ACTIVITY NO.

7
Cabungcal, Keneth Joe A.
Bs Management Accounting 3-1

THE PHILIPPINE COMPETITION ACT

DEFINITION AND SCOPE OF APPLICATION

The Philippine Competition Act (PCA) or R.A. 10667 is the primary competition policy of the
Philippines for promoting and protecting competitive market. It will protect the well-being of
consumers and preserve the efficiency of competition in the marketplace. The PCA was passed
in 2015 after languishing in Congress for 24 years. It is a game changing legislation that is
expected to improve consumer protection and help accelerate investment and job creation in the
country, consistent with the national government’s goal of creating more inclusive economic
growth. Enforcement of this law will help ensure that markets are open and free, challenging
anticompetitive business practices while maintaining an environment where businesses can
compete based on the quality of their work. A competitive market means a market with multiple
buyers and multiple sellers, driving market prices lower and offering consumers more choices. A
truly competitive market encourages efficiency and innovation, and forces businesses to excel.
The act reflects the belief that competition:

 Promotes entrepreneurial spirit;

 Encourages private investments;
 Facilitates technology development and transfer; and
 Enhances resource productivity.
However, under Section 3 provides the Scope and Application. This Act shall be enforceable
against any person or entity engaged in any trade, industry and commerce in the Republic of the
Philippines. It shall likewise be applicable to international trade having direct, substantial, and
reasonably foreseeable effects in trade, industry, or commerce in the Republic of the Philippines,
including those that result from acts done outside the Republic of the Philippines.

This Act shall not apply to the combinations or activities of workers or employees nor to
agreements or arrangements with their employers when such combinations, activities,
agreements, or arrangements are designed solely to facilitate collective bargaining in respect of
conditions of employment.

PROHIBITED ACTS

SEC. 14. Anti-Competitive Agreements. –

a) The following agreements, between or among competitors, are per se prohibited:

i. Restricting competition as to price, or components thereof, or other terms of trade;
ii. Fixing price at an auction or in any form of bidding including cover bidding, bid
suppression, bid rotation and market allocation and other analogous practices of
bid manipulation;
b) The following agreements, between or among competitors which have the object or effect
of substantially preventing, restricting or lessening competition shall be prohibited:
i. Setting, limiting, or controlling production, markets, technical development, or
investment;
ii. Dividing or sharing the market, whether by volume of sales or purchases,
territory, type of goods or services, buyers or sellers or any other means.
c) Agreements other than those specified in (a) and (b) of this Section which have the object
or effect of substantially preventing, restricting or lessening competition shall also be
prohibited: Provided, Those which contribute to improving the production or distribution
of goods and services or to promoting technical or economic progress, while allowing
consumers a fair share of the resulting benefits, may not necessarily be deemed a
violation of this Act.
An entity that controls, is controlled by, or is under common control with another
entity or entities, have common economic interests, and are not otherwise able to decide
or act independently of each other, shall not be considered competitors for purposes of
this Section.

