, and specifications, and if necessary, adjust the ABC, subject to the required approvals, and conduct a re-bidding with re-advertisement and/or posting.

All bidders who have initially responded to the Invitation to Bid/Request for Expression of Interest and have been declared eligible or shortlisted in the previous biddings shall be allowed to submit new bids.

The BAC shall observe the same process and set the new periods according to the same rules followed during the previous bidding(s).

Should there occur a second failure of bidding, the procuring entity may resort to negotiated procurement.

SINGLE CALCULATED/RATED AND RESPONSIVE BIDA single calculated/responsive bid shall be considered for award if it falls under any of the following circumstances: Only one prospective bidder submit a LOI and/or applies for eligibility check, and it meets the eligibility requirements of the criteria, after which it submits a bid which is found to be responsive to the bidding requirements; More than one prospective bidder submits LOI and/or applies for eligibility check, but only one bidder meets the eligibility requirements of the criteria, after which it submits a bid which is found to be responsive to the bidding requirements; orIf after the eligibility check, more than one bidder meets the eligibility requirements, but only one bidder submits a bid, and its bid is found to be responsive to the bidding requirements.

NOTICE AND EXECUTION OF AWARDThe BAC shall recommend to the HOPE the award contract to the bidder with the LCRB/HRRB or the SCRB/SRRB after the post-qualification process has been completed.Resolution of the BAC recommending award; To facilitate the approval of the award, the BAC shall submit the following supporting documents to the HOPE:Abstract of bids; Duly approved program of work or delivery schedule and cost estimates; Document issued by appropriated entity authorizing the procuring entity to incur obligation for a specified contract; and Other pertinent documents required by existing laws, rules, and/or the procuring entity concerned

If the award is approved, the HOPE shall immediately issue the Notice of Award to the bidder with LCRB/HRRB. In the event that the HOPE shall disapprove such recommendation, such disapproval shall be based only on valid, reasonable, and justifiable grounds to be expressed in writing, copy furnished by the BAC.

Contract award shall be made within the bid security period provided in Section 28 (bid validity shall not exceed 120 cd. the PE can request for extension but the bidder can deny it without forfeiting their bid security).

The BAC, through the Secretariat, shall post, within, three (3) cd from the issuance, the Notice of Award in the PhilGEPS, the website of the procuring entity, if any, and any conspicuous place in the premise of the procuring entity

CONTRACT SIGNING The winning bidder shall post the REQUIRED PERFORMANCE SECURITY and enter into contract with the procuring entity within (10) cd from the receipt by the winning bidder of the NoA. The procuring entity shall enter into contract within the same period provided that all documentary requirements are complied with, to wit: Contract Agreement;Bidding Documents; Winning bidders bid, including proposals submitted; Notice of Award of Contract;

Procedural Steps for the Public Bidding of Goods and Services ( Revised IRR, GPPB Res. 03-2009 )Pre-ProcurementConf.Advertise/Post ITBCall/Hold Pre-BidConferenceOpen Technical (with eligibility documents)EnvelopeOpenFinancial EnvelopeReceive the Two (2)EnvelopesSubmission ofAdditional Req. Post-qualify LCBIssueNotice to ProceedPre-Bid C. at least 12 c.d. before bid opening1 c.d.1 c.d.7 c.d. Within 30 c.d..Posting 7 c.d.within 3 c.d.

Prepare &Sign Contract

7 c.d.GOCC/GFIs- 15cdWithin 10 c.d.Approve Resolution / Issue Noticeof Award - LCRBIssue BiddingDocumentsEvaluate & Rank Bid/sWithin 3 c.d.

PERIOD OF ACTION ON PROCUREMENT ACTIVITIESOpening of Bids Award of ContractThis procurement process shall not exceed three (3) monthsAll members of the BAC shall be on a jury duty type of assignment until the NoA is issued by the HOPE in order to complete the entire procurement process at the earliest possible time.

