PROCUREMENT PROCESS

  1. Procurement Planning – procurement planning and budgeting linkage all procurement should be within the approved budget of the procuring entity and should be meticulously and judiciously planned by the procuring entity concerned. Only those considered crucial to the efficient disshare of governmental functions shall be included in the annual procurement plan (APP)

The end user units of the procuring entity shall prepare their respective project procurement management plan (PPMP) for their different programs, activities, and projects (PAPs).

After the budget proposal has been approved by the procuring entity and/or other oversight bodies, the procuring entity’s budget office shall furnish a copy of the procuring entity’s budget proposal as well as the corresponding PPMPS to the bac secretariat for its review and consolidation into the proposed app. The proposed app shall be consistent with the procuring entity’s budget proposal.

  1. Competitive Bidding – all procurement shall be done through competitive bidding, except for alternative methods of procurement.
  1. PREPARATION OF BIDDING DOCUMENTS:
  1. Form and Contents of Bidding Documents – the bidding documents shall be prepared by the procuring entity following the standards firms and manuals prescribed by the GPPB.
  2. Reference to Brand Names. – specification for the procurement of goods shall be based on relevant characteristics and/or performance requirements. Reference to brand names shall not be allowed.
  3. Access to Information. – in all stages of the preparation of the bidding documents. The procuring entity shall ensure equal access to information.
  • INVITATION TO BID:
  1. Pre-procurement Conference. – prior to the issuance of the invitation to bid, the BAC is mandated to hold a pre-procurement conference on each and every procurement, except those contracts below a certain level or amount specified in the irr, in which case, the holding of the same is optional.
  • Advertising and Contents of the Invitation to Bid. – in line with the principle of transparency and competitiveness, all invitation to bid for contracts under competitive bidding shall be advertised by the procuring entity in such manner and for such length of time as maybe necessary under the widest circumstances, in order to ensure the possible dissemination thereof, such as, but not limited to, posting in the procuring entity’s premises, g-eps and the website of the procuring entity, if available.
  • Pre-bid Conference. – at least one pre-bid conference shall be conducted for each procurement, unless otherwise provided in the IRR, subject to the approval of the BAC, a pre-bid conference may also be conducted upon written request of any prospective bidder.
  1. RECEIPT AND OPENING OF BIDS
  1. Eligibility Requirements for the Procurement of Goods and Infrastructure Projects. – the bac or under special circumstances specified in the IRR, its duly designated organic office shall determine the eligibility of prospective bidders for the procurement of goods and infrastructure projects, based on the bidders’ compliance with the eligibility requirements within the period set forth in the invitation to bid. The eligibility requirements shall provide for fair and equal access to all prospective bidders. The documents submitted in satisfaction of the eligibility requirements shall be made under oath by the prospective bidder or by his duly authorized representative certifying to the correctness of the statements made and the completeness and authenticity of the documents submitted.

A prospective bidder may be allowed to submit his eligibility requirements electronically. However, said bidder shall later on certify under oath as to correctness of the statements made and the completeness and authenticity of the documents submitted.

  • Eligibility Requirements and Short Listing for Consulting Services. – The eligibility of prospective bidders for the Procurement of Consulting Services shall be determined by their compliance with the eligibility requirements prescribed for the Competitive Bidding concerned, within the period stated in the Invitation to bid. The eligibility requirements shall provide for fair and equal access to all prospective bidders. The prospective bidder shall certify under oath as to the correctness of the statements made, and the completeness and authenticity of the documents submitted.

A prospective Bidder may be allowed to submit his eligibility requirements electronically. However, said bidder shall later on certify under oath as to correctness of the statements made and the completeness and authenticity of the documents submitted.

The eligible prospective bidders shall then be evaluated using numerical ratings on the basis of the short-listing requirements prescribed for the Competitive Bidding concerned, within the period stated in the Invitation to bid to determine the short list of bidders who shall allowed to submit their respective bids.

  • Submission and Receipt of Bids. – A bid shall have two (2) components, namely the technical and financial components which should be in separate sealed envelopes, and which shall be submitted simultaneously. The bids shall be received by the BAC on such date, time and place specified in the invitation to bid. The deadline for the receipt of bids shall be fixed by the BAC, giving it sufficient time to complete the bidding process and giving the prospective bidders sufficient time to study and prepare their bids. The deadline shall also consider the urgency of the procurement involved.

Bids submitted after the deadline shall not be accepted.

Notwithstanding the previous of this section and section 26 of this Act, the GPPB may prescribe innovative procedures for the submission, receipt and opening of bids through the G-EPS.