SEC. 15. Abuse of Dominant Position. – It shall be prohibited for one or more entities to abuse
their dominant position by engaging in conduct that would substantially prevent, restrict or
lessen competition:
a) Selling goods or services below cost with the object of driving competition out of the
relevant market: Provided, That in the Commission’s evaluation of this fact, it shall
consider whether the entity or entities have no such object and the price established was
in good faith to meet or compete with the lower price of a competitor in the same market
selling the same or comparable product or service of like quality;
b) Imposing barriers to entry or committing acts that prevent competitors from growing
within the market in an anti-competitive manner except those that develop in the market
as a result of or arising from a superior product or process, business acumen, or legal
rights or laws;
c) Making a transaction subject to acceptance by the other parties of other obligations
which, by their nature or according to commercial usage, have no connection with the
transaction;
d) Setting prices or other terms or conditions that discriminate unreasonably between
customers or sellers of the same goods or services, where such customers or sellers are
contemporaneously trading on similar terms and conditions, where the effect may be to
lessen competition substantially: Provided, That the following shall be considered
permissible price differentials:
i. socialized pricing for the less fortunate sector of the economy;
ii. price differential which reasonably or approximately reflect differences in the cost
of manufacture, sale, or delivery resulting from differing methods, technical
conditions, or quantities in which the goods or services are sold or delivered to the
buyers or sellers;
iii. price differential or terms of sale offered in response to the competitive price of
payments, services or changes in the facilities furnished by a competitor; and
iv. price changes in response to changing market conditions, marketability of goods
or services, or volume;
e) Imposing restrictions on the lease or contract for sale or trade of goods or services
concerning where, to whom, or in what forms goods or services may be sold or traded,
such as fixing prices, giving preferential discounts or rebate upon such price, or imposing
conditions not to deal with competing entities, where the object or effect of the
 restrictions is to prevent, restrict or lessen competition substantially: Provided, That
nothing contained in this Act shall prohibit or render unlawful:
i. Permissible franchising, licensing, exclusive merchandising or exclusive
distributorship agreements such as those which give each party the right to
unilaterally terminate the agreement; or
ii. Agreements protecting intellectual property rights, confidential information, or
trade secrets.
f) Making supply of particular goods or services dependent upon the purchase of other
goods or services from the supplier which have no direct connection with the main goods
or services to be supplied;
g) Directly or indirectly imposing unfairly low purchase prices for the goods or services of,
among others, marginalized agricultural producers, fisherfolk, micro-, small-, medium-
scale enterprises, and other marginalized service providers and producers;
h) Directly or indirectly imposing unfair purchase or selling price on their competitors,
customers, suppliers or consumers, Provided that prices that develop in the market as a
result of or due to a superior product or process, business acumen or legal rights or laws
shall not be considered unfair prices; and
i) Limiting production, markets or technical development to the prejudice of consumers,
provided that limitations that develop in the market as a result of or due to a superior
product or process, business acumen or legal rights or laws shall not be a violation of this
Act;

Provided, That nothing in this Act shall be construed or interpreted as a prohibition on having
a dominant position in a relevant market or on acquiring, maintaining and increasing market
share through legitimate means that do not substantially prevent, restrict or lessen competition.

Provided further, That any conduct which contributes to improving production or distribution
of goods or services within the relevant market, or promoting technical and economic progress
while allowing consumers a fair share of the resulting benefit may not necessarily be considered
an abuse of dominant position.
 Provided finally, That the foregoing shall not constrain the Commission or the relevant
regulator from pursuing measures that would promote fair competition or more competition as
provided in this Act.

PROHIBITED MERGER AND ACQUISITIONS

COVERED NOT COVERED

Substantially prevent, restrict or lessen 1. Gains in efficiencies > effects of any
competition (SPRLC) in the relevant market or limitation on competition
in the market for goods or services. 2. A party to the merger or acquisition
agreement is faced with actual or
imminent financial failure, and the
agreement represents the least anti-
competitive arrangement among the
known alternative uses for the failing
entity’s assets.
COMPULSORY NOTIFICATION IF FOUND ANTI-COMPETITIVE
 Transaction value > P1Billion 1. Implementation prohibited
 30-day ban on consummating 2. Implementation prohibited
agreement conditionally (subject to changes
 Information based on form prescribed imposed by PCC)
in IRR o Violation: void transaction 3. Implementation prohibited until new
and fine agreement reached

 Inaction amounts to approval

Php 1,000,000,000,00 (threshold)
 Annual gross revenues or value of assets o Value of the transaction
 In and/ out of the Philippines
 Acquisition of voting shares (value of assets or gross revenues, and 35%/ 50% voting
share)
 Combined asset value in joint venture
 Successive transactions in 1 year = 1 transaction >Php 1,000,000,000,00 (threshold) W
 Assess if SPRLC  Case-to-case basis analysis
  Consider substantiated efficiencies  Structure of relevant market o Market
 Compare competitive conditions (now position
and if)  Presence of competition
 Availability of alternatives
 Barriers to entry

SEC. 21. Exemptions from Prohibited Mergers and Acquisitions. – Merger or acquisition
agreement prohibited under Section 20 of this Chapter may, nonetheless, be exempt from
prohibition by the Commission when the parties establish either of the following:

a) The concentration has brought about or is likely to bring about gains in efficiencies that
are greater than the effects of any limitation on competition that result or likely to result
from the merger or acquisition agreement; or
b) A party to the merger or acquisition agreement is faced with actual or imminent financial
failure, and the agreement represents the least anti-competitive arrangement among the
known alternative uses for the failing entity’s assets:
Provided, That an entity shall not be prohibited from continuing to own and hold
the stock or other share capital or assets of another corporation which it acquired prior to
the approval of this Act or acquiring or maintaining its market share in a relevant market
through such means without violating the provisions of this Act.
Provided further, That the acquisition of the stock or other share capital of one or
more corporations solely for investment and not used for voting or exercising control and
not to otherwise bring about, or attempt to bring about the prevention, restriction, or
lessening of competition in the relevant market shall not be prohibited.

