southwest integrated transport system project...
TRANSCRIPT
Project Information Memorandum
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REPUBLIC OF THE PHILIPPINES
DEPARTMENT OF TRANSPORTATION AND
COMMUNICATIONS
SOUTHWEST INTEGRATED TRANSPORT
SYSTEM PROJECT
PROJECT INFORMATION MEMORANDUM
(PIM)
10 JANUARY 2014
Project Information Memorandum
Page 2 of 23
DISCLAIMER
The information contained in the Bidding Documents, Information Documents and any
other information, whether verbal or written, provided by the Department of
Transportation and Communications (“DOTC”) or any of its employees or advisors, or on
behalf of the DOTC, is provided to Bidders on the terms and conditions set out in the
Bidding Documents and such other terms and conditions subject to which such information
is provided.
The Bidding Documents and Information Documents are not agreements and are neither
offers nor invitations by the DOTC to the Bidders or any other person. The DOTC, its
employees and advisors are not bound by any of the contents of the Bidding Documents or
Information Documents. The purpose of the Bidding Documents and Information
Documents is to provide interested parties with information that may be useful to them in
making their Bids pursuant to the Bidding Documents. The Bidding Documents and
Information Documents include statements that reflect various assumptions and
assessments arrived at by the DOTC in relation to the Project. Such assumptions,
assessments and statements do not purport to contain all the information that each Bidder
may require. The Bidding Documents and Information Documents may not be appropriate
for all persons, and it is not possible for the DOTC, its employees or advisors to consider the
investment objectives, financial situation and particular needs of each party who reads or
uses the Bidding Documents and Information Documents. The assumptions, assessments,
statements and information contained in the Bidding Documents, Information Documents
and associated documents may not be complete, adequate, accurate or correct. Each Bidder
should therefore, conduct its own investigations and analysis and should check the
completeness, adequacy, accuracy, correctness, and reliability of the assumptions,
assessments, statements and information contained in the Bidding Documents and
Information Documents and obtain independent advice from appropriate sources.
Information provided in the Bidding Documents and the Information Documents is on a
wide range of matters, some of which may depend upon interpretation of law. The
information given is not intended to be an exhaustive account of statutory requirements
and should not be regarded as a complete or authoritative statement of law. The DOTC
accepts no responsibility for the accuracy or otherwise for any interpretation or opinion on
law expressed herein.
Project Information Memorandum
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The DOTC, its employees and advisors make no undertaking, assurance, representation or
warranty and shall have no liability to any person, including any Bidder, under any law,
statute, rules or regulations, principles of restitution or unjust enrichment or otherwise, for
any loss, damages, cost or expense that may arise from or be incurred or suffered on
account of anything contained in the Bidding Documents, Information Documents or other
information provided to Bidders, including the completeness, adequacy, accuracy,
correctness, and reliability of the Bidding Documents, Information Documents and any
assessment, assumption, statement or information contained therein or deemed to form
part of the Bidding Documents, Information Documents or arising in any way from
participation in the Bidding Process.
The DOTC also accepts no liability of any nature, whether resulting from negligence or
howsoever caused, arising from reliance of any Bidder upon the statements contained in the
Bidding Documents or Information Documents.
The DOTC may, in its absolute discretion, but without being under any obligation to do so,
amend, update, or supplement the information, assessments or assumptions contained in
the Bidding Documents or Information Documents. However, the DOTC, its employees and
advisors shall not be liable to any Bidder (including the Winning Bidder) in respect of any
failure to (i) disclose or make available any information, documents or data; (ii) amend,
update, or supplement the Bidding Documents or Information Documents; or (iii) provide
any information regarding any inaccuracy, error, omission, defect or inadequacy in the
Bidding Documents or Information Documents.
The issuance of the Bidding Documents or Information Documents does not imply that the
DOTC is bound to select a Bidder or to appoint the selected Bidder, as the case may be, for
the Project, and the DOTC reserves the right to reject all or any of the Bidders or Bids
without assigning any reason whatsoever.