To guarantee the faithful performance by the winning bidder of its obligations under the contract in accordance with the BidDocs, it shall post performance security prior to the signing of contract. PERFORMANCE SECURITY

PERFORMANCE SECURITY The performance security shall be in an amount equal to a percentage of the total contract price in accordance with the following schedule:

Form of Performance Security Amount of Performance Security (Equal to percentage of the total contract price)a) Cash or cashiers/managers check issued by a Universal or Commercial BankGoods and Consulting Services Five percent (5%)

Infrastructure Projects Ten percent (10%)b) Bank draft/guarantee or irrevocable letter of credit issued by a Universal or Commercial bank; provided however, that it shall be confirmed or authenticated by a foreign bank. c) Surety bond callable upon demand issued by a surety / insurance company duly certified by the Insurance commission as authorized to issue such security. Thirty percent(30%)d) Any combination of the foregoingProportionate to share of form with respect to total amount of security

The performance security shall be denominated in Philippine pesos and posted in favor of the procuring entity, which shall be forfeited in the event it is established that the winning bidder is in default in any of its obligations under the contract.

The performance security shall remain valid until issuance by the procuring entity of the final Certificate of Acceptance.

The performance security may be released by the PE after the issuance of CA, subject to the following conditions: PE has no claims filed against the contract awardee or the surety company; It has no claims for labor and materials filed against the contractor; and Other terms of the contract

If the bidder with LCRB/HRRB or the bidder with Single Calculated/Rated Responsive Bid, fails, refuses or is unable to submit documents required or make good its bid by entering into a contract with the procuring entity or post the required Performance Security within the period of 10 cd, the bid security shall be forfeited and with appropriate sanctions, except where such failure, refusal, or inability is through no fault of the said bidder.

In case of failure, the BAC shall disqualify the said bidder and shall initiate and complete post-qualification process on the bidder with the second LCB/HRB. This procedure shall be repeated until LCRB/HRRB is determined for award. FAILURE TO ENTER INTO CONTRACT AND POST PERFORMANCE SECURITY

The HOPE reserves the right to reject any and all bids, declares a failure to bidding, or not award the contract in the following situations: RESERVATION CLAUSEIf there is prima facie evidence of collusion between: Appropriate public officers or employees of the procuring entity;

BAC and any of the bidders;

Among the bidders themselves;

Bidder and a third party, including any act which restricts, suppresses, or nullifies or tends to restrict, suppress or nullify competition; If the BAC is found to have failed in following the prescribed bidding procedures; or

For any justifiable and reasonable grounds where the award of the contract will not redound to the benefits of the GOP, as follows: If the physical and economic conditions have significantly changed so as to render the project no longer economically, financially, or technically feasible, as determined by the HOPE;

If the project is no longer necessary as determined by the HOPE;

If the source of funds for the project has been withheld or reduced through no fault of the PE.RESERVATION CLAUSE

All bid shall be accompanied by a SWORN STATEMENT of the bidder that itis not related to the HOPE, members of the BAC, the TWG, and the BAC secretariat,the head of the PMO or the end-user unit, and the project consultants, by consanguinityor affinity up to the THIRD CIVIL DEGREE.

For this reason, relation to the aforementioned persons shall automatically disqualify the bidder from participating in the procurement of contracts of the PE. This apply to thefollowing persons:

If the bidder is an individual or a sole proprietorship, to the bidder himself;

If the bidder is a partnership, to all its officers and members;

If the bidder is a corporation, to all its officers, directors, and controlling stockholders; and

DISCLOSURE OF RELATIONS

The method of procurement to be used shall be indicated in the approved APP. If the original mode of procurement recommended in the APP was public bidding but cannot be ultimately pursued, the BAC, through a resolution, shall justify and recommend the change in the mode of procurement to be approved by the HOPE. ALTERNATIVE METHODS OF PROCUREMENTLIMITED SOURCE BIDDINGOtherwise known as selective bidding, is a method of procurement of goods and consulting services that involves direct invitation to bid by the procuring entity from the list of pre-selected suppliers or consultants with known experience and proven capability on the requirements of the particular contract. This alternative mode of procurement may be employed under any of the following conditions:

Procurement of highly specialized types of goods and consulting services whereby only a few suppliers or consultant are known to be available; or

Procurement of major plant components

ALTERNATIVE METHODS OF PROCUREMENTDIRECT CONTRACTING is also known as single source procurement. Is a method of procurement of goods that does not require elaborate bidding documents. The supplier is simply asked to submit a price quotation or a pro-forma invoice together with the conditions of sales.