  • Modification and Withdrawal of Bids. – A bidder may modify his bid, provided that this is done before the deadline for the receipt of bids. The modification shall be submitted in sealed envelope duly identified as a modification of the original bid and stamped received by the BAC.

A bidder may, through a letter, withdraw his bid or express his intention not to participate in the bidding before the deadline for the receipt of bids. In such case, he shall no longer be allowed to submit another Bid for the same contract either directly or indirectly.

  • Bid Security. – All bids shall be accompanied by a Bid security, which shall serve as a guarantee that, after receipt of the Notice of Award, the winning bidder shall enter into contract with the procuring entity within the stipulated time and furnish the required performance security. The specific amount and allowable forms of the Bid security shall be prescribed in the IRR.
  • Bid Validity. – Bids and bid securities shall be valid for such reasonable period of the indicated in the Bidding Documents. The duration for each undertaking shall take into account the time involved in the process of Bid evaluation and award of contract.
  • Bid Opening. – the BAC shall publicly open all bids at the time, date and place specified in the bidding documents. The minutes of the bid opening shall be made available to the public upon written request and payment of a specified fee.

IV. BID EVALUATION

  1. Preliminary Examination of Bids. – Prior to bid evaluation, the BAC shall examine first the technical components of the bids using “pass/fail” criteria to determine whether all required documents are present. Only bids that are determined to contain all the bid requirements of the technical component shall be considered for opening and evaluation of their financial component.
  2. Ceiling for Bid Prices. – The ABC shall be the upper limit or ceiling for the prices. Bid prices that exceed this ceiling shall be disqualified outright from further participating in the bidding. There shall be no lower limit to the amount of the award.
  3. Bid for the Procurement of Goods and Infrastructure Projects. – For the Procurement of Goods and Infrastructure Projects, the BAC shall evaluate the financial components of the bids. The bids that passed the preliminary examination shall be ranked from lowest to highest in terms of their corresponding calculated prices. The bid with the lowest calculated price shall be referred to as the Lowest Calculated Bid.”
  • Bid Evaluation of Short-Listed Bidders for Consulting Services. – For the Procurement of Consulting Services, the Bids of the short-listed bidders shall be evaluated and ranked using numerical ratings in accordance with the evaluation criteria stated in the bidding Documents, which shall include factors such as, but not limited to, experience, performance, quality of personnel, price and methodology. The Bids shall be ranked from highest to lowest in terms of their corresponding calculated ratings. The Bid with the highest calculated rating shall be the “Highest Rated Bid.” After approval by the Head of the Procuring Entity of the Highest Rated Bid, the BAC shall invite the bidder concerned for negotiation and/or clarification on the following items: financial proposal submitted by the bidder, terms of reference, scope of services, methodology and work program, personnel to be assigned to the job, services/facilities/data to be provided by the Procuring Entity concerned, and provisions of the contract. When negotiations with the first in rank bidder fails, the financial proposal of the second rank bidder shall be opened for negotiations: Provided, that the amount indicated in the financial envelope shall be made as the basis for negotiations and the total contracts amount shall not exceed the amount indicated in the envelope and the ABC. Whenever necessary, the same process shall be repeated until the bid is awarded to the winning bidder.
  • POST- QUALIFICATION
  1. Objective and Process of Post-Qualification. – Post-qualification is the stage where the bidder with the Lowest Calculated Bid, in the case of Goods and Infrastructure Projects, or the Highest Rated Bid, in the case of Consulting Services, undergoes verification and validation whether he has passed all the requirements and conditions as specified in the Bidding Documents.

If the bidder with the Lowest Calculated Bid or Highest Rated Bid passes all the criteria for post-qualification, his bid shall be considered the “Lowest Calculated Responsive Bid”, in the case of Goods and Infrastructure or the “Highest Rated Bid”, in the case of consulting Services. However, if a bidder fails to meet any of the requirements or conditions, he shall be “post-disqualified” and the BAC shall conduct the post-qualification on the bidder with the second Lowest Calculated Bid or Highest Rated Bid. If the bidder with the second Lowest Calculated Bid or Highest Rated Bid is post-disqualified, the same procedure shall be repeated until the Lowest Calculated Responsive Bid or Highest Rated Responsive Bid is finally determined.

In all cases, the contracts shall be awarded only to the bidder with the Lowest Calculated Responsive Bid or Highest Rated Responsive Bid.

