FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
S.B.No. 1414 
Introduced by Senator Loren Legarda 
EXPLANATORY NOTE 
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This bill seeks to strengthen and modernize the construction industry by 
creating the Philippine Construction Industry Development Authority or 
PHILCIDA 
The construction industry is one of the vital sectors of the economy, It 
accounts for a 5,11 percent share in GDP, It generates jobs and provides the basic 
physical, industrial, commercial and social infrastructure facilities necessary for the 
growth qnd sustained development of the different sectors of the economy such as 
housing, manufacturing, commerce, transport, agriculture, services and various 
other industries. 
Without a modern and efficient 
construction industry, the 
provision and maintenance of vital infrastructure facilities would be impaired and 
would seriously erode the nation's ability to improve the Filipino's living 
conditions, including the fundamental task of meeting his/her basic needs for 
shelter, water, electricity, transport, schools, hospitals and so on. 
The potentials of the industry to generate export receipts and create overseas 
jobs for Filipino workers are also huge and ,well known, Filipino engineering and 
construction firms have been successful in penetrating the Middle East market since 
the 1970s. The sector earns roughly US$25,02 Million a year from international 
projects and creates thousands of jobs, If modernized and transformed into a more 
competitive one, the industry can easily triple or quadruple its global export receipts 
and its job-generating capacity can be enhanced several times, 
Despite its potentials, however, the industry has not sustained its growth 
parallel with the growth of the population and the nation's expanding requirements, 
The industry is even not faring well vis-a-vis foreign construction firms bidding for 
projects right in the deregulated Philippine market For the reality is that the growth 
of the construction industry has wes;tkened by the absence of an enabling policy 
environment that can nudge it to become more competitive in the context of a 
rapidly globalizing world. In fact, several countries in Southeast Asia have managed 
to develop their construction industry faster than their Philippine counterpart 
through the continuous upgrading of their industry capacities and the skills of their 
construction workers and engineers, This they are able to do mainly with the 
guiding help of their governments and the leadership of agencies able to strategize 
how to position the construction industry under regional and global integration, 
The Philippines should not allow itself to be left behind, 
1 


The existing Construction Industry Authority of the Philippines (ClAP), with 
its Iimitep functions, personnel and resources, is unable to address the multiplicity 
of problems and emerging challenges affecting the growth and development of the 
Philippine construction industry. 
Further, the country is unable to produce enough construction engineers, 
designers and skilled workers, a great number of whom are being poached left and 
right by foreign construction companies. 
On the other hand, the upgrading of the skills of a large number of 
community-based construction workers found all over the c01,mtry is not being 
addressed sufficiently. Ordinary construction workers are also accorded low status 
and their rights often abused. They are given temporary tenure and they are 
exposed to unsafe and unhealthy working conditions. Most are not even covered by 
the Social Security System. 
This bill, therefore, seeks to address the foregoing multi-faceted problems and 
challenges facing the construction industry. This bill seeks to promote the 
upgrading, modernization and competitiveness of the construction industry. It also 
seeks to promote an integrated human resources development (HRD) for the 
industry, covering the skills, health and safety and protection concerns of the 
construction workers, both in the formal and informal sectors. 
This is the reason why a Construction Industry Competitiveness Upgrading 
Fund (CICUF) is likewise being created through this bill. CICUF shall serve as an 
instrument to promote industry modernization, productivity, public-private 
partnership and the rounded development and protection of the construction 
workers. CICUF recognizes the strategic and piwotal role of the construction 
industry in the economy. 
In sum, 
this proposed bill, 
therefore, 
enVISIOns 
to promote the 
competitiveness of the industry by raising the standards of construction work, 
enhancing the skills of the workers through training, promoting occupational safety 
and health standards at the workplace, and fostering greater public-private 
partnership in construction industry development. 
In view of this, the early passage of this bill is earnestly sought. 
