REPUBLIC OF THE PHILIPPINES 
House of Representatives 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
House Bill No. ____________ 
Introduced by REP. MERCEDES K. ALVAREZ, MNSA 
EXPLANATORY NOTE 
To secure the state’s sovereignty and the integrity of its national territory, acquiring defense 
equipment, facilities, material, ordinance, services, and integrated military systems is an utmost 
government priority. 
Strengthening the Philippine defense involves modernizing our armed forces through a 
procurement system that is expeditious and specialized which requires the adoption of the 
essential and appropriate criteria in determining the best rated offer governed by confidentiality 
in the acquisition process. 
The Philippine government, through this Defense Acquisition Act, recognizes the 
specialized needs of the defense establishment in the procurement of goods and services as 
well as the construction, improvement, rehabilitation, demolition, repair, restoration or 
maintenance of naval vessels or station and aircraft bases, roads and bridges, railways, airports, 
seaports, communication facilities, civil works components of information technology projects, 
water supply, sewerage and solid waste management systems, and other related defense 
construction projects. 
This Act will definitely complete the government's commitment to the capacity building 
and will boost the morale of the country's brave men and women of the Navy, Air Force, and 
Armed Forces. 
In view of the foregoing, the early passage of this bill is earnestly sought. 
MERCEDES K. ALVAREZ  MNSA 
Sixth District, Negros Occidental 
December 12, 2022
5:01 pm
6618


REPUBLIC OF THE PHILIPPINES 
House of Representatives 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
House Bill No. ____________ 
Introduced by REP. MERCEDES K. ALVAREZ, MNSA 
AN ACT 
PROVIDING 
FOR 
THE 
ACQUISITION 
OF 
MATERIAL, 
SYSTEMS, 
FACILITIES, 
INTERGRATED MILITARY SYSTEMS AND SERVICES BY THE DEPARTMENT OF 
NATIONAL DEFENSE AND ITS BUREAUS AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
ARTICLE I 
GENERAL PROVISIONS 
Section 1. Short Title. - This act shall be known as the "Defense Acquisition Act of 2022." 
Section 2. Declaration of Policy. —It is the policy of the State to secure its sovereignty and the 
integrity of its national territory. Towards this end, the acquisition of defense equipment, facilities, 
materiel, ordnance, services and integrated military systems shall be given utmost priority. 
Section 3. Governing Principles, - The Defense Acquisition Act shall be governed by the 
following principles: 
Expeditious and specialized process in the acquisition of defense materiel, systems, military 
facilities and installations, and services; 
Quality, reliability, and sustainability of defense equipment, facilities, services, systems, critical 
components, and other critical requirements through the adoption of appropriate criteria in 
determining the best rated offer; 
Confidentiality in the acquisition process of defense equipment, facilities, materiel, ordnance, 
services and integrated military systems that has significant impact to national interest and 
security; 
Self-reliant defense posture to support defense requirements of the Department of National 
Defense (DND) and its bureaus and promote the development of local defense industry, reduce 
foreign exchange outflow, generate local employment, and enhance technology transfer; and 
accountability and integrity through special monitoring of defense acquisition procedures and 
implementation of awarded contracts. 
6618


