Implementing Rules & Regulations of PD 1594 (Policies, Guidelines, Rules & Regulations For Government Infrastructure Contracts)

July 20, 2000

CUSTOMS MEMORANDUM CIRCULAR NO. 291-00

 

Attached is Memorandum dated July 7, 2000 of Assistant Secretary Ma. Eleanor F. Dela Cruz, Department of Finance endorsing the Implementing Rules & Regulations (IRR) of PD 1594 as approved by Office of the President per Letter dated 24 May 2000 of Senior Deputy Executive Secretary Ramon B. Cardenas.

For your information.

 

(SGD.) JULITA S. MANAHANDeputy CommissionerInternal Administration Group

July 7, 2000

ATTACHMENT

 

Enclosed herewith for information and guidance is a copy of the above-captioned subject. DEICaA

(SGD.) MA. ELEANOR F. DELA CRUZAssistant Secretary

May 2, 2000

Hon. FELIPE M. MEDALLADirector-GeneralNational Economic and Development AuthorityNEDA Sa Pasig, 12 Amber AvenuePasig City

Sir:

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

◊ Simultaneoussubmission 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.

◊ 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 deriving 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." cADEIa

◊ 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. CARDENASSenior Deputy Executive Secretary

APPROVED AMENDMENTS TO THE IMPLEMENTING RULES AND REGULATIONS OF PRESIDENTIAL DECREE NO. 1594

		Existing Provision		Approved Amendments		Rationale
1	1.	DETAILED ENGINEERING		1.	DETAILED ENGINEERING
	1.	No bidding and/or award of contract for a construction	1.	No bidding and/or award of contract for a construction
		project shall be made unless the detailed engineering		project shall be made unless the detailed engineering
		investigations, surveys and designs for the project have		investigations, surveys and designs for the project have
		been sufficiently carried out in accordance with the		been sufficiently carried out AND DULY APPROVED in	To be consistent with the
		standards and specifications prescribed by the head of		accordance with the standards and specifications	wording of Section 2 of PD
		office/agency/corporation concerned or his duly		prescribed by the head of office/agency/corporation	1594
		authorized representatives.			concerned or his duly authorized representatives.
2	3.	A schedule of detailed engineering activities shall include	3.	A schedule of detailed engineering activities shall include
		the following:			the following:
		a.	Survey		a.	Survey
		b.	Site Investigation		b.	Site Investigation
		c.	Foundation Investigation	c.	SOILS AND Foundation Investigation	To be more specific
		d.	Soils and Materials Investigation	d.	[Soils and]CONSTRUCTION  Materials Investigation
		e.	Preparation of Design	e.	Preparation of Design PLANS
		f.	Preparation of Specifications	f.	Preparation of TECHNICAL Specifications
		. . . -	. . . .
		m.	Environment Impact Statement for Major Project	m.	Environment Impact Statement for [Major]
			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 REQUIREMENTS					To ensure safety in the
		FOR A CONSTRUCTION SAFETY AND					implementation of construction
		HEALTH PROGRAM FOR THE PROJECT					projects.
		BEING CONSIDERED.
3	4.	Work under detailed engineering shall include but not	4.	Work under detailed engineering shall include but not
		necessarily limited to the following:		necessarily limited to the following:
		a.	Design Standards - Design standards shall be in	a.	Design Standards - Design standards shall be in
			accordance with appropriate standards adopted by the		accordance with appropriate standards AND	To give design engineers
			office/agency/corporation concerned		ACCEPTED DETAILED ENGINEERING	appropriate flexibility in arriving
			PRACTICE adopted by the office/					at an optimum design.
			agency/corporation concerned.
4		b.	Field Surveys - Necessary field surveys which may	b.	Field Surveys AND INVESTIGATIONS - Necessary	To make the sub-title consistent
			include aerial, hydrographic, topographic, sub-surface,		field surveys AND INVESTIGATIONS which may	with the enumerated types of
			monumenting and other surveys shall be carried out.		include aerial, hydrographic, topographic,	surveys and investigations and to
			All survey works shall be prepared in a manner		HYDROLOGIC, sub-surface, monumenting and other	emphasize the basis of the
			satisfactory to carry out accurate design and		surveys shall be carried out IN ACCORDANCE	survey and investigation works.
			production of plans.			WITH THE DESIGN GUIDELINES, CRITERIA
						AND 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 be	d.	Quantities - All construction quantities shall be	To be more realistic.
			computed to a reasonable accuracy of plus and minus		computed to a reasonable accuracy of plus and minus
			fifteen percent (15%) to avoid variation orders.		fifteen percent (15%) [to avoid variation orders.]
6.		Some wordings in the IRR are in calendar days while others		Add as Section I.4.k:
		are in working days.		k.	UNLESS OTHERWISE SPECIFICALLY STATED,	For clarity
						ALL "DAYS" AS USED IN THIS IRR SHALL
						MEAN "CALENDAR DAYS."
7.	Insert as Section I.5 under Detailed Engineering:
					5.	THE ABOVE RULES AND REGULATIONS SHALL	To define the application of the
						APPLY TO THE IMPLEMENTATION OF	IRR under different project
						INFRASTRUCTURE PROJECTS UNDER NORMAL	conditions and circumstances.
						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 A 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		IB 2 - ORGANIZATION OF THE PBAC
	1.	Each office/agency/corporation shall have in its head	1.	Each office/agency/corporation shall have in it head
		office or in its implementing offices a Prequalification,		office or in its implementing offices a Prequalification,
		Bid and Award Committee (PBAC) which shall be		Bid and Award Committee (PBAC) which shall be
		responsible for the conduct of Prequalification, bidding,		responsible for the conduct of Prequalification, bidding
		evaluation of bids and recommending award of contract.		evaluation of bids and recommending award of contract.
		Each committee shall be composed of the following:		Each committee shall be composed of the following:
		a.	. . .			a.	. . .
		b.	Executive Officer and Secretary (regular) - Legal		b.	Executive Officer and Secretary (regular) - Legal
			Officer of the office/agency/corporation			Officer of the office/agency/corporation. THE	To give the Chief of
							ADMINISTRATIVE OFFICER OF THE	Office/Agency/Corporation a
							AGENCY CONCERNED MAY BE THE	choice when there is no
							EXECUTIVE OFFICER AND SECRETARY OF	incumbent Legal Officer.
							THE PBAC WHEN THE AGENCY DOES NOT
							HAVE A LEGAL OFFICER IN ITS PLANTILLA
							POSITIONS.
9	(2)	Associations of Certified Public Accountants or Civil	(2)	PROJECT-RELATED PROFESSIONAL	This is in recognition of other
		Engineers duly recognized by the Professional		associations ACCREDITED OR [of Certified	professionals for other project
		Regulation Commission (PRC).			Public Accountants or Civil Engineers] duly	types aside from civil works.
						recognized by the Professional Regulation
						Both representatives shall be non-voting members.
						Commission (PRC)/SUPREME COURT (SC).
						Both representatives shall be non-voting members
10	Add New Section as IB 2-1.f:
	f.	OBSERVER - THE COMMISSION ON AUDIT		For increased transparency
		(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 SHOULD	PBAC members/observers
	RECEIVE THE NOTICE OF MEETING AT LEAST	should be given enough lead-
	TWO CALENDAR DAYS BEFORE THE DATE OF	time to prepare for the meeting.
	MEETING."
12	IB 3 - INVITATION TO PREQUALIFY AND TO BID	IB 3 - INVITATION TO PREQUALIFY 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	IB 3 - INVITATION TO PREQUALIFY AND TO BID	IB 3 - INVITATION TO PREQUALIFY AND TO BID
	1.	For locally funded projects, contractors shall be invited to	1.	For locally funded projects, contractors shall be invited TO
		bid through:			PREQUALIFY AND to bid through:
	a.	Advertisement for at least three (3) times within a	a.	THE advertisement SHALL BE MADE [for] at least
		reasonable period depending upon the size and		three times (3) within a reasonable period depending
		complexity but in no case less than two (2) weeks in at		upon the size and complexity OF THE PROJECT but
		least two (2) newspapers of general circulation which		in no case less than two (2) weeks in at least two (2)
		have been regularly published for at least two (2)		newspapers of general NATIONWIDE circulation
