PPA Administrative Order No. 03-09 Amendment to Article III (Guidelines in the Conduct of Public Bidding) of PPA Administrative Order No. 01-2006

April 14, 2009

PPA ADMINISTRATIVE ORDER NO. 03-09

TO	:	District Managers, Port Managers, Department Managers, Cargo Handling Operators and Others Concerned

SUBJECT	:	Amendment to Article III (Guidelines in the Conduct of Public Bidding) of PPA Administrative Order No. 01-2006

Pursuant to Sections 6-a (iii), and (v), 6-b (vi) and 23 of Presidential Decree No. 857, as amended, and in order to further clarify the procedures for the bidding and award of cargo handling (CH) services and to harmonize the requirements thereof with the other pertinent regulations on the matter, Article III (Guidelines in the Conduct of Public Bidding) of PPA Administrative Order No. 01-2006, otherwise known as the "Compendium of Regulations on Cargo Handling Operations", is hereby amended and modified as follows:

"ARTICLE III

Guidelines in the Conduct of Public Bidding

21. Policy on Public Bidding of CH Services

As a general rule, the award of contracts for the management and operations of CH services shall be through a transparent and competitive public bidding.

22. Governing Principles in Public Bidding of CH Services

a) Transparency in the bidding process and in the implementation of CH contracts.

b) Competitiveness by extending equal opportunity to enable contracting parties who are eligible and qualified to participate in the public bidding. AEIDTc

c) Streamlined bidding process that will uniformly apply to all bidding processes.

d) System of accountability where both the public officials directly or indirectly involved in the bidding process, as well as in the implementation of the CH contracts and the private parties that deal with the Authority are, when warranted by circumstances, investigated and held liable for their actions relative thereto.

e) Public monitoring of the bidding process and the implementation of awarded CH contracts with the end in view of guaranteeing that such contracts are awarded pursuant to this Order and that all these contracts are performed strictly to specifications.

23.1 Scope and application of the guidelines

These guidelines shall govern and apply to the bidding and award of contracts for the management and operations of CH services as specified in Article II of PPA Administrative Order No. 01-2006. SDATEc

23.2 When to Conduct Public Bidding

a) The conduct of the public bidding for CH services shall be done at least six (6) months before the expiration of the existing CH contracts in the port.

b) For CH services in ports without authorized CH operators or for new port facilities, the bidding of such services shall be conducted immediately.

c) CH services under existing Special Takeover Units (STUs) shall be bid out within six (6) months from the effectivity of this Order. CH services that may hereafter be taken over by the Authority shall be bid out within six (6) months from the date of the take-over of said services.

24. Bids and Awards Committee (BAC)

a) Constitution of the BAC

The BAC shall be constituted for the conduct of the public bidding of CH services with the following members or as the General Manager may determine.

Regular Members:

Chairperson	-	District Manager

Vice Chairperson	-	The Port Manager
		(PMO having jurisdiction
		of the port)

Member	-	Manager, Legal Affairs
		Division, PDO
Provisional Members:
	-	Manager, Port Services
		Division, PMO

	-	Manager, Resource
		Management
		Division, PMO

b) Observers:

Authorized representative from each of the following organizations:

i. Shipping Industry;

ii. Philippine Chamber of Arrastre and Stevedoring Operators (PCASO);

iii. Philippine Chamber of Commerce and Industry (PCCI);

iv. Catholic Bishops' Conference of the Philippines (CBCP);

v. Volunteers Against Crime and Corruption (VACC); and

vi. Commission on Audit (COA).

c) The BAC shall have at least five (5), but not more than seven (7) members.

d) Unless sooner removed for a cause, the term of the members of the BAC shall be co-terminus with the bidding process but not to exceed one (1) year, from the date of appointment, renewable at the discretion of the General Manager. In case of resignation, retirement, separation, transfer, re-assignment, removal, or death, the replacement shall serve only for the unexpired term: Provided, however, that in case of leave or suspension, the replacement shall serve only for the duration of the leave or suspension. For justifiable causes, a member shall be suspended or removed by the General Manager. In the interest of professionalization, the General Manager may extend the term of office of deserving members.

25. Functions of the BAC

a) The BAC shall have the following functions:

1) Prepare the bidding documents;

2) Advertise and post the Invitation to Apply for Eligibility and to Bid (IAEB);

3) Conduct pre-procurement and pre-bid conferences;

4) Issue Supplemental/Bid Bulletin;

5) Determine the eligibility of prospective bidders; ATHCac

6) Receive and open bids;

7) Conduct evaluation and comparison of bids;

8) Undertake post-qualification proceedings;

9) Resolve motions for reconsideration;

10) Recommend award of CH contract to the General Manager; and

11) Perform such other related functions as may be necessary, including the application of relevant provisions of Republic Act No. 9184 and its Implementing Rules and Regulations (IRR), and the creation of a Technical Working Group (TWG), from a pool of technical, financial and/or legal experts to assist in the bidding.

b) Quorum

A majority of the total BAC composition shall constitute a quorum for the transaction of business, provided the presence of the Chairperson or Vice Chairperson shall be required.

c) Meetings

1) The Chairperson, or in his absence, the Vice Chairperson, shall preside at all BAC meetings. The decision of at least a majority of those members present at a meeting in which there is a quorum shall be valid and binding as an act of the BAC.

2) The Chairperson or in his absence, the Vice Chairperson, shall vote only in case of a tie.

3) Observers and representatives of BAC members shall have no right to vote during BAC meetings, nor shall the representatives of BAC members be authorized to sign in behalf of the members represented.