 
Section 4. Scope and Application. - This Act shall apply to the acquisition of Defense materiel, 
services, ordnance, systems, and facilities of the Department of National Defense and its 
bureaus. In so far as practicable, the Defense System of Management (DSOM) process, as 
prescribed by the Secretary of National Defense (SND), shall be used in the determination of 
requirements to be procured under this Act.  
When acquisition is done pursuant to a treaty or International or Executive or Defense 
Cooperation Agreement, said agreements shall prevail. 
Section 5. Definition of Terms. — For purposes of this Act, the following terms, words or 
phrases shall mean or be understood as follows: 
Acquisition — refers to the acquisition of defense equipment, materiel, ordnance, services, 
facilities and integrated military systems. It is synonymous with "procurement" if pertaining to 
items not covered by this Act. 
Facilities/lnfrastructure — includes the construction, improvement, rehabilitation, demolition, 
repair, restoration or maintenance of naval vessels or station and aircraft and bases, roads and 
bridges, railways, airports, seaports, communication facilities, civil works components of 
information technology projects, irrigation, flood control and drainage, water supply, sanitation, 
sewerage and solid waste management systems, shore protection, energy/power and 
electrification facilities, national buildings, school buildings, hospital buildings, and other related 
defense constructions projects of the government. 
Materiel — refers to all items with military specifications that are necessary for the equipment, 
maintenance, services, operation and support of governmental and military activities. 
Services — refers to all defense related services. 
Systems — refer to the organization of hardware, software, materiel, facilities, personnel, data, 
and services needed to perform a designated function with specified results, such as the 
gathering of specified data, its processing, and delivery to users. A combination of two (2) or 
more interrelated equipment's set arranged in a functional package to perform an operational 
function or to satisfy a requirement. 
Military specifications — refers to the project/product standard based on local/international 
publication recognized and/or made by the AFP. 
Ordnance — refers to all items needed by the Navy, Air Force and Army defense requirements. 
Head of Acquisition Entity (HAE) — refers to the Head of the agency or body, or his duly 
authorized official in the acquisition of defense materiel, ordnance, facilities, services and 
integrated military systems. It is synonymous with "Head Procuring Entity (HoPE)" if pertaining 
to procurement of items not covered by this Act. 
Best Rated Offer — is the offer with the best calculated rating based on criteria/parameters 
including, but not limited to financial capacity, technical capabilities, additional technical 
capabilities of appropriate upgrade, and others such as life-cycle cost, after support, willingness 
to transfer technology, warranty, perquisites and price as determined by the end user. 
Previous Supplier — refers to a juridical entity that has supplied the same defense equipment, 
critical components, services and other critical requirements being procured. The surviving or 
consolidated juridical entity resulting from a merger, consolidation and acquisition shall be 
considered a previous supplier. 
 


 
Request for Expression of Interest (REI) — refers to a letter inviting the pre-selected suppliers 
identified by the Procuring Entity to be technically, legally and financially capable to render 
services or to supply the requirements and construction of facilities of the DND and its bureaus. 
Resource Manager (RM) — is a designated senior executive official appointed by the SND who 
is directly accountable to SND for developing financially realistic program, budget, and spending 
plan proposals that comply with the centralized policy and planning direction provided by the 
SND; accomplishing established programmatic and financial management objectives 
established by the SND; and, reporting performance against the established objectives; 
 
ARTICLE Il 
ACQUISITION, PLANNING, BUDGETING AND EXECUTION 
Section 6. Defense Acquisition Planning and Budgeting (DAPB). — The DAPB is 
collaboratively developed acquisition plan with a realistic financial program that meet identified 
capability requirements in a timely manner. Only those priority needs and/or crucial to the 
efficient discharge of functions shall be included on the DAPB. 
6.1. Preparation of Acquisition Plan and Budget (APB). — The APB must be 
consistent with the duly approved budget of the Department of National Defense and shall bear 
the approval of the concerned HAE. 
6.1.1. Short Term Acquisition plan and Budget (SAPB). — It is a 3-year defense 
procurement program to be funded thru General Appropriations. 
 For the AFP, the approving authority shall be the Chief of Staff, Armed Forces of the 
Philippines. 
 For DND Civilian Bureaus, the approving authority shall be the Head Bureaus. 
 
6.1.2. Midterm Acquisition Plan and Budget (MAPB). —A 5-year defense procurement 
program to be funded thru General Appropriation and/or other sources as enumerated in the 
AFP Modernization Program Act (RA 7898, as amended by RA 10349). The MAPB shall be 
approved by Secretary of National Defense. 
6.2. Modes of Payment. — In order to have a uniform and standard modes of payment, 
the same shall be limited to the following: 
For Foreign Suppliers. — The modes of payment shall be limited to Local Letters of Credit 
and Electronic Wire Transfer. 
For Local Suppliers. — The modes of payment shall be limited to Local Letters of Credit 
or Direct Payment. 
6.3. Budgetary Requirements. The Secretary of National Defense shall submit to the 
President, Congress and Secretary of Budget and Management the required budgets for 
defense procurement . 
6.4. Release of Funds by the Department of Budget and Management (DBM). — 
The DBM shall release the amounts to support the funding requirements for the acquisition of 
materiel, systems, facilities and services of the DND proper and its bureaus in accordance with 
the guidelines set forth by the DBM: 