Project Information Memorandum
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CONTENTS
1 Project Background .............................................................................................................. 6
2 Project Site Overview ........................................................................................................... 8
2.1 About Metro Manila ..................................................................................................................................................... 8
2.2 About the Project Site .............................................................................................................................................. 11
2.2.1 Southwest ITS Project Site ........................................................................................................................................... 12
3 Overview of the Existing Demand..................................................................................13
3.1 Traffic at the ITS Terminal (Estimated for Year 2012) ............................................................................. 13
4 Scope and Structure of the PPP Project .......................................................................19
4.1 Project Description ................................................................................................................................................... 19
4.2 Legal Framework for the Southwest ITS Project ......................................................................................... 20
4.2.1 Procurement Process ...................................................................................................................................................... 20
4.3 Proposed Contractual Arrangement ................................................................................................................. 21
4.3.1 PPP Structure .................................................................................................................................................................... 21
4.3.2 Implementing Agency .................................................................................................................................................... 21
4.3.3 Concession Period ............................................................................................................................................................ 21
4.3.4 Incentives............................................................................................................................................................................. 22
4.3.5 Project Site & Access Road ........................................................................................................................................... 23
4.3.6 Concessionaire Revenue ................................................................................................................................................ 23
Project Information Memorandum
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LIST OF ABBREVIATIONS
AADT Average Annual Daily Traffic
AO Administrative Order
BOI Board of Investments
BOT Build-Operate-and-Transfer
BTO Build-Transfer-Operate
BSP Bangko Sentral ng Pilipinas or Central Bank of the Philippines
CPC Certificate of Public Convenience
DILG Department of Interior and Local Government
DMB Diosdado Macapagal Boulevard
DOTC Department of Transportation and Communications
DPWH Department of Public Works and Highways
EDSA Epifanio de los Santos Avenue
EO Executive Order
FTI Food Terminal Inc.
GDP Gross Domestic Product
IRR Internal Rate of Return
ITB Instruction to Bidders
ITS Integrated Transport System
LGU Local Government Unit
LRT Light Rail Transit
LTFRB Land Transportation Franchising and Regulatory Board
LTO Land Transportation Office
MMDA Metro Manila Development Authority
NCR National Capital Region
NEDA National Economic and Development Authority
PBAC Pre-Qualification Bids and Awards Committee
PDP Philippine Development Plan
PIP Public Investment Program
PNR Philippine National Railway
PPP Public Private Partnership
PRA Philippine Reclamation Authority
PUV Public Utility Vehicle
ROW Right of Way
SLEX South Luzon Expressway
Project Information Memorandum
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1 PROJECT BACKGROUND
The 2011-2016 PDP prioritized the creation of an integrated and multimodal transport and
logistics system under a PPP framework as the centerpiece strategy for infrastructure
development. The PDP identifies the need to fast-track the establishment of an efficient,
reliable, seamless and integrated mass transportation network/system to spur the country’s
economic growth.
On 21 February 2012, the President issued EO No. 67 (EO 67) entitled: “Providing for the
Establishment of the Integrated Transport System (ITS)”, which is an integrated and
multimodal transport and logistics system (“ITS Project”).
Section 3 of EO 67 directs the DOTC to fast-track the implementation of the ITS
Project with the cooperation of all concerned agencies. The ITS Project must also be
included by NEDA in the 2011-2016 PIP.
Section 4 of EO 67 states that the ITS Project shall be structured under any of the
schemes allowed under the Philippine Build-Operate-and-Transfer (BOT) Law.
Section 5 of EO 67 designated the DOTC as the lead agency in planning,
implementing and monitoring of the ITS Project. DOTC is empowered to formulate
and recommend national policies and guidelines for the preparation and
implementation of integrated and comprehensive transportation and
communication systems at the national, regional and local levels.