		years before the date of issuance of the notices or		which have been regularly published for at least two (2)
		announcements and at the same time posting copies		years before the date [issuance] ISSUE of the
		thereof at any conspicuous place in the		[notices or announcements]ADVERTISEMENT and
		office/agency/corporation concerned if the project cost		at the same time posting copies thereof at any
		is more than P1,000,000. However, for projects		conspicuous place in the office/agency/corporation
		costing P1,000,000 and below or for projects		concerned if the project cost is more than [P1,000,000]	The P1 M limit, which was set in
		authorized to be bid by the regional/district offices		P5,000,000. However, for projects costing	1987, is now too low
		involving costs as may be delegated by the head of		[P1,000,000] P5,000,000 and below or for projects	considering the inflation since
		office/agency/corporation, the invitation to bid shall		authorized to be bid by the regional/district offices	then. P5 M is deemed more
		be advertised at least once within a week in a		involving costs as may be delegated by the head of	realistic.
		newspaper of local circulation which has been		office/agency/corporation, the invitation to bid shall be
		regularly published for at least six (6) months before		advertised at least [once within a week] TWO (2)
		date of issuance of the notices or announcement		TIMES WITHIN TWO (2) WEEKS in a newspaper
		within the region where the project is situated, or		of GENERAL local circulation IN THE REGION
		through posting of notices in the premises of		WHERE THE PROJECT IS LOCATED, which
		municipal/provincial offices, or through other forms		NEWSPAPER has been regularly published for at
		of media such as radio and television, provided that		least six (6) months before the date of [issuance]
		based on the agency's shortlist of contractors or		ISSUE of the [notices or announcements]
		referral with the Philippine Contractors Accreditation		ADVERTISEMENT [within the region where the
		Board, there are at least four contractors indigenous to		project is situated], or through posting of notices in the
		the region duly classified and registered to undertake		premises of municipal/provincial offices, or through
		such projects.			other forms of media such as radio and 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	IB 4 - ISSUANCE OF QUALIFICATION STATEMENTS/FORMS	IB 4 - ISSUANCE OF QUALIFICATION STATEMENTS/FORMS
	5.	The following papers shall, among others, comprise Pre-C:	5.	The following papers shall, among others, comprise Pre-C:	To correct the omission made
	a.	Credit line issued by an authorized bank in an amount	a.	Credit line COMMITMENT IN A FORM TO BE	and to be consistent with Sec. IB 4-1c.
		equal to the average operating expenses of the project		PRESCRIBED BY THE AGENCY issued by an
		for two (2) months or ten percent (10%) of the total		authorized bank in an amount equal to the average
		project cost, whichever is less.			operating expenses of the project 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 project.	b.	Proposed organization chart PLEDGED for the	For clarity
						SPECIFIC project TO BE BID.
16	c.	List of key personnel employed or to be employed in	c.	List of key personnel employed or to be employed in	To identify specific personnel
		the project with complete qualification and experience		the project, INCLUDING PROJECT MANAGER	pledged for the project to be bid.
		data sheet.			AND PROJECT ENGINEER with qualification and
						experience sheets.
17.	d.	Statement of all relevant completed construction	d.	Statement of all relevant completed construction	The CPES Rating Sheet serves
		projects in the last three years, construction projects in		projects in AT LEAST the last three years,	as the best reference in the
		the last three years, government and private. The		government and private, AS INDICATED IN THE	evaluation of the quality of all
		statement shall include the nature and value of the		INVITATION FOR PREQUALIFICATION . The	relevant completed projects
		project, original and actual project schedule, the		statement shall include the nature and value of the	undertaken in the government
		location of the project, and the name and address of the		project, original and actual project schedules, the	because it provides quantitative
		owner. It shall be supported by certificates of		location of the project, and the name and address	an qualitative descriptions of a
		completion and/or owner's acceptance.		of the owner. It shall be supported by THE	contractor's performance.
		CONSTRUCTORS PERFORMANCE EVALUATION		Further, the existing fixed period
		SYSTEM (CPES) RATING SHEETS AND/OR		of experience could not account
		certificates of completion and/or		for very large projects that the
		owner's acceptance.			government rarely builds (e.g., dam).
18.	e.	Detailed statement showing a list of all on-going	e.	Detailed statement showing a list of all on-going	To be consistent with the first
		construction projects, government and private, as well		construction projects, government and private, as well	sentence of the concerned
		as awarded and/or approved contracts not yet started.		as awarded and/or approved contracts not yet started.	Section.
		This statement shall include the nature and value of the		This statement shall include the nature and value of the
		project, percentage of time elapsed, percentage of		project, percentage of time elapsed, percentage of
		physical accomplishment, scheduled date of		physical accomplishment, scheduled date of
		completion, the location of the project and the name		completion, PERCENTAGE OF PLANNED AND
		and address of the owner. It shall be supported by		ACTUAL ACCOMPLISHMENT, the location of the
		certificates of completion and/or owner's acceptance,		project and the name and address of the owner. It shall
		notices of award, and/or notices to proceed issued by		be supported by [Certificates of Completion and/or
		the owner.			owners' acceptance,] Notices of Awards, and/or
						Notices to Proceed issued by the owner, AMONG OTHERS.
19.	e.	Each office/agency/corporation shall use the standard Pre-C		Delete the entire clause.		There is no standard format
		application form to contain the aforementioned		devised to date.
		requirements.
20.	IB 5 - CLASSIFICATION AND REGISTRATION OF	IB 5 - CLASSIFICATION AND REGISTRATION OF
	CONTRACTORS		CONTRACTORS
	1.	The inter-agency committee composed of Representatives	1.	THE PHILIPPINE CONTRACTORS	The Inter-Agency Committee
		from the Department of Public Works and Highways,		ACCREDITATION BOARD (PCAB) SHALL	has ceased to exist and its
		Department of Transportation and Communications, the		REGISTER AND CLASSIFY CONTRACTORS	functions subsumed by PCAB.
		Office of the President of the Philippines in the absence		BASED ON THE PCAB GUIDELINES FOR	Also, to clarify the existing
		of a Department of Energy and the Construction Industry		REGISTRATION AND CLASSIFICATION OF	procedure for classification and
		Authority of the Philippines (CIAP) which classified and		CONTRACTORS.		registration.
		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 CONTRACTORS FOR	IB 6 - PREQUALIFICATION OF CONTRACTORS FOR
	SPECIFIC CONTRACTS		SPECIFIC CONTRACTS
	3.	In the evaluation of the Pre-C statement, the PBAC shall	3.	In the evaluation of the Pre-C statement, the PBAC shall
		review, among other things, the technical capability of the		review, among other things, the technical capability of the
		contractor to carry out the subject contract as gauged by		contractor to carry out the subject contract as gauged by
		the extent and quality of his relevant experience extent		the extent and quality of his relevant experience and
		and quality of his relevant experience and performance		performance and track record, the suitability of his	To ensure the quality of
		and track record, the suitability of his available relevant		relevant construction equipment AND MINIMUM TESTING	construction.
		construction equipment, and the adequacy of his proposed		EQUIPMENT, and the adequacy of his proposed project
		project organization and personnel. Up-to-date		organization and personnel. THE CPES RATING OR ITS	The CPES rating serves as the
		information on these aspects shall be considered.		EQUIVALENT FOR EACH RELEVANT PROJECT	best reference in the evaluation
						SHALL BE USED AS BASIS IN EVALUATING THE	of the quality of relevant
						QUALITY OF RELEVANT EXPERIENCE AND	experience of contractor.
						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 contractor, the	4.	To determine the financial capacity of the contractor, the