26. BAC Observers

a) To enhance the transparency of the competitive bidding, the BAC shall, in all the stages of the selection process, invite all observers mentioned in Section 24 b) of this Order to sit in its proceedings. aATEDS

b) Observers will be informed at least two (2) days before the stages of bidding to which observers shall be invited on the following bidding activities:

1) Pre-bid conference;

2) Opening of bids;

3) Post-qualification;

4) Contract award; and

5) Special meetings.

The absence of observers will not nullify the BAC proceedings, provided, that they have been duly invited in writing.

c) The observers shall have the following responsibilities:

1) Preparation of report either jointly or separately indicating their observations on the bidding activity, BAC compliance with the provisions of this Order, and areas of improvement in the BAC's proceedings for submission to the General Manager, copy furnished the BAC Chairperson; IcDCaT

2) Upon request, the BAC shall furnish the observers a copy of the following documents:

(a) Minutes of BAC Meetings;

(b) Abstract of Bids;

(d) Copies of opened bids.

3) Sign the abstract of bids and post-qualification report, if amenable to the bidding activities and results of the post-qualification; and

4) May give a copy of their reports to the Office of the Ombudsman or Resident Ombudsman 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 CH contract will not redound to the benefit of the Authority.

27. BAC Secretariat and its Functions

a) The Chairperson of the BAC shall designate a Secretariat which will serve as the main support unit of the BAC. The Secretariat shall have the following functions:

1) Provide administrative support to the BAC;

2) Organize and make all necessary arrangements for BAC meetings;

3) Attend BAC meetings as Secretary;

4) Prepare the "Minutes" of the BAC meetings;

5) Take custody of all bidding documents and be responsible for the sale and distribution of bidding documents to interested bidders;

6) Assist in managing the bidding process;

7) Monitor bidding activities and milestones for proper reporting to relevant agencies when required;

8) Make arrangements for the pre-procurement and pre-bid conferences and bid openings;

9) Record all proceedings of the bidding and prepare the corresponding report thereof, as well as the relevant documents to be submitted to the concerned offices of the Authority; and

10) Serve as the central channel of communications for the BAC.

b) The Head of the BAC Secretariat shall be at least a third ranking permanent employee of the PDO concerned, or if not available, a permanent official of the next lower rank.

c) The members of the BAC, TWG and Secretariat may be granted honoraria in accordance with the pertinent Department of Budget and Management (DBM) guidelines on the matter.

28. Preparation of Bidding Documents

a) The bidding documents shall be prepared by the BAC following the generic forms appended in this Order. The BAC may, however, modify pertinent provisions of said bidding documents, or include new or additional provisions to the said documents depending on the requirements of the CH services or the circumstances obtaining in the port subject of bidding. The bidding documents prepared by the BAC shall be subject to review and approval of the Assistant General Manager for Operations if the term of the CH contract to be bid out is five (5) years and below. However, if the intended term of the CH contract is more than five (5) years, the corresponding bidding documents therefor shall be approved by the General Manager. The bidding documents shall be as follows: aTcIEH

1) Invitation to Apply for Eligibility and to Bid (Annex III-A);

2) Instructions to Prospective Bidders (Annex III-B);

3) Instructions to Bidders (Annex III-C);

4) Terms of Reference (Annex III-D);

5) Technical Bid (Annex III-E);

6) Financial Bid (Annex III-F); and

7) Pro-forma CH Contract (Annex III-G).

b) The bidding documents shall clearly and adequately define, among others: (a) objectives and scope of the contract; (b) contract duration; (c) obligations and duties of the winning bidder; and (d) minimum eligibility requirements.

c) The BAC may require additional documentary requirements or specifications, where applicable and necessary, to complete the information required for the bidders to prepare and submit their respective bids. DcCASI

d) The specifications and other terms in the bidding documents shall reflect the minimum requirements or specifications required to meet the needs of the BAC in clear and unambiguous terms. The bidder may submit a bid which provides for superior specifications and/or better terms and conditions to the Authority. However, these shall not be given any bonus, credit or premium in the bid evaluation.

e) Prospective bidders shall be given ample time to examine the bidding documents and to prepare their respective bids. Bidders shall be required to pay for the bidding documents to recover the cost of its preparation and development. The BAC shall issue the bidding documents upon payment of the corresponding cost thereof to the collecting officer of the Authority.

f) It shall be the sole responsibility of the prospective bidder to determine and to satisfy itself by such means as it considers necessary or desirable as to all matters pertaining to the CH services to be bid.

g) The Authority shall not assume any responsibility regarding erroneous interpretations or conclusions by the prospective or eligible bidder out of the data furnished by the Authority. CHcETA

29. Invitation to Apply for Eligibility and to Bid (IAEB)

a) Pre-procurement Conference

Prior to the advertisement or issuance of the IAEB, the BAC shall call, through the Secretariat, for a pre-procurement conference. The conference shall be attended by the BAC, the Secretariat, the unit or officials who prepared the Terms Of Reference (TOR), bidding documents and the draft advertisement, as the case may be, as well as those who separately reviewed these documents prior to the final approval, if any. During this conference, the participants, led by the BAC, shall:

1) Determine the readiness of the procurement at hand and adherence of the bidding documents to relevant procurement guidelines on the matter;

2) Review, modify and agree on the criteria for eligibility screening to ensure their fairness, reasonableness and that they are of the "pass/fail" type and are written in such manner;

3) Review, modify and agree on the criteria for the evaluation of bids to ensure their fairness, reasonableness and applicability to the procurement at hand;

4) Clarify that the specifications and other terms in the bidding documents are minimum requirements and that the bidder may submit a bid which provides better terms and conditions to the Authority at no extra cost, without any bonus, credit or premium in the bid evaluation; and

