SIXTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
'13 
JUL -4 
AlO :24 
SENATE 
S.No. 
t : 
RE('Hi'},'Ftr t:tY; 
XV' 
-----------------------------~U-
Introduced by Senator Ralph G. Recto 
Explanatory Note 
President Benigno Aquino Ill's 'Daang Matuwid' enVIsions a country that has high 
sustainable growth, generates mass employment and reduces poverty. Consistent with the President's 
commitment to transformational leadership is the government's considerable efforts in encouraging 
public-private partnerships (PPPs) as a means to develop the country's infrastructure in all sectors 
and secure our economic global ranking. 
With very little fiscal space in the national budget to even make a dent in the country's 
infrastructure backlog, President Aquino has declared that strengthening laws that provide incentives 
to PPPs will be a priority legislative policy during his administration. 
It is therefore of utmost importance to revisit Republic Act No. 6957, as amended by 
Republic Act No. 7718, Entitled "An Act Authorizing the FInancing, Construction, Operation and 
Maintenance lof Infrastructure Projects by the Private Sector, and for Other Purposes" or what is 
otherwise called the "Build-Operate-Transfer" (BOT) law. 
This bill is aimed at further improving the BOT law by expanding its coverage and providing 
more incentives to the private sector who become partners of the government in infrastructure 
projects. 
One salient feature of this bill is the classification of infrastructure projects as "Projects of 
National Significance" which, when classified as such, will enjoy incentives such as exemption from 
real property tax, restrictions on imposable local taxes and automatic grant of business permits, 
among others. 
This bill also protects these projects from being the subject of judicial reliefs such as 
temporary restraining orders (TROs), preliminary injunctions and preliminary mandatory injunctions. 
Another feature of the measure is the creation of a so-called "Public-Private Partnership 
Guaranty Fund" with an initial funding of P5 billion aimed at defraying the cost of compensation to 
project proponents in the event that the government agency or government-owned-and-controlled 
corporation (GOCC) concerned fails to comply or is prevented from complying with its obligations. 
The bill also states that unsolicited project proposals may be submitted but the government 
agency or GOCC can do the following: use the unsolicited proposal as the basis for public bidding; 
accept the unsolicited proposal on a negotiated basis; or reject the proposal. 
All of these features work to strengthen the BOT law and encourage more PPPs in national 
and local infrastructure projects. 
With these in mind, the passage of this bill is earnestly sought.~. __ , 


SIXTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
SENATE 
Ij5B 
s, No. _-=--'''---
Introduced by Senator Ralph G. Recto 
AN ACT 
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'13 
JUL -4 
1\10 :24 
ENCOURAGING MORE PUBLIC-PRIVATE PARTNERSHIP (PPP) PROJECTS, 
CREATING THE PUBLIC-PRIVATE PARTNERSHIP (PPP) GUARANTY FUND, AND 
FOR OTHER PURPOSES, THEREBY AMENDING REPUBLIC ACT NO. 6957, AS 
AMENDED BY REPUBLIC ACT NO. 7718, OTHERWISE KNOWN AS THE "BUILD-
OPERA TE-TRANSFER" (BOT) LAW 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled. 
1 
SECTION 1. Section 4-A of Republic Act (R.A.) No. 6957, as amended by Republic Act 
2 
(R.A.) No. 7718, is hereby further amended to read as follows: 
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"SEC. 4-A. Unsolicited proposals. - Unsolicited proposals for projects may 
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be [accepted by any govermnent agency or local govermnent unit on a negotiated 
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basis: Provided, That, all the following conditions are met: (I) such projects involve 
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a new concept or technology and/or are not part of the list of priority projects, (2) 
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no direct govermnent guarantee, subsidy or equity is required, and (3) the 
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govermnent agency or local govermnent unit has invited by publication, for three 
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(3) consecutive weeks, in a newspaper of general circulation, comparative or 
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competitive proposals and no other proposal is received for a period of sixty (60) 
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working days: Provided, further, That in the event another proponent submits a 
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lower price proposal, the original proponent shall have the right to match that price 
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within thirty (30) working days] SUBMITTED. THE GOVERNMENT AGENCY, 
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GOVERNMENT-OWNED AND CONTROLLED CORPORATION (GOCC), OR 
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LOCAL GOVERNMENT UNIT (LGU) CONCERNED MAY EITHER: 
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(1) 
USE THE UNSOLICITED PROPOSAL AS THE BASIS 
FOR PUBLIC BIDDING AS PROVIDED IN SECTION 5 OF THIS ACT. 