Section 6 of EO 67 provides for the creation of an Inter-Agency Committee which
shall be an advisory body and consultative forum in matters relating to the planning,
implementation and monitoring of the ITS Project. The Inter-Agency Committee,
composed of members from DOTC, MMDA, DPWH, DILG, NEDA, LTFRB and LTO, shall
provide for a mechanism for coordination to fast-track the implementation of the ITS
Project.
Section 6 and 7 of EO 67 mandates the Inter-Agency Committee to perform the
following principal functions of providing technical advice and recommendations to
DOTC:
- Overseeing the implementation of the ITS Project;
- Regulating the terminal fees that may be charged for the use of the transport
terminals and other facilities established under the ITS Project;
- Issuing the implementing rules and regulations, procedures, guidelines and
priority actions necessary to carry out the provisions of EO 67;
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- Performing other functions as may be necessary to implement EO 67 and as may
be directed by the President.
On 16 July 2013, the President issued AO No. 40 (AO 40) entitled: “Providing for the
Establishment of the Interim Transport Terminals in preparation of the Integrated Transport
System under EO NO. 67 (s. 2012)”. Section 6 of the AO states that the operation of interim
transport terminal shall be ceased within sixty (60) days from the date that DOTC has
determined that the permanent ITS terminals are fully operational.
The ITS Project aims to maximize road usage by reducing vehicle volume and improving
traffic flow along Metro Manila’s major thoroughfares, particularly EDSA. The ITS Project
aims to provide for the establishment of integrated transport terminals to provide effective
interconnections between different transport modes and services thereby ensuring efficient
and seamless travel for the commuting public.
The ITS Project envisages the establishment of three (3) mass transportation intermodal
terminals at the outskirts of Metro Manila – one (1) in the north (of EDSA) serving
passengers to and from northern Luzon, one (1) in the south serving passengers to and from
the Laguna/Batangas side, and one (1) in the southwest serving passengers to and from the
Cavite side. The terminals will connect passengers from the province to other urban
transport systems such as the LRT/PNR, city buses, taxis, and other PUVs serving inner
Metro Manila. The terminals will include passenger terminal buildings, emergency
maintenance areas (i.e. for minor repairs of buses and other vehicles), arrival and departure
bays, ticketing facilities, park-ride facilities, and transfer facilities such as shuttles to provide
seamless transport connections.
The DOTC invites bidders to submit Bids to finance, design, construct, operate and maintain
the Southwest ITS Project (or the ‘Project’).
Project Information Memorandum
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Figure 2.1: Political Map of Metro Manila
2 PROJECT SITE OVERVIEW
2.1 About Metro Manila
Metropolitan Manila, the National
Capital Region (NCR), more popularly
known as Metro Manila, is the
metropolitan region encompassing the
City of Manila and its surrounding
areas in the Philippines. It is composed
of 16 cities, namely Manila, Caloocan,
Las Piñas, Makati, Malabon,
Mandaluyong, Marikina, Muntinlupa,
Navotas, Pasay, Pasig, Parañaque,
Quezon City, San Juan, Taguig, and
Valenzuela, and the Municipality of
Pateros.
The region is the political, economic,
social, cultural, and educational center
of the Philippines. As proclaimed by
Presidential Decree No. 940, Metro
Manila as a whole is the Philippines'
seat of government while the City of
Manila is the capital. The largest city in
the metropolis is Quezon City, while
the largest business district is the
Makati Central Business District.
Metro Manila is the most populous of
the twelve defined metropolitan areas
in the Philippines and the 11th most
populous in the world. The region accounts for 37% of the Philippine gross domestic product
(GDP), 13% of employment, and contributes 41% of the country’s total tax collection. As of
the 2010 census, it had a population of 11,855,975 and holds the biggest concentration of
urban population among the major cities in the Philippines. The metropolis has a total area
of 63,600 hectares comprising about 0.2 percent of the total Philippine land area. The status
of Metro Manila’s land use is shown in Table 2.1.