2 


FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
S.B.No. 1414 
Introduced by Senator Loren Legarda 
AN ACT 
10 JUll3 P 11 :06 
STRENGTHENING THE CONSTRUCTION INDUSTRY, CREATING THE 
PHILIPPINECONSTRUCTION INDUSTRY DEVELOPMENTAUTHORITY 
AND FOR OTHER PURPOSES 
Be, it enacted by the Senate and House of Representatives of the Philippines In 
Congress Assembled: 
1 
SECTION 1. Short Title. - This Act shall be known as "The Philippine 
2 
Construction Industry Competitiveness Act of 2010." 
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SEC. 2. Declaration of Policy. - Recognizing that the construction industry 
5 
has the immense potential to trigger and sustain growth of the economy and 
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employment through a program of integrated and balanced development, it shall be 
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the policy of the State to encourage, promote, support and enhance the orderly 
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growth and development of the construction industry in the Philippines. It shall also 
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be the policy of the State to promote the welfare and hone the talents and skills of all 
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workers in the construction industry so that they can ably contribute to the 
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competitiveness of the industry while raising their economic and social well-being. 
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SEC. 3. Objectives. - Towards these ends, The Philippine Construction 
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Industry Competitiveness Act of 2010 shall have the following objectives: 
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a. To create a business environment conducive to the continuous growth of the 
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consh'uction industry; 
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b. To establish an adequate support structure to enhance the viability of the 
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construction industry; 
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c. To encourage the continuous upgrading of skills, qualifications and 
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competitiveness of the workers, both formal and informal, in consonance 
with national interest and public safety; 
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d. To promote the involvement of workers' organizations in the construction 
2 
industry in the delivery of skills training services; and 
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e. To provide occupational safety and health and social protection programs for 
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the construction workers in the context of social partnership, higher 
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productivity and competitiveness of the construction industry. 
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SEC. 4. Scope and Coverage. - This Act shall cover all persons, natural or 
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juridical, who are involved in the construction industry such as, but not limited to, 
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construction constructors and construction sub-contractors, specialty contractors, 
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"pakyaw" contractors, designers, consultants, manufacturers, suppliers and dealers 
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of construction materials, project managers, supervisors, construction workers, 
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construction project owners whether public or private, building officials, and 
13 
industry associations, councils and organizations. 
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SEC. 5. Creation of Philippine Constrnction Industry Development 
16 
Authority. -
The Philippine Construction Industry Development Authority 
17 
(PhilCIDA) is hereby created, which shall exercise corporate, developmental and 
18 
regulatory powers and functions through a Board of Directors composed by the 
19 
Secretary of Trade and Industry as Chairman, and the Secretaries of Public Works 
20 
and 
Highways, 
Interior 
and 
Local 
Government, 
Transportation 
and 
21 
Communications, Labor and Employment, the President of the Philippine 
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Constructors Association, Inc. (PCA), the Director-General of the Technical 
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Education and Skills Development Authority, and five (5) private sector members 
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composed of one (1) permanent representative each from the construction 
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contracting 
sector, 
consulting 
sector, 
materials 
manufacturers/suppliers, 
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construction workers, and project owners, to be appointed by the Chairman upon 
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the nomination of a council to be composed of the PCA, Confederation of Filipino 
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Consultants (COFILCO), subdivision and Housing Developers Association (SHDA), 
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Philippine Chamber of Commerce and Industry (PCCI), Association of Carriers and 
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Equipment Lessors (ACEL), and the Association of Construction and Informal 
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Workers (ACIW). 
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The Construction Industry Authority of the Philippines (ClAP), Philippine 
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Overseas Construction Board (POCB), Philippine Contractors Accreditation Board 
35 
(PCAB), and Philippine Domestic Construction Board (PDCB), and Construction 
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Manpower Development Foundation (CMDF) are hereby abolished and all their 
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funds, records, personnel and properties are hereby transferred to the Authority. 
2 
However, the Construction Industry Arbitration Commission (CIAC) except for its 
3 
personnel shall continue to exist as an independent body which shall be attached 'to 
4 
the Authority for purposes of policy and program coordination. 