COVERED TRANSACTION

Substantially prevent, restrict or lessen competition (SPRLC) in the relevant market or in the
market for goods or services

THRESHOLDS FOR COMPULSORY NOTIFICATION

[Link].–
TheCommissionshall,fromtimetotime,adoptandpublishregulationsstipulating:

a) ThetransactionvaluethresholdandsuchothercriteriasubjecttothenotificationrequirementofS
ection17ofthisAct;
b) Theinformationthatmustbesuppliedfornotifiedmergeroracquisition;
c) Exceptionsorexemptionsfromthenotificationrequirement;and
d) Otherrulesrelatingtothenotificationprocedures

NOTIFYING ENTITY

SECTION 2. Notifying entities.

a) Parties to a merger or acquisition that satisfy the thresholds in Section 3 of this Rule are
required to notify the Commission before the execution of the definitive agreements
relating to the transaction.
b) If notice to the Commission is required for a merger or acquisition, then all acquiring and
acquired pre-acquisition ultimate parent entities or any entity authorized by the ultimate
parent entity to file notification on its behalf must each submit a Notification Form (the
“Form”) and comply with the procedure set forth in Section 5 of this Rule. The parties
shall not consummate the transaction before the expiration of the relevant periods
provided in this Rule.
c) In the formation of a joint venture (other than in connection with a merger or
consolidation), the contributing entities shall be deemed acquiring entities, and the joint
venture shall be deemed the acquired entity

PERIOD OF NOTIFICATION

Upon submission of the Form, the Commission shall determine

a) Within fifteen (15) days whether the Form and other relevant requirements have been
completed in accordance with applicable rules or guidelines, and shall inform the parties
of other information and/or documents it may have failed to supply, or issue a notice to
 the parties that the notification is sufficient for purposes of commencing Phase I review
of the merger or acquisition.
b) The waiting period under this Section shall commence only upon the Commission’s
determination that the notification has been completed in accordance with applicable
rules and guidelines.
c) Within thirty (30) days from commencing Phase I review, the Commission shall, if
necessary, inform the parties of the need for a more comprehensive and detailed analysis
of the merger or acquisition under a Phase II review, and request other information and/or
documents that are relevant to its review.
d) The issuance of the request under the immediately preceding paragraph has the effect of
extending the period within which the agreement may not be consummated for an
additional sixty (60) days. The additional sixty (60) day period shall begin on the day
after the request for information is received by the parties; Provided, that, in no case shall
the total period for review by the Commission of the subject agreement exceed ninety
(90) days from the time the initial notification by the parties is deemed complete as
provided under paragraph (f) of this Section; Provided further, that should the parties fail
to provide the requested information within fifteen (15) days from receipt of the said
request, the notification shall be deemed expired and the parties must refile their
notification. Alternatively, should the parties wish to submit the requested information
beyond the fifteen (15) day period, the parties may request for an extension of time
within which to comply with the request for additional information, in which case, the
period for review shall be correspondingly extended.

EXCEPTIONS

SECTION 5. Exceptions. The Commission shall not consider the acquisition, maintenance and
increase of market share through legitimate means that does not substantially prevent, restrict, or
lessen competition in the market, such as but not limited to, having superior skills, rendering
superior service, producing or distributing quality products, having business acumen, and
enjoying the use of protected intellectual property rights as violative of the Act and these Rules,
Provided, that the concerned entity or entities invoking the exception shall clearly establish to the
Commission’s satisfaction, that the barrier to entry or anti-competitive act is an indispensable
and natural result of the superior product or process, business acumen, or legal rights or laws.