I IF A FINAL AWARD TO A WINNING BIDDER IS MADE ON THE 
BASIS OF THE UNSOLICITED PROPOSAL WITHIN ONE (I) YEAR 
FROM THE SUBMISSION THEREOF, AS DETERMINED BY THE 
NATIONAL 
ECONOMIC 
AND 
DEVELOPMENT 
AUTHORITY 
(NEDA), THE ORIGINAL PROPONENT OF THE UNSOLICITED 
PROPOSAL MAY BE REIMBURSED FOR COSTS INCURRED IN ITS 
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PREPARATION, INCLUDING, BUT NOT LIMITED TO, THE COST OF 
ANY FEASIBILITY STUDIES UNDERTAKEN: PROVIDED, THAT 
SUCH REIMBURSEMENT: (A) SHALL BE IN THE AMOUNT TO BE 
DETERMINED BY NEDA, BUT NOT EXCEEDING THREE PERCENT 
(3%) OF THE TOTAL PROJECT COST, EXCLUDING ANY PROJECT 
COSTS WHICH WILL BE BORNE BY THE GOVERNMENT SUCH AS, 
BUT 
NOT 
LIMITED 
TO, 
THE 
COST 
OF 
RIGHT-OF-WAY 
ACQUISITIONS; AND (B) SHALL BE PAID IN FULL BY THE 
WINNING BIDDER AS A REQUIREMENT FOR THE AWARD OF THE 
PROJECT; 
(2) 
ACCEPT THE UNSOLICITED 
PROPOSAL 
ON 
A 
NEGOTIATED 
BASIS: 
PROVIDED, 
THAT, 
THE FOLLOWING 
CONDITIONS ARE MET: (A) SUCH PROJECTS INVOLVE A NEW 
CONCEPT IN TECHNOLOGY AND/OR ARE NOT PART OF THE LIST 
OF 
PRIORITY 
PROJECTS; 
(B) 
NO 
DIRECT 
GOVERNMENT 
GUARANTEE, SUBSIDY OR EQUITY OR ANY FORM OF PAYMENT 
OR SECURITY FROM THE GOVERNMENT IS REQUIRED AS 
PROVIDED IN THE IMMEDIATELY SUCCEEDING SECTION; AND 
(3) THE GOVERNMENT AGENCY OR LGU 
HAS INVITED BY 
PUBLICATION FOR THREE (3) CONSECUTIVE WEEKS, IN A 
NEWSPAPER OF GENERAL CIRCULATION, COMPARATIVE OR 
COMPETITIVE PROPOSALS AND NO OTHER, PROPOSAL IS 
RECEIVED FOR A PERIOD TO BE DETERMINED BY NEDA, BUT 
NOT TO EXCEED ONE (I) YEAR: PROVIDED, FURTHER, THAT IN 
THE EVENT ANOTHER PROPONENT SUBMITS A PROPOSAL 
LO'YER IN PRICE, THE ORIGINAL PROPONENT SHALL HAVE THE 
RIGHT TO MATCH THAT PRICE WITHIN THIRTY (30) WORKING 
DAYS; OR 
(3) 
REJECT THE PROPOSAL." 
30 
SEC. 2. R.A. No. 6957, as amended by R.A. No. 7718, is hereby further amended by 
31 
inserting a new section after Section 4-A to read as follows: 
32. 
"SEC. 4-B. PROHIBITION AGAINST GOVERNMENT GUARANTEES OR 
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PAYMENTS. 
-
NOTWITHSTANDING ANY AGREEMENT TO THE 
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CONTRARY, 
THE 
PROJECT 
PROPONENT 
OF 
AN 
UNSOLICITED 
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PROPOSAL ACCEPTED BY THE GOVERNMENT ON A NEGOTIATED 
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BASIS IN ACCORDANCE WITH SECTION 4-A (2) SHALL NOT, AT 
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ANYTIME, BE ENTITLED TO ANY FORM OF PAYMENT OR SECURITY 
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FROM THE GOVERNMENT, INCLUDING, BUT NOT LIMITED TO, COST 
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SHARING, 
CREDIT 
ENHANCEMENT, 
DIRECT 
OR 
INDIRECT 
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GOVERNMENT GUARANTEE, SUBSIDY OR EQUITY." 
