Amendments to the IRR of P.D. No. 1594

June 13, 2000

DPWH DEPARTMENT ORDER NO. 120-00

 

Enclosed, for your guidance and compliance, is a copy of the Amendments to the Implementing Rules and Regulations (IRR) of P.D. No. 1594, which were approved by the Office of the President, as per the letter dated 24 May 2000 of Senior Deputy Executive Secretary Ramon B. Cardenas, and transmitted to the DPWH by Secretary of Socio-Economic Planning Felipe M. Medalla, as Chairman, NEDA Board Committee on Infrastructure, thru his letter dated 7 June 2000.

In accordance with Section V of the IRR, these amendments shall become effective on 17 June 2000 (ten (10) days from the date of issuance of the NEDA transmittal letter).

(SGD.) GREGORIO R. VIGILARSecretaryDepartment of Public Works and Highways

ATTACHMENT

Republic of the PhilippinesNational Economic Development Authority

June 7, 2000

Secretary GREGORIO R. VIGILAR

Dear Secretary Vigilar,

We are providing your Office herewith, for information and guidance, a copy of the amendments to the Implementing Rules and Regulations (IRR) of Presidential Decree No. 1594 which were approved by the Office of the President as per letter dated 24 May 2000 of Senior Deputy Executive Secretary Ramon B. Cardenas (copy attached). acEHCD

As per the IRR, these amendments shall become effective after ten (10) days from the date of dissemination/issuance of this letter. The amendments consist of capitalized words, phrases, sentences and paragraphs.

May we request for the circularization of the document to office/agencies/organizations attached to your Office.

Very truly yours,

(SGD.) FELIPE M. MEDALLA

Office of the President

May 24, 2000

Hon. FELIPE M. MEDALLA

Sir:

Please be informed that the following proposed amendments to the Implementing Rules and Regulations of Presidential Decree No. 1594, the major feature of which are:

• Simultaneous submission of Pre-qualification Statements and Bid Price Proposals (Section IB 3) — The implementing agencies are now given the flexibility to choose the pre-qualification/bidding procedure (i.e., this new option or the traditional pre-qualification then bidding activities) they would like to adopt. EcTCAD

• Bid Securities (Section IB 10.1) — The schedule of amounts for alternative forms of bid securities along the same lines as that allowed for performance securities are provided in this amendment.

• Construction Safety and Health Program (Section IB 10.2) — The inclusion of this provision will ensure that the project will be delivered with proper regard to quality and safety.

• Correction of Arithmetical Errors (Section IB 10.3) — The proposed amendment describes the procedures to be taken for correction of arithmetical errors on estimates made by the bidders during the Evaluation of Bids.

• Methods for Costing Work Items under Additional/Extra Works (Section CI 2) — This provision's main intent is to stipulate on how to cost work items under additional/extra works by providing specific methods for driving them in every different condition.

• Liquidated Damages (Section CI 8) — The proposed new formula follows the concept of "foregone economic benefits or returns" from unproductive investments tied up in the delayed project (contract work). These foregone benefits are computed on the basis of the "Opportunity Cost of Capital" using the compounded interest formula.

 Incentive Bonus (Section CI 9) — In parallel with the formula for liquidated damages, this new formula is based on the concept of "early economic benefits or returns" being derived from investments in the project because it is completed ahead of schedule. The early benefits are also computed based on the "Opportunity Cost of Capital".

• Administrative Sanctions (Section V.3) — The applicable laws and guidelines on sanctions against any government official/employee who is found to have violated any of the provisions of the IRR/P.D. are indicated, e.g., Republic Acts 3019 and 6713, and the Civil Service Law.

As the proposed amendment to the IRR that prescribes Policies, Guidelines, Rules and Regulations for Government Infrastructure Contracts will improve overall contract management procedures, the same is hereby approved.

Very truly yours,

By Authority of the President:

(SGD.) RAMON B. CARDENAS

 

Approved Amendments to the Implementing Rules and Regulations of Presidential Decree No. 1594