		PBAC shall require the contractor to submit a statement		PBAC shall [require] DETERMINE IF the contractor [to
		from a bank or a financing institution authorized/licensed		submit a] HAS SUBMITTED THE REQUIRED
		by the Central Bank of the Philippines that the		statement from a bank or a financing institution
		bank/financing institution commits to provide the		authorized/licensed by the Central Bank of the Philippines
		contractor, if awarded the contract, a credit line in an		that the bank/financing institution commits to provide the
		amount specified by the agency which is equal to the		contractor, if awarded the contract, a credit line in an
		average operating expenses of the project for two (2)		amount specified by the agency which is equal to the
		months or ten percent (10%) of the approximate total		average operating expenses of the project for two (2)
		project cost, whichever is less, or a cash deposit certificate		months or ten percent (10%) of the [approximate total]
		in the amount specified in the foregoing. Cash deposit		ESTIMATED project cost, whichever is less, or a cash
		certificate shall be released only when the cost of the		deposit certificate in the amount specified in the foregoing.
		remaining works is 10% of the total project cost or when		CASH DEPOSIT PLEDGED FOR A PARTICULAR	Cash deposit can be withdrawn
		the contract time remaining is less than two months before		PROJECT CANNOT BE WITHDRAWN DURING	anytime without the
		completion as certified by the implementing agency		CONTRACT EFFECTIVITY WITHOUT PRIOR	authorization/knowledge of the
		through the issuance of a statement of work accomplished.		AUTHORIZATION FROM THE CONCERNED	tendering agency.
		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, SPECIFICATIONS	IB 7 - ISSUANCE OF PLANS, SPECIFICATIONS
	PROPOSAL BOOK FORM(S) AND DRAFT CONTRACT	PROPOSAL BOOK FORM(S) AND DRAFT CONTRACT
	1.	The PBAC (or the Prequalification  Committee, as the case	1.	The PBAC (or the Prequalification Committee, as the case
		may be), shall issue the plans, specifications, proposal		may be), shall issue the plans, specifications, proposal
		book form(s) for the project to be bid to contractor-		book form(s) for the project to be bid to contractor-
		applicants prequalified under Pre-C prequalification under		applicants prequalified under Pre-C prequalification under
		the relevant classification, upon payment of the		the relevant classification, upon payment of the
		corresponding price thereof to the collecting/disbursing		corresponding price thereof to the collecting/disbursing
		officer of the office/agency/corporation concerned in		officer of the office/agency/corporation concerned in
		accordance with the following schedule:		accordance with the following schedule:
		Estimated Project Cost (in	Issuance of Plans,		Estimated Project Cost (in		Issuance of Plans,
		Pesos)	Specifications, Proposal		Pesos)			Specifications, Proposal
				Books, Form(s) and Draft					Books, Forms(s) and Draft
				Contracts					Contracts
	a.	Up to one (1) million	15 days before the date of	a.	Up to [one (1)] FIVE (5)	15 days before the date of	The cost limits were set in 1982.
				bidding		million		bidding	Because of the increase in prices
									since then, plus the advent of
	b.	Above one (1) million up	30 days before the date of	b.	Above[one (1)] FIVE	30 days before the date of	advanced technology, e.g.,
		five (5) million	bidding		(5) million up to [five	bidding	computerized analyses, which
									facilitate the preparation of bids,
	c.	Above five (5) million up	45 days before the date of		(5)]TWENTY-FIVE		new cost limits as indicated
		to ten (10) million	bidding		(25) million		are more appropriate.
	d.	Above ten (ten) million up	60 days before the date of	c.	Above [five (5)	45 days before the date of
		to one hundred (100)	bidding		TWENTY-FIVE (25)	bidding
		million			million up to [ten (10)]
	e.	Above one hundred (100)	90 days before the date of		FIFTY (50) million
		million	bidding	d.	Above [ten (10) FIFTY	60 days before the date of
						(50) million up to ONE	bidding
						HUNDRED (100)
						million
	e.	Above ONE HUNDRED	90 days before the date of
		(100) million	bidding
24	IB 10.1 - PREPARATION OF BIDS, BID BONDS, AND	IB 10.1 - PREPARATION OF BIDS, BID BONDS, AND
	PREQUALIFICATION STATEMENT		PREQUALIFICATION STATEMENT
	2.	The original copy of the bid shall be accompanied by a	2.	The original copy of the bid shall be accompanied by a bid
		bid security in an amount not less than two-and-one-half		security in an amount [not less than two-and-one-half
		percent (2½%) of the total bid price in the form of cash,		percent (2½%) of the total bid price} EQUIVALENT
		certified check, manager's check, or bank draft/guarantee		TO A PERCENTAGE, IN ACCORDANCE WITH
		confirmed by a local bank (in the case of foreign contractor		THE SCHEDULE GIVEN BELOW, OF THE TOTAL
		bonded by a foreign bank) against any reputable bank or		PROJECT COST, AS PUBLISHED/ADVERTISED
		letter of credit issued by a commercial bank or surety bond,		BY THE CONCERNED AGENCY, in the form of cash,
		callable on demand, issued by a surety or insurance		certified check, manager's check, or bank draft/guarantee
		company duly accredited by the Office of the Insurance		confirmed by a local bank (in the case of foreign
		Commission or any combination thereof as may be required		contractor bonded by a foreign bank) against any reputable
		by the Head of office/agency/corporation concerned		bank or letter of credit issued by a commercial bank or
		payable to the office/agency/corporation as guarantee that		surety bond, callable on demand, issued by a surety or
		the successful bidder shall within thirty (30) calendar days		insurance company duly accredited by the Office of the
		or less at the discretion of the Head of		Insurance Commission or any combination thereof, as may
		office/agency/corporation concerned, from receipt of Notice		be required by the Head of office/agency/corporation
		of Award, enter into contract with the Government and		concerned payable to the office/agency/corporation as
		furnish the performance security for the faithful and		guarantee that the successful bidder shall within thirty (30)
		complete prosecution of the work specified in the contract		calendar days or less at the discretion of the Head of
		documents. Bids and bid securities shall be valid for a		office/agency/corporation concerned, from receipt of
		reasonable period to be determined by the Head of		Notice of Award, enter into contract with the Government
		office/agency/corporation concerned as indicated in the		and furnish the performance security for the faithful and
		Instruction to Bidders but in no case later than one hundred		complete prosecution of the work specified in the contract
		twenty (120) calendar days following the opening of the		documents. THE SCHEDULE OF AMOUNTS FOR	To allow for posting alternative
		bids.				THE BID SECURITIES ARE AS FOLLOWS:	forms of bid securities along the
									same lines as that allowed for
	a.	CASH, MANAGER'S CHECK, CASHIER'S					performance securities.
		CHECK, IRREVOCABLE LETTER OF CREDIT,
		OR BANK DRAFT — ONE
		PERCENT (1%) OF THE TOTAL
		PROJECT COST, AS
		PUBLISHED/ADVERTISED BY THE
		CONCERNED AGENCY.
	b.	BANK GUARANTEE — ONE AND A HALF
		PERCENT (1½%) OF THE TOTAL
		PROJECT COST, AS
		PUBLISHED/ADVERTISED BY THE
		CONCERNED AGENCY
	c.	SURETY BOND — TWO AND A HALF
		PERCENT (2½%) OF THE TOTAL
		PROJECT COST, AS PUBLISHED/
		ADVERTISED BY THE CONCERNED
		AGENCY
		Bids and bid securities shall be valid for a reasonable
		period to be determined by the Head of
		office/agency/corporation concerned as indicated in the
		Instruction to Bidders but in no case later than one hundred
		twenty (12) calendar days following the opening of the
		bids.
25	IB 10.2 - SUBMISSION, OPENING AND ABSTRACT OF
	BIDS/TENDERS
	Add a new provision to IB 10.2-2 as follows:
	J.	CONSTRUCTION SAFETY AND HEALTH	To ensure that the project will be
		PROGRAM BY THE CONTRACTOR BASED ON	delivered with proper regard to
		SECTION IB1.3.G HEREOF AS REQUIRED BY	quality and safety.
		THE DEPARTMENT OF LABOR AND
		EMPLOYMENT'S (DOLE) OCCUPATIONAL
		SAFETY AND HEALTH STANDARDS.
26.	IB 10.2 - SUBMISSION, OPENING AND ABSTRACT OF	IB 10.2 - SUBMISSION, OPENING AND ABSTRACT OF
	BIDS/TENDERS		BIDS/TENDERS
	3.	The second envelope shall contain the following	3.	The second envelope shall contain the following
		information/documents:			information/documents:
	a.	. . .			a.	. . .
	b.	Detailed estimates		b.	Detailed estimates INCLUDING A SUMMARY	For cross-checking purposes and
						SHEET INDICATING THE UNIT PRICES OF	as future reference in pricing
						CONSTRUCTION MATERIALS, LABOR	extra works.
						RATES AND EQUIPMENT RENTALS USED IN
						COMING UP WITH THE BID.
27.	4.	Bids shall be received on or before the designated time and	4.	Bids shall be received on or before the designated time and	For clarity.
		date to be eligible for consideration. Bids may be		date to be eligible for consideration. Bids may be
		withdrawn only in writing 5 working days from the deadline		withdrawn only in writing five (5) working days [from]
		of submission of bids.			BEFORE the deadline of submission of bids.
28.	IB 10.3 - EVALUATION OF BIDS
		Add the following new provision to IB 10-3 as IB 10.3-2 and		For clarity. Describes the
		renumber the succeeding sub-sections accordingly:		procedures to be taken for
	2.	THE PBAC SHALL EXAMINE THE BIDS TO		arithmetical corrections on
		DETERMINE WHETHER THEY ARE
		GENERALLY IN ORDER. ARITHMETICAL
		ERRORS WILL BE RECTIFIED ON THE
		FOLLOWING BASIS:
					A)	IF THERE IS A DISCREPANCY BETWEEN
						THE UNIT BID PRICE AND THE EXTENDED
						TOTAL COST THAT IS OBTAINED BY
						MULTIPLYING THE UNIT BID PRICE WITH
						THE CORRESPONDING QUANTITY, THE
						UNIT BID PRICE SHALL PREVAIL AND THE
						EXTENDED TOTAL COST WILL BE
						CORRECTED ACCORDINGLY.
					B.)	IF THERE IS A DISCREPANCY BETWEEN
						THE TOTAL BID AMOUNT AND THE SUM
						OF TOTAL COSTS AFTER RECTIFICATION
						OF THE TOTAL COST IN ACCORDANCE
						WITH THE PARAGRAPH (A) ABOVE, THE SUM
						OF THE TOTAL COSTS SHALL PREVAIL
						AND THE TOTAL BID AMOUNT WILL BE
						CORRECTED.
					C.)	IF THERE IS A DISCREPANCY BETWEEN
						THE AMOUNT WRITTEN IN WORDS AND
						ITS EQUIVALENT AMOUNT IN FIGURES,
						THE AMOUNT WRITTEN IN WORDS SHALL
						PREVAIL.
29.	IB 10.4.1			IB 10.4.1
	13.	In the execution of the performance security, the following	13.	In the execution of the performance security, the
		conditions shall be complied with:		following conditions shall be complied with:
	a.	It shall be executed in accordance with the form	a.	It shall be executed in accordance with the	To give the agency concerned
		prescribed therefor.			form AS prescribed [therefor] BY THE	flexibility in protecting the best
						OFFICE/AGENCY/CORPORATION	interest of government in line
						CONCERNED IN THE INSTRUCTION TO	with relevant proposed
						BIDDERS/TENDER DOCUMENTS	amendment above.
30.	IB 10.4.2 - 5 Simplified Public Bidding			Delete Section IB 10.4.2 -5 (Simplified Public Bidding)	It is deemed that the present
									rules and regulations governing
									regular open competitive bidding
									are adequate, aside from the fact
									that the CPIP is no longer
									existent. Further, the
									contractors' masterlist has not
									been prepared.
31.	IB 10.5 ADMINISTRATIVE SANCTIONS		Transfer the entire Section IB 10.5 (Administrative	For better presentation.
					Sanctions) into the New Section V — ADMINISTRATIVE
					SANCTIONS
32.	IB 10.7 - DOCUMENTS COMPRISING THE CONTRACT	IB 10.7 - DOCUMENTS COMPRISING THE CONTRACT
	1.	The following documents shall form part of the contract:	1.	The following documents shall form part of the contract:
		a. to g . . .			a. to g. . . .
	h.	Bid Form including the following Annexes	h.	Bid Form including the following Annexes:
	(1)	Authority of the Signing Official		(1)	. . .
	(2)	Bid Prices in the Bill of Quantities	(2)	. . .
	(3)	Detailed Estimates		(3)	Detailed Estimates INCLUDING A SUMMARY	For cross-checking purposes and
		(4) to (10) . . .			SHEET INDICATING THE UNIT PRICES OF	as future reference in pricing
						CONSTRUCTION MATERIALS, LABOR	extra works.
						RATES AND EQUIPMENT RENTALS USED IN
						COMING UP WITH THE BID.
33.	Add a new provision to IB 10.7 - I.h as follows:
					(11)	CONSTRUCTION SAFETY AND HEALTH	To help ensure the enforcement
						PROGRAM		of safety procedures in the
									implementation of construction
									projects.
34.	IB 10.10 - ISSUANCE OF NOTICE TO PROCEED	IB 10.10 - ISSUANCE OF NOTICE TO PROCEED
	1.	The concerned government office/agency/corporation	1.	The concerned government office/agency/corporation
		should issue the Notice to Proceed (NTP) to the successful		should issue the Notice to Proceed (NTP) to the successful;
		bidder normally not later than fifteen (15) calendar days		bidder [normally] not later than fifteen (15) calendar days
		from the date of approval of the contract by the concerned/		concerned/authorized government official. THE	To clarify the effectivity date of
		authorized government official.			EFFECTIVITY DATE FOR THE NTP SHALL BE	the NTP.
						SPECIFIED BY THE AGENCY CONCERNED.
35.	CI	1—VARIATION ORDERS-CHANGE ORDERS/	CI	1—VARIATION ORDERS-CHANGE ORDERS/
		EXTRA WORK ORDER/SUPPLEMENTAL		WORK/ORDER/SUPPLEMENTAL AGREEMENT
	1.	The increase/decrease in quantities or reclassification of	1.	VARIATION ORDERS MAY BE ISSUED BY THE	For clarity, emphasis and better
		items is usually due to change of plans, design or		CONCERNED AGENCY/OFFICE/CORPORATION	presentation. As the overriding
		realignment to suit actual field conditions, or as a result of		TO COVER ANY [The] increase/decrease in quantities,	condition, variation orders
		great disparity between the preconstruction plans used for		INCLUDING, THE INTRODUCTION OF NEW	should be issued only when
		purposes of bidding and the "as-staked plans" or		WORK ITEMS THAT ARE NOT INCLUDED IN	changes in the workscope are
		construction drawings prepared after a joint survey by the		THE ORIGINAL CONTRACT or reclassification of	found necessary to suit actual
		contractor and the government after award of the contract.		WORK items [is usually] THAT ARE EITHER DUE to	field conditions. As provided for
						change of plans, design or realignment to suit actual field	the existing IRR, this is to
						conditions [or as a result of] RESULTING IN [great]	recognize the fact that some
						disparity between the preconstruction plans used for	important physical properties of
						purposes of bidding and the "as staked plans" or	the project site have been
						construction drawings prepared after a joint survey by the	overlooked or given shallow
						contractor and the government after award of the contract.	emphasis during the feasibility
						THE ADDITION/DELETION OF WORKS SHOULD	study and the detailed
						BE WITHIN THE GENERAL SCOPE OF THE	engineering stages of project
						PROJECT AS BID AND AWARDED. A VARIATION	preparation. Disparity between
						ORDER MAY EITHER BE IN THE FORM OF A	the preconstruction plans and the
						CHANGE ORDER, EXTRA WORK ORDER OR A	as-staked plans is a mere
						SUPPLEMENTAL AGREEMENT.	consequence of the necessary
								changes in the original
								workscope to suit actual
							conditions in the project site, and
								hence, could not be a valid
							reason for variation orders. The
							proposed amendment is geared
								to encourage well-thought
								preparation of projects.
36.	2.	A Change Order may be issued by the implementing	2.	A Change Order may be issued by the implementing	To clarify the coverage of
		official after the same has been approved by the		official TO COVER ANY INCREASE/DECREASE IN	change orders and emphasize
		appropriate official . . .under the following conditions:		QUANTITIES OF ORIGINAL WORK ITEMS IN	that the overriding condition
						THE CONTRACT AFTER THE SAME HAS BEEN	should first be satisfied before
						FOUND TO STRICTLY COMPLY WITH SECTION	the specific conditions for
						CI 1 - 1 AND approved by the appropriate official	Change Order could be
						. . .under the following conditions:	considered.
37.	a.	Where the aggregate cost of Change Order(s) is	a.	Where the aggregate cost of Change Order(s) is limited	The 2nd and 3rd sentences are
		limited to 25% of the original contract cost excluding		to 25% of the ESCALATED original contract cost	deleted and the 4th sentence is
		the effects of price escalation and provided that no		[excluding the effects of price escalation and]	transferred to CI 1-7 with minor
		major pay item shall be increased by more than 100%		provided that no major pay item shall be increased by	revisions for better presentation
		of its original cost. Change Orders exceeding 25% of		more than 100% of its original cost. [Change Orders	and grouping of provisions. In