 
6.5. Execution. — The DND proper and its bureaus shall execute the allocated amount 
for the acquisition of materiel, systems, ordnance, facilities and services in accordance with the 
existing government accounting and auditing rules and regulations. 
6.6. Review. — The Office of the Assistant Secretary for Financial Management 
(OASFM) shall be responsible in the conduct of quarterly review and assessment of the financial 
performance of the DND proper and its bureaus for the acquisition of the materiel, systems, 
facilities and services based on the guidelines set forth in the Implementing Rules and 
regulations (IRR). 
ARTICLE Ill 
MODES OF ACQUISITON 
Section 7. Modes of Acquisition. — Subject to objective evaluation and approval of 
SND and whenever justified by the conditions provided in this Act, the DND may, in order to 
promote economy and efficiency, in case of national emergency and calamity resort to any of 
the following modes of acquisition: 
7.1. Procurement. - The procurement of defense equipment maybe in any of the 
following mode: 
7.1.1. Open Competition — refers to a method of procurement which is open to 
participation by any interested party or entity who can meet the specified requirements. The 
procuring entity may enter into a framework agreement as necessary. 
7.1.2. Limited/Selective Competition — is a method of procurement that limits the 
participants in the procurement process to known legitimate manufacturers/suppliers. This 
mode is used mainly for security reasons; often where the requirements have been deemed 
classified such that the same may not be disclosed freely through an open competition. It 
involves direct invitation to at least (2) manufacturers by the Procuring Entity from the list of pre-
selected suppliers with known experience and proven capability. The pre-selection shall be 
based upon the capability and resources of the manufacturers to perform the contract take into 
account their experience and past performance on similar contracts, capabilities with respect to 
personnel equipment or manufacturing facilities, and financial position. 
7.1.3. Single-sourced- refers to the mode of procurement where the procuring Entity 
negotiated with one (1) manufacturer/supplier in view of national security and emergency and 
or other urgent strategic considerations. 
7.1.3.1. Government-to-Government — refers to an arrangement involving negotiation 
with a State with which the Philippines has a Treaty or International or Executive Agreements. 
7.1.3.2. Emergency Procurement — refers to the type of single-sourced procurement of 
defense materiel and other defense requirements necessary to support and sustain defense 
operations during a state of calamity or emergency where immediate acquisition is necessary 
to prevent loss of life or damage to property. 
7.1.3.3. Anticipated Emergency Procurement- refers to the type of single-sourced 
procurement of defense material materiel necessary in anticipation of a disaster that poses an 
imminent danger to life or damage to property. 
7.1.3.4. Direct Purchase- refers to the type of single sourced method/mode that allows 
procurement directly from pre-selected supplier, manufacturer, and/or contractor. It may be 
resorted to under any of the following circumstances: 
7.1.3.4.1. For procurement of readily available and off-the-shelf goods not available to 
the Procurement Service of the Department of Budget and management, subject to the 
threshold prescribed in the IRR. 


 
7.1.3.4.2. In order to obtain and maintain the desired standardization and interoperability 
of defense materiel based on the defense inventory of the DND and lor its Bureaus. 
7.1.3.4.3. Procurement of Goods of Proprietary nature which can be obtained only from 
the proprietary source, i.e. when patents, trade secrets, and copyrights prohibit others from 
manufacturing the same item. 
7.1.3.5. Assumption of Contracts. — Assumption of contract by a specific 
supplier/manufacturer whenever a contract under any of the methods of procurement of this Act 
is terminated or rescinded for causes provided for in the contract and existing laws. In the case 
of Open and Limited Competition, all the ranked offerors shall be considered prior to the sending 
of REIs. 
7.2 Donation — refers to an act of liberality whereby private companies, institutions, 
local government units (LGUs), government agencies and other foreign governments or 
institutions disposes gratuitously of assorted items/equipment to the DND and its attached 
bureaus. 
7.3 Barter — refers to the mode of acquisition by the exchange of goods or services for 
other goods or services without the use of money which may be made with foreign governments, 
local government agencies and foreign and local private entities. 
Section 8. Acquisition for the Development of Self-reliant Defense Posture (SRDP). 
— refers to the negotiation for acquisition of defense projects services, system and facilities that 
may also be undertaken if the SND has determined that the security interest of (the) country is 
protected by entering into in-country production with any foreign or local manufacturer. 
Section 9. Terms and Conditions for the Use of Acquisition Methods. The specific 
terms and conditions including the limitations and restrictions, for the application of each of the 
acquisition methods in this article shall be specified in the IRR. 
ARTICLE IV 
ORGANIZATIONAL STRUCTURE 
Section 10. Head of Acquisition Entity (HAE). — The SND and the Bureau Heads 
shall be the Head of the Acquisition Entity for the DND and their respective bureaus. 
Section 11. Office of the Defense Acquisitions (ODA). — The ODA shall be created 
to assist the Secretary of the National Defense Acquisitions who shall be assisted by at least 
two (2) Directors under the Department of National Defense (DND). 
Section 12. Defense Acquisition Secretariat (DAS). — The DAD shall be a permanent 
body composed of five (5) permanent members, with at least one (1) lawyer. The members of 
DAD shall occupy plantilla positions with salary grades to be determined by the SND. There 
shall also be two (2) alternate regular members and two (2) provisional members from the end-
user. The SND may create additional ad hoc Defense Acquisitions Committees DND shall 
create their own permanent and ad hoc DACs in accordance with this Act. Bureaus of the DND 
shall create their own permanent and ad hoc DACs in accordance with this Act. All members of 
the DAC shall have appropriate competencies to be determined by the HAE, and shall undergo 
a comprehensive training program. 
Section 13. Defense Acquisition Technical Assistance Office (DATAO). — The 
DATAO shall provide support to the Department in the performance of its duties and 
responsibilities specified in this Act and its IRR. The DND shall determine the DATAO's 
organizational structure and staffing. The DATAO shall be headed by a senior official of the 
Department of good moral character, unquestionable integrity, and known probity, to be 
designated by the SND, upon favorable recommendation of the Chief, DATAO. 