		Existing Provision			Approved Amendments	Rationale
1	I.	Detailed Engineering	I.	Detailed Engineering
	1.	No bidding and/or award of contract for a	1.	No bidding and/or award of contract for a	To be consistent with the
		construction project shall be made unless		construction project shall be made unless	wording of Section 2 of PD
		the detailed engineering investigations,		the detailed engineering investigations,	1594.
		surveys and designs for the project have		surveys and designs for the project have
		been sufficiently carried out in accordance		been sufficiently carried out AND DULY
		with the standards and specifications		APPROVED in accordance with the
		prescribed by the head of office/agency/		standards and specifications prescribed
		corporation concerned or his duly		by the head of office/agency/corporation
		authorized representatives.		concerned or his duly authorized
					representatives.
2	3.	A schedule of detailed engineering activities	3.	A schedule of detailed engineering activities shall	To be more specific.
		shall include the following:		include the following:
		a.	Survey		a.	Survey
		b.	Site Investigation		b.	Site Investigation
		c.	Foundation Investigation		c.	SOILS AND Foundation Investigation
		d.	Soils and Materials Investigation		d.	[Soils and] CONSTRUCTION Materials
						Investigation
		e.	Preparation of Design
		f.	Preparation of Specifications		f.	Preparation of TECHNICAL Specifications
		xxx                    xxx                    xxx	xxx                    xxx                    xxx
		m.	Environmental Impact Statement for		m.	Environmental Impact Statement for [Major]
			Major Project			CRITICAL Project AS DEFINED BY THE	The DENR issues
						DEPARTMENT OF ENVIRONMENT AND	Environmental Clearance
						NATURAL RESOURCES (DENR)	Certificate (ECC) on
						environmentally critical projects.
					Insert a new provision as follows:
					n.	PREPARATION OF MINIMUM	To ensure safety in the
						REQUIREMENTS FOR A CONSTRUCTION	implementation of construction
						SAFETY AND HEALTH PROGRAM FOR	projects.
						THE PROJECT BEING CONSIDERED.
3	4.	Work under detailed engineering shall	4.	Work under detailed engineering shall include
		include but not necessarily be limited to		but not necessarily be limited to the following:
		the following:
		a.	Design Standards — Design standards		a.	Design Standards — Design standards	To give design engineers
			shall be in accordance with appropriate			shall be in accordance with appropriate	appropriate flexibility in arriving
			standards adopted by the office/agency/			standards AND ACCEPTED DETAILED	at an optimum design.
			corporation concerned.			ENGINEERING PRACTICE adopted by
							the office/agency/corporation concerned.
		b.	Field Surveys — Necessary field surveys		b.	Field Surveys AND INVESTIGATIONS —	To make the sub-title consistent
			which may include aerial, hydrographic,			Necessary field surveys AND -	with the enumerated types of
			topographic, sub-surface, monumenting			INVESTIGATIONS which may include	surveys and investigations and
			and other surveys shall be carried out.			aerial, hydrographic, topographic,	to emphasize the basis of the
			All survey works shall be prepared in a			HYDROLOGIC, sub-surface,	survey and investigation works.
			manner satisfactory to carry out accurate			monumenting and other surveys shall
			design and production of plans.			be carried out IN ACCORDANCE WITH
						THE DESIGN GUIDELINES, CRITERIA
						STANDARDS ADOPTED BY THE OFFICE/
						AGENCY/CORPORATION CONCERNED.
						All survey AND INVESTIGATION works shall
						be prepared in a manner satisfactory to carry
						out accurate design and production of plans.
5	d.	Quantities — All construction quantities shall	d.	Quantities — All construction quantities	To be more realistic.
		be computed to a reasonable accuracy of		shall be computed to a reasonable accuracy
		plus and minus fifteen percent (15%) to avoid		of plus and minus fifteen percent (15%).
		variation orders.		[to avoid variation orders.]
6	Some wordings in the IRR are in calendar days	Add as Section 1.4.k:
	while others are in working days.	k.	UNLESS OTHERWISE SPECIALLY	For clarity.
					STATED, ALL "DAYS" AS USED IN THIS
					IRR SHALL MEAN "CALENDAR DAYS."
7					Insert as Section 1.5 under Detailed Engineering:
				5.	THE ABOVE RULES AND REGULATIONS	To define the application of the
					SHALL APPLY TO THE IMPLEMENTATION	IRR under different project
					OF INFRASTRUCTURE PROJECTS UNDER	conditions and circumstances.
					NORMAL OR ORDINARY CONDITIONS.
					HOWEVER, UNDER SEVERE EMERGENCY
					OR EXTRAORDINARY CASES INVOLVING
					MAJOR CALAMITIES AND DISASTERS
					WHERE TIME IS OF THE ESSENCE TO
					SAVE LIVES AND PROPERTIES
					AND RESTORE DAMAGED
					INFRASTRUCTURES, DETAILED
					ENGINEERING WORKS SHALL BE
					CONDUCTED IN ACCORDANCE WITH
					THE GUIDELINES AND PROCEDURES
					TO ENABLE QUICK RESPONSE TO
					SAID CASES, WHILE MAINTAINING
					THE SAFETY AND INTEGRITY OF
					THE STRUCTURE, AS PRESCRIBED
					BY THE HEAD OF OFFICE/AGENCY/
					CORPORATION CONCERNED.
8	IB 2 — ORGANIZATION OF THE PBAC	IB2 — ORGANIZATION OF THE PBAC
	1.	Each office/agency/corporation shall have	1.	Each office/agency/corporation shall have
		in its head office or in its implementing offices		in its head office or in its implementing
		a Prequalification, Bid and Award		offices a Prequalification, Bid and
		Committee (PBAC) which shall be		Award Committee (PBAC) which shall
		responsible for the conduct of Pre-		be responsible for the conduct of
		qualification, bidding, evaluation of bids		Prequalification, bidding, evaluation
		and recommending award of contract.		of bids and recommending award of
		Each committee shall be composed of		contract. Each committee shall be
		the following:		composed of the following:
		a.	. . .		a.	. . .
		b.	Executive Officer and Secretary		b.	Executive Officer and Secretary	To give the Chief of
			(regular) — Legal Officer of the office/			(regular) — Legal Officer of the office/	Office/Agency/Corporation a
			agency/corporation			agency/corporation. THE ADMINISTRATIVE	choice when there is no
						OFFICER OF THE AGENCY CONCERNED	incumbent Legal Officer.
						MAY BE THE EXECUTIVE OFFICER AND
						SECRETARY OF THE PBAC WHEN THE
						AGENCY DOES NOT HAVE A LEGAL
						OFFICER IN ITS PLANTILLA POSITIONS.
9	(2)	Associations of Certified Public Accountants	(2)	PROJECT-RELATED PROFESSIONAL	This is in recognition of other
		or Civil Engineers duly recognized by the		associations ACCREDITED OR [of Certified	professionals for other project
		Professional Regulation Commission		Public Accountants or Civil Engineers] duly	types aside from civil works.
		(PRC).			recognized by the Professional Regulation
					Commission (PRC)/SUPREME COURT (SC).
		Both representatives shall be non-voting		Both representatives shall be non-voting
		members.			members.
10					Add New Section as IB 2-1.f:
					f.	OBSERVER — THE COMMISSION ON	For increased transparency
						AUDIT (COA) OF THE CONCERNED	during the bidding process.
						OFFICE/AGENCY/CORPORATION.
11					Add as last paragraph of IB 2-1:
					'"MEMBERS/OBSERVERS OF THE PBAC	PBAC members/observers
					SHOULD RECEIVE THE NOTICE OF	should be given enough
					MEETING AT LEAST TWO CALENDAR DAYS	lead-time to prepare for the
					BEFORE THE DATE OF MEETING."	meeting.
12	IB3 — INVITATION TO PREQUALIFY		IB3 — INVITATION TO PREQUALIFY AND TO BID
	AND TO BID
					AS A GENERAL POLICY, THE SECRETARY/
					AGENCY HEAD (FOR THOSE NOT ATTACHED
					TO A DEPARTMENT)/GOVERNING BOARDS OF
					GOCCS SHALL HAVE THE OPTION AS TO THE
					PREQUALIFICATION/BIDDING PROCEDURE
					(I.E., SIMULTANEOUS SUBMISSION OF
					PREQUALIFICATION STATEMENTS AND BID
					PRICE PROPOSALS OR TRADITIONAL
					PREQUALIFICATION THEN BIDDING
					ACTIVITIES) TO BE ADOPTED WHICH
					SHALL BE DISCLOSED IN THE
					ADVERTISEMENT.
					FOR THE SIMULTANEOUS SUBMISSION OF
					PREQUALIFICATION STATEMENTS AND BID
					PRICE PROPOSALS, THE PROCEDURE IS
					PRESCRIBED IN ANNEX A.
13	IB3 — INVITATION TO PREQUALIFY		IB3 — INVITATION TO PREQUALIFY AND TO BID
	AND TO BID
	1.	For locally funded projects, contractors shall	1.	For locally funded projects, contractors shall be
		shall be invited to bid through:		invited TO PREQUALIFY AND to bid through:
		a.	Advertisement for at least three (3) times		a.	THE advertisement SHALL BE MADE [for]	The P1 M limit, which was set
			within a reasonable period depending			at least three (3) times within a reasonable	in 1987, is now too low
			upon the size and complexity but in			period depending upon the size and	considering the inflation since
			case less than two (2) weeks in at least			complexity OF THE PROJECT but in no	then. P5 M is deemed more
			two (2)newspapers of general circulation			case less than two (2) weeks in at least	realistic.
			which have been regularly published for			two (2) newspapers of general NATIONWIDE
			at least two (2) years before the date of			circulation which have been regularly
			issuance of the notices or			published for at least two (2) years
			announcements and at the same time			before the date of [issuance] ISSUE of
			posting copies thereof at any			the [notices or announcements]
			conspicuous place in the office/agency/			ADVERTISEMENT and at the
			corporation concerned if the project			same time posting copies thereof at
			cost is more than P1,000,000. However,			any conspicuous place in the
			for projects costing P1,000.00 and			office/agency/corporation concerned
			below or for projects authorized to be			if the project cost is more than
			bid by the regional/district offices			[P1,000,00.] P5,000,000. However, for
			involving costs as may be delegated			projects costing [P1,000,000] P5,000,000
			by the head of office/agency/corporation,			and below or for projects authorized to be
			the invitation to bid shall be advertised			bid by the regional/district offices involving
			at least once within a week in a			costs as may be delegated by the head of
			newspaper of local circulation which has			office/agency/corporation, the invitation to
			been regularly published for at least six			bid shall be advertised at least [once within
			(6) months before the date of issuance			a week] TWO (2) TIMES WITHIN TWO (2)
			of the notices or announcement			WEEKS in a newspaper of GENERAL
			within the region where the project is			local circulation IN THE REGION WHERE
			situated, or through posting of notices in the			THE PROJECT IS LOCATED, which
			premises of municipal/provincial offices,			NEWSPAPER has been regularly published
			or through other forms of media such as			for at least six (6) months before the date of
			radio and television, provided that based			[issuance] ISSUE of the [notices or
			on the agency's shortlist of contractors or			announcements] ADVERTISEMENT
			referral with the Philippine Contractors			[within the region where the project is situated],