5) Emphasize the importance of confidentiality during the bid evaluation process and the applicable sanctions and penalties for violation thereof.

b) Advertising, Posting and Contents of the IAEB

1) The IAEB shall provide the prospective bidders, among others, the following information:

a) Brief description of the CH services of the port;

b) A general statement on the criteria and minimum requirements to be used for the eligibility check, the examination and evaluation of bids and post-qualification;

c) The date, time and place of the deadline for the submission and receipt of the eligibility requirements, the pre-bid conference(s), if any, the submission and receipt of bids and the opening of bids;

d) The period of availability of the bidding documents, the place where the bidding documents may be secured and the price of the bidding documents;

e) The duration of the CH contract;

f) Instruction to prospective bidders to submit to the BAC a Letter of Intent (LOI) together with its application for

eligibility;

g) The name, address, telephone or mobile number, facsimile number, e-mail and website addresses of the Authority (PDO or PMO) and the designated contact person(s); and

h) Such other necessary information deemed relevant and necessary by the BAC. CSTHca

2) The IAEB shall be advertised and posted as follows:

a) Advertised at least once in one (1) newspaper of general nationwide circulation which has been regularly published for at least two (2) years before the date of issue of the advertisement;

b) Posted continuously in the PPA website and the Government Electronic Procurement System (G-EPS) for seven (7) calendar days starting on date of advertisement; and

c) Posted at any conspicuous place/s in the premises of PPA Head Office, PDO and PMO and in the port subject of bidding for seven (7) calendar days.

c) Submission of Letter of Intent (LOI)

The interested parties shall submit the LOI and application for eligibility to the BAC not later than seven (7) calendar days from the last date of posting of the IAEB.

d) Pre-Bid Conference(s)

1) The pre-bid conference(s) shall be held at least twelve (12) calendar days before the deadline for the submission and receipt of bids.

2) Only eligible bidders as determined by the BAC and issued corresponding notices of eligibility may attend said conference. Attendance of the eligible bidders to the said conference is not mandatory.

3) The pre-bid conference shall discuss, among others, matters relative to the technical and financial bids, and other relevant bidding matters.

4) The minutes of the pre-bid conference shall be recorded and made available to all participants not later than three (3) calendar days after the pre-bid conference.

5) Any statement made at the pre-bid conference shall not modify the terms of the bidding documents, unless such statement is specifically identified in writing as an amendment thereto and issued as a Supplemental or Bid Bulletin.

6) Supplemental/Bid Bulletin

(a) Supplemental/Bid Bulletin may be issued upon the BAC's initiative for purposes of clarifying or modifying any provision of the bidding documents not later than seven (7) calendar days before the deadline for the submission and receipt of bids. Any modification to the bidding documents shall be identified as an amendment. Bidders who have submitted bids before the issuance of the Supplemental/Bid Bulletin must be informed and allowed to modify or withdraw their bids in accordance with the pertinent provisions hereof.

(b) Requests for clarification on any part of the bidding documents or for an interpretation must be in writing and submitted to the BAC at least ten (10) calendar days before the deadline set for the submission and receipt of bids.

The BAC shall respond to the request by issuing a Supplemental/Bid Bulletin, duly signed by the BAC Chairperson to be made available to all those who have properly secured the bidding documents at least seven (7) calendar days before the deadline for the submission and receipt of bids. It shall be the responsibility of all those who have properly secured the bidding documents to inquire and secure Supplemental/Bid Bulletin that may be issued by the BAC. TcCEDS

e) Eligible Participants

The following shall be allowed to participate in the eligibility screening and bidding of CH services:

1) Duly licensed Filipino citizens/sole proprietorships;

2) Partnerships duly organized under the laws of the Philippines and of which at least sixty percent (60%) of the interest belongs to citizens of the Philippines;

3) Corporations duly organized under the laws of the Philippines, and of which at least sixty percent (60%) of the outstanding capital stock belongs to citizens of the Philippines;

4) Persons or entities forming themselves into a joint venture that intend to be jointly and severally responsible or liable for the CH contract: Provided, however, that Filipino ownership or interest of the joint venture concerned shall be at least sixty percent (60%); or aSTAIH

5) Cooperatives duly registered with the Cooperatives Development Authority (CDA).

The shipping companies shall not be eligible to participate in the bidding of CH services, either as a sole bidder or as a member in a joint venture. However, individual stockholders of the shipping companies are allowed to be a member of a joint venture provided that the individual share holdings shall not exceed 5% nor the aggregate share holdings of all such stockholders shall exceed 10% of the total shares of the corporation that will be formed if it will be declared the winning bidder.

30. Submission, Receipt and Opening of Eligibility Requirements

a) The eligibility requirements shall be submitted to the BAC in the prescribed forms in a sealed eligibility envelope and marked as such. The eligibility envelope of the prospective bidder shall be submitted on or before the deadline specified in the IAEB and shall be opened before the dates of the pre-bid conference and bid opening to determine eligibility of prospective bidders, who shall then be allowed to acquire or purchase the bidding documents from the Authority. 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. CSDcTH

b) The BAC shall determine if each prospective bidder is eligible to participate in the bidding by examining the completeness of each prospective bidder's eligibility requirements or statements against a checklist of requirements, using a non-discriminatory "pass/fail" criteria, as stated in the IAEB, and shall be determined as either eligible or ineligible. If a prospective bidder submits the specific eligibility document required, it shall be rated "passed" for that particular requirement. In this regard, failure to submit a requirement or an incomplete or patently insufficient submission shall be considered "failed" for the particular eligibility requirement concerned. If a prospective bidder is rated "passed" for all the eligibility requirements, it shall be considered eligible to participate in the bidding, and the BAC shall mark the set of eligibility requirements for the prospective bidder concerned as "eligible". If a prospective bidder is rated "failed" in any of the eligibility requirements, it shall be considered ineligible to participate in the bidding, and the BAC shall mark the set of eligibility documents of the prospective bidder concerned as "ineligible". In either case, the markings shall be countersigned by the BAC chairperson or duly designated authority. aCcADT

