Memo. Order No. 213 s. 2006 Re: Amendments to Sections 42.5, 54.2 (b) and 61.1 of the IRR-A of R.A. No. 9184

July 17, 2006 BLGF MEMORANDUM CIRCULAR NO. 007-06 TO : All BLGF Officials and Employees; Regional Directors for Local Government Finance, District Treasurers of Metropolitan Manila; Provincial, City and Municipal Treasurers and Others Concerned SUBJECT : Memorandum Order No. 213 Dated May 8, 2006 Entitled "Approving Amendments to Sections 42.5, 54.2 (b) and 61.1 of the Implementing Rules and Regulations Part A (IRR-A) of the Government Procurement Reform Act, Known as Republic Act No. 9184 For the information and guidance of all concerned, attached is a copy of Memorandum Order No. 213 dated May 8, 2006 of the Office of the President amending Sections 42.5, 54.2 (b), (d) and 61.1 of the Implementing Rules and Regulations Part A (IRR-A) of Republic Act No. 9184. DTCSHA Below are the full texts of Sections 42.5, 56.2 (b), (d) and 61.1 under R.A. 9184 and the amendments thereto: Republic Act No. 9184 As amended under Memorandum Order No. 213 42.5 No procuring entity shall be 42.5 Procuring entities may issue a allowed to issue a letter of credit letter of credit in favor of a local or in favor of a Philippine entity or foreign supplier; Provided, that, no to any of the latter's foreign payment on the letter of credit shall manufacturers or suppliers, with be made until delivery and acceptance respect to any procurement. of the goods as certified by the procuring entity in accordance with the delivery schedule provided for in the contract; Provided further, that, the cost for the opening of letter of credit shall be for the account of the local or foreign supplier and shall be so stated in the bidding documents. 54.2 (b) For items (a) and (b) of 54.2 (b) For item (a) of Section 53, the Section 53, in the case of goods procuring entity shall draw up a list and infrastructure projects, the of at least three (3) suppliers, procuring entity shall draw up a contractors, or consultants in good list of at least three (3) suppliers standing which will be invited to or contractors which will be submit bids and negotiate with the invited to submit bids. The bidder who submitted the lowest procedures for the conduct of calculated bid or highest rated bid, public bidding shall be observed, whichever is applicable. If the and the lowest calculated and offer of the bidder who submitted responsive bid shall be the lowest calculated bid or considered for award. highest rated bid, whichever is Moreover, the provisions of applicable, is not responsive to the Section 21.2.4 of this IRR-A original specifications and ABC, shall be observed. negotiation shall be made in ascending order starting from the (d) For item (b) of Section 53 of lowest offer. The bidder whose the Act and this IRR-A, the bid is found to be responsive to negotiation shall be made with a the original specifications and previous supplier, contractor or ABC shall be considered for consultant of good standing of award. In all cases the award of the procuring entity concerned, contact shall be posted at the G- or a supplier, contractor or EPS website, website of the consultant of good standing procuring entity, if any, and in situated within the vicinity where conspicuous place within the the calamity or emergency premises of the procuring entity. occurred. Moreover, while the procurement activity would still (c) . . . have to be posted in accordance with the provisions of Section (d) For item (b) of Section 53 of 21.2.4 of this IRR-A, the period the Act and this IRR-A, the for posting required therein may negotiation may be made with a be waived by the procuring entity previous supplier, contractor or concerned. consultant of good standing of the procuring entity concerned, or a supplier, contractor of consultant of good standing situated within the vicinity where the calamity or emergency occurred. The award of contract shall be posted at the G-EPS website, website of the procuring entity, if any, and in conspicuous places within the premises of the procuring entity. 6.1.1 For the given scope of work in 61.1 For the given scope of work in the the contract as awarded, all bid contract as awarded, all bid prices prices shall be considered as shall be considered as fixed fixed prices, and therefore not prices, and therefore not subject subject to price escalation during to price escalation during contract contract implementation, except implementation, except under under extraordinary circumstances extraordinary circumstances and and upon prior approval of the upon prior of the GPPB. All contracts GPPB. All contracts shall be shall be denominated and payable in denominated and payable in Philippine currency, and this shall currency, and this shall be stated be stated in the bidding documents: in the bidding documents: Provided, however, That subject Provided, however, That should to the guidelines issued by the the procuring entity receive bids GPPB, the procuring