			Accreditation Board, there are at			or through posting of notices in the premises of
			least four contractors indigenous			municipal/provincial offices, or through
			to the region duly classified and			other forms of media such as radio and
			registered to undertake such projects			television, provided that based on the
						agency's shortlist of contractors or referral
						with the Philippine Contractors Accreditation
						Board, there are at least four contractors
						indigenous to the region duly classified
						and registered to undertake such projects.
						THE ADVERTISEMENT MAY LIKEWISE
						BE MADE IN A NEWSPAPER OF GENERAL
						NATIONWIDE CIRCULATION AS DEFINED
						IN THE FOREGOING WHEN THERE IS
						EVIDENT LACK OF INTEREST TO
						PARTICIPATE AMONG THE REGION-
						BASED CONTRACTORS.
14	IB4 — ISSUANCE OF QUALIFICATION	IB4 — ISSUANCE OF QUALIFICATION
	STATEMENTS/FORMS		STATEMENTS/FORMS
	5.	The following papers shall, among others,	5.	The following papers shall, among others,	To correct the omission made
		comprise Pre-C:		comprise Pre-C:	and to be consistent with Sec.
							IB 4-1c.
		a.	Credit line issued by an authorized bank		a.	Credit line COMMITMENT IN A FORM TO	-
			in an amount equal to the average			BE PRESCRIBED BY THE AGENCY issued
			operating expenses of the project for			by an authorized bank in an amount equal to
			two (2) months or ten percent (10%)			the average-operating expenses of the project
			of the total project cost, whichever is less.			for two (2) months or ten percent (10%) of the
						[total] ESTIMATED project cost, whichever is
						less, OR A CASH DEPOSIT CERTIFICATE
						IN THE AMOUNT SPECIFIED IN THE
						FOREGOING.
15		b.	Proposed organization chart for the		b.	Proposed organized chart PLEDGED for	For clarity
			project.			the SPECIFIC project TO BE BID.
16		c.	List of key personnel employed or to be		c.	List of key personnel employed or to be	To identify specific personnel
			employed in the project with complete			employed in the project, INCLUDING	pledged for the project to be
			qualification and experience data sheet.			PROJECT MANAGER AND PROJECT	bid.
						ENGINEER with qualification and
						experience sheets.
17		d.	Statement of all relevant completed		d.	Statement of all relevant completed	The CPES Rating Sheet serves
			construction projects in the last three			construction projects in AT LEAST the	as the best reference in the
			years, construction projects in the last			last three years, government and private,	evaluation of the quality of all
			three years, government and private.			AS INDICATED IN THE INVITATION	relevant completed projects
			The statement shall include the nature			FOR PREQUALIFICATION. The	undertaken in the government
			and value of the project schedule, the			statement shall include the nature and	because it provides quantitative
			location of the project, and the name			value of the project, original and actual	and qualitative descriptions of
			and address of the owner. It shall be			project schedules, the location of the project,	a contractor's performance.
			supported by certificates of completion			and the name and address of the owner. It	Further, the existing fixed
			and/or owner's acceptance.			shall be supported by THE CONSTRUCTORS	period of experience could
						PERFORMANCE EVALUATION SYSTEM	not account for very large
						(CPES) RATING SHEETS AND/OR	projects that the government
						certificates of completion and/or owner's	rarely builds (e.g., dam).
						acceptance.
18		e.	Detailed statement showing a list of all		e.	Detailed statement showing a list of all on-	To be consistent with the
			on-going construction projects,			going construction projects, government and	first sentence of the
			government and private, as well as			private, as well as awarded and/or approved	concerned Section.
			awarded and/or approved contracts not			contracts not yet started. This statement shall
			yet started. This statement shall include			include the nature and value of the project,
			the nature and value of the project,			percentage of time elapsed, percentage of
			percentage of time elapsed, percentage			physical accomplishment, scheduled date of
			of physical accomplishment, scheduled			completion, PERCENTAGE OF PLANNED
			date of completion, the location of the			AND ACTUAL ACCOMPLISHMENT, the
			project and the name and address of the			location of the project and the name and
			owner. It shall be supported by certificates			address of the owner. It shall be supported by
			of completion and/or owner's acceptance,			[Certificates of Completion and/or owners'
			notices of award, and/or notices to proceed			acceptance.] Notice of Awards, and/or Notices
			issued by the owner.			to Proceed issued by the owner, AMONG
						OTHERS.
19	6.	Each office/agency/corporation shall use		Delete the entire clause.	There is no standard format
		the standard Pre-C application form to				devised to date.
		contain the aforementioned requirements.
20	IB 5 — CLASSIFICATION AND REGISTRATION	IB 5 — CLASSIFICATION AND REGISTRATION OF
	OF CONTRACTORS		CONTRACTORS
							Delete the existing clause and replace with the
							following:
	1.	The inter-agency committee composed	1.	THE PHILIPPINE CONTRACTORS	The Inter-Agency Committee
		of Representatives from the Department		ACCREDITATION BOARD (PCAB) SHALL	has ceased to exist and its
		of Public Works and Highways,		REGISTER AND CLASSIFY CONTRACTORS	functions subsumed by
		Department of Transportation and		BASED ON THE PCAB GUIDELINES FOR	PCAB. Also, to clarify the
		Communications, the Office of the		REGISTRATION AND CLASSIFICATION OF	existing procedure for
		President of the Philippines in the		CONTRACTORS.	classification and registration.
		absence of a Department of Energy
		and the Construction Industry Authority
		of the Philippines (CIAP) which classified
		and registered, or predisqualified
		Contractors based on their submitted
		confidential application for registration
		and classification functions, resources
		and manpower will be transferred to CIAP
		through PCAB. The inter-agency committee
		shall still exist for three months from the date
		of approval of the proposed amendments
		by the Office of the President to effect the
		smooth transfer of the system.
21	IB 6 — PREQUALIFICATION OF	IB 6 — PREQUALIFICATION OF CONTRACTORS
	CONTRACTORS FOR SPECIFIC CONTRACTS	FOR SPECIFIC CONTRACTS
	3.	In the evaluation of the Pre-C statement,	3.	In the evaluation of the Pre-C statement, the	To help ensure the quality of
		the PBAC shall review, among other things,		PBAC shall review, among other things, the	construction.
		the technical capability of the contractor		technical capability of the contractor to carry out	The CPES rating serves as the
		to carry out the subject contract		the subject contract as gauged by the extent and	best reference in the evaluation
		as gauged by the extent and		quality of his relevant experience and performance	of the quality of relevant
		quality of his relevant experience		and track record, the suitability of his relevant	experience of contractor.
		and performance and track record,		construction equipment AND MINIMUM
		the suitability of his available		TESTING EQUIPMENT, and the adequacy of
		relevant construction equipment, and		his proposed project organization
		the adequacy of his proposed project		and personnel. THE CPES RATING OR ITS
		organization and personnel. Up-to-date		EQUIVALENT FOR EACH RELEVANT PROJECT
		information on these aspects shall be		SHALL BE USED AS BASIS IN EVALUATING
		considered.			THE QUALITY OF RELEVANT EXPERIENCE
					AND PERFORMANCE AND TRACK RECORD
					OF THE CONTRACTOR. Up-to-date information
					on these aspects shall be considered.
22	4.	To determine the financial capacity of the	4.	To determine the financial capacity of the	Cash deposit can be withdrawn
		contractor, the PBAC shall require the		contractor, the PBAC shall [require]	anytime without the authorization/
		contractor to submit a statement from a		DETERMINE IF the contractor [to submit a]	knowledge of the tendering agency.
		bank or a financing institution authorized/		HAS SUBMITTED THE REQUIRED
		licensed by the Central Bank of the		statement from a bank or a financing
		Philippines that the bank/financing		institution authorized/licensed by the
		institution commits to provide the		Central Bank of the Philippines that the
		contractor, if awarded the contract, a		bank/financing institution commits to
		credit line in an amount specified by the		provide the contractor, if awarded the
		agency which is equal to the average		contract, a credit line in an amount
		operating expenses of the project for two		specified by the agency which is
		(2) months or ten percent (10%) of the		equal to the average operating
		approximate total project cost, whichever		expenses of the project for two (2)
		is less, or cash deposit certificate in the		months or ten percent (10%) of the
		amount specified in the foregoing. Cash		[approximate total] ESTIMATED
		deposit certificate shall be released only		project cost, whichever is less,
		when the cost of the remaining works is 10%		or a cash deposit certificate
		of the total project cost or when the contract		in the amount specified in the
		time remaining is less than two months before		foregoing. CASH DEPOSIT PLEDGED
		completion as certified by the implementing		FOR A PARTICULAR PROJECT
		agency through the issuance of a		CANNOT BE WITHDRAWN DURING
		statement of work accomplished.		CONTRACT EFFECTIVITY WITHOUT
					PRIOR AUTHORIZATION FROM THE
					CONCERNED AGENCY. Cash deposit
					certificate shall be released only when
					the cost of the remaining works is 10%
					of the total project cost or when the
					contract time remaining is less than
					two months before completion as
					certified by the implementing agency
					through the issuance of a statement
					of work accomplished.
23	IB 7 — ISSUANCE OF PLANS,	IB 7 — ISSUANCE OF PLANS, SPECIFICATIONS
	SPECIFICATIONS PROPOSAL BOOK	PROPOSAL BOOK FORM(S) AND DRAFT
	FORM(S) AND DRAFT CONTRACT	CONTRACT
	1.	The PBAC (or the Prequalification	1.	The PBAC (or the Prequalification
		Committee, as the case may be), shall		Committee, as the case may be), shall
		issue the plans, specifications, proposal		issue-the plans, specifications, proposal
		book form(s) for the project to be bid to		book form(s) for the project to be bid to
		contractor-applicants prequalified under		contractor-applicants prequalified
		Pre-C prequalification under the relevant		under Pre-C prequalification under the
		classification, upon payment of the		relevant classification, upon payment
		corresponding price thereof to the		of the corresponding price thereof to the
		collecting/disbursing officer of the office/		collecting/disbursing officer of the office/
		agency/corporation concerned in		agency/corporation concerned in accordance
		accordance with the following schedule:		with the following schedule:

	Estimated Project Cost	Issuance of Plans,		Estimated Project Cost (in	Issuance of Plans,
	(in Pesos)	Specifications,		Pesos)	Specifications,
		Proposal Book,			Proposal Book,
		Form(s) and Draft			Form(s) and Draft
		Contracts			Contracts
a.	Up to one (1) million	15 days before the	a.	Up to [one (1)] FIVE (5)	15 days before the	The cost limits were set in 1982.
		date of bidding		million	date of bidding	Because of the increase in prices
						since then, plus the advent of
						advanced technology, e.g.,
						computerized analyses, which
						facilitate the preparation of bids,
						the new cost limits as indicated
						are more appropriate.
b.	Above one (1)	30 days before the	b.	Above [one (1)] FIVE		30 days before the
	million up to five	date of bidding		(5) million up to [five		date of bidding
	(5) million			(5)] TWENTY-FIVE
				(25) million
c.	Above five (5) million	45 days before the	c.	Above [five (5)]		45 days before the
	up to ten (10) million	date of bidding		TWENTY-FIVE (25)		date of bidding
				million up to [ten (10)]
				FIFTY (50) million
d.	Above ten (10)	60 days before the	d.	Above [ten (10)] FIFTY		60 days before the
	million up to one	date of bidding		(50) million up to ONE		date of bidding
	hundred (100)			HUNDRED (100)
	million			million
e.	Above one hundred	90 days before the	e.	Above ONE HUNDRED		90 days before the
	(100) million	date of bidding		(100) million		date of bidding

