Re: Procurement of a Service Provider of Cable Television System for the Supreme Court (April 2012-March 2014)

July 31, 2012

EN BANC

A.M. No. 12-2-22-SC

NOTICE

Sirs/Mesdames :

Please take notice that the Court en banc issued a Resolution dated 31 July 2012, which reads as follows:

A.M. No. 12-2-22-SC (Re: Procurement of a Service Provider of Cable Television System for the Supreme Court [April 2012-March 2014]). AcSEHT

In a memorandum dated February 14, 2012, 1 the Supreme Court Bids and Awards Committee for Goods and Services (SC-BAC-GS) essentially requested for authority to directly contract the procurement of a service provider of cable television system for the Supreme Court for the period from April 2012 up to March 2014. The SC-BAC-GS manifested to the Court that in view of the 1st Indorsement dated January 3, 2012 of Atty. Ma. Carina M. Cunanan, Chairperson, Procurement Planning Committee (PPC), which reads in part:

Respectfully referred to Hon. Thelma C. Bahia, Assistant Court Administrator and Chairperson, Bids and Awards Committee for Goods and Services, the Approved Authority for the extension of the existing service contract with Cable Link and Holdings Corporation for a period of three (3) months and procurement of a new cable television service provider. 2 [Emphasis supplied.]

it scheduled a public bidding for the purpose; that the Invitation to Bid was posted in the Philippine Government Electronic Procurement System (PhilGEPS), in the Court's website, and in visible public areas beginning on January 10, 2012; that the scheduled January 17, 2012 Pre-Bid Conference was cancelled for lack of response to the Invitation to Bid; and that on January 31, 2012, the scheduled date of submission and opening of bids, it declared a failure of bidding in view of the absence of bidders.

The SC-BAC-GS later learned, however, that "the preferred channels of the end-users (i.e., ANC and DZMM Teleradyo) were exclusive to one company only, Skycable, which had earlier expressed that, as a matter of policy, it does not participate in public biddings." 3 Taking into account Section (Sec.) 50 of Rule XVI [Alternative Methods of Procurement] of the Revised Implementing Rules and Regulations of Republic Act No. 9184 (R.A. 9184), otherwise known as the "Government Procurement Reform Act", viz.:

Section 50. Direct Contracting. —

Direct Contracting or single source procurement is a method of procurement of goods that does not require elaborate Bidding Documents. The supplier is simply asked to submit a price quotation or a pro-forma invoice together with the conditions of sale. The offer may be accepted immediately or after some negotiations. Direct contracting may be resorted to by concerned Procuring Entities under any of the following conditions:

a) Procurement of goods of proprietary nature which can be obtained only from the proprietary source, i.e., when patents, trade secrets, and copyrights prohibit others from manufacturing the same item; CaDEAT

b) When the procurement of critical plant components from a specific supplier is a condition precedent to hold a contractor to guarantee its project performance, in accordance with the provisions of its contract; 4 or

c) Those sold by an exclusive dealer or manufacturer which does not have sub-dealers selling at lower prices and for which no suitable substitute can be obtained at more advantageous terms to the GOP.

the SC-BAC-GS requested the Court for authority to resort to the alternative method of procurement, i.e., directly contracting with SKY Cable, as the service provider for the Court's cable television system for the period from April 2012 up to March 2014.

Before acting on the aforementioned memorandum, the Court resolved in a Resolution dated March 6, 2012 5 to direct the SC-BAC-GS to (1) submit a comparison of the service provided by SKY Cable and the current service provider, Cable Link, vis-à-vis the service requirements of the Court; and (2) conduct another bidding relative to said procurement. 6

In compliance, the SC-BAC-GS informed the Court, via a Memorandum dated April 25, 2012, 7 that the Procurement Planning Committee had conducted a survey of the preferred channels of the end-users, i.e., the Offices of the Associate Justices and the Public Information Office; and that the survey showed that SKY Cable was the favored service provider, to wit:

The results show that of the ten respondents, four (4) indicated that they prefer SKY Cable over Cable Link in general. With respect to the news channels exclusive only to SKY Cable, six (6) respondents prefer ANC and two (2) chose Teleradyo. Cable Link, on the other hand, has the local news channel, GMA News TV, which has three (3) respondents who opted for it. The three (3) respondents favoring GMA News TV also favor ANC which is exclusively provided by SKY Cable. 8 cSTCDA

The SC-BAC-GS further informed the Court that on the terms of subscription rates, "the quotation of SKY Cable for its annual subscription fee amounting to P125,280.00 is lower than that of Cable Link which is P191,000.00 per annum . . .;" 9 that in connection with the second bidding, the Pre-Bid Conference scheduled on April 10, 2012 for the purpose was again cancelled for lack of response to the Invitation to Bid; that on April 24, 2012, the day of the submission and opening of bids, a failure of bidding was again declared when no bid was received; and requested that authority to directly negotiate a contract with SKY Cable Corporation as service provider of cable television be granted.

Considering that the majority of end-users of the cable television system for the Court appeared to prefer the ANC Channel, which is exclusive to SKY Cable; and that the cost of subscription from SKY Cable would be more cost-effective than the present cable television service provider of the Court, the Court finds the request to resort to an alternative method of procurement, i.e., direct contracting, justifiable and in order. There is no question that Sec. 50 of the Government Procurement Reform Act, which provides:

Section 50. Direct Contracting. — Direct Contracting may be resorted to only in any of the following conditions:

a. Procurement of Goods of propriety nature, which can be obtained only from the propriety source, i.e., when patents, trade secrets and copyrights prohibit others from manufacturing the same items;

b. When the Procurement of critical components from a specific manufacturer, supplier, or distributor is a condition precedent to hold a contractor to guarantee its project performance, in accordance with the provisions his contract; or,

c. Those sold by an exclusive dealer or manufacturer, which does not have sub-dealers selling at lower prices and for which no suitable substitute can be obtained at more advantageous terms to the government. DcCIAa

sanctions the resort to such alternative method of procurement; hence, the SC-BAC-GS is hereby authorized to directly contract and negotiate with SKY Cable for the procurement of a service provider of cable television system for the Court for the period from April 2012 up to March 2014 with an approved budget of P600,000.00.

WHEREFORE, acting on the Memorandum dated April 25, 2012 of the Supreme Court Bids and Awards Committee for Goods and Services, the Court resolves to GRANT the request for authority to adopt the alternative method procurement of direct contracting with SKY Cable Corporation under Sec. 50 of the Government Procurement Reform Act for the procurement of a service provider of cable television system for the Court for the period from April 2012 up to March 2014 with an approved budget of P600,000.00. Mendoza, J., on leave. (62)

Very truly yours,

Signed by representative

ENRIQUETA E. VIDALClerk of Court

Footnotes

1. Rollo, pp. 1-2.

2. Id. at 75.

3. Id. at 1.

4. As amended by GPPB Resolution 11-2009 dated 30 November 2009.

5. Id. at 94.

6. Id.

7. Id. at 96-97.

8. Id. at 96.

9. Id.