NPM No. 125-2017
Requesting Entity: LOCAL GOVERNMENT OF SURIGAO CITY
Issues Concern: Cancellation and Rebidding
Whether the HoPE is correct to recommend for the cancellation and rebidding of the LGU of Surigao`s procurement because of the findings that the bids offered by the two (2) bidders have different technical specifications, in effect having unequal bids.
For guidance, the HoPE reserves the right to reject any and all bids, declare a failure of bidding, or not award the contract in the situations provided in Section 41 of the 2016 IRR of RA 9184. Accordingly, if the HoPE determines that any of the grounds provided in Section 41 is present in the conduct of the procurement activity, such as “for any justifiable and reasonable ground where the award of the contract will not redound to the benefit of the GoP, to wit:
i. if the physical and economic conditions have significantly changed so as to render the project no longer economically, financially, or technically feasible, as determined by the HoPE;
ii. if the project is no longer necessary as determined by the HoPE; or
iii. if the source of funds for the project has been withheld or reduced through no fault of the Procuring Entity, the HoPE has the right to reject any and all bids, declare a failure of bidding or not award the contract, in accordance with Section 41 of the IRR of RA 9184.
As the approving authority, the HOPE is given discretionary power to approve or disapprove the recommendations made by the BAC. Nonetheless, when the HOPE exercises its power under the Reservation Clause, he must be able to clearly show the existence of the ground/s relied upon. Moreover, the same is not without any sanction if exercised capriciously. Thus, Section 65 of RA 9184 and its IRR provides penal sanctions to the HOPE if he abuses his power to reject any and all bids as mentioned under Section 41 of RA 9184 and its IRR, with manifest preference to any bidder who is closely related to him in accordance with Section 47 of the Act and the IRR.
Accordingly, if a bidder`s offer is indeed responsive to all the legal, technical and financial requirements of the bid, and who actually met and passed the minimum and necessary specifications contained in the bidding documents, the HoPE must be able to clearly show the existence of the ground/s relied upon under Section 41.
As for the rebidding of the project and use of a 2-stage bidding procedure, “it is also within the procuring entity`s authority, function, and discretion to decide, whether the procurement should be eventually pursued according to its needs and budget availability. Caveat must be made, however, that when a project has been cancelled by the HOPE for reason provided for under Section 41 of the procurement law and its IRR, the rebidding of the same project must be carefully studied.”1