			NEW UNIT COST = ORIGINAL UNIT COST X				4.	The alternatives for costing
			(Pt/Po)					additional works involving
								at least 25% of the escalated
				WHERE	Pt	= APPROPRIATE NSO INDEX		contract price is biased in
						DURING THE AGREED UPON		favor of the cost-plus
						DATE/MONTH		method since the contractor
								has the right to disagree to
					Po	= APPROPRIATE NSO INDEX AT		his advantage. Note that the
						THE MONTH OF BIDDING OR		supporting documents
						NEGOTIATED BIDDING		thereto include official
								receipts/invoices from
								suppliers whose amounts
								could be easily padded.
51					(2)	ALL NEW COMPONENTS OF THE NEW	5.	The proposed alternative
						WORK ITEM SHALL BE BASED ON		method of costing new
						PRICES PREVAILING AT THAT AGREED		work items relies on the
						DATE/MONTH, PROVIDED THE SAME IS		NSO indices so that only
						ACCEPTABLE TO BOTH THE GOVERNMENT		the price of a few new
						AND THE CONTRACTOR, AND PROVIDED		components would be
						FURTHER THAT THE DIRECT UNIT COSTS		subject to arbitrariness.
						OF NEW COMPONENTS SHALL BE BASED
						ON THE CONTRACTOR'S ESTIMATE AS
						VALIDATED BY THE AGENCY
						CONCERNED VIA DOCUMENTED
						CANVASS IN ACCORDANCE WITH
						EXISTING RULES AND REGULATIONS.
52					(3)	THESE TWO SHALL BE COMBINED TO	6.	Considering the delayed
						ARRIVE AT THE DIRECT COST OF THE		issuance of the NSO
						NEW WORK ITEM. IT SHALL THEN BE		indices, the contracting
						COMBINED WITH THE MARK-UP		parties are allowed to
						FACTOR (I.E., TAXES & PROFIT) USED		agree on a reckoning
						BY THE CONTRACTOR IN HIS BID TO		date/month for purposes
						DETERMINE THE UNIT PRICE OF THE		of unit price adjustment
						NEW WORK ITEM. THE RECKONING		and subsequent claims
						DATE FOR PRICE ESCALATION		for price escalation.
						PURPOSES SHALL BE THE DATE/MONTH
						AS AGREED UPON BY BOTH PARTIES.	7.	In consideration of the
								contractor's bid, the use
								of the mark-up factor
								(representing the
								indirect cost usually-
								in percentage of
								the direct cost) is
								allowed in arriving
								at the unit price of
								a new work item.
53	2.	If the parties are unable to agree on any	Delete CI 2-2 and renumber succeeding	As explained above.
		of the modes of payment specified in	section accordingly.
		Section CI2-1.a, the extra
		work shall be done on a cost-plus
		percentage basis described in Section
		CI2-1.b above.
54	CI 3 — CONDITIONS UNDER WHICH	CI 3 — CONDITIONS UNDER WHICH
	CONTRACTOR IS TO START WORK UNDER	CONTRACTOR IS TO START WORK UNDER
	VARIATION ORDERS AND RECEIVE	VARIATION ORDERS AND RECEIVE
	PAYMENTS			PAYMENTS
	1.	Under no circumstances shall a contractor	1.	Same
		proceed to commence work under any
		Change Order, Extra Work Order or
		Supplemental Agreement unless it has
		been approved by the Secretary or his
		duly authorized representative. Exceptions
		to the preceding rule are the following:
		a.	The Regional Director may, . . .		a.	The Regional Director, OR ITS	For clarity. Agencies having no
						EQUIVALENT POSITION IN AGENCIES/	Regional Director positions in
			(1) In the event of . . .			OFFICES/CORPORATIONS WITHOUT	their plantilla find this provision
						PLANTILLA POSITION FOR THE SAME	restrictive.
			(2) When time is of the essence			may, . . .
						(1) In the event of . . .
			Provided, however, that such approval is			(2) When time is of the essence;
			valid on work done up to the point where
			the cumulative increase in value of work			provided, however, that such approval is valid	The provision that no variation
			on the project which has not yet been			on work done up to the point where the	order may be started if the
			approved does not exceed five percent			cumulative increase in value of work on the	cumulative increase exceeds
			(5%) of the total original contract price, or			project which has not yet been approved	15% of the adjusted or original
			P500,000 whichever is less; . . .			does not exceed five percent (5%) of the	contract price without the prior
						[total] ADJUSTED original contract price,	approval of the concerned
		b.	For a Change/Extra Work Order involving			or P500,000 whichever is less; . . .	Secretary/authorized
			a cumulative amount exceeding fifteen				Representative conflicts with
			percent (15%) of the original contract price		b.	For a Change/Extra Work Order involving	the 2nd sentence of Section
			or original adjusted contract price, no work			a cumulative amount exceeding [fifteen	CI2 which allows contractors
			thereon may be commenced unless said			percent (15%)] FIVE PERCENT (5%) of	to promptly proceed with the
			Change/Extra Work Order has been			the original contract price or original	extra work involving an
			approved by the Secretary or his duly			adjusted contract price, no work thereon	increase below 25% of the
			authorized representative.			may be commenced unless said Change/	original or adjusted contract
						Extra Work Order has been approved by	price. Further, the bases
						the Secretary or his duly authorized	in getting the percentage
						representative.	ceilings are different. For
							consistency, the adjusted
							original contract price
							should be used as the
							common basis in
							determining the
							cut-offs. Also, the
							Government's signatory
							to the contract, not
							necessarily the
							Secretary concerned,
							should be identified
							as the official authorized
							to order the start of
							extra works involving
							more than 5% of the
							adjusted original
							contract price, upon
							issuance of a written
							advice by the former to
							the contractor that funds
							necessary to cover the
							extra works is available.
55	CI 7 — CONTRACT COMPLETION	CI 7 — CONTRACT COMPLETION
	1.	Once the project reaches an accomplishment	1.	Once the project reaches an accomplishment	The contract time does not have
		of 95% of the total contract amount,		of 95% of the total contract amount, [the	to be and should not be suspended
		the contract time may be suspended and		contract time may be suspended and]	while the inspectorate team makes
		the government upon the request of the		the government [upon the request of the	the inspection and prepares the
		contractor may create an inspectorate		contractor] may create an inspectorate	punch list.
		team to make preliminary inspection		team to make preliminary inspection and
		and submit a punch list to the contractor		submit a punch list to the contractor in
		in preparation for the final turnover of the		preparation for the final turnover of the
		project.			project.
56	CI.8 — LIQUIDATED DAMAGES	CI.8 — LIQUIDATED DAMAGES
	1.	Where the contractor refuses or fails to	1.	Where the contractor refuses or fails to	The proposed formula follows
		satisfactorily complete the work within		satisfactorily complete the work within the	the concept of "foregone
		the specified contract time, plus any time		specified contract time, plus any time	economic benefits or returns"
		extension duly granted and is hereby in		extension duly granted and is hereby in	from unproductive investments
		default under the contract, the contractor		default under the contract, the contractor	tied up in the delayed project
		shall pay the Government for liquidated		shall pay the Government for liquidated	(contract work). Since the
		damages, and not by way of penalty, an		damages, and not by way of penalty, an	project is not completed on
		amount to be determined in accordance		amount to be determined in accordance	time, the economy foregoes
		with the following formula for each calendar		with the following formula for each	or loses the opportunity to
		day of delay, until the work is completed		calendar day of delay, until the work is	realize the benefits or returns
		and accepted or taken over by the		completed and accepted or taken over	that could have been generated
		Government:		by the Government:	during the period of delay
		LD = 0.75 x CP/CT		TLD=VUUP x [(1+OCC) n - 1] x K	(beyond the contract expiry date).
					VUUP = TCP-VCUP	The investment funds allocated
