Local Government Units - Government Procurement Policy …

1 Page i Local Government Units Procurement manual Table of Contents The Procurement manual for LGUs was developed to guide Local Government Procurement practitioners through the different steps involved in the whole Procurement process under RA 9184 and its IRR taking into consideration the distinct structure and systems of Local governments. Local Government Units Procurement manual 2014 Page i Local Government Units Procurement manual ABBREVIATIONS AND ACRONYMS .. V GENERAL PROVISIONS .. 7 SECTION 1: PURPOSE, SCOPE AND APPLICATION .. 9 I. Purpose .. 9 II. Scope .. 9 III. Application .. 10 SECTION 2: PRINCIPLES OF Government Procurement .. 11 I. Transparency .. 11 II. Competitiveness .. 11 III. Streamlining and Use of Modern Technology in Procurement .

2 11 IV. Accountability .. 11 V. Public Monitoring .. 11 Procurement ORGANIZATION .. 13 SECTION 1: THE ORGANIZATIONAL STRUCTURE .. 15 I. Head of the Procuring Entity .. 15 II. Bids and Awards Committee (BAC) .. 15 III. BAC Secretariat .. 17 IV. Technical Working Group (TWG) .. 18 V. Observers .. 19 SECTION 2: ROLES AND RESPONSIBILITIES .. 21 I. Head of the Procuring Entity .. 21 II. Bids and Awards Committee (BAC) .. 22 III. BAC Secretariat .. 23 IV. Technical Working Group (TWG) .. 23 V. Observers .. 24 VI. Bidders .. 24 SECTION 3: BENEFITS FOR BAC, TWG AND SECRETARIAT .. 27 I. Professionalization of BAC 27 II. Grant of Honoraria .. 27 III. Legal Assistance and Indemnification Package .. 29 SECTION 4: Procurement PLANNING AND BUDGET LINKAGE.

3 33 I. Preparation of the Project Procurement Management Plan (PPMP) .. 33 II. Annual Procurement Plan (APP) .. 37 MODES OF Procurement .. 39 SECTION 1: PRIMARY MODE OF Procurement .. 41 I. Competitive Bidding .. 41 SECTION 2: ALTERNATIVE METHODS OF Procurement .. 42 I. Conditions for Use of Alternative Methods of 42 II. Different Alternative Methods .. 42 COMPETITIVE BIDDING AND CONTRACT IMPLEMENTATION PROCEDURES FOR THE Procurement OF GOODS AND SERVICES .. 67 SECTION 1: INTRODUCTION .. 69 SECTION 2: DEFINITION OF TERMS .. 70 Page ii Local Government Units Procurement manual I. Goods and Services (Section 5 [r], IRR of RA 9184) .. 70 II. Common-Use Supplies .. 70 III. Inventory Items .. 70 IV. Non-Common Use Supplies.

4 71 V. Purchase Order .. 71 SECTION 3. Procurement PLANNING .. 72 I. Preparation of Project Procurement Management Plan and Annual Procurement Plan .. 72 II. Preparation of the Bidding Documents .. 74 III. Pre- Procurement Conference .. 76 SECTION 4. PROCEDURAL STEPS FOR COMPETITIVE BIDDING .. 79 I. Advertisement and/or Posting the Invitation to Bid (IB) .. 79 II. Distribution and Sale of the Bidding Documents .. 82 III. Call a Pre-Bid Conference and, if necessary, Issue Supplemental/Bid Bulletins .. 83 IV. Receipt, Opening and Preliminary Examination of Bids .. 87 V. Detailed Bid Evaluation .. 99 VI. Post-qualification .. 102 VII. Issuance of the Notice of Award .. 105 VIII. Contract Signing and Approval.

5 109 IX. Issuance of Notice to Proceed .. 110 SECTION 5. RESERVATION CLAUSE AND FAILURE OF BIDDING .. 112 I. Reservation Clause .. 112 II. Failure of Bidding .. 113 SECTION 6: THE Procurement SERVICE OF THE DEPARTMENT OF BUDGET AND MANAGEMENT (DBM-PS) AND THE PHILIPPINE Government ELECTRONIC Procurement SYSTEM (PHILGEPS) .. 114 I. DBM-PS .. 114 II. PhilGEPS .. 114 SECTION 7: TWO-STAGE COMPETITIVE BIDDING .. 115 I. Concept of Two-Stage Competitive Bidding .. 115 II. When Applicable .. 115 III. Timeline .. 115 IV. Procedure for the Two-Stage Competitive Bidding Process .. 116 SECTION 8: CONTRACT IMPLEMENTATION .. 118 I. Warranty .. 118 II. Amendment to Order .. 119 III. Suspension of Delivery.