c) The BAC shall inform the eligible prospective bidder that it has been found eligible to participate in the bidding. On the other hand, the BAC shall inform an ineligible prospective bidder that it has been found ineligible to participate in the bidding, and of the grounds for its ineligibility. Those found ineligible have three (3) calendar days upon written notice, or if present at the time of opening of eligibility requirements, upon verbal notification, within which to file a request for a reconsideration with the BAC. Provided, however, that the BAC shall decide on the request for reconsideration within seven (7) calendar days from receipt thereof. The BAC may request a prospective bidder to clarify its eligibility documents, if it is deemed necessary. The BAC shall not be allowed to receive, hold and/or open the bids of ineligible prospective bidders; provided, however that if an ineligible prospective bidder signifies his intent to file a motion for reconsideration, the BAC shall hold the eligibility documents of the said ineligible prospective bidder until such time that the motion for reconsideration has been resolved.

d) Notwithstanding the eligibility of a prospective bidder, the BAC reserves the right to review its qualifications at any stage of the procurement process if it has reasonable grounds to believe that a misrepresentation has been made by the said prospective bidder, or that there has been a change in the prospective bidder's capability to undertake the CH operations from the time it submitted its eligibility requirements. Should such review uncover any misrepresentation made in the eligibility requirements, statements or documents, or any changes in the situation of the prospective bidder which will affect the capability of the bidder to undertake such CH operations so that it fails the preset eligibility criteria, the BAC shall consider the said prospective bidder as ineligible and shall disqualify it from submitting a bid or from obtaining an award of CH contract. aHcDEC

e) Only an eligible bidder as determined by the BAC in accordance with the provisions hereof may purchase the bidding documents and submit the corresponding bid. The determination of eligibility shall be based on the submission of the following documents to the BAC, utilizing the forms prescribed by the BAC and using the criteria approved for this purpose:

Legal Documents

1) LOI and Application for Eligibility.

2) Authority of signing official.

3) Articles of Incorporation/Partnership/Cooperation and By-Laws, whichever may be appropriate under existing laws of the Philippines.

4) Department of Trade and Industry (DTI), Securities and Exchange Commission (SEC) or Cooperative Development Authority (CDA) Certificate of Registration, whichever may be appropriate under existing laws of the Philippines.

5) Valid and current Mayor's Permit or Municipal License from the City or Municipality where the principal place of business is located.

6) Taxpayer's Identification Number (TIN) Card.

7) Joint Venture Agreement in case of persons or entities forming themselves into a Joint Venture.

8) Affidavit of the prospective bidder or duly authorized representative that it is not "blacklisted" or barred from bidding by the Government, or any of its agencies, offices, or corporations and has no CH contract terminated or cancelled for cause.

9) Affidavit by the bidder or duly authorized representative that each document submitted in satisfaction of the eligibility requirements is an authentic and original copy or a true and faithful reproduction of the original and that all statements and information provided therein are true and correct

10) Affidavit of the Bidder or duly authorized representative of its compliance with existing labor laws and standards.

11) Affidavit of Disclosure of No Relationship.

12) Letter of Authority to verify submitted documents.

13) Other appropriate documents, clearances and licenses that may be required by the Authority.

Technical Documents

1) Business Profile of the Prospective Bidder.

2) Curriculum Vitae (CV) of prospective bidder's principal/key personnel for CH operations, namely: General Manager, Operations Manager, Safety Officer and Supervisor, all of which must have at least five (5) years relevant work experience.

3) Statement of prospective bidders of its completed, ongoing and awarded but not yet started CH contracts.

4) The types and number of CH equipment that the prospective bidder owns, has under lease, and/or has under purchase agreements, if any.

5) Copy of latest General Information Sheet (GIS) submitted to the SEC, if applicable.

Financial Documents

1) Audited financial statements, stamped "Received" by the BIR or its duly accredited and authorized institutions for the immediately preceding calendar year showing, among others, total and current assets and liabilities. For new establishments, balance sheet and income statement, stamped "Received" by the BIR or its duly accredited and authorized institutions for the most recent quarter.

2) Income Tax Return (ITR) for the immediately preceding year duly filed and stamped "Received" by the BIR, or proof of electronic filing of the same. For new establishments which have no annual ITR, the most recent quarterly ITR duly filed and stamped "Received" by the BIR or proof of electronic filing thereof. aCHcIE

3) Value Added Tax (VAT) or Percentage Tax Return (PTR) covering the immediately preceding six (6) months duly filed and stamped "Received" by the BIR, or proof of electronic filing of the same. For those with less than six (6) months of operations, the monthly business tax returns duly filed and stamped "Received" by the BIR or proof of electronic filing thereof.

4) Tax Clearance Certificate issued by the Collection Enforcement Division of the BIR.

5) Certification from the PPA Head Office Treasury Department that the prospective bidder has no outstanding account.

6) Prospective bidder's computation of its Available Paid Up Capital/owner's equity for the Contract (APCC/OE).

The APCC shall be at least equal to the paid up capital/owner's equity required for the CH contract subject of bidding.

FORMULA:

APCC/OE = Paid Up Capital/Owner's Equity per financial statements less paid up capital required for all existing CH contracts and CH contracts awarded but not yet started.