		Where:			WHERE:		to the project, which are not yet
		LD = Amount of liquidated damages for each		TLD = TOTAL LIQUIDATION DAMAGES IN	productive because the project
		calendar day of delay.		PESOS		is incomplete and unusable,
							could have earned returns if
	CP = Total contract price minus the value of	VUUP = VALUE OF THE UNCOMPLETED AND	invested in other productive
	completed portions of the contract certified by the	UNUSABLE PORTIONS OF THE CONTRACT	ventures elsewhere.
	government office concerned as usable as of the	WORK, AS OF THE EXPIRY DATE OF THE
	expiration of the contract time, in pesos.	CONTRACT, IN PESOS
	CT = Contract time plus any time extension duly	TCP = TOTAL CONTRACT PRICE, IN PESOS	The foregone benefits are
	granted to the contractor, in calendar days.				computed on the basis of
				VCUP = VALUE OF THE COMPLETED AND	the "Opportunity Cost of
				USABLE PORTION OF THE CONTRACT	Capital" using the
				WORK, AS OF THE EXPIRY DATE OF	compounded interest
				THE CONTRACT, IN PESOS	formula [(I + OCC) n -1].
							The Opportunity Cost of
				OCC = PREVAILING OPPORTUNITY COST	Capital is that adopted by
				OF CAPITAL FOR GOVERNMENT	NEDA, presently set at
				PROJECTS SET BY NEDA, WHICH IS	15% per annum.
				CURRENTLY PEGGED AT 15%
				n = TOTAL NUMBER OF YEARS THAT	The compounded interest
				THE CONTRACT WORK IS DELAYED	formula is applied to the funds
				AFTER THE EXPIRY DATE OF THE	allocated to the uncompleted
				CONTRACT			and unusable portion of the
							project, which is unproductive
				K = ADJUSTMENT FACTOR TO COVER	because of the delay. This
				ADDITIONAL LOSSES		portion is VUUP which is equal to
				=1 + C + (i x n)		TCP-VCUP. In some cases, the
							project may be partly
				WHERE:			completed and usable, e.g.,
							a partly finished section of
				C = COST OF CONSTRUCTION	a road pavement. In other
				SUPERVISION AS A PERCENTAGE,	cases, the project may be
				NOT EXCEEDING 10%, OF		partly completed but still
				CONSTRUCTION COST		unusable, e.g., a partly
							finished bridge; in these
				i = ANNUAL INFLATION RATE	cases, VCUP equals zero,
							and the compounded
				THE HEAD OF AGENCY MAY ALSO	formula is applied to TCP.
				IMPOSE ADDITIONAL LIQUIDATED
				DAMAGES ON THE CONTRACTOR	K is the adjustment factor
				PROVIDED THAT SUCH IS		to cover the following
				PRESCRIBED IN THE INSTRUCTIONS	additional losses incurred
				TO BIDDERS.			by the economy, which are
							not captured by the basic
							compounded interest
							formula.
					a.	Additional Government
						expenses for construction
						supervision of the
						delayed project beyond
						the expiry date of the
						contract. This is
						estimated at 10% of
						the VUUP, which is
						the ceiling for
						construction supervision
						per NEDA Guidelines for
						consultancy.
					b.	Additional budgetary
						outlays to cover the
						cost increases in the
						VUUP due to inflation
						during the period of
						delay. This is based
						on the latest inflation
						rate published by
						NEDA applied to the
						number of days of
						delay.
				Insert as CI 8-2 and renumber succeeding
				provisions accordingly:
				2.	A PROJECT OR A PORTION THEREOF	For clarity.
					MAY BE DEEMED USABLE WHEN IT STARTS
					TO PROVIDE THE DESIRED BENEFITS AS
					CERTIFIED BY THE TARGETED END-USERS
					AND THE CONCERNED AGENCY.
57	CI 9 — INCENTIVE BONUS	CI 9 — INCENTIVE BONUS
	1.	For major and urgent projects, except for	1.	For major and urgent projects, except for	This formula is based on the
		negotiated contracts and provided that the		negotiated contracts and provided that the	concept of "early economic
		Instructions to Bidders and other Tender		Instructions to Bidders and other Tender and	benefits or returns" being
		and Contract Documents so prescribed,		Contract Documents so prescribed, if the	derived from investments
		if the contractor completes the contract		contractor completes the contract works	in the project because it
		works ahead of schedule without any		ahead of schedule without any suspension	is completed ahead of
		suspension order affected or extension		order affected or extension of contract time	schedule. That is, since
		of contract time granted, he may be given		granted, he may be given a bonus for saving	the project is completed
		a bonus for saving the Government		the Government additional expenses for	before the contract expiry
		additional expenses for engineering and		engineering and inspection services and	date, the economy
		inspection services and for allowing the		for allowing the Government the early use	will realize the benefits
		Government the early use of the completed		of the completed facilities, in an amount	or returns earlier than
		facilities, in an amount to be determined,		to be determined, but not to exceed ten	if the project were completed
		but not to exceed ten percent (10%) of the		percent (10%) of the contract price:	just on schedule.
		contract price:
		IB = 0.75 x VWA		TIB = VCUP x [(1 + OCC) t - 1] x K'
		Where:			WHERE:		The early benefits are
							computed based on the
		IB = Total amount of incentive bonus	TIB = TOTAL INCENTIVE BONUS, IN PESOS,	Opportunity Cost of Capital,
				WHICH SHALL NOT EXCEED OR BE	using the same compounded
		VWA = Value of works accomplished	GREATER THAN 10% OF THE TOTAL	interest formula [(1 + OCC) n
		ahead of schedule	CONTRACT PRICE		- 1] as for Liquidated
							Damages. The Opportunity
				VCUP = VALUE OF THE COMPLETED AND	Cost of Capital is that adopted
				USABLE PORTION OF THE CONTRACT	by NEDA, presently set at 15%
				WORK DONE AHEAD OF SCHEDULE,	per annum.
				I.E., BEFORE THE EXPIRY OF THE
				CONTRACT, IN PESOS
				OCC = PREVAILING OPPORTUNITY COST	K' is an adjustment factor to
				OF CAPITAL FOR GOVERNMENT	cover the following additional
				PROJECT SET BY NEDA WHICH IS	returns from investments which
				CURRENTLY PEGGED AT 15%	are not captured by the basic
							compounded interest formula:
				t = TOTAL NUMBER OF YEARS THAT THE	a.	Savings in Government
				CONTRACT WORK WAS COMPLETED		expenses for supervision
				BEFORE THE EXPIRY DATE OF THE		of the portion of the
				CONTRACT				contract work completed
								and made usable before
				K' = ADJUSTMENT FACTOR TO COVER		the expiry date of the
				ADDITIONAL RETURNS			contract. This is
				= 1 - C + (i x n)			estimated at 10% of the
								VPSCU, which is the
								ceiling for contract
								supervision per NEDA
								Guidelines for consultancy.
				WHERE:
				C = COST OF CONSTRUCTION	b.	Savings in budgetary
				SUPERVISION AS A PERCENTAGE,		outlays for the contract
				NOT EXCEEDING 10%, OF CONSTRUCTION		due to avoided inflation
				COST				beyond the actual
				i = ANNUAL INFLATION RATE		completion date. This
				VCUP = TCP-VPSCU			is based on the latest
				WHERE:				inflation rate per year
				TCP = TOTAL CONSTRUCTION PRICE, IN		published by NEDA
				PESOS				applied to the number
				VPSCU = VALUE OF THE PORTION OF THE		of days needed to
				CONTRACT WORK SUPPOSED TO BE		accomplish VPSCU.
				COMPLETED AND USABLE, PER
				APPROVED PERT/CPM SCHEDULE,
				ON THE DATE OF ACTUAL CONTRACT
				COMPLETION, IN PESOS
58	CI 12 — CONTRACT PRICE ESCALATION	CI 12 — CONTRACT PRICE ESCALATION
	CI 12.1 — GUIDELINES ON CONTRACT	CI 12.1 — GUIDELINES ON CONTRACT
	PRICE Escalation		PRICE ESCALATION
	1.	These guidelines for the computation	1.	These guidelines for the computation	To encourage the introduction,
		and payment of price escalation shall		and payment of price escalation shall apply	improvement and/or refinement
		apply to existing contracts, . . . All		to existing contract, . . . All infrastructure	of the parametric formulae to
		infrastructure contracts entered into		contracts entered into after the date of	reflect more accurately the
		after the date of effectivity of these		effectivity of these guidelines (August 27,	fluctuation in the prices.
		guidelines (August 27, 1980) shall		1980) shall employ the escalation method
		employ the escalation method provided		USING THE PARAMETRIC FORMULAE
		for in these guidelines. Equipment supply		provided for in these guidelines.