Direct contracting may be resorted to under any of the following conditions:

Procurement of goods of proprietary nature which can be obtained only from the proprietary source;

When the procurement of critical plant components from a specific supplier ;

Those sold by an exclusive dealer or manufacturer.

ALTERNATIVE METHODS OF PROCUREMENTREPEAT ORDER repeat order, when provided for in the APP, is a method of procurement of goods from the previous winning bidder, whenever there is a need to replenish goods procured under a contract previously awarded through Competitive bidding.

Repeat order may be resorted to under any of the following conditions:

Unit prices of the repeat order must be the same as or lower that those in the original contract;

will not result to splitting of contracts, requisitions, or purchase orders;

shall be availed of only within six (6) months from the contract effectivity date stated in the NTP arising from the original contract; and

shall not exceed twenty-five percent (25%) of the quantity of each item in the original contract.

ALTERNATIVE METHODS OF PROCUREMENTSHOPPING is a method of procurement of goods whereby the PE simply requests for the submission of price quotations for readily available off-the-shelf goods or ordinary/regular equipment to be procured directly from suppliers of known qualifications.

Shopping may be employed in any of the following cases:

when there is an unforeseen contingency requiring immediate purchase: Provided however that the amount shall not exceed the thresholds prescribed.

Procurement of ordinary or regular office supplies and equipment not available in the procurement service involving an amount not exceeding the thresholds prescribed.

TAKE NOTE!Ordinary or regular office supplies shall be understood to include those supplies, commodities, or materials, which, depending on the procuring entitys mandate and nature of operations, are necessary in the transaction of its official businesses, and consumed in the day-to-day operations.

However, office supplies shall not include services such as repair, and maintenance of equipment and furniture, as well as trucking, hauling, janitorial, security, and related or analogous services.

THRESHOLDS FOR SHOPPING (a)For NGAs, GOCCs, GFIs, and SUCs - One Hundred Thousand Pesos (P100, 000.00)

For LGUs, in accordance with the following schedule: In case of barangays - Fifty Thousand Pesos (P50, 000.00)

DOF Classification of LGUsMaximum Amount (in Philippine Peso)ProvinceCityMunicipality 1st class100,000100,00050, 0002nd class100,000100,00050, 0003rd class100,00080, 00050, 0004th class80, 00060, 00050, 0005th class60, 00050, 00050, 0006th class50, 00050, 00050, 000

THRESHOLDS FOR SHOPPING & SVP (b)For NGAs, GOCCs, GFIs, and SUCs - Five Hundred Thousand Pesos (P500, 000.00)

For LGUs, in accordance with the following schedule: In case of barangays - Fifty Thousand Pesos (P50, 000.00)

DOF Classification of LGUsMaximum Amount (in Philippine Peso)ProvinceCityMunicipality 1st class500,000500,000100, 0002nd class500,000500,000100, 0003rd class500,000400, 000100, 0004th class400, 000300, 00050, 0005th class300, 000200, 00050, 0006th class200, 000100, 00050, 000

ALTERNATIVE METHODS OF PROCUREMENTNEGOTIATED PROCUREMENT After conduct of mandatory review, the BAC shall revise and agree on the minimum technical specifications, and if necessary, adjust the ABC. However, the ABC cannot be increased by more than twenty percent (20%) of the ABC for the last failed bidding.

The BAC shall invite and engage in negotiations with a sufficient number of suppliers, contractors, or consultants to ensure effective competition. Two Failed Biddings is a method of procurement of goods, infrastructures, and consulting services, whereby the PE directly negotiates a contract with a technically, legally, and financially capable supplier, contractor or consultant in any of the following cases.

ALTERNATIVE METHODS OF PROCUREMENT Any requirements, guidelines, documents, clarifications, and other information shall be communicated by the PE to suppliers, etc. On an equal basis.

Following the completion of the negotiations, the PE shall request all suppliers, etc to submit, on a specified date, a best and final offer with respect to all aspects of their proposals.

The procuring entity shall select the successful offer on the basis of such best and final offers.

In all stages of the negotiations, observers shall be invited.