Or, in lieu thereof, a commitment from a bank duly licensed by the Bangko Sentral Ng Pilipinas to extend to the prospective bidder a credit line if awarded the CH contract the amount of which shall be at least equal to the paid up capital/owner's equity required for the CH contract to be bid.

7) Prospective bidder's intended working capital for CH operations.

31. Submission and Receipt of Technical and Financial Bids

a) Eligible bidders shall submit their bids thru their duly authorized officers or representatives in the prescribed bid forms, including its annexes, on or before the specified deadline and in two (2) separate sealed envelopes which shall be submitted simultaneously. The first envelope shall contain the Technical Bid and the second envelope the Financial Bid, with the name of the contract to be bid and the name of the bidder in capital letters addressed to the BAC. The bidder shall mark the two (2) envelopes: "Do not open before (date and time of opening of bids)." Both envelopes shall then be sealed in an outer envelope which shall be addressed to the BAC and shall be marked as specified in the Instructions to Bidders (ITB).

b) The Technical Bid shall contain the following technical information and documents:

1) Authority of signing official;

2) Bid security as to form, amount and validity period;

3) Certificate of Site Inspection issued by duly authorized official of PMO concerned;

4) Affidavit of Site Inspection of the port executed by the bidder or authorized representative;

5) Affidavit of Compliance on Bidder's Responsibilities;

6) Organizational Chart for the CH contract to be bid;

7) The Business Plan with all its components, as provided for in Article II, Section 17 (b) (5) of PPA Administrative Order No. 01-2006, as amended, and each component shall include the prescribed minimum requirements thereof, if any; and

8) List of principal/key CH personnel for deployment at the start of operations.

c) The Financial Bid shall contain the proposed CH tariff to be charged to the shippers/port users or the committed government share on the gross income from the CH services, depending on the type of the CH operations in the port subject of the bidding:

1) For ports with manual CH operations, the Financial Bid shall contain the proposed CH tariff to be charged to the shippers or port users for the CH services rendered in the port which shall be lower by a certain percentage than the existing approved CH tariff. The said percentage shall be invariably applied to all tariff items, except on Ro-Ro Cargo subject to the Ro-Ro Tariff or Terminal Fee which shall have the same rates as prescribed under existing PPA regulations. In case where the existing CH tariff is unreasonably low as determined by the PMO concerned and confirmed as such by the Commercial Services Department (CSD), the CSD shall prescribe the corresponding CH tariff which shall be the basis of the CH tariff to be proposed by the bidder.

However, the proposed CH tariff shall not be lower than the "Floor" prescribed therefor in the bidding documents; otherwise, the Financial bid shall be considered as non-complying.

2) For ports with mechanized CH operations, the Financial Bid shall contain the committed government share on the gross income from CH Operations for the duration of the contract which shall be at the rate of not less than 10% of the gross income from domestic CH operations and 20% of the gross income from foreign CH operations but in no case shall the said percentages exceed the ceiling indicated in the bidding documents; otherwise, the said financial bid shall be considered as non-complying.

32. Modification and Withdrawal of Bids

a) A bidder may modify its bid, provided this is done before the deadline for the submission and receipt of bids. Where a bidder modifies its bid, it shall not be allowed to retrieve its original bid but shall only be allowed to send another bid equally sealed, identified and linked to its original bid and marked as "Modification" thereof and stamped "Received" by the BAC. Bid modifications received after the applicable deadline shall not be considered and shall be returned to the bidder unopened. EISCaD

b) A bidder, thru a letter, may withdraw its bid before the deadline for the receipt of bids. Withdrawal of bids after the applicable deadline shall be subject to appropriate sanctions as may be imposed by the Authority. A bidder may also express its intention not to participate in the bidding thru a letter, which should reach and be stamped received by the BAC before the deadline for the receipt of bids. A bidder that withdraws its bid shall not be permitted to submit another bid, directly or indirectly, for the same bidding.

33. Bid Security

a) All bids shall be accompanied by a bid security, payable to the Authority as a guarantee that the successful bidder shall, within ten (10) calendar days from receipt of the Notice of Award (NOA), enter into a CH contract with the Authority.

b) The bid security shall be in the amount at least equal to, and not lower than, a percentage of the total gross income from CH operations at the subject port in the immediately preceding year based on the record of the Authority, in any of the following forms: ESTDcC

i. Cash, certified check, cashier's check, manager's check, bank draft or guarantee confirmed by a reputable local bank;

ii. Irrevocable letter of credit issued by a reputable commercial bank or in the case of an irrevocable letter of credit issued by a foreign bank, the same shall be confirmed or authenticated by a reputable local bank;

iii. Surety bond, callable upon demand, issued by the Government Service Insurance System (GSIS) or other reputable surety or insurance company duly licensed by the office of the Insurance Commission; or

iv. Any combination thereof.

The required amount of the above forms as bid security shall be in accordance with the following schedule:

FORM OF BID	P______________
SECURITY	(TOTAL GROSS
	INCOME FROM CH
	OPERATIONS OF THE
	PORT FOR THE
	IMMEDIATELY
	PRECEDING YEAR)
Cash, certified check,
cashier's check,
manager's check,
bank draft or	One percent (1%)
irrevocable letter
of credit
Bank guarantee	One and a half percent
	(1 1/2%)
Surety Bond	Two and a half percent
	(2 1/2%)

The required bid security based on the above schedule shall be the minimum amount thereof and shall be stated in Philippine Peso in the bidding documents.

c) No bid securities shall be returned to the bidder after the opening of bids and before contract signing, except to those that (i) failed to comply with any of the requirements to be submitted in the first bid envelope (Technical Bid) of the bid, or (ii) were post-disqualified and submitted a written waiver of its right to file a motion for reconsideration and/or protest in accordance with the pertinent provisions hereof. Without prejudice to the provisions on the forfeiture of bid securities, bid securities shall be returned only after the winning bidder has signed the contract and furnished the performance security, but in no case later than the expiration of the bid security validity period.

