2017-05-02

NPM No. 006-2017

Requesting Entity: Department of Transportation (DOTr)

Issues Concern: Applicability of Republic Act (RA) No. 9184 in the Selection of a Technical Support Consultant funded through a World Bank Loan

 

Details

1.    Whether the Bids and Awards Committee (BAC) is permitted to apply the provisions of RA 9184 in place of the World Bank Guidelines.


      RA 9184 and its IRR apply to government procurement activities regardless of source of funds, but recognize the application of any Treaty or International or Executive Agreement, to which the government is a signatory, particularly when the Treaty or International or Executive Agreement expressly provides the use of a separate set of procurement rules and regulations other than those provided in RA 9184 and its IRR, such as the Loan Agreement with the World Bank. On the other hand, RA 9184 and its IRR shall apply if the Treaty, International Agreement, or Executive Agreement expressly provides its applicability; or when the Treaty, International Agreement, or Executive Agreement are silent or has failed to identify the applicable procurement procedure to be utilized.


2.    Whether RA 9184 may apply suppletorily to the World Bank Guidelines.


      In GSIS v. Villaviza, the Supreme Court had the opportunity to define the word “suppletory” as “supplying deficiencies”. In line with this definition, a rule, statute, or guideline may only be applied when there is an insufficiency, deficiency or gap in the applicable primary rule, statute or guideline.

      At this juncture, it is opportune to stress that it is not within the ambit of our authority to determine whether the World Bank procurement guidelines is insufficient or lacking to address a particular circumstance or situation during a procurement activity, such that RA 9184 and its associated rules apply.


3.    Whether the DOTr can directly negotiate, as approved by World Bank, with a bidder despite submitting a financial proposal above the Agency Estimate.


      The ABC as ceiling for bid prices applies only for projects procured through RA 9184 and its IRR; or, in case the World Bank allows the use of ABC as ceiling for bid prices subject to compliance with the conditions provided in Section 31.2 of the IRR of RA 9184. It is worthy to emphasize, however, that the Government of the Philippines and the IFI may agree to waive these conditions pursuant to the stipulations, covenants and conditions in the Loan Agreement. Thus, the DOTr can directly negotiate with a bidder despite submitting a financial proposal above the “agency estimate” or “cost estimate” if allowed by the World Bank pursuant to the terms and conditions of the Loan Agreement.


4.    Whether a No Objection Letter (NOL) issued by the World Bank supersedes the procedural or documentary requirements of RA 9184.


      Pursuant to Section 37.1.4 of the IRR of RA 9184, an NOL is not among the documentary requirements needed in order for a contract to be awarded. However, considering the applicability of the World Bank procurement guidelines for projects funded through the proceeds of the Loan Agreement, the issuance of an NOL is necessary in accordance with the World Bank Guidelines.