Emergency Cases. In case of imminent danger to life or property during a state of calamity, or when time is of the essence of arising from natural or man made calamities or other causes where immediate action is necessary to prevent damage to or loss of life or property, or to restore vital public service and public utilities.

ALTERNATIVE METHODS OF PROCUREMENTAgency to - Agency Procurement of infrastructure projects, consulting services, and goods from another agency of the GOP, such as the PS DBM, which is tasked with a centralized procurement of Common-Use supplies for the GOP. Procurement Agent Procuring entities which may not have the proficiency or capability to undertake a particular procurement, as determined by the HOPE, may request other GOP agencies to undertake such procurement for them, or at their option, result and hire consultants to assist them directly and/or train their staff in the management of the procurement functions.

ALTERNATIVE METHODS OF PROCUREMENTHighly Technical Consultants. Individual consultants hired to do work that is (i) highly technical (ii) primarily confidential where trust and confidence are the primary consideration for the hiring of consultant. Provided, however, shall, at the most, be on six month basis, renewable at the option of the HOPE, but in no case shall exceed the term of 6 months. Defense Cooperation Agreement. Upon approval by the President of the Philipines, and when the procurement for use by the AFP involves major defense equipment or materials and/or defense-related consultancy services, when expertise required is not available locally, and the Secretary of National Defense has determined that the interests of the country shall be protected by negotiating directly with an agency or instrumentality of another country with which the Philippines has entered into a defense cooperation agreement or otherwise maintains diplomatic relations: Provided, however, that the performance by the supplier of its obligations under the procurement of contract shall be covered by a performance security.

ALTERNATIVE METHODS OF PROCUREMENTSmall Value Procurement. Where the procurement does not fall under shopping and the amount does not exceed the thresholds prescribed.

The procuring entity shall draw up a list of at least three (3) suppliers, contractors, or consultants, of known qualifications which will be invited to submit proposals, in the case of goods and infrastructure projects, or curriculum vitae, in the case of consulting services. Lease of Real PropertyNGO Participation.- When an appropriation law or ordinance earmarks an amount to be specifically contracted out to NGO, the PE may enter into a Memorandum of Agreement with an NGO.

ALTERNATIVE METHODS OF PROCUREMENTCommunity Participation. United Nations Agencies. Procurement from specialized agencies of the United Nations of any of the following:

Small quantities of-the-shelf goods, primarily in the fields of education and health; and

Specialized product where the number of suppliers is limited, such as vaccines or drugs.

TERMS AND CONDITIONS FOR THE USE OF ALTERNATIVE METHODS Except for Limited Source Bidding under section 49 of this IRR, submission of bid securities may be dispensed with.

Performance and warranty security shall be submitted for contract acquired through the alternative methods of procurement except for:

Shopping

Negotiated Procurement: emergency cases, SVP, lease of real property and UN agencies.

DELIVERY, INSPECTION, & ACCEPTANCE

DELIVERIESDeliveries of supplies must be made by the Supplier/Manufacturer/Contractor within the stipulated period and at the place/s indicated in the purchase order of the contract.

In all cases, delivery shall be made within office hours and during working days.

Failure to deliver within the prescribed period, the supplier/manufacturer/contractor shall be liable for penalty, usually in the form of liquidated damages specified in the Contract/Purchase Order.

LIQUIDATED DAMAGES1 % of the undelivered items/delaysLiquidated damages of the undelivered items in the contract deducted for each day of delay

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DELIVERIESAll supplies shall be adequately contained, packed, crated, cased, bundled, wrapped, or sealed to prevent damage, spoilage, and loss.

They must be properly labelled and marked in accordance with the minimum requirements of RA 7394 otherwise known as Consumer Act of the Philippines.

Responsibility in case of damage, spoilage, or loss shall be governed by existing laws on the matter unless the purchase order or contract provides otherwise.

DELIVERIESDeliveries shall be made within seven(7) calendar days upon receipt of the order unless otherwise provided in the Purchase Order or contract.

All items delivered SHALL BE RECEIVED BY THE SUPPLY OFFICER/DESIGNATED PROPERTY CUSTODIAN as the case may be. Receiving and signing of the DR and temporary recording of the deliveries shall be subjected to inspection by the Inspectorate Team.