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Table 2.1: Land Use Pattern in Metro Manila
Land Use Area (Hectares) % Share
Residential 24,530 38.57
Commercial 2,446 3.85
Industrial 3,129 4.92
Institutional 3,537 5.56
Utilities 665 1.05
Open Space/Vacant Areas 8,623 13.56
Agricultural 5,630 8.85
Fishponds 1,280 2.01
Parks/Cemetery 6,162 9.69
Race Track/Golf Course 778 1.22
Water Surface 1,022 1.61
Mountains/Hills 5,798 9.12
Total 63,600 100
In Metro Manila, the rapid growth in population and, as a consequence, motorization, have
caused many urban transportation and environmental problems. The resulting urban
pattern is one where an increasing number of people live at the fringes of the metropolitan
area but still need to travel to the city centers to work or study.
The urban transport sector in Metro Manila comprises primarily of an urban road network
and public transport system. EDSA is Metro Manila’s main thoroughfare stretching around
24 kilometers and connecting the north and south of the metropolis. Its average annual
daily traffic (AADT) is over 156,000 vehicles. Table 2.2 presents the past data on the number
of franchises and authorized units of road based public transportation in Metro Manila.
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Table 2.2: Public Utility Vehicles in Metro Manila
Type of Service
As of December 2009
As of December 2010
As of December 2011
As of December 2012
As of October 2013
No. of Franchise
No. of Units
No. of Franchise
No. of Units
No. of Franchise
No. of Units
No. of Franchise
No. of Units
No. of Franchise
No. of Units
Public Utility Buses
City Buses 385 5,299 522 7,161 522 7,161 391 5,392 391 5,392
Inter-Regional Buses 1,515 10,238 1,215 8,872 1,215 8,872 1,212 8,561 1,212 8,561
Mini Buses
City Buses 2 30 2 30 2 30 - - - -
Inter-Regional Buses 50 103 50 103 50 103 32 62 32 62
Public Utility Jeepneys 57,505 60,564 57,326 59,938 57,537 60,149 57,931 60,876 57,935 60,880
Taxi 17,775 22,386 15,921 21,798 15,924 21,801 17,487 24,314 17,488 24,315
Vehicles for Hire 3,180 3,397 5,104 5,375 5,227 5,498 9,255 10,185 9,255 10,185
Shuttle Transport 1,289 2,291 1,155 2,197 1,156 2,198 1,179 2,332 1,179 2,332
Project Information Memorandum
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Figure 2.2: Location of the Project Site within Metro Manila
2.2 About the Project Site
The identified site for the proposed Project is located in the southwest of Metro Manila at
PRA property beside Asia world/Uniwide along Coastal Road, Paranaque City. Figure 2.2
illustrates the location of the Project site within Metro Manila.
SOUTHWEST ITS PROJECT
Project Information Memorandum
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2.2.1 Southwest ITS Project Site
Location of the
Project Site
The Project site is located in the southwestern part of Metro Manila and it
lies near Manila-Cavite Expressway which connects Metro Manila to the
province of Cavite.
Co-ordinates Latitude - 14°30'44.04"N; Longitude - 120°59'31.71"E
Site Area 2.9 Hectares
Access The site is accessible from the Manila-Cavite Expressway (R1 Expressway)
and there are plans to provide access to the site from Diosdado Macapagal
Boulevard (DMB) and the future LRT-1 extension.
The following plan illustrates the structure of the Project site and also shows the
developments in the context areas.
Figure 2.3: Southwest ITS Project Site Location of LRT Station is indicative.
TO CAVITE
TO MANILA
R-1 EXPRESSWAY
LOCATION OF PROPOSED LRT STATION
PROJECT SITE(2.9 HECTARE)
DIOSDADO MACAPAGAL BOULEVARD
Project Information Memorandum
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3 OVERVIEW OF THE EXISTING DEMAND
Table 3.1 demonstrates the existing situation of the provincial traffic under various
parameters.