GOVERNMENT PROCUREMENT LAW

SCOPE AND APPLICATION

Section 4. Scope and Application of the IRR

4.1 This IRR shall apply to all procurement of any branch, agency, department, bureau, office, or
instrumentality of the GoP, including government-owned and/or -controlled corporations
(GOCCs), government financial institutions (GFIs), state universities and colleges (SUCs), and
local government units (LGUs).

4.2 Any Treaty or International or Executive Agreement to which the GoP is a signatory
affecting the subject matter of the Act and this IRR shall be observed. In case of conflict between
the terms of the Treaty or International or Executive Agreement and this IRR, the former shall
prevail.

4.3 Unless the Treaty or International or Executive Agreement expressly provides another or
different procurement procedures and guidelines, R.A. 9184 and this IRR shall apply to Foreign-
funded Procurement of Goods, Infrastructure Projects, and Consulting Services by the GoP.

The GoP negotiating panels shall, as its default position, adhere to R.A. 9184 and this IRR, or at
the very least, selection through competitive bidding, in all Foreign-funded Procurement. If the
Treaty or International or Executive Agreement states otherwise, then the negotiating panel shall
ensure that the reasons for the adoption of a different rule or method of procurement are clearly
reflected in the records of discussion.(a)

4.4 This IRR shall not apply to the following activities:

 Procurement of Goods, Infrastructure Projects and Consulting Services funded

from Foreign Grants covered by R.A. 8182, as amended by R.A. 8555, entitled
“An Act Excluding Official Development Assistance (ODA) from the Foreign
 Debt Limit in order to Facilitate the Absorption and Optimize the Utilization of
ODA Resources, Amending for the Purpose Paragraph 1, Section 2 of R.A. 4860,
As Amended,” unless the GoP and the foreign grantor/foreign or international
financing institution agree otherwise;
 Acquisition of real property which shall be governed by R.A. 107523 , entitled
“An Act Facilitating the Acquisition of Right-Of-Way Site or Location for
National Government Infrastructure Projects,” and other applicable laws, rules
and regulations; and
 Public-Private sector infrastructure or development projects and other
procurement covered by R.A. 6957, as amended by R.A. 7718, entitled “An Act
Authorizing the Financing, Construction, Operation and Maintenance of
Infrastructure Projects by the Private Sector, and for Other Purposes,” as
amended: Provided, however, That for the portions financed by the GoP, in whole
or in part, the provisions of the Act and this IRR shall apply.(a)

4.5 The following are not procurement activities under R.A. 9184 and this IRR:

 Direct financial or material assistance given to beneficiaries in accordance with

the existing laws, rules and regulations, and subject to the guidelines of the
concerned agency;
 Participation in local or foreign scholarships, trainings, continuing education,
conferences, seminars or similar activities that shall be governed by applicable
COA, CSC, and DBM rules;
 Lease of government-owned property as lessor for private use;
 Hiring of Job Order Workers;
 Joint Venture under the revised NEDA Guidelines (GOCC and Private Entities),
and Joint Venture Agreements by LGU with Private entities; and
 Disposal of Property and Other Assets of the Government.(n)

PROCUREMENT PROCEDURE

Section 6. Standardization of Procurement Process and Forms

 i. To systematize the procurement process, avoid confusion and ensure transparency, the
GPPB shall pursue the development and approval of generic procurement manuals and
standard bidding documents and forms including those to be used for major procurement
like drugs and textbooks.
ii. Once issued by the GPPB, the use of the Generic Procurement Manuals (GPMs),
Philippine Bidding Documents (PBDs), and other standard forms shall be mandatory
upon all Procuring Entities. However, whenever necessary, to suit the particular needs of
the procuring entity, modifications may be made, particularly for major and specialized
procurement, subject to the approval of the GPPB.

INVITATION TO BID

An invitation to bid, also called an invitation for bid or sealed bid, is a call to contractors

to submit a proposal on a project for a specific product or service. ... While an ITB is very
similar to an RFP (request for proposal), it is concerned with the pricing more so than the
conceptual ideas of the project.

RECEIPT AND OPENING OF BIDS

SEC. 29. Bid Opening. - The BAC shall publicly open all bids at the time, date, and place
specified in the bidding documents. The minutes of the bid opening shall be made available to
the public upon written request and payment of a specified fee.

