Government Procurement Policy Board Technical Support Office

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    Date: 2022-09-14 15:38:07.817848

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    Date: 2022-09-23 09:19:11.748269

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clarification on sec 23.4.2.4 of RA 9184

Requested from GPPB by w. tan at 03:38 PM on Sep 14, 2022.
Purpose: clarification
Date of Coverage: 09/01/2022 - 09/14/2022
Tracking no: #GPPB-327881564059

tan 03:38 PM, Sep 14, 2022

Hi, Im a small B contractor and i joined a 2M drainage bidding with only 500k SLCC. but I was disqualified by BAC even if i cited the specific provision. there answer was that I already have 500k experience and the provision clearly states that (only contractors WITHOUT similar experience are allowed to bid). please enlighten me if the BAC is correct or not. thanks

Officer 09:19 AM, Sep 23, 2022

September 23, 2022 

Dear Mr. Tan,

Greetings! 	

Thank you for your request dated September 14, 2022 3:38 PM under Executive Order No. 2 (s. 2016) on Freedom of Information in the Executive Branch. 

Your request 

You asked the Government Procurement Policy Board-Technical Support Office (GPPB-TSO), for clarification, on the justiciability of the decision made by a Bids and Awards Committee to disqualify you as a contractor on the ground of lacking Single Largest Completed Contract (SLCC) requirement.

Response to your request 

Your FOI request is partially approved. 

At the outset, we wish to inform you that the under GPPB Circular No. 06-2013, the GPPB-TSO has neither quasi-judicial and investigatory nor fact-finding powers and functions, such as, to hold hearings, determine facts, and exercise discretion of a judicial nature, and thus cannot dictate upon, decide, nor interfere with the functions of the Procuring Entity (PE), Head of Procuring Entity (HoPE), and Bids and Awards Committee (BAC), which solely falls within its discretion and authority as sanctioned by the law. 

Considering this, we cannot determine the justiciability of your claim as against the decision of the BAC on your company’s disqualification. 

However, we can provide you with reference materials on SLCC, as follows: 

a. Section 23.4.2.4 of the 2016 revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No. 9184: 

The bidder must have completed an SLCC that is similar to the contract to be bid, and whose value, adjusted to current prices using the PSA consumer price indices, must be at least fifty percent (50%) of the Approved Budget for the Contract to be bid: Provided, however, That contractors under Small A and Small B categories without similar experience on the contract to be bid may be allowed to bid if the cost of such contract is not more than the Allowable Range of Contract Cost (ARCC) of their registration based on the guidelines as prescribed by the Philippine Contractors Accreditation Board (PCAB).

For foreign-funded Procurement, the Government of the Philippines and the foreign government/ foreign or international financing institution may agree on another track record requirement. 

Moreover, a contract shall be considered “similar” to the contract to be bid if it has the same major categories of work. The Procuring Entity may clarify in the Bidding Documents what is regarded as major categories of work. 

b. Section 23.4.2.5 of the 2016 revised IRR of RA No. 9184: 

The SLCC shall be supported by an Owner’s Certificate of Final Acceptance issued by the project owner other than the contractor or a final rating of at least Satisfactory in the Constructors Performance Evaluation System (CPES). In case of contracts with the private sector, an equivalent document shall be submitted; and


c. Non-Policy Matter No. 143-2017 which provides the following:

	The SLCC criterion is required in order to ensure that the government is contracting with an entity that has accomplished at least one project with a value no less than fifty percent (50%) of the contract to be bid. This assures the government that the bidder has sufficient experience and reliable track record or it is not the first time that the prospective bidder will be required to accomplish such as an undertaking, and therefore, provides the government a level of security that such bidder, if awarded the contract, will be able to satisfactorily fulfill the contract requirements.

	A contract shall be considered similar to the contract to be bid if it involves goods or services of the same nature and complexity as the subject matter of the project being procured. This requirement should not be interpreted strictly as to unreasonably limit competition and inequitably bar participation of capable suppliers, manufacturers and service provides, much more to constrain Procuring Entities in the performance of their constituent and ministrant functions. Hence, similarity of contract should be interpreted liberally in the sense that it should not refer to an exact parallel but only to an analogous one of similar category. 

	It is within the discretion of the Procuring Entity whether to consider a project as being similar or not similar in nature and complexity to the project to be bid, but the same has to be clearly stated in the Bidding Documents. 

	In general, the term “completion” and “completed contract” in case of infrastructure projects refers to a contract where a certificate of completion has been issued by the owner. Thus, for purposes of a bidder’s compliance with the SLCC Requirement, the Procuring Entity may consider contracts that were issued their corresponding certificate of completion. 

	However, it should be stressed that the rationale for the SLCC requirement is to ensure that the PE will deal with bidders that have adequate experience and have performed all its contractual obligations through a showing of at least one (1) contract that has been fulfilled, or not just completely, but satisfactorily. Accordingly, it is in this wise that the law requires that the Owner’s Certificate of Final Acceptance issued by the project owner other than the contractor, or the Constructors Performance Evaluation System rating must be satisfied.

	As an exception to the SLCC requirement, bidders under Small A and Small B categories without similar experience on the contract to be bid may be allowed to bid if the cost of such contract is not more than the Allowable Range of Contract Cost of their registration based on the guidelines prescribed by the PCAB. Thus, contractors under Small A and Small B category who do not have a previous completed contract are allowed to participate if the cost of such contract is not more than the ARCC under its PCAB registration.   
  

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If you are unhappy with this response to your FOI request, you may ask us to carry out an internal review of the response by writing to Executive Director, Atty. Rowena Candice M. Ruiz, thru e-mail address at gppb@gppb.gov.ph. Your review request should explain why you are dissatisfied with this response and should be made within fifteen (15) calendar days from the date when you received this letter. We will complete the review and tell you about the result within thirty (30) calendar days from the date when we receive your review request.  
 
If you are not satisfied with the result of the review, you then have the right to appeal to the Office of the President under Administrative Order No. 22 (s. 2011).  


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Respectfully,  

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