INSPECTION

INSPECTIONInspection is the process of examining and testing the procured supplies, materials, equipment, and services including raw materials and components to determine their conformity with the contract requirements including all applicable drawings, specifications, and purchase description.

What is Inspection?

INSPECTIONThe inspection of items SHALL BE DONE BY THE INSPECTORATE TEAM, whose members shall be determined and designated by the HOPE.

Inspection shall be done in accordance with the standards and specifications and be conducted in the presence of the suppliers and end-users representatives.

The Inspectorate Team and the Supply Officer/Designated Property Custodian SHALL PREPARE AND SIGN the Inspection and Acceptance Report (IAR).

TECHNIQUES OF INSPECTION Inspection by Item- Individual item is checked in conformity with the requirement stated in the specification. This method of inspection is applicable, but not limited to deliveries of equipment and fixed assets. Inspection by Sampling- Sampling is a process of obtaining information about a group of data having similar purpose or function, usually ten percent (10%) of the total or lot delivery.

General Procedures in Conducting InspectionUpon receipt of the request for inspection, check the following documents as their completeness and authenticity. Purchase Order & Contract

Date; PO NumberName and Address of the SupplierSuppliers Acknowledgement or Receipt (date of receipt) SpecificationsQuantity Unit/Total PriceAvailability of fundApproval of the HOPE or his duly authorized representative

General Procedures in Conducting InspectionSuppliers Invoice Delivery Receipt

Pre-numbered and not just typed stamped or hand-written

Date checked against the delivery date stated in the P.O or contract

RECEIVED portion Receipt and date of item delivered acknowledged by the supply officer/designated property custodian.

Conduct inspection and testing procedure when applicable.

Prepare inspection report immediately and give to the Inspectorate Team and supply officer/designated property custodian for signature.

Inspection Procedures for EquipmentExamine the equipment as to the physical condition: brand new, second hand, rebuild, or reconditioned. See to it that no defective or old worn out parts are used/attached to the equipment.

Take hold of the manual, catalogue or handbook for equipment delivered for reference. All date/information contained thereon should conform with the delivery of the serial number, point of origin, color, and the accessories or tools that go with the equipment.

Make a physical count and inspect the unit piece-by-piece or unit-by-unit. Random sampling is not applicable for this type of delivery because you have to request the supplier or his representative to demonstrate the operation of the equipment (test run) in your presence and that of the end-user. Observes the actual performance thereof.

Get the warranty card and note down the warranty card number in the original invoice. Check if the serial indicated thereon is the same as that of the delivery.

Inspection & Acceptance of Infra ProjectsThe Head/End-user/Implementing Office/Property Officer/etc. must secure copy of the Program of Works prior to the start of the construction.

The End-user must seek assistance from the technical person (TWG for the project) to check the materials that are being used during the construction if they are in accordance with the required specifications.

The End-user (usually the Head) shall sign the Certificate of Acceptance (CA)/Certificate of Turnover only after the issuance of the 100% completion report by the project engineer. The same certificate shall also be signed by the Division Physical Facilities Officer.

The End-user (usually the Head) shall issue a Certificate of Non-compliance if the works are not in accordance with the specifications or standards.

Documentary Requirements for InspectionGeneral Requirements for Inspection of deliveries/fabrication/installation

Original copy of approved contract/PO

Original Invoice/ Delivery Receipt

Performance/Quality Test Result (if applicable)

Other documents specified in the contract necessary to determine conformance with specifications (e.g. Approved plans/samples, standard specifications, etc. )

Documentary Requirements for InspectionInspection of Infrastructure Project for construction, repairs and rehabilitation

Statement of Work Accomplishment (SWA) Certificate of completion for final paymentCertificate of Final Acceptance (CFA) for release of retention money Approved original contractApproved Program of Works

Post-repair Inspection for repairs

Approved job order/work order/contractCertificate of AcceptanceWaste Materials reports, if applicable

Acceptance or Rejection of Deliveries of Goods The Inspectorate Team may recommend a REJECTION / REDUCTION OF PRICE when their is a SHORTAGE IN QUANTITY, DEFICIENCY, OR DEFECTIVENESS IN QUALITY.