6 122 IV. Delays in Delivery of Goods or Performance of Services and Liquidated Damages .. 123 V. Payment (Advance and Progress Payments) .. 125 VI. Taxes and Duties .. 126 VII. Subcontracts .. 126 VIII. Standards .. 127 IX. Packaging .. 127 X. Insurance .. 127 XI. Transportation .. 127 XII. Inspection and Tests .. 128 XIII. Intellectual Property Rights .. 129 XIV. Limitations of 129 XV. Termination of Contract .. 129 XVI. Assignment .. 130 XVII. Other Rules and Guidelines .. 131 Page iii Local Government Units Procurement manual COMPETITIVE BIDDING AND CONTRACT IMPLEMENTATION PROCEDURES FOR THE Procurement OF INFRASTRUCTURE PROJECTS .. 135 SECTION 1: INTRODUCTION .. 137 SECTION 2: DEFINITION OF TERMS.

7 138 I. INFRASTRUCTURE PROJECTS/CIVIL WORKS (Section 5 [u], IRR of RA 9184) .. 138 SECTION 3: Procurement PLANNING .. 139 I. Procurement 139 II. Preparation of the Bidding Documents .. 142 III. Pre- Procurement Conference .. 144 SECTION 4. PROCEDURAL STEPS FOR COMPETITIVE BIDDING .. 147 I. Advertisement and/or Posting the Invitation to Bid (IB) .. 147 II. Distribution and Sale of the Bidding Documents .. 150 III. Call a Pre-Bid Conference and, if necessary, Issue Supplemental/Bid Bulletins .. 151 IV. Receipt, Opening and Preliminary Examination of Bids .. 156 V. Detailed Bid Evaluation .. 167 VI. Post-qualification .. 169 VII. Issuance of the Notice of Award .. 172 VIII. Contract Signing and Approval.

8 176 IX. Issuance of Notice to Proceed .. 178 SECTION 5. RESERVATION CLAUSE AND FAILURE OF BIDDING .. 180 I. Reservation Clause .. 180 II. Failure of Bidding .. 181 SECTION 6: CONTRACT IMPLEMENTATION .. 182 I. Subcontracting .. 182 II. Measurement of Works .. 183 III. Impact of the Infrastructure Project on Traffic and Adjoining Properties .. 183 IV. Responsibilities of the Contractor for the Project Site .. 183 V. Turn-over of excess, used, unused and/or reusable materials .. 183 VI. Contract Price and Payment .. 184 VII. Variation Orders .. 187 VIII. Suspension of Work .. 190 IX. Contract Extension .. 191 X. Delays in Work Completion .. 193 XI. Liquidated Damages .. 193 XII. Contract Termination.

9 194 XIII. Preliminary Inspection upon Contract Completion .. 195 XIV. Dayworks .. 195 XV. The Use of Accredited Testing Laboratories .. 195 XVI. Evaluation of Contractor s Performance .. 196 XVII. Warranty .. 197 COMPETITIVE BIDDING AND CONTRACT IMPLEMENTATION PROCEDURES FOR THE Procurement OF CONSULTING SERVICES .. 201 SECTION 1: SCOPE .. 203 I. Advisory and review services .. 203 Page iv Local Government Units Procurement manual II. Pre-investment or feasibility studies .. 203 III. Design .. 203 IV. Construction supervision .. 204 V. Management and related services .. 204 VI. Other technical services or special studies .. 205 SECTION 2: Procurement PLANNING .. 207 I. Factors to be considered in determining the ABC.

10 207 II. Preparing the Bidding Documents .. 212 III. Pre- Procurement Conference .. 213 SECTION 3: GUIDELINES FOR THE CONDUCT OF COMPETITIVE BIDDING FOR THE Procurement OF CONSULTING SERVICES .. 217 I. Advertisement and/or Posting of the Request for Expression of Interest (REI): .. 218 II. Eligibility Check and Short-listing: .. 220 III. Issue the Bidding Documents .. 227 IV. Call a Pre-Bid Conference and, if necessary, Issue Supplemental/Bid Bulletins .. 228 V. Submission, Opening and Examination of Bids .. 232 VI. Detailed Bid Evaluation .. 239 VII. 245 VIII. Post-qualification .. 245 IX. Issuance of the Notice of Award .. 247 X. Contract Signing and Approval .. 248 XI. Issuance of Notice to Proceed.