  • Failure of Bidding. – There shall be failure of bidding if:
  • No bids are received;
  • No bid qualifies as the Lowest Calculated Responsive Bid or Highest Rated Responsive Bid; or,
  • Whenever the bidder with the highest rated/lowest calculated responsive bid refuses, without justifiable cause to accept the award of contract, as the case may be.

Under any of the above instances, the contract shall be re-advertised and re-bid. The BAC shall observe the same process and set the new periods according to the same rules followed during the first bidding. After the second failed bidding, however, the BAC may resort to negotiated procurement as provided for in Section 53 of this Act.

  • Single Calculated/Rated and Responsive Bid Submission. – A single calculated/rated and responsive bid shall be considered for award if it falls under any of the following circumstances:
  1. If after advertisement, only one prospective bidder submits a letter of intent and/or applies for eligibility check, and meets the eligibility requirements or criteria, after which it submits a bid, which is found to be responsive to the bidding requirements;
  2. If after the advertisement, more than one prospective bidder applies for eligibility requirements or criteria, after which it submits a bis which is found to be responsive to the bidding requirements; or
  3. If 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.

In all instances, the Procuring Entity shall ensure that the ABC reflects the advantageous prevailing price for the Government

  • AWARD, IMPLEMENT AND TERMINATION OF THE CONTRACT
  1. Notice and Execution of Award. – Within a period not exceeding fifteen (15) calendar days from the determination and declaration by the BAC of the Lowest Calculated Responsive Bid or Highest Responsive Bid, and the recommendation of the award, the head of the Procuring Entity or his duly authorized representative shall approve or disapprove the said recommendation. In case of approval, the Head of the Procuring Entity or his duly authorized representative shall immediately issue the Notice of Award to the bidder with the Lowest Calculated Responsive Bid or Highest Rated Responsive Bid.

Within ten (10) calendar days from receipt of the Notice of Award, the winning bidder shall formally enter into contract with the Procuring Entity, when further approval of higher authority is required, the approving authority for the contract shall be given a maximum of twenty (20) calendar days to approve or disapprove it.

In the case of Government-owned and/or controlled corporations, the concerned board shall take action on the said recommendation within thirty (30) calendar days from receipt thereof.

The Procuring Entity shall issue the Notice to Proceed to the winning bidder not later than seven (7) calendar days from the date of approval of the contract by the appropriate authority. All notices called for by the terms of the contract shall be effective only at the time of receipt thereof by the contractor.

  • Period of Action on Procurement Activities. – The Procurement process from the opening of bids up to the award of contract shall not exceed three (3) month or a shorter period to be determined by the procuring entity concerned. Without prejudice to the provisions of the preceding section, the different procurement activities shall be completed within reasonable periods to be specified in the IRR.

If no action on the contract is taken by the head of the procuring entity, or by his duly authorized representative, or by the concerned board, in the case of government owned and/or controlled corporations, within the periods specified in the preceding paragraph, the contract concerned shall be deemed approved.

  • Performance Security. – Prior to the signing of the contract, the winning bidder shall, as a measure of guarantee for the faithful performance of and compliance with his obligations under the contract prepared in accordance with the Bidding Documents, be required to post a performance security in such form and amount as specified in the Bidding Documents.
  • Failure to Enter into Contracts and Post Performance Security. – If, for justifiable causes, the bidder with the Lowest Calculated Responsive Bid or Highest Rated Responsive Bid fails, refuses or is otherwise unable to enter into contract with the Procuring Entity, or if the bidder fails to post the required performance security within the period stipulated in the Bidding Documents, the BAC shall disqualify the said bidder and shall undertake post-qualification for next-ranked Lowest Calculated Bid or Highest Rated Bid. This procedure shall be repeated until an award is possible, the contract shall be subjected to a new bidding.

In the case of a failure to post the required performance security, the bid security shall be forfeited without prejudice to the imposition of sanctions prescribed under Article XXIII.