After consideration of 10% tolerable allowance based on standards, the following shall be observed by the Inspectorate Team in the evaluation of the result of the inspection:

Supplies or property tested and found to be in accordance with the approved PO/Contract and with the required specifications SHALL BE ACCEPTED;

Supplies or property whose quality analysis shows deficiency of less than ten percent (10%) may be accepted, provided that they shall serve the purpose for which they were purchased. The defect is minor and the contract price is reduced according to the deficiency noted;

Acceptance or Rejection of Deliveries of Goods

Supplies or property whose quantity is short by volume, weight, actual count, etc. Shall be subjected to reduction on contract price at an amount equivalent to the shortage, provided that the said deliveries are acceptable to the agency or unit; and

Damaged items that are not disclose or incorrectly marked as such shall be subjected to corresponding reduction in the contract.

Acceptance of deliveries maybe made only if the supplies and materials delivered CONFORM TO THE STANDARDS AND SPECIFICATIONS STATED IN THE CONTRACT/PO

Acceptance or Rejection of Deliveries of Goods If the supplier failed to comply with the requirements, the property/supply officer shall submit a report to the HOPE for appropriate actions. The HOPE may forfeit the contractors performance bond, if any, and may also institute civil actions against the contractors for breach of contract.

The supply officer/ designated property custodian shall be responsible for accepting deliveries of procured items and should notify the Auditor within five (5) days upon receipt of the approved contract/PO.

CUSTODIANSHIP

PROPERTY CUSTODIANSHIPProperty custodianship refers to the guardianship of government property by the accountable person.

This includes the receipt, safekeeping, issuance, repair, and maintenance of supplies, materials, and equipment.

The designated property custodian/officer is responsible, accountable and liable for any loss, misuse, damage, or deterioration of government property due to fault or negligence in safekeeping which may be physical or destructive What is custodianship?

Storage / Warehousing Storage/ Warehousing refers to the scientific and economical warehousing of materials for their best safekeeping and availability.

Best safekeeping means protecting the materials against theft, fire, and deterioration but easily accessible when needed. The method or systems include factors and procedures in the manner of undertaking due care and maintenance of good condition of the property.What is warehousing?

Factors to be considered in Storage and Warehousing:Site Location and size of storage/stockroom to use

Generally, selection of site location, type and size of storage of stockroom to be used, play a major role for an effective storage and Warehousing management. It is important factor for the following purposes:

To be able to figure out the amount of materials that can be stored; For determination of access for efficient and proper transport of supplies and materials; For provision of large size of doorways and entrances; For installation of proper lightings and ventilation.

Factors to be considered in Storage and Warehousing:Special layout planning for materials to be stored.

For easy facilitation, space layout for materials to be stored should be planned. Specifically the layout should contain the placement of supplies by category, type, similarity, popularity, sizes, shapes, characteristics and to include perishability.

It is important that materials be stored and placed in its proper places to avoid accidents and wastage.

Factors to be considered in Storage and Warehousing:Types of stacking suitable for each type of property

In like manner as in space layout planning, types of stacking for each type of materials should be given careful planning. It may be classified into:

Bulk storage

Medium Lot Storage; and

Small Lot Storage

Procedures in Storage / Warehousing Receipt of Materials and Equipment and Other Property

- Supplies, materials, and equipment delivered by the supplier must be accompanied by Delivery Receipts (DRs) and/or Sales Invoice (SI), which were pre-inspected by the supply officer / designated property custodian before the items are received.

Arrangement of Materials

- The storekeeper arranges the materials inside the warehouse/ stockroom in accordance with the prepared storage plan.

Procedures in Storage / Warehousing Recording of Receipts/ Deliveries

- The storekeeper properly posts and updates the information (receipts, issuances and balance on hand) taken from the IAR.

- Reconciliation of entries of bin cards with stock/property cards and with the physical count of stock on hand should be currently and properly updated.

Issuance and UtilizationIssuance and Utilization of supplies and materials and equipment is among the activities of property custodian

procurement

Documents

line of supplies

supplies desiredas

acquisition of supplies

regulations of republic

expendable supplies

contract budget

applicable rules

commonuse supplies goods