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SEC. 6. Powers, Duties and Objectives of PhilCDA. - The Philippine 
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Construction Industry Development Authority is hereby vested with powers and 
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authority over the Philippine construction industry. It is tasked to develop and 
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promote' the viability, stimulate and accelerate the development, growth, 
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improvement, expansion of the construction industry of the Philippines, and to 
II 
regulate and supervise the business and exercise of profession in the construction 
12 
industry. For this purpose, the Authority is vested with the following powers and 
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duties: 
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a. Formulate and implement policies, 'standards and best practices for the 
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constructions industry, including the formulation, issuance and enforcement 
17 
of policies, guidelines, rules and regulations for licensing, registration, 
18 
and/ or accreditation of contractors, consultants, and other construction 
19 
service providers, to carry out the provisions of this Act. 
20 
b. Develop a comprehensive and long-term development plan to e,nsure the 
21 
continued viability of the local construction industry based on sustained 
22 
economic growth and for a more equitable distribution of domestic and 
23 
overseas opportunities for Filipino enterprises and workers, in conformity 
24 
with the constitutionally-mandated goals of national economy; 
25 
c. Design and adopt strategies to accelerate the development of the construction 
26 
industry, including but not limited to, measures for upgrading professional, 
27 
technical, and financial capabilities of all workers; 
28 
d. Develop a comprehensive skills training program to Improve the 
29 
competitiveness and efficiency of the construction workers. 
30 
e. Regularly monitor, research and study the construction industry in the 
31 
Philippines and in other countries, to establish an updated database of 
32 
construction workers, contractors, etc, identify and address problems, 
33 
enhance growth, develop programs, recommend, support and implement 
, 
34 
j7olicies, legislation and other measures for the optimum development of the 
35 
. construction industry; 
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f. 
Prescribe and issue policies, rules and regulations, circulars and guidelines 
2 
pertinent to its powers and functions; 
3 
g. Develop programs and strategies for the optimum use of local construction 
4 
materials and for the improvement of their quality, competitiveness and 
5 
efficiency; 
6 
h. Establish a 
compensation plan, position classification system, and 
7 
qualification standards for its officers and staff based on a comprehensive job 
8 
analysis and audit of actual duties and responsibilities; 
9 
i. Make a periodic review of its organizational and operational capability, and 
10 
affect a re-structuring, upgrading, or the creation of plantilla positions and 
11 
acquisition of appropriate resources as may be deemed necessary. For this 
12 
purpose, the Authority may use its income, subject to government auditing 
13 
rules and regulations; 
14 
j. 
Develop and maintain a construction industry information system that is 
15 
efficient and accessible to the public; 
16 
k. Establish a funding mechanism to carry out its programs and activities, 
17 
including the provision of resources to accredited and/ or designated 
18 
government agencies in the implementation of the Authority's functions; 
19 
I. Assess and collect fees and other assessments, contributions; receive grants 
, 
20 
to promote and develop the construction industry; administer its funds, 
21 
.including grants received; and provide incentives under such guidelines 
22 
approved by the Board; 
23 
m. Investigate any violation of this Act and its Rules and Regulations and other 
24 
complaints within the contemplation of this Act, issue subpoena ad 
25 
testificandum and duces tecum, cite for contempt, issue cease and desist 
26 
orders, and conduct ocular inspection and other proceedings as may be 
27 
deemed necessary; 
28 
n. Prosecute, in coordination with the Department of Justice, violators of this 
29 
Act and/ or any of its rules and regulations; 
30 
o. Approve the annual budget of the Authority; 
31 
p. Adopt, alter and use a corporate seal; enter into contacts, lease, own or 
32 
otherwise dispose of personal or real property; sue and be sued; and 
33 
otherwise carry out its duties and functions as provided for in this Act; 
34 
q. Submit an annual report of its activities to the Secretary of Trade and 
35 
Industry; and 
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r. Adopt measures for the enforcement of this Act and other relevant laws, 
statutes, rules and regulations and perform such other functions necessary to 
achieve its objectives, properly exercise its authority and effectively discharge 
its fu.nctions and duties. 