SEC. 25. Submission and Receipt of Bids. - A bid shall have two (2) components, namely the
technical and financial components which should be in separate sealed envelopes, and which
shall be submitted simultaneously. The bids shall be received by the BAC on such date, time and
place specified in the invitation to bid. The deadline for the receipt of bids shall be fixed by the
BAC, giving it sufficient time to complete the bidding process and giving the prospective bidders
sufficient time to study and prepare their bids. The deadline shall also consider the urgency of
the procurement involved. Bids submitted after the deadline shall not be accepted.
Notwithstanding the provisions of this Section and Section 26 of this Act, the GPPB may
prescribe innovative procedures for the submission, receipt and opening of bids through the G-
EPS.
BID EVALUATION

SEC. 25. Submission and Receipt of Bids. - A bid shall have two (2) components, namely the
technical and financial components which should be in separate sealed envelopes, and which
shall be submitted simultaneously. The bids shall be received by the BAC on such date, time and
place specified in the invitation to bid. The deadline for the receipt of bids shall be fixed by the
BAC, giving it sufficient time to complete the bidding process and giving the prospective bidders
sufficient time to study and prepare their bids. The deadline shall also consider the urgency of
the procurement involved. Bids submitted after the deadline shall not be accepted.
Notwithstanding the provisions of this Section and Section 26 of this Act, the GPPB may
prescribe innovative procedures for the submission, receipt and opening of bids through the G-
EPS.

POST-QUALIFICATION

Section 34 of Republic Act (RA) No. 9184 states that the postqualification is the stage where the
bidder with the Lowest Calculated Bid (LCB), in the case of Goods and Infrastructure Projects,
or the Highest Rated Bid (HRB), in the case of Consulting Services, undergoes verification,
ascertainment and validation whether he has complied with all the requirements and conditions
as specified in the Bidding Documents. 3.2 Section 34.3 of the 2016 Revised Implementing
Rules and Regulations (IRR) of RA 9184 provides that the post-qualification shall verify,
validate, and ascertain all statements made and documents submitted by the bidder with the
LCB/HRB, using non-discretionary criteria, as stated in the Bidding Documents 3.3 Pursuant to
the Generic Procurement Manuals issued by the Government Procurement Policy Board (GPPB),
in verifying the information contained in the documents submitted by bidders, the Technical
Working Group (TWG) may make inquiries with appropriate government agencies and examine
the original documents kept in the bidder’s place of business. In addition, the Bids and Awards
Committee (BAC)/ TWG may conduct a site inspection of the bidder’s place of business and/or
plant/factory, where applicable

AWARD, IMPLEMENTATION AND TERMINATION OF THE CONTRACT

SEC. 37. Notice and Execution of Award. - Within a period not exceeding fifteen (15) calendar
days from the determination and declaration by the BAC of the Lowest Calculated Responsive
Bid or Highest Rated Responsive Bid, and the recommendation of the award, the Head of the
Procuring Entity or his duly authorized representative shall approve or disapprove the said
recommendation. In case of approval, the Head of the Procuring Entity or his duly authorized
representative shall immediately issue the Notice of Award to the bidder with the Lowest
Calculated Responsive Bid or Highest Rated Responsive Bid. Within ten (10) calendar days from
receipt of the Notice of Award, the winning bidder shall formally enter into contract with the
Procuring Entity. When further approval of higher authority is required, the approving authority
for the contract shall be given a maximum of twenty (20) calendar days to approve or disapprove
it. In the case of government-owned and/or -controlled corporations, the concerned board shall
take action on the said recommendation within thirty (30) calendar days from receipt thereof.
The Procuring Entity shall issue the Notice to Proceed to the winning bidder not later than seven
(7) calendar days from the date of approval of the contract by the appropriate authority. All
notices called for by the terms of the contract shall be effective only at the time of receipt thereof
by the contractor.

SEC. 42. Contract Implementation and Termination. - The rules and guidelines for the
implementation and termination of contracts awarded pursuant to the provisions of this Act shall
be prescribed in the IRR. The rules and guidelines shall include standard general and special
conditions for contracts.