Table 3.1: Overview of the Provincial Bus and Passenger Traffic at the ITS Terminal (Estimated at Year 2012)
Parameters (Year 2012) Arrival Departure
Provincial bus volume per day 1,060 949
Provincial Passenger volume per day 48,527 44,828
3.1 Traffic at the ITS Terminal (Estimated for Year 2012)
Table 3.2 presents the hourly traffic of provincial buses and the provincial passengers on a
15-minute interval basis.
Table 3.2: Hourly Volume of Provincial Bus & Passenger Traffic at 15 Min. Interval (Estimated for Year-2012)
Time Period
Direction 1 (Arrivals)
North bound buses via Manila-cavite expressway
Direction 2 (Departures)
South bound buses via manila-cavite expressway
Number of buses
Average passenger
occupancy/bus
Number of buses
Average passenger
occupancy/bus
01:00 - 02:00 3 20 7 44
01:15 - 02:15 2 13 6 42
01:30 - 02:30 1 13 5 40
01:45 - 02:45 3 22 5 42
02:00 - 03:00 3 33 4 55
02:15 - 03:15 8 25 4 46
02:30 - 03:30 12 29 5 42
02:45 - 03:45 12 31 4 38
03:00 - 04:00 15 29 5 33
03:15 - 04:15 15 39 7 44
03:30 - 04:30 17 43 9 46
03:45 - 04:45 29 40 16 42
04:00 - 05:00 39 39 19 44
04:15 - 05:15 50 37 30 42
04:30 - 05:30 62 37 41 43
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Time Period
Direction 1 (Arrivals)
North bound buses via Manila-cavite expressway
Direction 2 (Departures)
South bound buses via manila-cavite expressway
Number of buses
Average passenger
occupancy/bus
Number of buses
Average passenger
occupancy/bus
04:45 - 05:45 67 41 45 42
05:00 - 06:00 66 46 53 43
05:15 - 06:15 63 51 57 40
05:30 - 06:30 64 58 53 39
05:45 - 06:45 61 60 58 41
06:00 - 07:00 66 59 62 39
06:15 - 07:15 63 60 59 43
06:30 - 07:30 54 59 62 41
06:45 - 07:45 54 61 50 42
07:00 - 08:00 47 62 45 44
07:15 - 08:15 56 61 47 42
07:30 - 08:30 63 60 40 45
07:45 - 08:45 65 58 51 41
08:00 - 09:00 72 58 52 38
08:15 - 09:15 62 58 42 36
08:30 - 09:30 54 58 45 35
08:45 - 09:45 51 56 36 37
09:00 - 10:00 46 55 36 38
09:15 - 10:15 55 52 40 38
09:30 - 10:30 58 51 41 37
09:45 - 10:45 60 49 45 36
10:00 - 11:00 53 48 43 35
10:15 - 11:15 51 48 50 33
10:30 - 11:30 49 48 58 35
10:45 - 11:45 48 51 65 33
11:00 - 12:00 54 52 66 34
11:15 - 12:15 51 51 59 37
11:30 - 12:30 50 50 51 38
11:45 - 12:45 53 49 42 41
12:00 - 13:00 50 48 35 43
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Time Period
Direction 1 (Arrivals)
North bound buses via Manila-cavite expressway
Direction 2 (Departures)
South bound buses via manila-cavite expressway
Number of buses
Average passenger
occupancy/bus
Number of buses
Average passenger
occupancy/bus
12:15 - 13:15 49 47 36 39
12:30 - 13:30 50 48 48 39
12:45 - 13:45 45 47 52 40
13:00 - 14:00 53 48 68 42
13:15 - 14:15 52 53 67 45
13:30 - 14:30 61 52 61 47
13:45 - 14:45 66 54 61 47
14:00 - 15:00 64 54 53 49
14:15 - 15:15 68 52 56 49
14:30 - 15:30 69 50 48 50
14:45 - 15:45 72 50 49 50
15:00 - 16:00 72 49 46 51
15:15 - 16:15 73 49 48 53
15:30 - 16:30 72 47 50 52
15:45 - 16:45 63 46 51 56
16:00 - 17:00 64 47 55 56
16:15 - 17:15 56 48 53 57
16:30 - 17:30 50 51 58 58
16:45 - 17:45 54 50 62 57
