NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE 
S. Nol 303
(A gicuaff
Aa of tlif iSiftiirj)
23 JAN 30 P3:39
RECEIVED BV
Introduced by Senator Francis "Tol" N. Tolentino
AN ACT
AMENDING SECTION 23 OF REPUBLIC ACT NO. 9184A OTHERWISE KNOWN 
AS THE GOVERNMENT PROCUREMENT REFORM ACT, PROVIDING FOR 
ELIGIBILITY OF BIDDERS IN THE PROCUREMENT OF GOODS AND 
INFRASTRUCTURE PROJECTS AND FOR OTHER PURPOSES
EXPLANATORY NOTE
"The legal concept of a joint venture is of common law origin. It has no precise 
legal definition but it has been generally understood to mean an organization formed 
for some temporary purpose" (As explained by the Supreme Court in Aurbach, et. al. 
vs. Sanitary Wares Manufacturing Corporation citing the case Gates v. Megargel, 266 
Fed. 811 [1920])
In the case of Kilosbayan v. Guingona, 232 SCRA 110 (1994), the Philippine 
Supreme Court described a joint venture as an "association of persons or companies 
jointly undertaking some commercial enterprise; generally, all contribute assets and 
share risks which requires a community of interest in the performance of the subject 
matter, a right to direct and govern the policy in connection therewith, and a duty, 
which may be altered by agreement to share both in profit and losses."
While allowed to join procurement projects, the present law does not provide 
specific requirements for the qualification of a joint venture as a bidder, other than 
the requirement under the implementing rules and regulations (IRR) that the members 
of the joint venture must be governed by a Joint Venture Agreement (JVA).


This gap in the law has opened doors for corporations and entities whose 
primary purpose is not related to the procurement project to join biddings as long as 
they partner with bigger companies that have the financial capacity and previous 
project experience to enter into the project.
Thus was the case in the laptop procurement project conducted by the 
Procurement Service - Department of Budget and Management (PS-DBM) for the 
Department of Education (DepEd) which was flagged by the Commission on Audit 
(COA) for being overpriced.
The winning bidder in the said project was a joint venture, one member of 
which was engaged in a business not at all related to the procurement project. While 
possessing the financial capacity to enter into the project, the said company did not 
have the expertise required for the project as it was engaged in general construction 
and other allied businesses, including the construction, enlarging, repairing, removing, 
developing or otherwise engaging in any work upon buildings, roads, highways, 
manufacturing plants, bridges, airfields, pier, docks, mines, shafts, waterworks, 
railroads, railways, structures, all iron, steel, wood, masonry, and earth construction.
Aside from being found "too pricey for an entry-level type laptop", initial 
feedback gathered from the auditors in NRC and CAR also found the delivered laptops 
to be too slow because of the outdated Intel Celeron processor.
The issues found in this procurement project highlighted the problem in the 
temporary nature of the existence of a Joint Venture. Thus, this legislative measure 
aims to provide in the law clear requirements as to the eligibility of a joint venture to 
join procurement projects, primary of which is the requirement that the primary 
purpose of every member must be similar and related to the requirement of the project 
to be bidded out to ensure that each member of the joint venture is really competent 
to comply with the requirements of the project.
This Bill further requires that the joint venture must be registered with the 
Securities and Exchange Commission (SEC) and specifies that the liability of each of 
the members shall be joint and several with the Joint Venture itself.
In view of the foregoing, the immediate passage of this bill is^ameg^^ought.
RANCI
N. TOLENTINO


NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
)
)
SENATE 
S. NoJ- 803
fel
of tljr
23 JAN 30 P3 :39
RECEIVED BV
Introduced by Senator Francis "Tol" N. Tolentino
AN ACT
AMENDING SECTION 23 OF REPUBLIC ACT NO. 9184, OTHERWISE KNOWN 
AS THE GOVERNMENT PROCUREMENT REFORM ACT, PROVIDING FOR 
ELIGIBILITY OF BIDDERS IN THE PROCUREMENT OF GOODS AND 
INFRASTRUCTURE PROJECTS AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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Section 1. Section 23 of Republic Act No. 9184, otherwise known as the 
"Government Procurement Reform Act" is hereby amended to read as follows:
"Section 23. Eligibility Requirements for the Procurement of Goods and 
Infrastructure Projects. - The BAC or, under special circumstances specified in the 
IRR, its duly designated organic office shall determine the eligibility of prospective 
bidders for the procurement of Goods and Infrastructure Projects, based on the 
bidders' compliance with the eligibility requirements within the period set forth in the 
Invitation to Bid.
A. PROCUREMENT OF GOODS - THE FOLLOWING SHALL BE ELIGIBLE TO 
PARTICIPATE IN THE BIDDING FOR THE SUPPLY OF GOODS:
i. DULY LICENSED FILIPINO CITIZENS / SOLE 
PROPRIETORSHIPS;
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ii. 
PARTNERSHIPS DULY ORGANIZED UNDER
THE LAWS OF THE PHILIPPINES AND OF 
WHICH AT LEAST SIXTY PERCENT (60%) OF 
THE INTEREST BELONGS TO CITIZENS OF 
THE PHILIPPINES;
iii. 
CORPORATIONS DULY ORGANIZED UNDER
THE LAWS OF THE PHILIPPINES, AND OF 
WHICH AT LEAST SIXTY PERCENT (60%) OF 
THE OUTSTANDING CAPITAL STOCK 
BELONGS TO CITIZENS OF THE 
PHILIPPINES;
iv. 
COOPERATIVES DULY ORGANIZED UNDER
THE U\WS OF THE PHILIPPINES; OR
V. CORPORATE JOINT VENTURES LICENSED BY 
THE SECURITIES AND EXCHANGE 
COMMISSION (SEC) AND REGISTERED 
WITH THE BUREAU OF INTERNAL REVENUE 
(BIR) AND THE LOCAL GOVERNMENT 
WHERE IT HAS ITS PRINCIPAL OFFICE: 
PROVIDED, HOWEVER, THAT FILIPINO 
OWNERSHIP OR INTEREST OF THE JOINT 
VENTURE CONCERNED SHALL BE AT LEAST 
SIXTY PERCENT (60%). FOR THIS 
PURPOSE, FILIPINO OWNERSHIP OR 
INTEREST SHALL BE BASED ON THE 
CONTRIBUTIONS OF EACH OF THE 
MEMBERS OF THE JOINT VENTURE AS 
SPECIFIED IN THEIR JOINT VENTURE 
AGREEMENT. ALL DOCUMENTS SUBMITTED 
BY THE JOINT VENTURE IN SATISFACTION 
OF THE ELIGIBILITY REQUIREMENTS SHALL 
BE THOSE PERTAINING TO THE 
CORPORATE JOINT VENTURE, AND NOT OF 
THE CONSTITUENT MEMBERS THEREOF, 
PROVIDED, FURTHER, THAT THE PRIMARY 
PURPOSE OF EACH MEMBER OF THE JOINT 
VENTURE MUST BE SIMILAR OR RELATED 
TO THE REQUIREMENT OF THE PROJECT TO 
BE BIDDED OUT; PROVIDED, FINALLY,


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THAT WHEN A SUPPLIER IS A JOINT 
VENTURE, EACH MEMBER OF THE JOINT 
VENTURE SHALL BE JOINTLY AND 
SEVERALLY LIABLE TO THE PROCURING 
ENTITY IN CASES OF BREACH OR FAILURE 
TO COMPLY WITH THE REQUIREMENTS OF 
THE PROJECT.
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FOREIGN BIDDERS MAY BE ELIGIBLE TO PARTICIPATE UNDER ANY OF 
THE FOLLOWING CIRCUMSTANCES IN ACCORDANCE WITH THE GUIDELINES 
ISSUED BY THE GPPB:
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(A) 
WHEN PROVIDED FOR UNDER ANY TREATY OR 
INTERNATIONAL OR EXECUTIVE AGREEMENT 
AS PROVIDED IN SECTION 4 OF THIS ACT;
(B) 
WHEN THE FOREIGN SUPPLIER IS A CITIZEN, 
CORPORATION OR ASSOCIATION OF A 
COUNTRY, THE LAWS OR REGULATIONS OF 
WHICH GRANT RECIPROCAL RIGHTS OR 
PRIVILEGES TO CITIZENS, CORPORATIONS OR 
ASSOCIATIONS OF THE PHILIPPINES;
(C) 
WHEN THE GOODS SOUGHT TO BE PROCURED 
ARE NOT AVAILABLE FROM LOCAL SUPPLIERS; 
OR
(D) 
WHEN THERE IS A NEED TO PREVENT 
SITUATIONS THAT DEFEAT COMPETITION OR 
RESTRAIN TRADE.
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B. PROCUREMENT OF INFRASTRUCTURE PROJECTS - THE FOLLOWING 
PERSONS / ENTITIES SHALL BE ALLOWED TO PARTICIPATE IN THE 
BIDDING FOR INFRASTRUCTURE PROJECTS:
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II.
DULY LICENSED FILIPINO CITIZENS / SOLE 
PROPRIETORSHIPS;
PARTNERSHIPS DULY ORGANIZED UNDER 
THE LAWS OF THE PHILIPPINES AND OF 
WHICH AT LEAST SIXTY PERCENT (60%) OF