  • Reservation Clause. – The head of the Agency reserves the right to reject any and all bids, declare a failure of bidding, or not award the contract in the following situations:
  • If there is prima facie evidence of collusion between appropriate public officers or employees of the Procuring Entity, or BAC and any of the bidders, or if the collusion is between or among the bidders themselves, or between a bidder and a third party, including any act which restricts, suppresses or nullifies or tends to restrict, suppress or nullity competition;
  • If the BAC is found to have failed in following the prescribed bidding procedures; or
  • For any justifiable and reasonable ground where the award of the contract will not redound t o the benefit of the government as defined in the IRR.
  • Contract Implementation and Termination. – The rules and guidelines for the implementation and termination of contracts awarded pursuant to the provisions of this Act shall be prescribed in the IRR. The rules and guidelines shall include standard general and special conditions for contarcts.
  • ALTERNATIVE METHODS OF PROCUREMENT

Alternative Methods. – Subject to the prior approval of the head of the Procuring Entity or his duly authorized representative, and whenever justified by the conditions provided in this Act, the Procuring Entity may, in order to promote economy and efficiency, resort to any of the following alternative methods of Procurement:

  1. Limited Source Bidding. – Limited Source Bidding may be resorted to only in any of the following conditions:
  2. Procurement of known to be obtainable only from a limited number of sources; or
  3. Procurement of major plant components where it is deemed advantageous to limit the bidding to known eligible bidders in order to maintain an optimum and uniform level of quality and performance of the plant as a whole.
  • Direct Contracting. – Direct Contracting may be resorted to only in any of the following conditions:
  • Procurement of Goods of proprietary nature, which can be obtained only from the proprietary source, i.e.  when patents, trade secrets and copyrights prohibit others from manufacturing the same item;
  • When the Procurement of critical components from a specific manufacturer, supplier or distributor is a condition precedent to hold a contractor to guarantee its project performance, in accordance with the provisions of his contract; or,
  • Those sold by an exclusive dealer or manufacturer, which does not have sub-dealers selling at lower prices and for which no suitable can be obtained at more advantageous terms to the Government.
  • Repeat Order. – When provided for in the Annual Procurement Plan, Repeat Order nay allowed wherein The Procuring Entity directly procures Goods from the Previous winning bidder whenever there arises a need to replenish goods procured under a contract previously awarded through competitive Bidding, subject to post-qualification process prescribed in the Bidding Documents and provided all the following conditions are present:
  1. The Unit price must be equal to or lower than that provided in the original contract;
  2. The repeat order does not result in splitting of requisitions or purchase orders;
  3. Except in special circumstances defined in the IRR, the repeat order shall be availed of only six (6) months from the date of the Notice to proceed arising from the original contract; and
  4. The repeat order shall not exceed twenty-five percent (25%) of the quantity of each item of the original contract.
  • Shopping. – Shopping may be resorted to under any of the following instances:
  1. When there is an unforeseen contingency requiring Immediate purchase: provided, however, That the amount shall not exceed fifty thousand pesos (50,000); or
  2. Procurement of ordinary or regular office supplies and equipment not available in the Procurement Service involving an amount not exceeding Two Hundred Fifty Thousand Pesos (250,000): Provided, however, That the Procurement does not result in splitting of Contracts: Provided, further, that at least Three (3) price quotation from bona fide suppliers shall be obtained.

The above amounts shall be subject to a periodic review by the GPPB. For this purpose, the GPPB shall be authorized to increase or decrease the said amount in order to reflects changes in economic conditions and for other justifiable reasons.

  • Negotiated Procurement. – Negotiated Procurement shall be allowed only in the following instances:
  1. In case of two failed biddings, as provided in Section 35 hereof;
  2. In case of imminent danger to life or property during a state of calamity.  or when times is of the 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 services, infrastructure facilities and other public utilities;
  3. Take-over of contracts, which have been rescinded or terminated for causes provided for in the contract and existing laws, where immediate action is necessary to prevent damage to or loss of life or property, or to restore vital public services, infrastructure facilities and other public utilities;
  4. When the subject contracts is adjacent or contiguous to an on-going infrastructure project, as defined in the IRR: Provided however, that the original contract is the result of a Competitive Bidding; the subject contract to be negotiated has similar or related scopes of work; it is within the contracting capacity of the contractor; the contractor uses the same prices or lower unit prices as in the original contract less mobilization cost; the amount involved does not exceed the amount of the ongoing project; and, the contractor has no negative slippage: Provided, further, that negotiations for the procurement are commenced before the expiry of the original contract. Whenever applicable shall also govern consultancy contracts, where the consultants have unique experience and expertise to deliver the required service; or,
  5. Subject to the guidelines specified in the IRR, purchases of Goods from another agency of the Government, such as the Procurement Service of the DBM, which is tasked with a centralized procurement of commonly used Goods for the government in accordance with Letters of Instruction No 755 and Executive Order No 359, series of 1989.
  6. Terms and Conditions for the use of Alternative Methods. –  The specific terms and conditions, including the limitations and restrictions, for the application of each of the alternative methods mentioned in this Article shall be specified in the IRR.