 
13.1. The DATAO shall provide research, technical and administrative support to the 
Department, including: a) Research-based acquisition policy recommendations and rule-
drafting; b) Development and updating of generic acquisition manuals and standard bidding 
forms; c) Management and conduct of training on acquisition systems and procedures; d) 
Evaluation of the effectiveness of the government acquisition system and recommendation of 
improvements in systems and procedures. E) Monitoring the compliance to this Act and 
assisting Acquisitioning Entities improve their compliance; and f) Secretariat support. 
Section 14. Professionalization of Acquisition Personnel. — The ODA shall establish 
a sustained training program to develop the capability of the Defense Acquisition Division 
(DAD), Defense Acquisition Secretariats, Project Management Teams (PMTs), and the 
Acquisition Units of Acquisition Entities, and professionalize the same. The HAE shall ensure 
that the DAD, its Secretariat and PMT members, including other relevant acquisitioning 
personnel are sent to attend acquisition training or capacity development program. Within six 
(6) months upon designation, the DAD, its Secretariat and PMT members should have 
satisfactorily completed such training or program conducted, authorized or accredited by the 
DATAO. The HAE is encouraged to attend similar acquisition training and capacity development 
activities. 
Section 15. Project Management Team (PMT). — There shall be PMTs created to 
support the DAD which shall be composed of financial, legal, and technical experts to assist in 
the acquisition process. 
ARTICLE V 
ACQUISITION PROCEDURES 
 
Section 16. Acquisition Requirements. — The acquisition requirements shall be 
determined in accordance with the DSOM process prescribed by the SND. 
1. Determination of the Mode of Acquisition. — The end user shall recommend the mode 
of acquisition for approval of the HAE. 
16.2. Best Rated Offer (BRO). — The offer with the best calculated rating based on 
criteria/parameters including but not limited to financial. 
capacity, technical capabilities, additional technical capabilities of appropriate upgrade, 
and other such as life-cycle cost, after-sales support, willingness to transfer technology, 
warranty, perquisites, and price. 
Section 17. Awarding of Contract. — The DAC shall recommend award of contract to 
the supplier with the Best Rated Offer. 
17.1. Contract Signing. — The HAE shall be the signing authority to enter into a contract 
with the supplier with the Best Rated Offer. 
 
Section 18. Contract Implementation. — The rules and guidelines for the 
implementation of contracts which includes but not limited to the delivery, acceptance test, 
extension of contract, variation of contract and payment shall be prescribed in the IRR. The 
rules and guidelines shall include standard general and special conditions for contracts. 
Section 19. Contract of Termination. — The rules and guidelines for the termination of 
contracts awarded pursuant to the provisions of this Act shall be prescribed in the IRR. The 
rules and guidelines shall include standard general and special conditions for contracts. 