		the original contract price may be covered by a		exceeding 25% of the original contract price may be	the 2nd sentence, 25% of the
		Supplemental Agreement. In case of a repeat order,		covered by a Supplemental Agreement. In case of a	original contract price is used
		the Change Order should not exceed 100% of the		repeat order, the Change Order should not exceed	while the existing CI 1-7 uses
		escalated original contract price and the same shall be		100% of the escalated original contract price and the	25% of the escalated original
		covered by a Supplemental Agreement. All Change		same shall be covered by a Supplemental Agreement.	contract price. To eliminate the
		Orders beyond 100% of the escalated original contract		All Change Orders beyond 100% of the escalated	inconsistency, the escalated
		cost shall be subject to public bidding except where		original contract cost shall be subject to public bidding	original contract price will be the
		inseparable from the original scope of the project in		except where inseparable from the original scope of	basis in entering a supplemental
		which case negotiation with the incumbent contractor		the project in which case negotiation with the	agreement since it is more
		may be allowed, subject to approval by the		incumbent contractor may be allowed, subject to	extensively used in the IRR.
		appropriate authorities. All Change Orders shall be		approval by the appropriate authorities.] All Change
		subject to price adjustment in accordance with duly		Orders shall be subject to price adjustment in
		approved guidelines.			accordance with duly approved guidelines.
38.	b.	Where there is a decrease in work due to deletion of	b.	When there is a decrease OR INCREASE in	To cover any additional
		work items or sections of the project.		ORIGINAL work ITEMS UNDER THE	quantities of original work items.
						CONTRACT due to NECESSARY
						deletion/ADDITION  of work items or sections
						of the project.
39.	c.	Where there is a reclassification of an existing item,	c.	Delete the existing provision and renumber	For clarity. Reclassification of
		like earth excavation to slid rock excavation, due to		succeeding providing accordingly.	work items results in the deletion
		latent conditions which were not known at the time of					of the existing items in favor of
		bidding.						new ones. While the deletion of
									existing work items is covered
									by change order under Section
									CI 1-2.b above, the introduction
									of new work items are more
									appropriately covered by Extra
									Work Orders under Section CI
									1-4.a
40.	4.	An Extra Work Order may be issued by the implementing	4.	An Extra Work may be issued by the implementing	To clarify the coverage of extra
		official after the same has been approved by the		official TO COVER THE INTRODUCTION OF NEW	work orders and to emphasize
		appropriate official . . . under the following conditions:		WORK ITEMS after the same has been FOUND TO	that the overriding condition
						STRICTLY COMPLY WITH SECTION CI 1-1 AND	should first be satisfied before
						approved by appropriate official . . . under the following	the specific conditions for Extra
						conditions:		Work Order could be
						considered.
41.	a.	. . .			a.	. . .
	b.	Where there are subsurface or latent physical	b.	Delete the phrase "beyond the limit of the Change	For consistency with the
		conditions at the site differing materially from those		Order"			proposed deletion of Section CI
		indicated in the contract beyond the limit of the Change					1-2.c above.
		Order.
42.	c.	Where there are unknown physical conditions at the	c.	Delete the phrase "beyond the limits of Change	For consistency with the
		site of an unusual nature differing materially beyond		Order'			proposed deletion of Section CI
		the limits of Change Order from those ordinarily					1-2.c above.
		encountered and generally recognized as inherent in the
		work or character provided in the contract.
43.	5.	As an absolute rule, Change Orders or Extra Work Orders		Delete and renumber succeeding provisions.	The intent of this section is
		should be issued only for additional/deletion of works					already captured in Section CI 1-
		necessary for the completion of the project and, therefore,					1 as proposed.
		should be within the limits stated above and the general
		scope of the project as bid and awarded.
44.	7.	A separate Supplemental Agreement may be entered into	7.	A separate Supplemental Agreement may be entered into	Transferred from Section CI1-
		for all Change Orders and Extra Work Orders if the		for all Change Orders and Extra Work Orders if the	2.a including clarificatory
		aggregate amount exceeds 25% of the escalated original		aggregate amount exceeds 25% of the escalated original	insertions. Since Change Orders
		contract price. A supplemental Agreement may likewise		contract price. [A Supplemental Agreement may likewise	beyond 100% of the escalated
		be entered into for works immediately beyond the project		be entered into for works immediately beyond the project	original contract price are
		limits but are immediately abutting the project under the		limits but are immediately abutting the project under the	subject to public bidding (with
		same terms and conditions as the original contract		same terms and conditions as the original contract	exceptions) under the IRR, there
		provided it does not exceed 100% of the escalated original		provided it does not exceed 100% of the escalated original	is more reason to subject Extra
		contract price less mobilization and provided further that		contract price less mobilization and provided further that	Work Orders beyond 100% of
		funds are certified as available and subject to approval of		funds are certified as available and subject to approval of	the escalated contract amount as
		appropriate authority.			appropriate authority.] ALL CHANGE ORDERS/	they involve new work items
						EXTRA WORK ORDERS BEYOND 100% OF THE	which have not been
						ESCALATED ORIGINAL CONTRACT COST	contemplated at the time of
						SHALL BE SUBJECT TO PUBLIC BIDDING	bidding.
						EXCEPT WHERE THE WORKS INVOLVED ARE
						INSEPARABLE FROM THE ORIGINAL SCOPE OF
						THE PROJECT IN WHICH CASE NEGOTIATION
						WITH THE INCUMBENT CONTRACTOR MAY BE
						ALLOWED, SUBJECT TO APPROVAL BY THE
						APPROPRIATE AUTHORITIES.
45.	8.	Any Variation Order (Change Order or Extra Work Order)	8.	Any Variation Order (Change Order, [or] Extra Work Order	To emphasize that Supplemental
		shall be subject to the escalation formula used to adjust the		OR SUPPLEMENTAL AGREEMENT) shall be	Agreements are also entitled to
		original contract price less the cost of mobilization. In		subject to the escalation formula used to adjust the	price escalation. Further, there is
		claiming for any Variation Order, the contractor shall,		original contract price less than the cost of mobilization. In	only one written notice required
		within seven (7) calendar days after such work has been		claiming for any Variation Order, the contractor shall,	of the contractor, hence, the
		commenced or after the circumstances leading to such		within seven (7) calendar days after such work has been	correction.
		conditions(s) leading to the extra cost, and within 28		commenced or after the circumstances leading to such
		calendar days deliver a written communication giving full		conditions(s) leading to the extra cost, and within 28
		and detailed particulars of any extra cost in order that they		calendar days deliver a written communication giving full
		may be investigated at that time. Failure to provide either		and detailed particulars of any extra cost in order that
		of such notices in the time stipulated shall constitute a		they may be investigated at that time. Failure to provide
		waiver by the contractor for any claim. The preparation		[either of] such notice[s] in the time stipulated shall
		and submission of Change Orders, Extra Work Orders or		constitute a waiver by the contractor for any claim. The
		Supplemental Agreement are as follows:		preparation and submission of Change Orders, Extra
						Work Orders or Supplemental Agreement are as follows:
46.	Insert a new Section CI 1-7.e as follows:
					e.	THE TIMEFRAME FOR THE PROCESSING	To stipulate the timeframe for
						OF VARIATION ORDERS FROM THE	the processing of variation
						PREPARATION UP TO THE APPROVAL BY	orders by agencies concerned.
						THE IMPLEMENTING AGENCY
						CONCERNED SHALL NOT EXCEED THIRTY
						(30) CALENDAR DAYS.
47.		CI 2-EXTRA WORK COSTING			CI 1-ADDITIONAL/EXTRA WORK COSTING	This provision encompasses the