		contracts, whether or not included as an		FORMULAE OTHER THAN
		integral part of the infrastructure contract,		THOSE PRESCRIBED HEREIN MAY
		shall not be covered by this provision.		ALSO BE USED FOR PRICE ESCALATION
					PURPOSES PROVIDED THE
					ADOPTION OF THE SAME IS CLEARLY
					STIPULATED IN THE TENDER AND
					CONTRACT DOCUMENTS PROVIDED TO
					TENDERERS PRIOR TO THE BIDDING
					AND AGREED UPON BY THE
					GOVERNMENT AND THE CONTRACTOR.
					Equipment supply contracts, whether
					or not included as an integral part of
					the infrastructure contract, shall not be
					covered by this provision.
59	4.	For projects with remaining balances of	Delete this section		This is already outdated and
		work as of February 1, 1976, the Contract				deemed no longer applicable.
		Price Adjustment Committee (CPAC) shall
		complete the determination of adjusted unit
		prices as determined by CPAC multiplied
		by 1.05 as if they were the original contract
		unit price. For projects without any balances
		of work, and not started as of February 1,
		1976, the original unit prices of the contract
		as set forth in Section CI 12.2-4 below shall
		be used.
60	6.	All price escalation to be granted may be	Delete the portion "except those recommended	For consistency. This is in
		approved by the Secretary or head of office/	by CPAC for escalation in contract unit prices	connection with the deletion
		agency/corporation concerned in accordance	up to price levels as of February 1, 1976 where	of CI 12.1-4 above.
		with Section 8 of Presidential Decree No.	the old CPAC guidelines were used, and which
		1594 to become effective except those	must be forwarded to the Office of the President
		recommended by CPAC for escalation	for approval before they become effective".
		in contract unit prices up to price levels
		as of February 1, 1976 where the old
		CPAC guidelines were used, and which
		must be forwarded to the Office of the
		President for approval before they become
		effective. . . .
61	7.	Excalation of prices for work	7.		Escalation of prices for work accomplishment	For clarity.
		accomplishment on infrastructure . . .			on infrastructure . . . shall be made periodically
		shall be made periodically . . . an increase			. . . an increase or decrease of more than five
		or decrease of more than five percent (5%)			percent (5%) of the original OR ADJUSTED
		of the original contract unit price of items of			contract unit price of items of work.
		work.
62	CI 12.2-4			CI 12.2-4
	4.	. . . In the absence of any price index for a	4.		. . . In the absence of any price index for	For clarity.
		specified adjustable item, the nearest			a specified adjustable item, THE PRICE
		related price index shall be used.			INDEX OF the nearest related ITEM
						[price index] shall be used.
63	IV.PE — EVALUATION OF CONTRACTORS	IV. PE — EVALUATION OF CONTRACTORS
	PERFORMANCE		PERFORMANCE
	PE 1 — SUBJECT AND SCOPE	PE 1 — SUBJECT AND SCOPE
	All contractors undertaking projects with the	All contractors undertaking projects with the
	government, regardless of contract amount	government, regardless of contract amount
	and funding source and whose contracts are	and funding source and whose contracts are
	awarded either thru bidding or negotiation,	awarded either thru bidding or negotiation,
	shall have their performance evaluated by	shall have their performance evaluated by
	offices/agencies/corporations concerned.	offices/agencies/corporations concerned.
	This evaluation shall be done during the	This evaluation shall be done during [the]
	construction phase and completion phase.	construction [phase] and UPON completion
				[phase] OF EACH GOVERNMENT	Grammatical/syntax correction
				PROJECT.			only.
64				To link the mechanism defined by CIAP
				below, the following paragraph is
				suggested to replace the existing
				provision under PE 2 — Evaluation
				Guidelines:
				ALL OFFICES/AGENCIES/CORPORATIONS	While this satisfies the
				CONCERNED ARE MANDATED TO ADOPT	intended updating, it also
				THE CPES IMPLEMENTING GUIDELINES	allows the formulation of
				AS APPROVED BY THE NEDA INFRACOM.	similar implementing
				WHILE THE CPES IS SPECIFIC FOR ROAD,	guidelines for projects
				BRIDGE, HOUSING, BUILDING, PORT AND	other than those
				HARBOR PROJECTS, AGENCIES	specifically covered by
				CONCERNED MAY FORMULATE AND	the CPES.
				ADOPT THEIR OWN IMPLEMENTING
				GUIDELINES SPECIFIC TO PROJECT
				TYPES OTHER THAN THOSE ABOVE-
				MENTIONED BUT ALONG THE SAME
				LINE WITH THE APPROVED CPES,
				PROVIDED THE NEDA-INFRACOM
				HAS NO OBJECTION FOR THE
				ADOPTION OF THE FORMULATED
				GUIDELINES, AND PROVIDED
				FURTHER THAT THE FORMULATED
				GUIDELINES ARE MADE KNOWN TO ALL
				PROSPECTIVE BIDDERS.
65				Insert new Section under PE 3 and
				renumber succeeding provisions.
				PE 3 — IMPLEMENTATION MECHANISM
				FOR CPES
				1.	EACH AGENCY SHALL ESTABLISH	The present provision needs
					A CPES IMPLEMENTING UNIT (IU)	updating to cite the CPES
					WHICH SHALL BE RESPONSIBLE	implementing guidelines
					FOR CPES GUIDELINES IMPLEMENTATION,	that have been approved
					INCLUDING BUT NOT LIMITED TO THE	by the NEDA-INFRACOM.
					SUPERVISION OF PERFORMANCE	The setting-up of the CPES
					EVALUATORS ACCREDITED BY THE CIAP.	IU will provide clear
							delineation of roles and
							responsibility in the CPES
							implementation accreditation
							process by CIAP-PDCB.
66				Merge Section IB 10.5 and the approved
				Blacklisting Guidelines as new Section V:
				SECTION V — ADMINISTRATIVE SANCTIONS
				1.	THE ADMINISTRATIVE SANCTIONS	To incorporate Section 4.2
					AS PROVIDED FOR UNDER THE	of the Blacklisting Guidelines
					UNIFORM GUIDELINES FOR	approved by the NEDA
					BLACKLISTING CONSTRUCTORS	INFRACOM in the IRR
					INVOLVED IN PUBLIC CONSTRUCTION	of PD 1594 for enforcement
					(CIAP BLACKLISTING GUIDELINES)	by agencies concerned.
					SHALL BE IMPOSED FOR OFFENSES/
					VIOLATIONS COMMITTED BY
					CONTRACTORS DURING PREQUALIFICATION,
					BIDDING, AWARD AND CONTRACT
					IMPLEMENTATION.
				2.	THE IMPOSITION OF ADMINISTRATIVE
					SANCTIONS IN THIS SECTION SHALL
					BE PURSUANT TO THE CIAP BLACK-
					LISTING GUIDELINES APPROVED BY
					THE NEDA-INFRACOM ON 14 AUGUST
					1996 AND BY THE NEDA BOARD ON
					17 SEPTEMBER 1996. THE CIAP
					BLACKLISTING GUIDELINES SHALL,
					HOWEVER, BE SUBJECT TO REVIEW
					AND REVISION BY THE CIAP
					INTER-AGENCY COMMITTEE (IAC)
					ON BLACKLISTING. AMENDMENTS/
					REVISIONS TO SUCH GUIDELINES
					SHALL BE APPROVED BY THE
					CIAP BOARD AND BECOME
					EFFECTIVE FIFTEEN (15) DAYS
					AFTER FILING OF THE SAME
					WITH THE OFFICE OF THE
					NATIONAL ADMINISTRATIVE
					REGISTER PURSUANT TO
					ADMINISTRATIVE REGISTER
					PURSUANT TO ADMINISTRATIVE
					CODE OF 1987.
				3.	VIOLATION OF THE PROVISIONS
					OF THE IRR OF PD 1594 WILL
					SUBJECT THE ERRING
					GOVERNMENT OFFICIAL/
					EMPLOYEE TO THE SANCTIONS
					PROVIDED UNDER EXISTING
					LAWS PARTICULARLY REPUBLIC
					ACT 3019 (KNOWN AS THE
					"ANTI-GRAFT AND CORRUPT
					PRACTICES ACT") AND 6713
					(KNOWN AS THE "CODE OF
					CONDUCT AND ETHICAL
					STANDARDS FOR PUBLIC
					OFFICIALS AND EMPLOYEES"),
					AND THE CIVIL SERVICE LAW,
					AMONG OTHERS. COMPLAINTS
					AGAINST GOVERNMENT
					OFFICIALS/EMPLOYEES
					MAY BE FILED WITH THE
					AGENCY HEAD, OR IF THE
					AGENCY HEAD IS THE
					OFFICIAL BEING COMPLAINED,
					WITH THE OFFICE OF THE
					PRESIDENT.
67	V.	APPLICABILITY	[V.]	VI. APPLICABILITY
	1.	The above notwithstanding, nothing in these	1.	The above notwithstanding, nothing in
		implementing rules and regulations shall		these implementing rules and regulations
		negate any existing and future commitments		shall negate any existing and future
		with respect to the bidding and award of		commitments with respect to the
		contracts financed partly or wholly with funds		bidding, award and EXECUTION of
		from international financial institutions, as		contracts financed partly or wholly
		well as from bilateral and other similar		with funds from international
		sources.			financial institutions, as well as
					from bilateral and other similar
					sources.