DISCLOSURES OF RELATIONS

Section 47 of the revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No.
9184 automatically disqualifies a bidder from participating in the procurement activities of a
Procuring Entity when such bidder is related by consanguinity or affinity within the third civil
degree to the Head of the Procuring Entity (HOPE), members of the Bids and Awards
Committee (BAC), the Technical Working Group (TWG), and the BAC Secretariat, the head of
the Project Management Office (PMO), or the end-user unit, and the project consultants, if any.
For purposes of State Universities and Colleges (SUCs), the HOPE pertains to its governing
board, which is the Board of Trustees.

 The disqualification of bidders pursuant to Section 47 of the IRR of RA 9184 is based

merely on the existing relationship between the bidder and the aforementioned
 procurement official. xxx. Hence, notwithstanding the inhibition made by the officers or
employees concerned, the cause-and-effect link between relationship and disqualification
is not severed by the supposed corrective measure.
 The concerned bidder is automatically disqualified to submit a bid and to participate in
any procurement contracts of OMSC since one of its officers, the Corporate Secretary, is
related to one of the members of the Board of Trustees of OMSC by consanguinity within
the third civil degree. The voluntary inhibition and non-participation of the identified
Board of Trustee in the deliberation of the Board does not remove his blood relationship
with one of the Directors of a would be bidder.

ALTERNATIVE METHODS OF PROCUREMENT

SEC. 48. Alternative Methods. - Subject to the prior approval of the Head of the Procuring Entity
or his duly authorized representative, and whenever justified by the conditions provided in this
Act, the Procuring Entity may, in order to promote economy and efficiency, resort to any of the
following alternative methods of Procurement:

a) Limited Source Bidding a method of Procurement that involves direct invitation to bid
by the Procuring Entity from a set of pre- selected suppliers or consultants with known
experience and proven capability relative to the requirements of a particular contract;
b) Direct Contracting a method of Procurement that does not require elaborate Bidding
Documents because the supplier is simply asked to submit a price quotation or a pro-
forma invoice together with the conditions of sale, which offer may be accepted
immediately or after some negotiations;
c) Repeat Order a method of Procurement that involves a direct Procurement of Goods
from the previous winning bidder, whenever there is a need to replenish Goods procured
under a contract previously awarded through Competitive Bidding;
d) Shopping a method of Procurement whereby the Procuring Entity simply requests for the
submission of price quotations for readily available off-the-shelf Goods or
ordinary/regular equipment to be procured directly from suppliers of known qualification;
e) Negotiated Procurement - a method of Procurement that may be resorted under the
extraordinary circumstances provided for in Section 53 of this Act and other instances
that shall be specified in the IRR, whereby the Procuring Entity directly negotiates a
 contract with a technically, legally and financially capable supplier, contractor or
consultant.

In all instances, the Procuring Entity shall ensure that the most advantageous price for the
Government is obtained.

Section 5. Definition of Terms For purposes of this IRR, the following terms or words and
phrases shall mean or be understood as follows:

a) Act. Refers to R.A. 9184, entitled “An Act Providing for the Modernization,
Standardization and Regulation of the Procurement Activities of the Government and for
other Purposes,” otherwise known as the Government Procurement Reform Act.
b) Approved Budget for the Contract (ABC). Refers to the budget for the contract duly
approved by the HoPE, as provided for in the General Appropriations Act (GAA),
continuing, and automatic appropriations, in the case of national government agencies
(NGAs); the corporate budget for the contract approved by the governing board, pursuant
to Executive Order (E.O). No. 518, s. 1979, in the case of GOCCs and GFIs, and R.A.
8292 in the case of SUCs; the budget approved by the Sanggunian through an
appropriations ordinance in the case of LGUs. For multi-year contracts, for which a
Multi-Year Obligational Authority (MYOA) or an equivalent document is required, the
ABC shall be that incorporated in the project cost reflected in the MYOA or equivalent
document. For Foreign-funded Procurement, the ABC refers to the cost estimate prepared
by the Procuring Entity and approved by the foreign government/foreign or international
financing institution as specified in the Treaty or International or Executive Agreement.
(a)
c) Bid. Refers to a signed offer or proposal to undertake a contract submitted by a bidder in
response to and in consonance with the requirements of the Bidding Documents. For
purposes of, and throughout this IRR, the term “Bid” shall be equivalent to and be used
interchangeably with “Proposal” and “Tender.”(5.d)
d) Bidder. Refers to a contractor, manufacturer, supplier, distributor and/or consultant who
submits a bid in response to the requirements of the Bidding Documents.([Link])
e) Bidding Documents. Refer to the documents issued by the Procuring Entity as the basis
for bids, furnishing all information necessary for a prospective bidder to prepare a bid for
 the Goods, Infrastructure Projects and/or Consulting Services required by the Procuring
Entity.(5.f)
f) Bids and Awards Committee (BAC). Refers to the Committee established in accordance
with Rule V of this IRR.(5.c)
g) Common-Use Supplies and Equipment (CSE). Refer to those goods, materials and
equipment that are used in the day-to-day operations of Procuring Entities in the
performance of their functions. For the purpose of this IRR, CSE shall be those included
in the Electronic Catalogue of the PhilGEPS.(a)
h) Competitive Bidding. Refers to a method of procurement which is open to participation
by any interested party and which consists of the following processes: advertisement, pre-
bid conference, eligibility screening of prospective bidders, receipt and opening of bids,
evaluation of bids, post-qualification, and award of contract. For purposes of, and
throughout this IRR, the terms “Competitive Bidding” and “Public Bidding” shall have
the same meaning and shall be used interchangeably.
i) Consulting Services. Refer to services for infrastructure projects and other types of
projects or activities of the GoP requiring adequate external technical and professional
expertise that are beyond the capability and/or capacity of the GoP to undertake such as,
but not limited to:
 advisory and review services;
 preinvestment or feasibility studies;
 design;
 construction supervision;
 management and related services; and
 other technical services or special studies. General principles on Consulting
Services are provided for in Annex “B” of this IRR.
j) Domestic Bidder. Refers to any person or entity offering unmanufactured articles,
materials or supplies of the growth or production of the Philippines, or manufactured
articles, materials, or supplies manufactured or to be manufactured in the Philippines
substantially from articles, materials, or supplies of the growth, production, or
manufacture, as the case may be, of the Philippines.
k) Domestic Entity. Refers to an individual or a sole proprietor who is a citizen of the
Philippines or a partnership, corporation, cooperative, or association duly organized
under the laws of the Philippines and of which at least seventy five percent (75%) of the
interest or outstanding capital stock belongs to citizens of the Philippines, habitually
established in business and habitually engaged in the manufacture or sale of the
merchandise covered by his bid, and the business has been in existence for at least five
(5) consecutive years prior to the advertisement and/or posting of the Invitation to Bid.
l) Executive Agreements. Refer to International Agreements except that they do not require
legislative ratification.
m) Expendable Supplies. Refer to articles which are normally consumed in use within one
(1) year or converted in the process of manufacture or construction, or those having a life
expectancy of more than one (1) year but which shall have decreased substantially in
value after being put to use for only one (1) year (e.g., medicines, stationery, fuel, and
spare parts).
n) Foreign Bid. Refers to any offer of articles, materials or supplies not manufactured or not
to be manufactured in the Philippines, substantially from articles, materials, or supplies of
the growth, production, or manufacture, as the case may be, of the Philippines.
o) Foreign-funded Procurement. Refers to the acquisition of goods, consulting services,
and the contracting for infrastructure projects by the GoP which are wholly or partly
funded by Foreign Loans or Grants pursuant to a Treaty or International or Executive
Agreement. For purposes of, and throughout this IRR, the term “foreignfunded
procurement” shall have the same meaning as and shall be used interchangeably with
“foreign-funded projects” or “foreign-assisted projects.”
p) Foreign Grants. Refer to grants with no repayment obligations and are provided in