									conditions under which the
		1.	The Government may, at any time by written order and		1.	ADDITIONAL / [The Government may, at any time by	contractor is to start work (see
			without notice to the Sureties, direct the contractor to			written order and without notice to the Sureties, direct the	Section CI 3) including noted
			perform extra work necessary to and within the General			contractor to perform] extra works necessary to and within	inconsistency. Under CI2, the
			Scope of the Contract. The contractor shall promptly			the General Scope of the Contract. SHOULD BE	cut-off by which contractors
			proceed with the extra work involving an increase of less			COSTED WHETHER THEY ARE COVERED BY	should proceed with the extra
			than twenty five percent (25%) of the original contract			CHANGE ORDERS OR EXTRA WORK ORDERS.	work is 25% of the escalated
			price or adjusted original contract price, the contractor			[The contractor shall promptly proceed with the extra	original contract price, while
			shall be paid on the basis of the unit prices indicated in the			work involving an increase of less than twenty five percent	under CI3, the cut-off is 15%.
			original contract or adjusted original contract price for			(25%) of the original contract price or adjusted original	The 2nd & 3rd sentences is
			work items similar to those in the original contract. If the			contract price, the contractor shall be paid on the basis	transferred to CI 3 for better
			contract does not contain any rate applicable to the			of the unit prices indicated in the original contract or	grouping of provisions and
			additional or extra work, then suitable prices shall be			adjusted original contract price for work items similar to	revised for consistency. Further,
			agreed upon by the Government and the contractor. In case			those in the original contract. If the contract does not	the main intent of this Section is
			of extra work involving an increase of twenty five percent			contain any rate applicable to the additional or extra	to stipulate on how to cost
			(25%) or more of the original contract price or adjusted			work, then suitable prices shall be agreed upon by the	additional/extra works involving
			original contract price to be covered by a supplemental			Government and the contractor. In case of extra work	cumulative increases of at least
			agreement, the price shall be agreed upon by the parties			involving an increase of twenty five (25%) or more	25% of the escalated original
			covering the entire extra work, under any of the following			of the original contract price or adjusted original contract	contract price only, nor covering
			methods:				price to be covered by a supplemental agreement, the price	additional works below the 25%
							shall be agreed upon by the parties covering the entire	cut-off. Such causes confusion
							extra work,] THE CONTRACTOR SHALL BE PAID	among the users of these IRR.
							FOR ADDITIONAL WORK ITEMS WHOSE UNIT	The proposed amendments
							PRICES SHALL BE DERIVED BASED ON [under any	intends to resolve the following:
							of] the following [methods]:
									1.	The coverage of Change
48	a.	By applicable unit prices contained in the original price		a.	FOR ADDITIONAL/EXTRA WORKS DULY		Orders should only cover
		or adjusted original contract price for like work.			COVERED BY CHANGE ORDERS INVOLVING		work items that are exactly
							WORK ITEMS WHICH ARE EXACTLY THE		the same or similar to those
							SAME OR SIMILAR TO THOSE IN THE		contained in the original
							ORIGINAL CONTRACT, THE APPLICABLE		contract and that new work
							UNIT PRICES OF WORK ITEMS IN THE		items to be covered
							ORIGINAL CONTRACT SHALL BE USED.		through extra work orders.
49	b.	By cost-plus percentage basis where the cost represents		b.	FOR ADDITIONAL/EXTRA WORKS DULY	2.	The present provision does
		the expenses incurred, exclusive of profit and			COVERED BY CHANGE ORDERS		not provide for the costing
		contractor's tax, while the plus represents a certain			INVOLVING NEW WORK ITEMS THAT ARE		of new work items if the
		percentage of the cost which shall not exceed fifteen			NOT IN THE ORIGINAL CONTRACT, THE		cumulative increase is
		percent (15%). The contractor shall be reimbursed for			UNIT PRICES OF THE NEW WORK ITEMS		below the 25% cut-off. Such
		all actual necessary costs, as determined by:			SHALL BE DERIVED AS FOLLOWS:		could result in the delayed
										implementation of new work
50	(1)	his direct labor costs;			(1)	EACH COMPONENT OF THE NEW WORK		items that fall under the
	(2)	all materials used in the extra work;			ITEM SHALL BE BASED ON THE DIRECT		critical path, hence,
	(3)	all supplies, fuel lubricants, power and other incidentals;			UNIT COSTS USED IN THE ORIGINAL		adversely affecting the
	(4)	reasonable base equipment rental for use of his			CONTRACT (E.G., UNIT COST OF		contract time.
		construction equipment; and				CEMENT, REBARS, FORM LUMBER
	(5)	current rental rates for use of construction			LABOR RATE, EQUIPMENT RENTAL,	3.	Users of the IRR interpret
		equipment not owned by the contractor			ETC.) AND UPDATED TO PRICE LEVELS		the term "rate applicable"
		AS OF THE DATE AGREED UPON BY THE						differently. With the
		GOVERNMENT AND THE CONTRACTOR						proposed amendment, the
		USING APPROPRIATE NSO INDICES AS						interpretation would be
		FOLLOWS:							narrowed down to the issue
										similar work items only.
		NEW UNIT COST = ORIGINAL UNIT COST X (P1/Po)					4.	The alternatives for costing
		WHERE P1 = APPROPRIATE NSO INDEX						additional works involving
		DURING THE AGREED UPON							at least 25% of the escalated
		DATE/MONTH							contract price is biased in
										favor of the cost-plus
		Po = APPROPRIATE NSO INDEX AT						method since the contractor
		THE MONTH OF BIDDING OR							has the right to disagree to
		NEGOTIATED BIDDING							his advantage. Note that the
										supporting documents
51	(2)	ALL NEW COMPONENTS OF THE NEW						thereto include official
		WORK ITEM SHALL BE BASED ON							receipts/invoices from
		PRICES PREVAILING AT THAT AGREED						suppliers whose amounts
		DATE/MONTH, PROVIDED THE SAME IS						could be easily padded.
		ACCEPTABLE TO BOTH THE
		GOVERNMENT AND THE CONTRACTOR,					5.	The proposed alternative
		AND PROVIDED FURTHER THAT THE						method of costing new work
		DIRECT UNIT COSTS OF NEW							items relies on the NSO
		COMPONENTS SHALL BE BASED ON THE						indices so that only the price
		CONTRACTOR'S ESTIMATE AS							of a few new components
		VALIDATED BY THE AGENCY							would be subject to
		CONCERNED VIA DOCUMENTED							arbitrariness.
		CANVASS IN ACCORDANCE WITH
		EXISTING RULES AND REGULATIONS.					6.	Considering the delayed
										issuance of the NSO
	(3)	THESE TWO SHALL BE COMBINED TO						indices, the contracting
		ARRIVE AT THE DIRECT COST OF THE						parties are allowed to agree
		NEW WORK ITEM. IT SHALL THEN BE						on a reckoning date/month
		COMBINED WITH THE MARK-UP							for purpose of unit price
		FACTOR (I.E., TAXES & PROFIT) USED BY						adjustment and subsequent
		THE CONTRACTOR IN HIS BID TO							claims for price escalation.
		DETERMINE THE UNIT PRICE OF THE
		NEW WORK ITEM. THE RECKONING					7.	In consideration of the
		DATE FOR PRICE ESCALATION							contractor's bid, the use of
		PURPOSES SHALL BE THE DATE/MONTH						the mark-up factor
		AS AGREED UPON BY BOTH PARTIES.						(representing the indirect
										cost usually in percentage of
										the direct cost) is allowed in
										arriving at the unit price of a
										new work item.
										As explained above.
53.	2.	If the parties are unable to agree on any of the modes of	Delete CI 2-2 and renumber succeeding section accordingly.
		payment specified in 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 CONTRACTOR IS	CI 3 - CONDITIONS UNDER WHICH CONTRACTOR IS
	TO START WORK UNDER VARIATION ORDERS	TO START WORK UNDER VARIATION ORDERS
	AND RECEIVE PAYMENTS		AND RECEIVE PAYMENTS.
	1.	Under no circumstances shall a contractor proceed to	1.	Same
		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:							For clarity. Agencies having no
										Regional Director positions in
	a.	The Regional Director may . . . .		a.	The Regional Director, OR ITS EQUIVALENT		their plantilla find this provision
	(1)	In the event of . . .			POSITION IN AGENCIES/OFFICES/CORPORATIONS
	(2)	When time is of the essence			WITHOUT PLANTILLA POSITION FOR
		THE SAME may . . .			restrictive.
