2010-01-25

NPM 004-2010

Requesting Entity: National Irrigation Administration

Issues Concern: Agency-to-Agency Agreements

 

Details

Whether the National Irrigation Administration (NIA) may directly engage NIA Consult, Inc. (NIAConsult) under Section 53.5 (or Agency-to-Agency Agreement) of the Revised Implementing Rules and Regulations (IRR) of Republic Act No. 9184 (RA 9184).

Under Section 53.5 of the IRR, government owned and controlled corporations (GOCCs) formed under the Corporation Code are excluded from the definition of agency, and thus, not qualified to act as servicing agencies in Agency-to-Agency Agreements. Based on the opinion of the Office of the Government Corporate Counsel (OGCC), however, GOCCs formed under the Corporation Code may still enter into Agency-to-Agency Agreements with another GOCC provided that a parent-subsidiary relationship exists between the two. Therefore, as long as the parent owns directly or indirectly more than half of the voting power of its subsidiary, then it may directly engage the services of said subsidiary.

From the foregoing, it is our considered opinion that NIA may enter into an Agency-to-Agency Agreement with NIAConsult for the provision of feasibility and detailed engineering studies. NIA is also advised to comply with the conditions outlined in Section 5 and 6 Implementing Guidelines on Agency-to-Agency Agreements issued by the GPPB.