17:00 - 18:00 47 48 60 58
17:15 - 18:15 57 45 55 58
17:30 - 18:30 57 41 43 59
17:45 - 18:45 59 34 35 60
18:00 - 19:00 67 31 29 62
18:15 - 19:15 58 26 29 61
18:30 - 19:30 73 27 33 62
18:45 - 19:45 64 27 33 62
19:00 - 20:00 58 29 38 61
19:15 - 20:15 73 33 39 62
19:30 - 20:30 50 36 41 61
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Time Period
Direction 1 (Arrivals)
North bound buses via Manila-cavite expressway
Direction 2 (Departures)
South bound buses via manila-cavite expressway
Number of buses
Average passenger
occupancy/bus
Number of buses
Average passenger
occupancy/bus
19:45 - 20:45 72 32 41 62
20:00 - 21:00 72 31 45 62
20:15 - 21:15 56 27 54 59
20:30 - 21:30 51 25 57 59
20:45 - 21:45 25 35 57 58
21:00 - 22:00 18 44 55 58
21:15 - 22:15 14 53 43 60
21:30 - 22:30 15 52 39 59
21:45 - 22:45 15 46 37 60
22:00 - 23:00 13 45 35 57
22:15 - 23:15 14 42 38 57
22:30 - 23:30 17 40 35 56
22:45 - 23:45 13 39 32 56
23:00 - 24:00 13 33 24 57
23:15 - 00:15 10 32 19 58
23:30 - 00:30 7 30 16 59
23:45 - 00:45 6 28 15 55
24:00 - 00:00 5 27 14 54
00:15 - 01:15 4 29 11 51
00:30 - 01:30 4 26 10 51
00:45 - 01:45 3 23 7 52
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Figure 3.1: Hourly Volume of Buses at 15 Min. Interval (Estimated at Year 2012), North Bound Direction via Manila-Cavite Expressway
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Figure 3.2: Hourly Volume of Buses at 15 Min. Interval (Estimated at Year 2012), South Bound Direction via Manila-Cavite Expressway
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4 SCOPE AND STRUCTURE OF THE PPP PROJECT
4.1 Project Description
The Project to be undertaken by the Concessionaire consists of:
a) the design, engineering, and construction of the ITS Terminal, within 12 months from
the start of construction;
b) from its completion until the end of the concession period, the operation and
maintenance of the ITS Terminal in accordance with specified performance
standards;
c) the collection of pre-approved tolls from users of the ITS Terminal;
d) the financing of the above activities;
e) the carrying out of the Commercial Business (at the Concessionaire's option) and
collection of any revenues generated from the same; and
f) turn-over of the Project assets to the DOTC at the end of the Concession Period,
all in accordance with the Concession Agreement.
The accompanying work to be effected by the DOTC or for which the DOTC is responsible
consists of:
a) the provision or acquisition of the Project site;
b) the design, engineering and construction of the access road leading to the Project
site;
c) the financing of the above activities;
d) the amendment of CPCs 1 of affected units of bus operators to ensure the
compulsory use of the ITS Terminal; and
e) the implementation of the necessary regulatory measures or changes to ensure the
successful implementation of the Project, including such regulations and institutional
support as may be necessary to implement the timetable/departure schedule,
all in accordance with the Concession Agreement.