		Provided, however, that such approval is valid on		(1)	In the event of . . .
		work done up to the point where the cumulative		(2)	When time is of the essence;		The provision that no variation
		increase in value of work on the project which has not						order may be started if the
		yet been approved does not exceed five percent (5%)		provided, however, that such approval is valid on work		cumulative increase exceeds
		of the total original contract price, or P500,000		done up to the point where the cumulative increase in
		whichever is less . . .			value of work on the project which has not yet been
		approved does not exceed five percent (5%) of the		15% of the adjusted or original
		[total] ADJUSTED original contract price, or		contract price without the prior
		P500,000 whichever is less . . .			approval of the concerned
		Secretary/authorized Representative
	b.	For a Change/Extra Work Order involving a	b.	For a Change/Extra Work Order involving a cumulative		conflicts with the 2nd
		cumulative amount exceeding fifteen percent (15%) of		amount exceeding [fifteen percent (15%)] FIVE		sentence of Section CI2 which
		the original contract price or original adjusted contract		PERCENT (5%) of the original contract price or		allows contractors to promptly
		price, no work thereon may be commenced unless said		original adjusted contract price, no work thereon may		proceed with the extra work
		Change/Extra Work Order has been approved by the		be commenced unless said Change/Extra Work Order		involving an increase below
		Secretary or his duly authorized representative.		has been approved by the Secretary or his duly		25% of the original or adjusted
						authorized representative.			contract price. Further, the bases
										in getting the percentage 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
										The contract time does not
	1.	Once the project reaches an accomplishment of 95% of the	1.	Once the project reaches an accomplishment of 95% of the		to be and should not be
		total contract amount, the contract time may be suspended		total contract amount [the contract time may be suspended		suspended while the inspectorate
		and the government upon the request of the contractor may		and] the government [upon the request of the contractor]		team makes the inspection and
		create an inspectorate team to make preliminary inspection		may create an inspectorate team to make preliminary		prepares the punch list.
		and submit a punch list to the contractor in preparation for		inspection and submit a punch list to the contractor in
		the final turnover of the project.			preparation for the final turnover of the project.
56	CI 8 - LIQUIDATED DAMAGES		CI.8 - LIQUIDATED DAMAGES
										The proposed formula follows
	1.	Where the contractor refuses or fails to satisfactorily	1.	Where the contractor refuses or fails to satisfactorily		the concept of the "foregone
		complete the work within the specified contract time, plus		complete the work within the specified contract time, plus		economic benefits or returns"
		any time extension duly granted and is hereby in default		any time extension duly granted and is hereby in default		from unproductive investments
		under the contract, the contractor shall pay the		under the contract, the contractor shall pay the		tied up in the delayed project
		Government for liquidated damages, and not by way of		Government for liquidated damages, and not by way of		(contract work). Since the
		penalty, an amount to be determined in accordance with		penalty, an amount to be determined in accordance with		project is completed on time,
		the following formula for each calendar day of delay, until		the following formula for each calendar day of delay, until		the economy foregoes or loses
		the work is completed and accepted or taken over by the		the work is completed and accepted or taken over by the		the opportunity to realize the
		Government:			Government:			benefits or returns that could
										have been generated during the
		LD = 0.75 x CP/CT			TLD = VUUP x [(1 + OCC)n -1] x K		period of delay (beyond the
						VUUP = TCP - VCUP			contract expiry date). The
	Where								investment funds allocated to the
						WHERE:				project, which are not yet
	LD = Amount of liquidated damages for each calendar day of						productive because the project is
	delay				TLD = TOTAL LIQUIDATED DAMAGES, IN PESOS		incomplete and unusable, could
										have earned returns if invested in
	CP = Total contract price minus the value of completed		VUUP = VALUE OF THE UNCOMPLETED AND		other productive ventures
	portions of the contract certified by the government		UNUSABLE PORTIONS OF THE CONTRACT		elsewhere.
	office concerned as usable as of the expiration of the		WORK, AS OF THE EXPIRY DATE OF THE
	contract time, in pesos.			CONTRACT, IN PESOS
										The foregone benefits are
	CT = Contract time plus any time extension duly granted to		TCP = TOTAL CONTRACT PRICE, IN PESOS		computed on the basis of the
	the contractor, in calendar days.
										Opportunity Cost of Capital
						VCUP = VALUE OF THE COMPLETED AND USABLE		using the compounded interest
						PORTION OF THE CONTRACT WORK, AS OF THE		formula [(1 + OCC)n-1]. The
						EXPIRY DATE OF THE CONTRACT, IN PESOS		Opportunity Cost of Capital is
										that adopted by NEDA,
										presently set at 15% per annum.
						OCC = PREVAILING OPPORTUNITY COST OF
						CAPITAL FOR GOVERNMENT PROJECTS SET BY		The compounded interest
						NEDA, WHICH IS CURRENTLY PEGGED AT 15%		formula is applied to the funds
										allocated to the uncompleted and
						n = TOTAL NUMBER OF YEARS THAT THE		unusable portion of the project,
						CONTRACT WORK IS DELAYED AFTER THE		which is unproductive because
						EXPIRY DATE OF THE CONTRACT		of the delay. This portion is
										VUUP which is equal to TCP -
						K = ADJUSTMENT FACTOR TO COVER		VCUP. In some cases, the
						ADDITIONAL LOSSES			project may be partly completed
						= 1 + C + (i x n)			and usable, e.g., a partly finished
										section of a road pavement. In
					WHERE:				other cases, the project may be
										partly completed but still
					C = COST OF CONSTRUCTION SUPERVISION AS A		unusable, e.g., a partly finished
					PERCENTAGE, NOT EXCEEDING 10%, OF		bridge ; in these cases, VCUP
					CONSTRUCTION COST			equals zero, and the
										compounded formula is applied
					i = ANNUAL INFLATION RATE			to TCP.
										K is the adjustment factor to
					THE HEAD OF AGENCY MAY ALSO IMPOSE		cover the following additional
					ADDITIONAL LIQUIDATED DAMAGES ON THE		losses incurred by the economy,
					CONTRACTOR PROVIDED THAT SUCH IS		which are not captured by the
					PRESCRIBED IN THE INSTRUCTIONS TO BIDDERS		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 MAY BE			For clarity.
		DEEMED USABLE WHEN IT STARTS TO
		PROVIDE THE DESIRED BENEFITS AS
		CERTIFIED BY THE TARGETTED END-USERS
		AND THE CONCERNED AGENCY.
57		CI 9 - INCENTIVE BONUS		CI 9 - INCENTIVE BONUS
	1.	For major and urgent projects, except for negotiated	1.	For major and urgent projects, except for negotiated		This formula is based on the
		contracts and provided that the Instructions to Bidders and		contracts and provided that the Instructions to Bidders and		concept of "early economic
		other Tender and Contract Documents so prescribed, if the		other Tender and Contract Documents so prescribed, if the		benefits or returns" being
		contractor completes the contract works ahead of schedule		contractor completes the contract works ahead of schedule		derived from investments in the
		without any suspension order affected or extension of		without any suspension order affected or extension of		project because it is completed
		contract time granted, he may be given a bonus for saving		contract time granted, he may be given a bonus for saving		ahead of schedule. That is, since
		the Government additional expenses for engineering and		the Government additional expenses for engineering and		the project is completed before
		inspection services and for allowing the Government the		inspection services and for allowing the Government the		the contract expiry date, the
		early use of the completed facilities, in an amount to be		early use of the completed facilities, in an amount to be		economy will realize the benefits
		determined, but not to exceed ten percent (10%) of the		determined, but not to exceed ten percent (10%) of the		or returns earlier than if the
		contract price:			contract price.		project were completed just on
										schedule
