2004-07-23

NPM 098-2004

Requesting Entity: BM Marketing & Construction

Issues Concern: Eligibility Requirements for Joint Venture under the Implementing Rules and Regulations Part A (IRR-A) of Republic Act No. 9184 (R.A. 9184)

 

Details

Request for guidance on the conditions that a Joint Venture Agreement (JVA) should contain in order to be considered as a valid Class “B” Document under Section 23.6 (2) of the IRR-A of R.A. 9184.

Requirement of a Valid JVA for purposes of Eligibility Check

For purposes of conducting eligibility on the prospective bidders for the procurement of goods and infrastructure projects, Section 23.6 (2) of the IRR-A of R.A. 9184 requires the prospective bidders to submit the following Class “B” Documents:

a) Valid joint venture agreement, in case of a joint venture; and
b) Letter authorizing the BAC or its duly authorized representative/s to verify any or all of the documents submitted for the eligibility check.

As regards the requirement of a “valid joint venture agreement” for JV bidders, the IRR-A of R.A. 9184 does not prescribe a standard form nor does it spell out the specific terms and conditions that should be included in such agreement to be valid. However, for purposes of eligibility check, all JVAs are required to be notarized in order to be considered valid as prescribed in the aforequoted section. Further, it is advised that the JVAs should specifically state the name of the person who is appointed as the lawful attorney-in-fact of the JV to sign the contract, if awarded, and the member who is the lead representative of the concerned JV.

Eligibility Requirements for JVs

Aside from the foregoing, it is also relevant to discuss the eligibility requirements for JVs. Hence, we are citing the following:

1. Entities forming themselves into a joint venture or consortium are also required to submit as part of their eligibility documents, a valid PCAB license for such joint venture or consortium. This can be deduced from Section 23.11.2 (2), which prescribes the eligibility criteria for the procurement of infrastructure projects, to wit:

x x x x

2. Consequently, the determination of eligibility of prospective bidders is based on the submission of Class “A” (legal, technical and financial documents) and Class “B’ Documents as specified in Section 23.6 of the IRR-A of R.A. 9184, thus:

x x x x

Based on the aforequoted provision (Section 23.6, IRR-A, R.A. 9184), it can be observed that although entities under a joint venture participating in a particular procurement as prospective bidders are required to submit a valid Joint Venture Agreement as part of its Class “B” eligibility documents, they are still required to submit as part of their Class “A” eligibility documents a valid PCAB license and registration for the type and cost of the contract to be bid. Thus, aside from their separate individual license and registration with the PCAB, contractors forming themselves into a joint venture must have obtained a license and registered with the PCAB as early as the time when they submit their eligibility documents, considering that such contractors shall be treated a single entity for such project under the name of the joint venture.