, 
SEC. 7. Organization. - The Authority shall be attached to the Department of 
Trade. and Industry for policy and program coordination. It shall have a General 
Manager to be appointed by the Secretary of Trade and Industry upon the 
recommendation of the Board of Directors. The General Manager shall be the Chief 
Executive Officer of the Authority and is responsible to the PhilCIDA Board of 
Directors. He must be a natural-born citizen of the Philippines, at least thirty five 
(35) years of age on the day of his appointment, holder of a college degree with at 
least ten (10) years of experience relevant to the construction industry, and of proven 
competence, integrity, probity and independence. He shall perform such functions 
and duties as may be prescribed by the Board. 
For purposes of this Section, the Board shall organize the Authority by 
creating departments, committees and such other offices as it may deem necessary 
for the proper exercise of its powers and the efficient performance and discharge of 
its functions, duties and responsibilities. 
The Authority shall provide for an organization for its officers and staff. All 
positions in the Authority shall be permanent and governed by a compensation and 
position classification system and qualification standards based on a comprehensive 
job analysis and audit of actual duties and responsibilities. The compensation plan 
shall be subject to the periodic review by the Authority no more then once every two 
(2) years without prejudice to yearly merit reviews or increases based on 
productivity and performance. The Authority shall be exempt from the provisions of 
the Salary Standardization Law and the Attrition Law. 
Subject to Civil Service laws, rules and regulations, no officer or employee of 
the Authority shall be removed or suspended except for cause, as provided for by 
law. 
SEC. 8 -
Construction Industry Competitiveness Upgrading Fund. The 
Authority shall establish and administer the Construction Industry Competitiveness 
Upgrading Fund (CICUF) as a competitiveness strategy to meet the demands of a 
globalizing construction industry. This Fund shall be disbursed or used by the 
Authority for: 
5 


I 
a. Promotion, development and upgrading of skills and expertise of 
2 
construction workers preparing to join the construction industry and workers 
3 
already in the construction industry. 
4 
b. Improvement of productivity and stability in the industry through assistance 
5 
for value-adding training and critical structural adjustments in the face of 
6 
regional and global competition. 
7 
c. Enhancement of the research and development capacities of the construction 
8 
industry to be always at par with the best in the region and in the rest of the 
9 
world. 
10 
d. Accomplishment of the highest occupational safety and health standards and 
II 
practices. 
12 
e. Improvement of the socio-economic welfare of the workers. 
13 
14 
The Authority shall assess and cause the collection of One-Fourth of One 
15 
Percent (1/4 o£1 %) of the Total Estimated Cost of every construction contract, which 
16 
exceeds P500,000.00, entered into, whether with the private sector or the public 
17 
sector, irrespective of funding sources, shall be imposed on every contractor 
18 
operating in the Philippines, irrespective of nationality, and on Filipino contractors 
19 
operating overseas as the contractor's contribution to the Fund. Such Fund shall be 
20 
deposited in government bank/ s designated by the Authority. 
21 
Payment to the Fund shall be made 14 days prior to the commencement of the 
22 
construction project or upon application for a building license. No building permit 
23 
shall be issued without proof of payment to the Fund and no construction shall be 
24 
permitted to commence without proof thereof. Non-payment to the Fund shall be a 
25 
ground for the revocation/ suspension of the building permit, issuance of a work 
26 
stoppage order, or non-issuance of the occupancy permit by the Building Official. 
27 
No project authorization for overseas contracts shall be issued without contribution 
28 
to the CICUF by the concerned contractor. 
29 
Any contractor who fails to contribute to CICUF when due, shall be liable to 
30 
pay a fine equivalent to fifty percent (50%) of the amount due, without prejudice to 
31 
the payment of the levy. 
32 
The amount of contribution payable under this section shall be recoverable as 
33 
a civil debt due to the Authority. 
34 
Twenty per cent (20%) of the Fund shall be allocated for the retirement and 
35 
hospitalization needs of the construction workers. 