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SEC. 3. R.A. No. 6957, as amended by R.A. No. 7718, is hereby further amended by 
inserting a new section after Section 10 to read as follows: 
"SEC. 10-A. PROJECTS OF NATIONAL SIGNIFICANCE. - UPON 
CERTIFICATION AND RECOMMENDATION OF NEDA, THE PRESIDENT 
MAY CLASSIFY CERTAIN PROJECTS UNDERTAKEN UNDER THIS ACT 
AS PROJECTS OF NATIONAL SIGNIFICANCE, WHICH SHALL BE 
ENTITLED TO THE FOLLOWING INCENTIVES: 
A. 
ALL REAL PROPERTIES WHICH ARE ACTUALLY 
I 
. AND DIRECTLY USED FOR THE PROJECT SHALL BE EXEMPT 
I FROM ANY AND ALL REAL PROPERTY TAXES LEVIED UNDER 
REPUBLIC ACT NO. 7160; 
B. 
ALL LOCAL TAXES IMPOSED BY A PROVINCE, CITY 
OR MUNICIPALITY IN METRO MANILA PURSUANT TO REPUBLIC 
ACT NO. 7160 ON THE PROJECT PROPONENT SHALL NOT EXCEED 
FIFTY PERCENT (50%) OF ONE PERCENT (1%) OF GROSS SALES 
OR RECEIPTS OF THE PRECEDING CALENDAR YEAR; 
C. 
THE NECESSARY BUSINESS PERMITS, INCLUDING 
ANY RENEWALS THEREOF, SHALL BE DEEMED TO HAVE BEEN 
AUTOMATICALLY GRANTED OR ISSUED TO THE WINNING 
PROJECT PROPONENT UPON TENDER OF THE REQUIRED TAXES 
AND FEES TO THE APPROPRIATE LGU. 
FOR PURPOSES OF THIS SECTION, IN ORDER FOR A PROJECT TO 
QUALIFY 
AS 
A 
PROJECT 
OF 
NATIONAL 
SIGNIFICANCE, 
THE 
FOLLOWING CONDITIONS MUST BE SATISFIED: 
1. 
THE TOTAL COST OF THE PROJECT IS AT LEAST FIVE 
BILLION PESOS (PHP5,000,000,000.00); AND 
2. 
THE PROJECT IS LOCATED IN OR WILL DIRECTLY BENEFIT 
AT LEAST TWO (2) PROVINCES." 
SEC. 4. 
R.A. No. 6957, as amended by R.A. No. 7718, is hereby further amended by 
inserting a new Section 11 to read as follows: 
"SEC. 11. PROHIBITION ON THE ISSUANCE OF TEMPORARY 
RESTRAINING ORDERS, PRELIMINARY INJUNCTIONS AND PRELIMINARY 
MANDATORY INJUNCTIONS. 
-
NO COURT, EXCEPT THE SUPREME 
COUtU, SHALL ISSUE ANY TEMPORARY RESTRAINING ORDER, 
PRELIMINARY 
INJUNCTION 
AND 
PRELIMINARY· MANDATORY 
I 
INJUNCTION 
AGAINST 
THE 
GOVERNMENT, 
OR 
ANY 
OF 
ITS 
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I 
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SUBDIVISIONS, OFFICIALS OR ANY PERSON OR ENTITY, WHETHER 
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PUBLIC 
OR 
PRIVATE, 
ACTING 
UNDER 
THE 
GOVERNMENT'S 
3 
DIRECTION, TO RESTRAIN, PROHIBIT OR COMPEL THE FOLLOWING 
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ACTS WITH REGARD TO PROJECTS OF NATIONAL SIGNIFICANCE 
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UNDER THE IMMEDIATELY PRECEDING SECTION: 
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A. 
ACQUISITION, CLEARANCE AND DEVELOPMENT OF 
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THE RIGHT-OF-WAY AND/OR SITE OR LOCATION; 
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B. 