34. Bid Validity and Opening

a) Bids and bid securities shall be valid for a period of one hundred twenty (120) calendar days from the date of the opening of bids and such validity period shall be indicated in the bidding documents.

b) The BAC shall open the bids at the time, date and place specified in the IAEB and the bidding documents. The bidders or their duly authorized representatives may attend the opening of bids. All BAC members or their duly authorized representatives who are present during the bid opening, shall initial every page of the original copies of all bids received and opened. The "Minutes" of the bid opening shall be made available to the concerned parties upon written request and payment of a specified fee to recover cost of materials.

35. Preliminary Examination of Bids

a) The BAC shall open the Technical Bids of eligible bidders in public to determine each bidder's compliance with the documents required to be submitted for the first component of the bid. For this purpose, the BAC shall check the submitted documents of each bidder against a checklist of required documents to ascertain if they are all present in the Technical Bid, using non-discretionary "pass/fail" criteria. If a bidder submits the required document, it shall be rated "passed" for that particular requirement. In this regard, failure to submit a requirement or an incomplete or patently insufficient submission shall be considered "failed" for the particular requirement and immediately return to the bidder concerned its Financial Bid unopened. Otherwise, the BAC shall rate the said Technical Bid as "passed".

b) A bidder determined as "failed" has three (3) calendar days upon written notice, or if present at the time of bid opening, upon verbal notification, within which to file a request for reconsideration with the BAC; provided, however, that the request for reconsideration shall not be granted if it is established that the finding of failure is due to fault of the bidder concerned; provided, further, that the BAC shall decide on the request for reconsideration within seven (7) calendar days from receipt thereof. If a failed bidder signifies his intent to file a motion for reconsideration, in the case of a bidder who fails in the Technical Bid, the BAC shall hold the Financial Bid of said failed bidder unopened and duly sealed until such time that the motion for reconsideration has been resolved. ISADET

c) Immediately after determining compliance with the requirements in the Technical Bid, the BAC shall forthwith open the Financial Bid of each remaining eligible bidder whose Technical Bid was rated "passed". The Financial Bid of each complying bidder shall be opened within the same day. In case one or more of the requirements in the Financial Bid of a particular bid is missing, incomplete or patently insufficient, the BAC shall rate the bid concerned as "failed".

d) The Financial Bid shall be considered as non-complying under the following instances:

1. For ports with manual CH operations — The Financial Bid submitted does not provide a reduction in CH Tariff; or provide a reduction in rates in some but not in all tariff items; or does not provide a uniform reduction for all tariff items; or the proposed rates in any or all of the tariff items exceeds the floor prescribed therefor in the bidding documents.

2. For ports with mechanized CH operations — The Financial Bid submitted provides with government share on the gross income from domestic CH operations and/or foreign CH operations that exceeds the "floor" and/or "ceiling" prescribed therefor in the bidding documents. HEITAD

e) Only bids that are determined to contain all the bid requirements for both Technical and Financial bids shall be rated "passed" and shall immediately be considered for evaluation and comparison.

f) Members of the BAC, including its staff and personnel, as well as its Secretariat and TWG, are prohibited from making or accepting any kind of communication with any bidder regarding the evaluation of their bids until the issuance of the NOA.

36. Detailed Evaluation and Comparison of Bids

a) The BAC shall undertake a detailed evaluation and comparison of the financial bids to determine their compliance with the requirements of Section 31 c) of this Order. If the financial bid does not meet the said requirements, the same is considered non-complying and shall be rejected.

b) For ports with Manual CH operations, the BAC shall rank the complying bidders thereof in ascending order based on their financial bids to identify the Lowest Calculated Bid (LCB). ATDHSC

For ports with Mechanized CH operations, the BAC shall rank the complying bidders thereof in descending order based on their financial bids to identify the Highest Calculated Bid (HCB).

c) The bidder with the LCB or HCB, as the case maybe, shall be subject to post-qualification to determine its responsiveness to the eligibility and bid requirements.

d) 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 Abstract of Bids and attach thereto all the bids with their corresponding bid securities and the minutes or proceedings of the bidding. The Abstract of Bids shall contain the following:

1) Name of the port subject of bidding and its location;

2) Time, date and place of bid opening; and

3) Names of bidders and their corresponding financial bid arranged from lowest to highest or highest to lowest, as the case maybe, the amount of bid security and the name of the issuing entity.

37. Post-Qualification

Objective and Process of Post-Qualification

a) Within seven (7) calendar days from the determination of the LCB or HCB, as the case maybe, the BAC shall conduct and accomplish a post-qualification of the bidder with the LCB or HCB, to determine whether the bidder concerned complies with all the requirements and conditions for eligibility and the bidding, as specified in the bidding documents, in which case the said bidder's bid shall be considered and declared as the Lowest Calculated and Responsive Bid (LCRB) or Highest Calculated and Responsive Bid (HCRB).

b) The post-qualification shall validate and ascertain all statements made and documents submitted by the bidder with the LCB or HCB, among others, the following:

1) Legal Requirements — To verify, validate and ascertain licenses and agreements submitted by the bidder and the fact that he has not been blacklisted by the Government or any of its agencies or instrumentalities;

2) Technical Requirements — To determine compliance with the requirements of the bidding documents and the contract, to include, among others:

(a) Verification and validation of the bidder's stated competence and experience and those of the key officials and personnel to operate and manage the CH services;

(b) Verification of availability and commitment, and/or inspection of CH equipment and gears owned, leased or to be leased by the bidder; and