		IB = 0.75 x VWA		TIB = VCUP x [(1 + OCC)t-1] x K'
										The early benefits are computed
		Where		WHERE:				based on the Opportunity Cost of
		IB = Total amount of incentive bonus						Capital, using the same
		VWA = Value of works accomplished ahead of schedule	TIB = TOTAL INCENTIVE BONUS, IN PESOS, WHICH		compounded interest formula [(1
					SHALL NOT EXCEED OR BE GREATER THAN		+ OCC)n-1] as for Liquidated
					10% OF THE TOTAL CONTRACT PRICE.		Damages. The Opportunity Cost
										of Capital is that adopted by
					VCUP = VALUE OF THE COMPLETED AND USABLE		NEDA,  presently set at 15% per
					PORTION OF THE CONTRACT WORK DONE		annum.
					AHEAD OF SCHEDULE, I.E., BEFORE THE
					EXPIRY OF THE CONTRACT, IN PESOS	K' is an adjustment factor to
									cover the following additional
					OCC = PREVAILING OPPORTUNITY COST OF	returns from investments which
					CAPITAL FOR GOVERNMENT PROJECTS SET BY	are not captured by the basic
					NEDA WHICH IS CURRENTLY PEGGED AT 15%	compounded interest formula:
					t = TOTAL NUMBER OF YEARS THAT THE	a.	Savings in Government
					CONTRACT WORK WAS COMPLETED BEFORE		expenses for supervision of
					THE EXPIRY DATE OF THE CONTRACT		the portion of the contract
										work completed and made
					K' = ADJUSTMENT FACTOR TO COVER		usable before the expiry
					ADDITIONAL RETURNS		date of the contract. This
					= 1 + C + (i x n)		is estimated at 10% of the
										VPSCU, which is the
					WHERE:				ceiling for contract
										supervision per NEDA
					C = COST OF CONSTRUCTION SUPERVISION AS A		Guidelines for consultancy.
					PERCENTAGE, NOT EXCEEDING 10%, OF
					CONSTRUCTION COST	b.	Savings in budgetary
										outlays for the contract due
					i = ANNUAL INFLATION RATE		to avoided inflation beyond
										the actual completion date.
					VCUP = TCP - VPSCU			This is based on the latest
										inflation rate per year
					WHERE:				published by NEDA
										applied to the number of
					TCP = TOTAL CONSTRUCTION PRICE, IN PESOS		days needed to accomplish
					VPSCU.
					VPSCU = VALUE OF THE PORTION OF THE
					CONTRACT WORK SUPPOSED TO BE
					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 PRICE
	ESCALATION			CI 12.1 - GUIDELINES ON CONTRACT PRICE ESCALATION
	1.	These guidelines for the computation and payment of price
		escalation shall apply to existing contracts, . . . All	1.	These guidelines for the computation and payment of price		To encourage the introduction,
		infrastructure contracts entered into after the date of		escalation shall apply to existing contracts, . . . All		improvement and/or refinement
		effectivity of these guidelines (August 27, 1980) shall		infrastructure contracts entered into after the date of		of the parametric formulae to
		employ the escalation method provided for in these		effectivity of these guidelines (August 27, 1980) shall		reflect more accurately the
		guidelines. Equipment supply contracts, whether or not		employ the escalation method USING THE		fluctuation in the prices.
		included as an integral part of the infrastructure contract,		PARAMETRIC FORMULAE provided for in these
		shall not be covered by this provision.		guidelines. FORMULAE OTHER THAN THOSE
						PRESCRIBED HEREIN MAY 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 work as of	Delete this section.			This is already outdated and
		February 1, 1976, the Contract price Adjustment						deemed no longer applicable.
		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 approved by the	Delete the portion "except those recommended by CPAC for		For consistency. This is in
		Secretary or head of office/agency/corporation concerned	escalation in contract unit prices up to price levels as of		connection with the deletion of
		in accordance with Section 8 of Presidential Decree No.	February 1, 1976 where the old CPAC guidelines were used,		CI 12.1-4 above.
		1594 to become effective except those recommended by	and which must be forwarded to the Office of the President
		CPAC for escalation in contract unit prices up to price	for approval before they become effective."
		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.	Escalation of prices for work accomplishment on	7.	Escalation of prices for work accomplishment on	For clarity.
		infrastructure. . . . shall be made periodically . . . an increase		infrastructure. . . . shall be made periodically. . . an increase
		or decrease of more than five (5%) of the original		or decrease of more than five percent (5%) of the original
		contract unit price of items of work.		OR ADJUSTED contract unit price of items of work.
62	CI 12.2 - 4			CI 12.2 - 4
	4.	. . . In the absence of any price index for a specified	4.	. . . In the absence of any price index for a specified	For clarity.
		adjustable item, the nearest related price index shall be		adjustable item, THE PRICE INDEX OF the nearest
		used.				related ITEM [price index] shall be used.
63.	IV.	PE — EVALUATION OF CONTRACTORS	IV.	PE — EVALUATION OF CONTRACTORS
	PERFORMANCE		PERFORMANCE
	PE I — SUBJECT AND SCOPE		PE I — SUBJECT AND SCOPE
	All contractors undertaking project with the government,	All contractors undertaking projects with the government,
	regardless of contract amount and funding source and whose	regardless of contract amount and funding source and whose
	contracts are awarded either thru bidding or negotiation, shall	contracts are awarded either thru bidding or negotiation, shall
	have their performance evaluated by		have their performance evaluated by
	offices/agencies/corporations concerned. This evaluation shall	offices/agencies/corporations concerned. This evaluation shall
	be done during the construction phase and completion phase.	be done during [the] construction [phase] and UPON		Grammatical/syntax correction
					completion [phase] OF EACH GOVERNMENT 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 intended
	CONCERNED ARE MANDATED TO ADOPT THE	updating, it also allows the
	CPES IMPLEMENTING GUIDELINES AS APPROVED	formulation of similar
	BY THE NEDA INFRACOM. WHILE THE CPES IS	implementing guidelines for
	SPECIFIC FOR ROAD, BRIDGE, HOUSING,	projects other than those
	BUILDING, PORT AND HARBOR PROJECTS,	specifically covered by the
	AGENCIES CONCERNED MAY FORMULATE AND	CPES.
	ADOPT THEIR OWN IMPLEMENTING GUIDELINES
	SPECIFIC TO PROJECT TYPES OTHER THAN THOSE
	ABOVEMENTIONED 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 A CPES	The present provision needs
		IMPLEMENTING UNIT (IU) WHICH SHALL BE	updating to cite the CPES
		RESPONSIBLE FOR CPES GUIDELINES	implementing guidelines that
		IMPLEMENTATION, INCLUDING BUT NOT	have been approved by the
		LIMITED TO THE SUPERVISION OF	NEDA-INFRACOM. The
		PERFORMANCE EVALUATORS ACCREDITED	setting-up of the CPES IU will
		BY THE CIAP.		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 AS
		PROVIDED FOR UNDER THE UNIFORM	To incorporate Section 4.2 of the
		GUIDELINES FOR BLACKLISTING		Blacklisting Guidelines
		CONSTRUCTORS INVOLVED IN PUBLIC	approved by the NEDA
		CONSTRUCTION (CIAP BLACKLISTING	INFRACOM in the IRR of PD
		GUIDELINES) SHALL BE IMPOSED FOR	1594 for enforcement by
		OFFENSES/VIOLATIONS COMMITTED BY	agencies concerned.
		CONTRACTORS DURING PREQUALIFICATION,
		BIDDING, AWARD AND CONTRACT
		IMPLEMENTATION.
	2.	THE IMPOSITION OF ADMINISTRATIVE
		SANCTIONS IN THIS SECTION SHALL BE
		PURSUANT TO THE CIAP BLACKLISTING
		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 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 ACTS 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 implementing	1.	The above notwithstanding, nothing in these implementing
		rules and regulations shall negate any existing and future		regulations shall negate any existing and future
		commitments with respect to the bidding and award of		commitments with respect to the bidding, award and
		contracts financed partly or wholly with funds from		EXECUTION of contracts financed partly or wholly with
		international financial institutions, as well as from bilateral		funds from international financial institutions, as well as
		and other similar sources.			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. AcDHCS

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

a. Cash, manager's check, cashier's one percent (1%) of the total

check, letter of credit, or bank project cost as advertised

draft

b. Bank guarantee one and a half percent (1½%)

of the total project cost as

advertised.

c. Surety bond two and a half percent (2½%)

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.