1 “CPC” means the certificate issued by the LTFRB authorizing the operation of public land transportation
services provided by motorized vehicles.
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4.2 Legal Framework for the Southwest ITS Project
The bidding and implementation of the Project shall be conducted in accordance with
Republic Act No. 6957, as amended by Republic Act No. 7718 ("BOT Law”), and its 2012
Revised Implementing Rules and Regulations (“2012 Revised IRR”). The BOT Law is the
primary law governing PPP in the Philippines and provides the legal framework for
government agencies to enter into PPP contracts with qualified private sector proponents
for the implementation of government infrastructure and development projects.
4.2.1 Procurement Process
The Southwest ITS Project will be procured by a single-stage public bidding in accordance
with the rules and procedures for public bidding set out in the BOT Law and the 2012
Revised IRR.
The bidding will follow the solicited mode under the 2012 Revised IRR. Under the solicited
mode, prospective bidders are qualified based on minimum legal, technical and financial
eligibility requirements determined by the PBAC to be formed by the implementing agency.
The qualification documents and the bid of each prospective bidder will be evaluated based
on their completeness, adequacy and compliance with the prescribed evaluation criteria.
The general procedure for the procurement and bidding under the single-stage process will
be as follows:
a) Prospective bidders will be invited by the PBAC to submit their qualification
documents and bid proposals. The prospective bidders shall submit these in three (3)
envelopes, containing the qualification documents, the technical proposal and the
financial proposal.
b) Prior to the bidding, the PBAC will conduct a pre-bid conference to which all
prospective bidders will be invited. During the pre-bid conference, prospective
bidders may seek clarification regarding any requirements and/or terms and
conditions of the bidding documents.
c) On the deadline stipulated in the Instructions to Bidders, prospective bidders will be
asked to submit their bids consisting of their qualification documents, technical and
financial proposals, a bid security and other supporting documents.
d) After reviewing the qualification documents, the PBAC will determine which of the
prospective bidders fulfill the prescribed qualification requirements and inform all
such qualified bidders. Only the bid proposals of qualified bidders will be evaluated
by the PBAC. The PBAC shall also inform all disqualified bidders in writing of their
failure to qualify and the reasons for their disqualification from the bidding.
e) The technical proposals of qualified bidders will be opened and evaluated by the
PBAC on a pass/fail basis. Qualified bidders will be informed as to whether their
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technical proposals passed the evaluation. The financial proposals of qualified
bidders who fail to pass the technical evaluation shall be returned unopened
together with the reasons for their disqualification from the bidding.
f) The financial proposals of qualified bidders which pass the technical evaluation will
be opened and evaluated by the PBAC based on the most advantageous bid for the
government. The specifics of the criteria for the evaluation of the financial proposals
are described in the Instructions to Bidders.
g) The qualified bidder which pass the technical evaluation and with the best financial
proposal shall be considered for awarding the Project, subject to its compliance with
requirements prescribed in the ITB.
4.3 Proposed Contractual Arrangement
The sections below provide a brief outline of certain significant aspects of the Project
structure. The details are provided in the draft Concession Agreement.
4.3.1 PPP Structure
The Project will be implemented using a BTO arrangement, which is a contractual
arrangement whereby the implementing agency (DOTC) contracts out the construction of
an infrastructure facility (ITS Terminal) to a private entity (Concessionaire) such that the
private entity builds the facility on a turnkey basis, assuming cost overruns, delays and
specified performance risks. Once the facility is commissioned satisfactorily, title over the
facility is transferred to the implementing agency. The private entity, however, operates the
facility on behalf of the implementing agency in accordance with specified performance
standards and specifications set out in the PPP contract.
4.3.2 Implementing Agency
The implementing agency for the Project is the DOTC. The BOT Law provides the DOTC with
a valid and tested legal framework to undertake the Project. The law authorizes
infrastructure agencies such as the DOTC to enter into BOT contracts with qualified private
sector proponents for the implementation of public infrastructure or development projects.