BIDDING OR AWARDING; 
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C. 
COMMENCEMENT, 
PROSECUTION, 
EXECUTION, 
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IMPLEMENTATION AND OPERATION; 
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D. 
TERMINATION OR RESCISSION OF THE CONTRACT; 
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AND 
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E. 
THE UNDERTAKING OR AUTHORIZATION OF ANY 
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OTHER LAWFUL ACTIVITY NECESSARY OR IN CONNECTION 
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WITH THE EXECUTION OR IMPLEMENTATION OF THE PROJECT. 
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THIS PROHIBITION SHALL APPLY IN ALL CASES, DISPUTES OR 
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CONTROVERSIES INSTITUTED BY A PRIVATE PARTY, INCLUDING, BUT 
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NOT LIMITED TO, CASES FILED BY BIDDERS OR THOSE CLAIMING TO 
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HAVE RIGHTS THROUGH SUCH BIDDERS INVOLVING PROJECTS OF 
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NATIONAL SIGNIFICANCE. THIS PROHIBITION SHALL NOT APPLY 
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WHEN THE MATTER IS OF EXTREME URGENCY INVOLVING A 
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CONSTITUTIONAL ISSUE, 
SUCH THAT UNLESS 
A TEMPORARY 
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RESTRAINING 
ORDER 
IS 
ISSUED, 
GRAVE 
INJUSTICE 
AND 
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IRREPARABLE INJURY WILL ARISE. THE APPLICANT SHALL FILE A 
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BONP, IN AN AMOUNT TO BE FIXED BY THE COURT, WHICH BOND 
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SHAf-L ACCRUE IN FAVOR OF THE GOVERNMENT IF THE COURT 
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SHOULD FINALLY DECIDE THAT THE APPLICANT WAS NOT ENTITLED 
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TO THE RELIEF SOUGHT. 
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ANY 
TEMPORARY 
RESTRAINING 
ORDER, 
PRELIMINARY 
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INJUNCTION AND PRELIMINARY MANDATORY INJUNCTION ISSUED IN 
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VIOLATION OF THIS SECTION IS VOID AND OF NO FORCE AND 
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EFFECT." 
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SEC. S. The succeeding sections ofR.A. No. 6957, as amended by R.A. No. 7718, are 
34 
hereby renumbered accordingly. 
35 
SEC. 6. Public-Private Partnership (PPP) Guaranty Fund. - A PPP Guaranty Fund is 
36 
hereby created to defray the cost of compensation to project proponents which enter into BOT 
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contracts, concession agreements or other contractual agreements with any national government 
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agency or GOCC pursuant to the provisions of Republic Act No. 6957, as amended, in the event 
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1 
that the government agency or GOee fails to comply, or is prevented from complying, with its 
2 
obligations under the aforementioned contracts or agreements as a result of any act of another 
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agency or branch of government: Provided, That no compensation shall be paid out of the PPP 
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Guaranty Fund if the contract or agreement has been determined to be unlawful or 
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unconstitutional by a final judgment of a court of competent jurisdiction. 
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The initial funding in the amount of Five Billion Pesos (P5,OOO,OOO,OOO.OO) for the 
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creation of the Fund shall be charged against the overall savings of the National Government. 
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Thereafter, the PPP Guaranty Fund may be replenished or increased by such amount as may be 
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deemed necessary in subsequent General Appropriations Act. 
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SEC. 7. 
Implementing Rules and Regulations. - The NEDA, Departments of Finance 
and Budget and Management shall promulgate the implementing rules and regulations within sixty 
(60) days from the effectivity of this Act. 
SEC. 8. Separability Clause. - If any part or provision of this Act shall be held to be 
unconstitutional or invalid, other parts or provisions hereof which are not affected thereby shall 
, 
continue to pe in full force and effect. 
. 
SEC. 9. Repealing Clause. -
All laws, decrees, executive orders, rules and regulations 
and other issuances or parts thereof which are inconsistent with this Act are hereby repealed or 
modified accordingly. 
SEC. 10. ,Effectivity. This Act shall take effect fifteen (15) days from the date of 
publication in the Official Gazette or in at least two (2) newspapers of general circulation. 
Approved, 
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