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III.
IV.
V.
THE INTEREST BELONGS TO CITIZENS OF 
THE PHILIPPINES;
CORPORATIONS DULY ORGANIZED UNDER 
THE LAWS OF THE PHILIPPINES, AND OF 
WHICH AT LEAST SIXTY PERCENT (60%) OF 
THE OUTSTANDING CAPITAL STOCK 
BELONGS TO CITIZENS OF THE 
PHILIPPINES;
COOPERATIVES DULY ORGANIZED UNDER 
THE LAWS OF THE PHILIPPINES; OR
CORPORATE JOINT VENTURES LICENSED BY 
THE SECURITIES AND EXCHANGE 
COMMISSION (SEC) AND REGISTERED 
WITH THE BUREAU OF INTERNAL REVENUE 
(BIR) AND THE LOCAL GOVERNMENT 
WHERE IT HAS ITS PRINCIPAL OFFICE: 
PROVIDED, HOWEVER, THAT FILIPINO 
OWNERSHIP OR INTEREST OF THE JOINT 
VENTURE CONCERNED SHALL BE AT LEAST 
SIXTY PERCENT (60%). FOR THIS 
PURPOSE, 
FILIPINO 
OWNERSHIP 
OR
INTEREST 
SHALL BE BASED ON 
THE
CONTRIBUTIONS OF 
EACH 
OF 
THE
MEMBERS OF THE JOINT VENTURE AS 
SPECIFIED 
IN THEIR JOINT VENTURE
AGREEMENT. ALL DOCUMENTS SUBMITTED 
BY THE JOINT VENTURE IN SATISFACTION 
OF THE ELIGIBILITY REQUIREMENTS SHALL 
BE THOSE PERTAINING TO THE 
CORPORATE JOINT VENTURE, AND NOT OF 
THE CONSTITUENT MEMBERS THEREOF, 
PROVIDED, FURTHER, THAT THE PRIMARY 
PURPOSE OF EACH MEMBER OF THE JOINT 
VENTURE MUST BE SIMILAR OR RELATED 
TO THE REQUIREMENT OF THE PROJECT TO 
BE BIDDED OUT; PROVIDED, FINALLY, 
THAT WHEN A SUPPLIER IS A JOINT 
VENTURE, EACH MEMBER OF THE JOINT 
VENTURE SHALL BE JOINTLY AND


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SEVERALLY LIABLE TO THE PROCURING 
ENTITY IN CASES OF BREACH OR FAILURE 
TO COMPLY WITH THE REQUIREMENTS OF 
THE PROJECT.
FOREIGN BIDDERS MAY BE ELIGIBLE TO PARTICIPATE IN THE 
PROCUREMENT OF INFRASTRUCTURE PROJECTS WHEN PROVIDED FOR UNDER 
ANY TREATY OR INTERNATIONAL OR EXECUTIVE AGREEMENT AS PROVIDED IN 
SECTION 4 OF THIS ACT.
The eligibility requirements shall provide for fair and equal access to all prospective 
bidders. The documents submitted in satisfaction of the eligibility requirements shall 
be made under oath by the prospective bidder or by his duly authorized representative 
certifying to the correctness of the statements made and the completeness and 
authenticity of the documents submitted.
A prospective bidder may be allowed to submit his eligibility requirements 
electronically. However, said bidder shall later on certify under oath as to the 
correctness of the statements made and the completeness and authenticity of the 
documents submitted."
Section 2. Separability Clause - If any part or portion of this Act shall be 
declared unconstitutional or invalid, such parts or portions not otherwise affected shall 
remain in full force and effect.
Section 3. Repealing Clause - All laws, orders, rules and regulations, other 
issuances, or parts thereof, inconsistent with any provision of this Act, are hereby 
repealed or modified accordingly.
Section 4. Effectivity. - This Act shall take effect after fifteen (15) days 
following its publication in the Official Gazette or in two (2) newspapers of general 
circulation.
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Approved,