4.3.3 Concession Period
The PPP concession shall be for a period of 35 years.
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4.3.4 Incentives
In accordance with the BOT Law, project proponents may avail of the investment incentives
under the Omnibus Investments Code as described below. The DOTC, however, does not
guarantee that the project proponent will be granted such incentives.
4.3.4.1 Incentives under Omnibus Investments Code
Project Proponents for PPP Projects are entitled to fiscal and non-fiscal incentives under the
Omnibus Investment Code of 1987, upon registration with the BOI if:
a) the project cost exceeds 1 Billion Pesos; or
b) the project activity or sector is included in the current Investment Priorities Plan of
the BOI, even if the project cost does not exceed 1 Billion Pesos.
Every annual Investment Priorities Plan contain General and Specific Guidelines that provide
certain rules for the approval of the BOI registration of any enterprise and the entitlement
to incentives of such registrant to implement the general parameters indicated in the
Omnibus Investment Code.
One key incentive provided under the Omnibus Investments Code is the exemption from
payment of income taxes upon the scheduled start of commercial operations. Such tax
exemption may be for a period of six (6) years, for pioneer enterprises, or four (4) years for
non-pioneer enterprises from the start of commercial operations, as may be determined
under the Omnibus Investments Code.
The income tax holiday may be extended for another year, at the discretion of the BOI, as
long as the total exemption period does not exceed eight years, in each of the following
cases:
a) compliance with the BOI’s prescribed ratio of capital equipment to the number of
workers for the project; or
b) utilization of indigenous raw materials at rates set by the BOI; or
c) net foreign exchange savings or earnings amount to at least US$500,000 annually
during the first three years of operation.
Other additional fiscal and non-fiscal incentives may also be available, such as:
a) simplification of customs procedures;
b) unrestricted use of consigned equipment;
c) tax and duty exemptions on imported spare parts used on consigned equipment;
d) employment of foreign nationals in supervisory, technical or advisory positions for
five (5) years from the date of registration with the BOI, extendible for limited
periods at the discretion of the BOI; and
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e) the positions of President, General Manager and Treasurer of foreign-owned
registered enterprises (majority foreign-owned) or their equivalent shall not be
subject to the 5-year limitation.
4.3.4.2 Incentives Extended by Local Governments
An LGU may, in its discretion, provide tax incentives, exemptions or relief to a PPP project
proponent for projects implemented within its jurisdiction. The precise incentives granted,
however, will vary with each LGU.
4.3.4.3 Foreign Exchange
Foreign exchange may be traded freely and with few restrictions, brought into or sent out of
the country by foreign corporations operating in the Philippines. Foreign
investments/profits can also be repatriated in foreign exchange. Repatriation of foreign
exchange sourced from the banking system will need prior BSP registration of inward
remittance of the underlying investment.
4.3.5 Project Site & Access Road
The DOTC shall provide, at no cost to the project proponent, all the right-of-way and other
possessory rights over the Project site as may be necessary for the implementation of the
Project. In addition, the DOTC shall ensure the construction, operation and maintenance of
the access road leading to the Project site.
4.3.6 Concessionaire Revenue
As a form of repayment for financing, constructing, operating and maintaining the
Southwest ITS Project, the Concessionaire shall be authorized to charge and collect
prescribed tolls from the various modes/vehicles using the ITS Terminal, during the
Concession Period. The Concession Agreement shall set out the tolls that may be charged by
the project proponent for each year of the Concession Period. In addition, the
Concessionaire shall be entitled to construct commercial assets or to carry out commercial
businesses on the Project site and to collect and retain the revenues from these commercial
business undertakings for so long as such construction and businesses do not interfere with
the Project. Such commercial assets shall not include any residential property. For this
purpose, the development of hotels and service apartments/hotel apartments shall not be
deemed to constitute residential property.