Local firms now eligible to bid for foreign-funded projects

MANILA, Philippines - Local firms are now eligible to participate in national competitive biddings for foreign-funded projects worth $5 million or below following the signing of the revised implementing rules and regulations of the Government Procurement Reform Act yesterday.

The Procurement Law or Republic Act 9184, provides for transparent and competitive bidding procedures in government projects. The law and the initial implementing rules were signed in 2003. The initial implementing rules only covered domestically funded projects. 

The government revised the implementing rules to integrate the procurement rules for domestic and foreign funded projects.  

Under the revised implementing rules, goods and infrastructure projects that are foreign-funded under the so-called National Competitive Bidding (NCB) are now subject to domestic rules.

Budget Secretary Rolando Andaya said this simply means that local firms may now participate in the bidding for foreign-funded projects worth $5 million or below. 

In the past, all foreign-funded projects used other procurement systems and methods as stipulated under the Executive Agreement between the government and the foreign lender. 

“Although the government surged ahead with procurement reforms, it could never really be considered complete without definitive rules on foreign-funded projects,” Andaya said. Andaya, chairman of the Government Procurement Policy Board, sponsored RA 9184 in Congress.

Foreign-funded projects above $5 million are subject to the rules of the lender, Andaya said.

The revised implementing rules also limited the number of eligibility documents required to just six documents from 16 previously. 

By lessening the documentary requirements, potential suppliers of government will find it easier to join public bidding. This aims to encourage more businesses to become potential suppliers of government and ensure that the best prices are achieved at auction. 

During yesterday’s signing ceremony, Finance Secretary Margarito Teves said that strengthening public procurement reforms will translate to “a more efficient use of precious tax revenues.” 

In the last four years, an average of P121 billion worth of infrastructure, equipment, materials, supplies and services passed through the procurement process. This represents about 15 percent of the country’s total annual budget and equivalent to about three percent of gross domestic product (GDP).