 
Section 20. Warranties. — In order to ensure the integrity of the materiel acquired and 
the supplier's obligation to repair or replace the same when warranted, a warranty security shall 
be required form the supplier for a period as specified in the contract. 
Section 21. Review and Assessment. — The HAE may create an Acquisition Review 
Committee to assess the acquisition activities of the Department and its bureaus on a quarterly 
basis in accordance with the guidelines and procedures provided for in the IRR. 
Section 22. Security and Confidentiality. — Whenever necessary, an offeror or bidder 
may be required to sign a Non-Disclosure Agreement. 
ARTICLE VI 
SANCTIONS FOR DEFAULT 
Section 23. Liquidated Damages. — All contracts executed in accordance with this Act 
and its IRR shall contain a provision on liquidated damages which shall be payable by the 
contractor or supplier in case of breach as specified in the contract. 
Section 24. Blacklisting. - Corporations, companies, board members, single 
proprietorships, their principals, and duly authorized representatives or agents shall be 
blacklisted in accordance with the grounds and procedures as provided for in the IRR. The 
Period of Backlisting shall be as follows: 
1 st Blacklisting — five (5) years 
2 nd Blacklisting — Perpetual disqualification from participating in the acquisition proCess 
of the DND 
Non-performance of obligation under warranty shall be a ground for blacklisting. 
ARTICLE VII 
SETTLEMENT OF DISPUTES 
Section 25. Protests on Decisions of the DAC — Decisions of the DAC in all stages 
of acquisition may be protested to the HAE and shall be in writing. Decisions of the DAC may 
be protested by filling a verified position paper and paying a non-refundable protest fee. The 
amount of the protest fee and the periods during which the protests may be files ad resolved 
shall be specified in the IRR 
Section 26. Resolution of Protests — The protests shall be resolved strictly on the 
basis of records of the DAC. The decisions of the HAE shall be final. 
Section 27. Non-interruption of the Acquisition Process. — In no case shall any 
protest taken from any decision treated in this Article stay or delay the acquisition process. 
Section 28. Resort to Regular Courts; Certiorari. — Court action may be resorted to 
only after the protests contemplated in this Article shall have been completed. Cases that are 
filed in violation of the process specified in this Act shall be dismissed for lack of jurisdiction. 
The Regional Trial Court shall have jurisdiction over final decisions of the HAE. Court actions 
shall be governed by Rule 65 of the 1997 Rules of Civil Procedure or its amendment as the 
case maybe and as applicable. 
Section 29. Arbitration — Any and all disputes arising from the implementation of a 
contract covered by this Act shall be submitted to arbitration in the Philippines according to the 
provisions of the Republic Act. No. 876, otherwise known as the "Arbitration Law" Provided, 
however, That, disputes that are within the competence of the Construction Industry Arbitration 
Commission to resolve shall be referred thereto. The process of arbitration shall be incorporated 


 
as a provision in thr contract that will be executed pursuant to the provisions of this Act: 
Provided, that by mutual agreement, the parties may agree in writing to resort to alternative 
modes of dispute resolution. 
Section 30. Appeals. — The arbitral award andÄiYdéOiSion rendered in accordance 
with the foregoing Section shall be appealable by way of a petition for review to the Court of 
Appeals. The petition shall raise pure questions of law and shall be governed by the Rules of 
COUN 
ARTICLE VIII 
PENAL CLAUSE 
Section 31. Offenses and Penalties. — The provisions of Republic Act No. 3019, 
otherwise known as the "Anti-Graft and Corrupt Practices Act", and other pertinent penal laws 
shall be strictly applied against erring public officers or any person for action or inaction in 
violation of the provision or intent of this Act as the competent body or court may determine. 
ARTICLE IX 
CIVIL LIABLITY 
Section 32. Civil Liability in Case of Conviction. — Without prejudice to administrative 
sanctions that may be imposed in proper cases, a conviction under this Act or Republic Act No. 
3019 shall carry with it civil liability, which may either consist of restitution for the damage done 
or the forfeiture in favor of the government of any unwarranted benefit derived from the act or 
acts in question or both, at the discretion of the courts. 
Section 33. Liquidated Damages. — All contracts executed in accordance with this Act 
shall contain a provision on liquidated damages which shall be payable in case of breach 
thereof. The amount thereof shall be specified in the IRR. 
ARTICLE X 
LEGAL ASSISTANCE 
Section 34. Legal Assistance. - The legal office of the DND or its equivalent for DND 
bureaus, is authorized to represent in all stages of the case for the members of DAS, DAD, PMT 
and TWG or any or all persons involved in the procurement or acquisition process immediately 
upon receipt of Court Notice that a civil, criminal, or Ombudsman case, suit or proceeding in 
filed against them. 
Section 35. Private Legal Assistance. - In case of inability of the legal office of the DND 
or its equivalent for DBD bureaus, the Acquisitioning Entity shall provide for the lawyer's fee 
subject to guidelines as provided for under the IRR. 
ARTICLE Xl 
MISCELLANEOUS PROVISIONS 
Section 36. Multi-year contracts and Other Contractual Arrangement. — For the 
purpose of acquisitions under this Act, notwithstanding existing laws to the contrary, the DND 
and its bureaus shall be authorized to enter into multi-year contracts and other multiyear 
contractual arrangements; Congress shall, upon issuance of a multi-year obligation authority by 
the DBM, make the corresponding appropriation for the ensuing fiscal years. 
Section 37. Issuance of Import Licenses and other Licenses. All acquisition under 
this Act shall be exempt from import and other licenses imposed by other agencies of the 
government. In lieu thereof, the SND shall issue an Authority to Import and other certification 