3) Financial Requirements — To verify, validate and ascertain, among others, the financial bid, available paid-up capital, committed working capital and credit line with the bank, if any.

c) If the BAC determines that the bidder with the LCB or HCB, as the case maybe, passes all the criteria for post-qualification, it shall declare the said bidder as the LCRB or HCRB and the CH contract shall be awarded to the said bidder.

d) If, however, the BAC determines that bidder with the LCB or HCB fails the criteria for post-qualification, it shall immediately notify the said bidder in writing of its post disqualification, and the grounds for it. The post-disqualified bidder shall have three (3) calendar days from receipt of the said notification to request from the BAC, if it so wishes, a reconsideration of this decision. The BAC shall evaluate the request for reconsideration, if any, using the same non-discretionary criteria and shall issue its final determination of the said request within seven (7) calendar days from receipt thereof.

e) Immediately after the BAC has notified the first-ranked bidder of its post-disqualification and notwithstanding any pending request for reconsideration thereof, the BAC shall initiate and complete the same post-qualification process on the second-ranked bidder. If the second-ranked bidder passes the post-qualification and provided that the request for reconsideration of the first-ranked bidder has been denied, the second-ranked bidder shall be post-qualified as the bidder with the LCRB or HCRB and the CH contract shall be awarded to it. aESIHT

f) If the second-ranked bidder, however, fails the post-qualification, the procedure for post-qualification shall be repeated for the bidder with the next-ranked bidder, and so on until the LCRB or HCRB is determined for award.

In the event two or more bidders have been post-qualified as LCRB or HCRB, the tie shall be resolved through the following tie-breaking scheme, viz.:

1. The lotto scheme shall be used wherein the concerned bidders shall select the lotto draw dates to be used (e.g., 6/42 — every Tuesday and Saturday, 6/45 — every Monday, Wednesday and Friday or 6/49 — every Sunday and Thursday);

2. From slots 1 to 6, each concerned bidder shall select their respective slot thru drawing of numbers;

3. During the lotto draw date (as selected by the bidders), the numbers as consecutively drawn shall be placed in the slots 1 to 6; i.e., first number to be drawn shall be placed in slot no. 1, second to be drawn in slot no. 2 and so on;

4. The bidder whose slot gets the highest number

shall be declared as the LCRB or HCRB;

5. In case there are more than six (6) tied bidders, the BAC shall use the bingo chips to break the tie.

38. Failure of Bidding

a) The BAC shall declare the bidding a failure and conduct a rebidding with re-advertisement and/or posting, after a re-evaluation of the terms, conditions and specifications of the first bidding, when:

1) No bidder submits an LOI and application for eligibility or no bids are received;

2) All prospective bidders are declared ineligible;

3) All bids fail to comply with the bid requirements or failed post-qualification;

4) The bidder with the LCRB or HCRB refuses, without justifiable cause to accept the award of the contract; or

5) Unavoidable reasons resulting to non-completion of the selection process not attributable to the participating CH applicant-operators.

b) The BAC shall modify the terms, conditions and specifications in the first bidding documents, when necessary. All bidders who have initially responded to the IAEB and have been declared eligible in the first bidding shall be allowed to submit new bids. The BAC shall observe the same process and set the new bidding timetable according to the same rules following the first bidding.

c) Should there occur a second failure of bidding, the Authority may adopt the alternative method of negotiated procurement.

39. Single Calculated and Responsive Bid Submission

A single calculated and responsive bid (SCRB) shall be considered for award if the process falls under any of the following circumstances:

a) If after advertisement, only one (1) prospective bidder submits an LOI and applies for eligibility check, in accordance with the provisions of this Order, and meets the eligibility requirements or criteria, after which it submits a bid which is found to be responsive to the bidding requirements;

b) If after advertisement, more than one (1) prospective bidder submits an LOI and applies for eligibility check, in accordance with the provisions of this Order, but only one bidder meets the eligibility requirements or criteria, after which it submits a bid which is found to be responsive to the bidding requirements; or

c) If after the eligibility check, more than one (1) bidder meets the eligibility requirements, but only one (1) bidder submits a bid, and its bid is found to be responsive to the bidding requirements.

The BAC shall ensure that the technical and financial bids of this bidder are advantageous to the government.

40. Notice and Execution of Award

a) Contract Award

1) The Assistant General Manager for Operations, the General Manager or the PPA Board of Directors, depending on the term of the CH contract, shall within a period of fifteen (15) calendar days from the determination and declaration of the LCRB, HCRB or SCRB, as the case maybe, and receipt of the corresponding recommendation for the award of CH contract, approve or disapprove said recommendation. In case of approval, the NOA shall be immediately issued to the bidder with the LCRB, HCRB or SCRB with corresponding advice to submit the required performance security within thirty (30) calendar days from the effectivity of the contract.

2) Contract award shall be made within the bid validity period. Should it become necessary to extend the validity of the bids and, if applicable, the bid securities, the Authority shall request in writing all those who submitted bids for such extension before the expiration date therefor. Bidders, however, shall have the right to refuse to grant such extension without forfeiting their bid securities.