entity may denominated in foreign currency, provide in the bidding documents the same shall be converted to that obligations may be paid in Philippine currency based on the foreign currency; Provided exchange rate prevailing on the further, That should the procuring day of the bid opening. entity receive bids denominated in foreign currency, the same shall be converted to Philippine currency based on the exchange rate prevailing on the day of the bid opening for purposes of bid comparison and evaluation. The Regional Directors, the District Treasurers of Metropolitan Manila and all Provincial Treasurers are hereby instructed to disseminate the contents of this Circular, including the attachments to all City, Municipal Treasurers within their respective jurisdictions. cEaCTS For strict compliance. (SGD.) MA. PRESENTACION R. MONTESA Executive Director ATTACHMENT May 8, 2006 MEMORANDUM ORDER NO. 213 APPROVING AMENDMENTS TO SECTIONS 42.5, 54.2 (b) (d), AND 61.1 OF THE IMPLEMENTING RULES AND REGULATIONS PART A (IRR-A) OF REPUBLIC ACT NO. 9184 WHEREAS, in its Resolution Nos. 016-2005 and 24-2005 dated September 12, 2005 and November 25, 2005, respectively, the Government Procurement Policy Board (GPPB) has resolved to endorse for approval the proposed amendments to Sections 42.5 54.2 (b) (d), and 61.1 of the Implementing Rules and Regulations Part A (IRR-A) of Republic Act No. 9184; WHEREAS, the proposed amendments will streamline and improve the procurement procedures for a more effective procurement system; NOW THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby approve the proposed amendments of the Implementing Rules and Regulations Part A (IRR-A) of Republic Act (RA) 9184 as follows: SECTION 1. Sections 42.5, 54.2. (b) (d), and 61.1 of the IRR-A of RA 9184 are hereby amended as follows: Section 42. Contract Implementation and Termination 42.5 Procuring entities may issue a letter of credit in favor of a local or foreign supplier; Provided , that , no payment on the letter of credit shall be made until delivery and acceptance of the goods as certified to by the procuring entity in accordance with the delivery schedule provided for in the contract; Provided further , that , the cost for the opening of letter of credit shall be for the account of the local or foreign supplier and shall be so stated in the bidding documents. Section 54. Terms and Conditions for the Use of Alternative Methods 54.2 . . . b) For item (a) of Section 53, the procuring entity shall draw up a list of at least three (3) suppliers, contractors, or consultants in good standing which will be invited to submit bids and negotiate with the bidder who submitted the lowest calculated bid or highest rated bid, whichever is applicable. If the offer of the bidder who submitted the lowest calculated bid or highest rated bid, whichever is applicable, is not responsive to the original specifications and ABC, negotiation shall be made in ascending order starting from the lowest offer. The bidder whose bid is found to be responsive to the original specifications and ABC shall be considered for award. In all cases, the award of contract shall be posted at the G-EPS website, website of the procuring entity, if any, and in conspicuous place within the premises of the procuring entity. c) . . . d) For item (b) of Section 53 of the Act and this IRR-A, the negotiation may be made with a previous supplier, contractor or consultant of good standing of the procuring entity concerned, or a supplier, contractor of consultant of good standing situated within the vicinity where the calamity or emergency occurred. The award of contract shall be posted at the G-EPS website, website of the procuring entity, if any, and in conspicuous place within the premises of the procuring entity. Section 61. Contract Prices 61.1 For the given scope of work in the contract as awarded, all bid prices shall be considered as fixed prices, and therefore not subject to price escalation during contract implementation, except under extraordinary circumstances and upon prior approval of the GPPB. All contracts shall be denominated and payable in Philippine currency, and this shall be stated in the bidding documents Provided, however , That subject to the guidelines issued by the GPPB, the procuring entity may provide in the bidding documents that obligations may be paid in foreign currency; Provided further , That should the procuring entity receive bids denominated in foreign currency, the same shall be converted to Philippine currency based on the exchange rate prevailing on the day of the bid opening for purposes of bid comparison and evaluation: SECTION 2. All other provisions of the IRR-A of RA 9184 shall remain unchanged. SECTION 3. This Memorandum Order shall take effect immediately upon its publication in a newspaper if general circulation. DONE in the City of Manila, this 8th day of May, in the year of Our Lord, Two Thousand and Six. Published in The Manila Times on May 12, 2006 .