monetary form, goods, works, and consultancy services, among others.
q) Foreign Loans. Refer to loans, credits, and indebtedness with private foreign banks or
with foreign governments, agencies, or instrumentalities of such foreign governments,
foreign financial institutions, or other international organizations with whom, or
belonging to countries with which, the Philippines has diplomatic relations, as may be
necessary and upon such terms and conditions as may be agreed upon, to enable the GoP
to finance, either directly or through any government office, agency or instrumentality or
 any government-owned and controlled corporation, industrial, agricultural or other
economic development purposes or projects authorized by law.
r) Goods. Refer to all items, supplies, materials and general support services, except
Consulting Services and infrastructure projects, which may be needed in the transaction
of public businesses or in the pursuit of any government undertaking, project or activity,
whether in the nature of equipment, furniture, stationery, materials for construction, or
personal property of any kind, including non-personal or contractual services, such as, the
repair and maintenance of equipment and furniture, as well as trucking, hauling,
janitorial, security, and related or analogous services, as well as procurement of materials
and supplies provided by the Procuring Entity for such services. The term “related” or
“analogous services” shall include, but is not limited to, lease of office space, media
advertisements, health maintenance services, and other services essential to the operation
of the Procuring Entity.(a)
s) Government Procurement Policy Board (GPPB). Refers to the Body created in
accordance with Rule XX of this IRR.
t) Head of the Procuring Entity (HoPE). Refers to:
 the head of the agency or body, or his duly authorized official, for NGAs and the
constitutional commissions or offices, and other branches of government;
 the governing board or its duly authorized official, for GOCCs, GFIs and SUCs;
or
 the local chief executive, for LGUs: Provided, however, That in an agency,
department, or office where the procurement is decentralized, the head of each
decentralized unit shall be considered as the HoPE, subject to the limitations and
authority delegated by the head of the agency, department, or office.(a)
u) Infrastructure Projects. Include the construction, improvement, rehabilitation,
demolition, repair, restoration or maintenance of roads and bridges, railways, airports,
seaports, communication facilities, civil works components of information technology
projects, irrigation, flood control and drainage, water supply, sanitation, sewerage and
solid waste management systems, shore protection, energy/power and electrification
facilities, national buildings, school buildings, hospital buildings, and other related
construction projects of the government. For purposes of, and throughout this IRR, the
 term “Infrastructure Projects” shall have the same meaning as, and shall be used
interchangeably with, “civil works” or “works.”
v) International Agreement. Refers to a contract or understanding, regardless of
nomenclature, entered into between the GoP and another government or foreign or
international financing institution in written form and governed by international law,
whether embodied in a single instrument or in two (2) or more related instruments.
w) Non-expendable Supplies. Refer to articles which are not consumed in use and ordinarily
retain their original identity during the period of use, whose serviceable life is more than
one (1) year and which add to the assets of the GoP (e.g., furniture, fixtures, transport and
other equipment). For this IRR, the term non-expendable supplies shall include semi-
expendable property.(a)
x) Philippine Government Electronic Procurement System (PhilGEPS). Refers to the
electronic System as provided in Section 8 of this IRR. For purposes of, and throughout
this IRR, the term “PhilGEPS” shall have the same meaning as, and shall be used
interchangeably with, “G-EPS” referred to in the Act.
y) Philippine National. Refers to an individual or a sole proprietor who is a citizen of the
Philippines or a partnership, corporation, or association organized under the laws of the
Philippines of which at least sixty percent (60%) of the capital or interest is owned by
citizens of the Philippines, or cooperatives registered with the Cooperative Development
Authority.(a)
z) Portal. Refers to a website that integrates a wide variety of contents for the purpose of
attracting and aggregating multiple users together in a central virtual space.
aa) Procurement. Refers to the acquisition of goods, consulting services, and the contracting
for infrastructure projects by the Procuring Entity. In case of projects involving mixed
procurements, the nature of the procurement, i.e., Goods, Infrastructure Projects or
Consulting Services, shall be determined based on the primary purpose of the contract.
Procurement shall also include the lease of goods and real estate. With respect to real
property, its procurement shall be governed by the provisions of R.A. 10752 and other
applicable laws, rules and regulations.(a)
 bb) Procuring Entity. Refers to any branch, constitutional commission or office, agency,
department, bureau, office, or instrumentality of the GoP (NGA), including GOCC, GFI,
SUC and LGU procuring goods, infrastructure projects and consulting services.
cc) Treaties. Refer to international agreements entered into by the GoP which require
legislative ratification after executive concurrence.
dd) Universal or Commercial Banks. Refer to universal or commercial banks duly
authorized under R.A. 8791, otherwise known as “The General Banking Act of 2000.”

REFERRENCE:

R.A. No. 10667

R.A. No. 9184