3) The BAC shall also notify all losing bidders of its decision.

b) Contract Documents

1) The following documents shall form part of the CH contract:

(a) Invitation to Apply for Eligibility and to Bid;

(b) Bidding Documents;

(d) Eligibility requirements, documents and/or statements;

(e) Technical and Financial bids including all its annexes;

(f) Notice of Award and the winning bidder's "Conforme" thereto;

(g) Performance security and other documents that may be required; and DCAEcS

(h) Other documents as may be required by existing laws or by the Authority.

c) Contract Signing

The winning bidder or its duly authorized representative shall formally enter into contract with the Authority within ten (10) calendar days from receipt of the NOA.

d) Approval of CH contract by Higher Authority

When further approval of the PPA Board of Directors is required, the BAC shall, through appropriate channels, submit to the Board the CH contract with all the required supporting documents and the Board shall act on the same within twenty five (25) calendar days from receipt thereof.

e) Notice to Proceed (NTP)

The Authority shall issue the NTP, together with a copy or copies of the approved CH contract to the successful bidder, within three (3) calendar days from date of approval. All notices called for by the terms of the CH contract shall be effective only at the time of receipt thereof by the successful bidder. If an effectivity date is provided in the NTP, all notices called for by the terms of the approved CH contract shall be effective only from such effectivity date. TIEHSA

f) Performance Security

To guarantee the faithful performance by the winning bidder of its obligations under the contract, it shall post a Performance Security within thirty (30) calendar days from effectivity of the CH Contract. The performance security shall be in any of the following forms:

(a) Cash, certified check, cashier's/manager's check, bank draft/guarantee confirmed by a reputable local bank;

(b) Irrevocable letter of credit issued by a reputable commercial bank or in case of an irrevocable letter of credit issued by a foreign bank the same shall be confirmed or authenticated by a reputable local bank;

(c) Surety bond, callable upon demand, issued by the GSIS or other reputable surety or insurance company duly licensed by the office of the Insurance Commission; or

(d) A combination of the foregoing.

The required amount of the above forms of security shall be in accordance with the following schedule:

FORM OF	P______________
PERFORMANCE	(TOTAL GROSS
SECURITY	INCOME FROM CH
	OPERATIONS OF THE
	PORT FOR THE
	IMMEDIATELY
	PRECEDING YEAR)
Cash, certified check,
cashier's check,
manager's check,
bank draft or	Five percent (5%)
irrevocable letter
of credit
Bank guarantee	Ten percent (10%)
Surety Bond	Thirty percent (30%)

The performance security shall be posted in favor of the Authority and shall be forfeited in favor of the Authority in the event it is established that the winning bidder is in default in any of its obligations under the CH contract.

g) Failure to Enter into Contract and Post Performance Security

1. If the bidder with the LCRB, HCRB or SCRB fails, refuses or is unable to make good its bid by entering into a contract with the Authority or post the required performance security within the period stipulated in the bidding documents, the bid security shall be forfeited and the appropriate sanctions shall be imposed, except where the failure, refusal or inability is through no fault of the said bidder.

2. In case of failure, refusal or inability of the bidder with the LCRB or HCRB to enter into contract and post the required performance security, the BAC shall disqualify the said bidder and shall initiate and complete the post-qualification process of the bidder with the second LCB or HCB. However, if no bidder passes post-qualification, the BAC shall declare the bidding a failure and conduct a rebidding with re-advertisement. Should there occur another failure of bidding after the conduct of the rebidding, the Authority may avail of alternative method of negotiated procurement.

3. In case of failure, refusal or inability of the bidder with the SCRB to enter into contract and post the required performance security, the BAC shall disqualify the said bidder, and shall declare the bidding a failure and conduct a rebidding with re-advertisement and posting. Should there occur another failure of bidding after the conduct of the contract rebidding, the Authority may avail of the alternative method of negotiated procurement.

41. Reservation Clause

The Authority reserves the right to reject any and all bids, declare a failure of bidding, or not award the contract in the following situations:

a) If there is prima facie evidence of collusion between appropriate public officers or employees of the Authority, or between the 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 nullify competition; SCEDAI

b) If the BAC is found to have failed in following the prescribed bidding procedures; or

c) For any justifiable and reasonable ground where the awarding of the CH contract will not redound to the benefit of the Authority.

42. Protest Mechanism

a) Protests on Decisions of BAC

Decisions of the BAC on the bidding conducted may be protested in writing to the Authority: Provided, however, that a prior motion for reconsideration has been filed by the party concerned within the reglementary periods specified in this Order. The protest must be filed within seven (7) calendar days from receipt by the party concerned of the resolution of the BAC denying its motion for reconsideration. A protest may be made by filing a verified position paper with the Authority, accompanied by the payment of a non-refundable protest fee. The protest fee shall be in an amount equivalent to one percent (1%) of the total gross income from CH operations for the preceding year in the port subject of bidding as indicated in the bidding documents. SCEDAI

b) The verified position paper shall contain the following information:

1) Name of bidder;

2) Office address of the bidder;

3) Name of the port subject of bidding;

4) Name of the contract;

5) Issue(s) to be resolved; and

6) Other matters and information pertinent and relevant for the proper resolution of the protest.

The position paper is verified by an affidavit that the affiant has read and understood the contents thereof and that the allegations therein are true and correct of his personal knowledge or based on authentic records. An unverified position paper shall be considered unsigned, produces no legal effect and results to the outright dismissal of the protest.

c) Resolution of Protests

The protests shall be resolved primarily on the basis of the records of the BAC. The Authority shall resolve the protest within seven (7) calendar days from receipt thereof.

d) Non-Interruption of the Bidding Process

In no case shall any protest taken from any decision treated in this Order stay or delay the bidding process: Provided, however, that protests must first be resolved before any award is made.

e) Resort to Regular Courts

Court action may be resorted to only after the protests contemplated in this Order shall have been completed and resolved by the Authority with finality.

This Order shall take effect fifteen (15) calendar days from its publication in the Official Gazette or in a newspaper of general circulation and a copy filed with the University of the Philippines Law Center.

(SGD.) ATTY. OSCAR M. SEVILLAGeneral Manager

Published in The Manila Standard on April 17, 2009.