ANNEX A

Procedure for Simultaneous Submission of Prequalification Statements and Bid Price Proposals

1. For a given project to be bid out, the PBAC concerned shall determine the corresponding PCAB class of contractors that will be invited to submit bids.

2. The PBAC shall cause the publication of an advertisement inviting all contractors falling under such class to submit to the PBAC at the designated time and date the following: (a) their prequalification statements and (b) their price proposals for the subject project in two separate sealed envelopes. The advertisement shall also indicate the project description, project cost, maximum contract duration, and desirable starting date, among others.

3. Interested contractors shall secure from the PBAC, upon payment of a fee, copies of the bid documents, including plans, specifications, draft contract with terms and conditions, instructions to bidders, and proposal book with bill of quantities.

4. Contractors shall submit to the PBAC at the designated time and time, in two separate sealed envelopes: (a) their accomplished prequalification statements and (b) their price proposals for the subject using the bid forms in the proposal book.

5. The PBAC is given the discretion on how to secure the price proposals provided this is indicated in the Instructions to Bidders. Normally, the PBAC may, in the presence of the contractors, deposit all the sealed envelopes containing the price proposals in a designated secured container (e.g., steel cabinet) and shall lock this using three padlocks, one of whose keys shall be kept by the PBAC Chairman, another by the representative of the Commission on Audit (COA) in the PBAC, and the third by the contractors' representative in the PBAC.

6. The PBAC shall then evaluate the prequalification statement of each of the contractors, considering among other things: (a) its technical capability to prosecute the project based on the extent and quality of its relevant experience and performance/track record, (b) the adequacy of its available construction equipment, (c) the adequacy of its proposed project organization and personnel, (d) the financial capacity based on a statement from an authorized bank/financing institution that it commits to provide the contractor a credit line or cash deposit in the amount pre-specified by the PBAC to cover the average project operating expenses for two months or ten percent (10%) of the total contract cost, whichever is less, and (e) its performance in on-going and completed projects.

7. The PBAC shall notify the prequalified as well as the predisqualified contractors of the results of the evaluation of the prequalification statements. In case of a predisqualification, the reason for same shall be indicated.

8. The PBAC shall allow seven (7) days after the notices mentioned in paragraph 7 above have been transmitted during which to evaluate requests for reconsideration, if any, from predisqualified contractors, and shall notify them accordingly of the results of such re-evaluation.

9. The PBAC shall inform all prequalified contractors of the date and time of the opening of bids and instruct them to submit their respective bid securities in an amount in accordance with the schedule given below and in the form of cash, certified check, manager's check, bank draft/guarantee confirmed by a local bank against any reputable bank, letter of credit issued by a commercial bank, or surety bond, callable on demand, issued by a surety company duly accredited by the Office of the Insurance Commissioner, or a combination thereof. HSAcaE

a. Cash, manager's check, cashier's check, letter of credit, or bank draft — one percent (1%) of the total project cost as advertised

b. Bank guarantee — one and a half percent (1 1/2%) of the total project cost as advertised

c. Surety bond — two and a half percent (2 1/2%) of the total project cost as advertised

10. At the designated date and time, the PBAC shall receive the bid securities of the prequalified contractors. Thereafter, the PBAC shall publicly open the container where the sealed envelopes containing the price proposals were deposited. All bidders shall be required to have their respective duly authorized representatives present to witness the opening of the price proposals. 

11. The PBAC shall return to the predisqualified contractors their respective sealed envelopes containing the price proposals.

12. The PBAC shall open the sealed envelope of each of the prequalified contractors, examine its contents, and determine if the corresponding bid security is adequate in amount and in the proper form. The PBAC shall then open, read and record the Approved Agency Estimate. It shall thereafter read and record the price proposals of each bidder.

13. The award of contract and all subsequent activities shall follow the pertinent sections of the IRR/PD 1594.