2019-03-04

NPM No. 003-2019

Requesting Entity: National Power Corporation (NPC)

Issues Concern: Committed Line of Credit

 

Details

1. Whether the committed Line of Credit needs to be effective or has already been granted by the bank at the time of bid opening?

The committed Line of Credit must be effective or available on the date of the bid submission. Stated differently, a Line of Credit that shall be effective only at some future time other than on the date of bid submission or has no indicative date when the same shall be available is not compliant with the requirements under Section 23.1(a)(xviii) of the 2016 revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No. 9184 which states that:

23.1 For purposes of determining the eligibility of bidders using the criteria stated in Section 23.4 of this IRR, only the following documents shall be required by the BAC, using the forms prescribed in the Bidding Documents:

xviii. The prospective bidder`s computation of Net Financial Contracting Capacity (NFCC). However, in the case of procurement of Goods, a bidder may submit a committed Line of Credit from a Universal or Commercial Bank, in lieu of its NFCC computation.


2. Whether a bidder can submit a committed Line of Credit that will be effective only upon award (or few days after award) of the contract?

In the procurement of goods wherein the prospective bidder opts to submit a committed Line of Credit in lieu of its Net Financial Contracting Capacity, the Line of Credit must have been granted by the bank to the bidder at the time of submission of bids. Therefore, a Line of Credit that has not yet been extended by the bank to the bidder at the time of submission of bid is not the committed Line of Credit required for eligibility under the rules.


3. Whether the bid submission should be disqualified if the bank did not specify a date as to when the committed Line of Credit will be available or if the availability thereof is at some future date, i.e., upon award of contract?

The committed Line of Credit must be effective or available on the date of the bid submission. Stated differently, a Line of Credit that shall be effective only at some future time other than on the date of bid submission or has no indicative date when the same shall be available is not compliant with the requirements under Section 23.1(a)(xviii) of the 2016 IRR of RA No. 9184.