 
that the goods, services, systems and equipment being imported are acquired pursuant to this 
Act. 
Section 38. Exemption from Custom Duties and other Taxes for Donated Goods. 
The donation of defense equipment or items to the Department of National Defense, which are 
directly and exclusively used for its projects, undertakings, activities, services and programs 
under this Act, shall be exempted from custom duties and other taxes. 
 
Section 39. Acquisition of Units Deployed Overseas. — Units deployed overseas 
such as the DAFA, U.N. Peace-Keepers and the likes are authorized to acquire certain 
reasonable requirements in connection with the discharge of their functions within the country 
where they are deployed, subject to the guidelines provided for in the IRR. 
Section 40. Administration of the Revised AFP Modernization Act Trust Fund. — 
Section 1 1 of Republic Act No. 7898, otherwise known as the "AFP Modernization Act", as 
amended by Republic Act No. 10349, is hereby further amended to read as follows: 
"Sec. 11. The Revised AFP Modernization Act Trust Fund. —x x x : 
Funds from the foregoing sources, regardless of income source, shall be directly 
deposited to a special account in the general fund created specifically for the Revised AFP 
Modernization Program. The corresponding allotment and cash allocation shall be released to 
the DND subject to the submission of a special budget and subject to submission of periodic 
report to the Oversight Committee. Thereafter, the cash allocation shall be transferred to the 
Revised AFP Modernization Trust Fund which shall be administered by the Secretary of 
National Defense in accordance with the existing government budgeting and auditing rules and 
regulations. The DND shall conduct periodic studies on how to maximize the utilization of the 
trust fund and how additional revenues can be generated to fund the Revised AFP 
Modernization Program." 
Section 41. Exemption from Value-Added Tax, Customs Duties and other Taxes. 
— The sale and/or importation of weapons, equipment and ammunitions to and by the AFP, 
which are directly and exclusively used for its projects, undertakings and activities and programs 
under Revised AFP Modernization Act, shall be exempt from the value added tax, customs 
duties and other taxes. 
ARTICLE Xll 
FINAL PROVISIONS 
Section 42. Join Congressional Oversight Committee on Defense Acquisition. — 
For the purposes of transparency and accountability, there shall be a Joint Congressional 
Oversight Committee on Defense Acquisition. 
Section 43. Implementing Rules and Regulations: Supplementary Regulations. — 
Within 60 days from the promulgation of this Act, the necessary rules and regulations for the 
proper implementation of its provisions shall be formulated by the DBD. The said rules and 
regulations shall be approved by the President of the Philippines. The President thru the 
Secretary of National Defense is authorized to implement this Act, formulate and amend, 
whenever necessary, the implementing rules and regulations and standard forms necessary for 
the implementation of this Act, and issue supplemental regulations to hasten and facilitate the 
implementation of this Act. 
Section 44. Rule of Interpretation. — Rights and obligations existing on the date of 
effectivity of this Act and arising out of contracts shall be governed by the original terms and 
conditions od said contract or the law in force at that time such rights were vested. 


 
Section 45. Repealing Clause. —All provisions of existing laws, orders and regulations 
contrary to or inconsistent with this Act are hereby repealed or modified accordingly. 
Section 46. Separability Clause. - In any provision of this Act is declared invalid or 
unconstitutional, the other provisions not affected thereby shall remain valid and subsisting. 
Section 47. — Effectivity Clause. — This Act shall take effect fifteen (15) days following 
its publication in the Official Gazette or in two (2) newspapers of general circulation. 
 
Approved,