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The Authority shall simultaneously implement an orderly, efficient, and 
2 
transparent collection and contribution procedure and guideline once the law takes 
3 
effect. 
4 
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SEC. 9. Human Resource Development. - There shall be created within the 
6 
Authority a Human Resource Development Committee to oversee the function of 
7 
the Authority for human resource and manpower development of the construction 
8 
industry. The Human Resource Development Committee shall: 
9 
lOa. Draw up an overall construction human resource development plan, 
II 
programs and relevant strategies. 
12 
b. In coordination with TESDA-
13 
1. Develop 
training 
regulations, 
competency-based 
curriculum 
and 
14 
competency-based assessment materials; 
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2. Administer competency-based training; 
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3. Administer competency-based assessment; 
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4. Determine and recommend fees and upon approval by TESDA, impose 
18 
these on competency-based training and assessment; and 
19 
5. Maintain a registry of skilled workers trained, assessed, and certified. 
20 
c. In consultation with the private sector -
21 
1. Formulate, adopt and set standards for site supervisors and C0l1struction 
22 
managers; 
23 
2. Accredit training providers for site supervisors and construction 
managers; 
24 
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3. Administer assessment and certification for site supervisors and 
26 
construction managers; 
27 
4.. Determine and impose fees for training program, assessment, and 
28 
certification of site supervisors and construction managers; and 
29 
5. Maintain a registry of site supervisors and construction managers trained, 
30 
assessed, and certified. 
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d. Recommend appropriate policies and measures to rationalize training and 
32 
export of developed human resource in the construction industry in 
33 
coordination with the Department of Labor and Employment (DOLE) and 
34 
other pertinent government agencies, and to maintain a registry of 
35 
construction workers abroad. 
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e. Develop, provide, and coordinate with private and public sectors, human 
2 
resource training programs for 
construction service providers and 
3 
construction-related entrepreneurs, construction site supervisors for domestic 
4 
and foreign deployment, standardization and improvement of construction 
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techniques, procedures and materials, quality assurance, and construction 
occupational safety and health; and 
f. 
Perform such other functions as may be assigned by the Authority. 
SEC. 10. Local Government Participation. - The cities and municipalities are 
encouraged to create its own committee to oversee the development of programs for 
skills upgrading of the construction workers and the enhancement of technical 
capabilities of all the technical workers in the construction industry in their area. 
, 
These local government units are also encouraged to partner with workers 
organizations in their areas in the delivery of skills training and upgra<;ling services. 
16 
SEC. 11. Constrnction Industry Dispute Resolution. - The Construction 
17 
Industry Arbitration Commission, created by virtue of Executive Order No. 1008 
18 
otherwise known as the Construction Industry Arbitration Law, shall continue to 
19 
exercise original and exclusive jurisdiction over disputes arising from, or connected 
20 
with, contracts entered into by parties involved in construction in the Philippines, 
21 
whether the dispute arises before or after the completion of the contract, or after the 
22 
abandonment or breach thereof. The disputes cognizable by the CIAC may involve 
23 
government or private contracts as provided for under Republic Act No. 9184 or the 
24 
Government Procurement Reform Act and Republic Act No. 9285, also known as the 
25 
Alternative Dispute Resolution Act of 2004. The CIAC shall acquire jurisdiction 
26 
upon the filing of a request for arbitration or mediation by any or both of the 
27 
contracting parties and shall be responsible for the following, in addition to its 
28 
powers and authority as specifically provided in this Act: 
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a. To formulate and adopt arbitration, mediation and other alternative dispute 
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resolution programs for the construction industry (hereinafter collectively 
32 
called as ADR programs); 
33 
b. To enunciate policies and prescribe rules and procedures for its ADR 
34 
programs; 
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c. To supervise its ADR programs and exercise such authority related thereto as 
2 
regards the training, accreditation, appointment, replacement or challenging 
3 
of arbitrators/ mediators/conciliators; 
4 
d. To have an official seal to authenticate its official documents; 
5 
e. To direct its officer and employees to perform such functions as may be 
6 
assigned to theme from time.to time; 
7 
f. 
To submit its annual report to the Authority within three (3) months after the 
8 
end of the fiscal year; and 
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g. To perform such other functions as may be assigned by the Authority from 
10 
time to time. 
11 
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SEC. 12. Mandatory Use of the Constructors Peiformance Evaluation System 
13 
(CPES). - All government construction projects regardless of funding source shall be 
14 
subject to CPES. For this purpose, no government project shall be acceptable by the 
15 
concerned agency unless it has undergone CPES evaluation. Failure of the 
16 
responsible officer of a particular project to implement CPES shall be deemed 
17 
dereliction of duty and shall make him or her liable for disciplinary action. In 
18 
addition, he or she shall be jointly and severally liable with the contractor for any 
19 
damage or claim that may arise due to his failure to implement the CPES. 
20 
No contractor with a CPES final rating lower than satisfactory for a particular 
21 
project shall be eligible to bid for similar government construction projects in 
22 
accordance with the guidelines to be prescribed by the Authority. 
23 
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SEC. 13. Budget for Phi/CDA. - The National Government shall continue to 
25 
allocate in its annual General Appropriations Act such amount that is presently 
26 
allocated for ClAP to the newly created PHiLCDA, which shall be used solely for its 
27 
operational expenses and capital outlay. 
28 
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SEC. 14. Implementing Rules and Regulations. - The Authority shall, within 
30 
sixty days (60) from the effectively of this Act, issue such rules and regulations as 
31 
may be necessary for the implementation of the general provisions of this Act, 
32 
including the authority to collect fees, impose levies and other charges to support its 
33 
operations and other lawful activities necessary in the execution of its functions and 
34 
responsibilities. 
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SEC 15. Transitory Provisions. - Upon approval of this Act, the officers and 
2 
employees of the CIAP, PCAB, POCB, PDCB, CIAC and the CMDF shall be 
3 
transferred to the Authority and shall continue to perform their respective functions, 
4 
duties and responsibilities and receive the corresponding salaries and benefits until 
5 
a new structure and plantilla shall have been submitted to and approved by the 
6 
Department of Budget and Management within thirty (30) days upon signing of this 
7 
Bill. 
8 
All permanent employees of the Construction Industry Authority of the 
9 
Philippines (ClAP), the Philippine Contractors Accreditation Board (PCAB), the 
10 
Philippine Overseas Construction Board (POCB), the Philippine Domestic 
11 
Construction Board (PDCB), Construction Industry Arbitration Commission (CIAC), 
12 
and the Construction Manpower Development Foundation (CMDF) who are not 
13 
absorbed or transferred are hereby declared qualified for early retirement and shall 
14 
be entitled to separation pay equivalent to three (3) months for every year of service, 
15 
in addition to retirement and other benefits· allowed under eXisting laws. For this 
16 
purpose, the revenues of ClAP, PCAB, POCB, PDCB, CIAC and CMDF are hereby 
17 
appropriated and set aside for deposit in a separate trust account for the payment of 
18 
separation pay. 
19 
Upon effectivity of this Act, all revenues of ClAP, its implementing Boards, 
20 
CIAC, and CMDF shall be set aside and deposited in a separate trust account to 
21 
cover the payment of separation pay. 
22 
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SEC. 16. Separability Clause. If any part, section or provision of this Act is 
24 
declared invalid or unconstitutional, other parts or provisions hereof not affected 
25 
thereby shall continue to b.e in full force and effect. 
26 
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SEC. 17. Repealing Clause. All laws, rules and regulations and/or parts of 
28 
Republic Act No. 4566, Presidential Decree Nos. 1167 and 1746, and Executive Order 
29 
No. 1008 inconsistent with the provisions of this Act are hereby repealed 
30 
accordingly. 
31 
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SEC 18. Effectivity. - This Act shall take effect fifteen (15) days after its 
33 
publication in at least one (1) newspaper of general circulation. 
34 
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·Approved, 
10