EIGHTEENTH CONGRESS OF THE 
]
REPUBLIC OF THE PHILIPPINES 
]
First R e g u la r Session 
]
SENATE
S.B. No. 1QQ8
£)!lu • ol M 
r '-'I?
•19 SEP-4 PI -22
In tro d u c e d  by SEN. WIN GATCHALIAN
AN ACT
FURTHER AMENDING REPUBLIC ACT NO. 4566 
TO PROMOTE COMPETITION AND INVESTMENTS IN THE 
CONSTRUCTION CONTRACTING SERVICES INDUSTRY, 
AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Through its linkages with other industries, the construction industry in 
the Philippines plays a vital role to national economic development as a 
provider of production inputs and as a consumer of services and products 
from other sectors.
However, the nationality requirement in the granting of licenses has 
created a substantial barrier to entry of new contractors, thereby hindering 
the growth of the construction industry. A survey of the Philippine 
Construction Accreditation Board’s data on licenses issued annually shows a 
very low rate of entry for both new domestic players and foreign firms, which 
is indicative of how competition in the construction industry has remained 
limited throughout the years.1 Essentially, these government restrictions on 
foreign participation in the construction industry create distortions that
1 Philippine Competition Commission’s Policy Note No. 1, Series of 2017, entitled “Anti­
competitive Effects of Regulatory Restrictions: The Case of the Construction Sector.”


reduce competitive pressure, reward poor performance, and distort incentives 
to innovate.
In this light, the Philippine government has to balance the need to 
supervise and regulate the construction industry for public safety with the 
need to ensure a level-playing field that would generate growth due to the 
considerable scope for learning-by-doing, knowledge generation, expansion of 
product variety, and an upgrade on product quality in the construction 
industry. Therefore, this proposed bill seeks to provide a level playing field 
and extend equal opportunities to eligible and qualified domestic and foreign 
contractors by removing barriers to entry of new players, including 
government restrictions that hinder potential economic growth.
In view of the foregoing, immediate passage of this bill is earnestly 
sought.
rATC


]
EIGHTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
]
F irst R e g u la r Session 
]
SENATE
■C r ; 
tfn ti. 
*£'■
S.B. No. 1008
In tro d u c e d  by SEN. WIN GATCHALIAN
AN ACT
FURTHER AMENDING REPUBLIC ACT NO. 4566 
TO PROMOTE COMPETITION AND INVESTMENTS IN THE 
CONSTRUCTION CONTRACTING SERVICES INDUSTRY, 
AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the 
Philippines in Congress assembled:
1 
Section 1. A new Section 2 of Republic Act No. 4566 (R.A. 4566),
2 
otherwise known as the “Contractors’ License Law,” is hereby inserted to read
3 
as follows:
4 
“SEC. 2. STATEMENT OF POLICY. -  THE STATE RECOGNIZES
5 
THE VITAL ROLE OF CONTRACTORS IN THE DELIVERY OF
6 
RELIABLE, SAFETY-COMPLIANT AND QUALITY CONSTRUCTION,
7 
BUILDING AND ENGINEERING THAT ARE FUNDAMENTAL TO
8 
NATIONAL DEVELOPMENT.
9
10 
GIVEN THE COUNTRY’S DEVELOPMENT OBJECTIVES, THERE IS
11 
A NEED TO SUPERVISE AND REGULATE THE PRACTICE OF
12 
CONSTRUCTION CONTRACTING FOR PUBLIC SAFETY, AND TO
13 
PROMOTE COMPETITION IN THE CONSTRUCTION INDUSTRY


1 
FOR ITS DEVELOPMENT AND GROWTH AND THE UPGRADING
2 
OF CONSTRUCTION CAPABILITY IN THE COUNTRY.”
3
4 
Sec. 2. Section 9 of R.A. 4566 is hereby amended to insert the following
5 
definition of new terms and to read as follows:
6 
“Sec. 9. Definition of Terms. As used in this Act,
7 
(A) “Persons” include an individual, firm, partnership,
8 
corporation, association or other organization, or any combination
9 
of any thereof, REGARDLESS OF NATIONALITY OR CITIZENSHIP.
10 
X X X
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(F) “LICENSE” REFERS TO AUTHORITY GRANTED BY THE
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PHILIPPINE CONTRACTORS ACCREDITATION 
BOARD 
(THE
13 
“BOARD”) WITH CONFORMITY WITH THE CONSTRUCTION
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INDUSTRY AUTHORITY OF THE PHILIPPINES (CIAP) FOR A
15 
PERSON TO ENGAGE IN CONSTRUCTION CONTRACTING IN THE
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PHILIPPINES WITHIN THE SCOPE AND FIELD OF ITS LICENSE
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CLASSIFICATION FOR THE PERIOD OF ITS VALIDITY. IT SHALL
18 
BE MAINTAINED THROUGH ANNUAL RENEWAL, 
UNLESS
19 
SUSPENDED, CANCELLED OR REVOKED.
20 
(G) 
“ACCREDITATION” 
REFERS 
TO 
THE 
STATUS
21 
CONFERRED 
ON 
A 
LICENSED 
CONSTRUCTOR 
BY 
THE
22 
CONSTRUCTION INDUSTRY AUTHORITY OF THE PHILIPPINES
23 
(THE “AUTHORITY”), INDICATING THE PERFORMANCE AND
24 
EXPERIENCE OF THE CONSTRUCTOR AS BEING IN ACCORD
25 
WITH STANDARDS SET BY THE BOARD.”
26
27 
Sec. 3. Article III of R.A. 4566 shall be retitled as Practice of
28 
Construction Contracting, and Section 16 thereof is hereby amended to read
29 
as follows:
30 
“SEC. 
16. 
SCOPE 
OF 
PRACTICE. 
- 
CONSTRUCTION
31 
CONTRACTING SERVICE SHALL EMBRACE THE SERVICES IN
32 
RELATION TO ANY OR ALL OF THE FOLLOWING PRINCIPAL
33 
CLASSIFICATIONS:


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10
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14
15
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(a) General engineering contracting
(b) General building contracting; and
(c) Specialty contracting.”
Sec. 4. A new Section 17 is hereby inserted to read as follows:
“SEC. 17. WHO MAY PRACTICE CONSTRUCTION CONTRACTING.
-  
ONLY 
PERSONS, 
REGARDLESS 
OF 
NATIONALITY 
OR 
CITIZENSHIP, PROPERLY LICENSED AND REGISTERED WITH 
THE BOARD IN CONFORMITY WITH THE AUTHORITY MAY 
PRACTICE 
CONSTRUCTION 
CONTRACTING 
IN 
THE 
PHILIPPINES.”
Sec. 5. A new Section 18 is hereby inserted to read as follows:
“SEC. 18. FOREIGN RECIPROCITY. - NO FOREIGN CONTRACTOR 
SHALL BE GRANTED A LICENSE TO PRACTICE CONSTRUCTION 
CONTRACTING IN THE PHILIPPINES, UNLESS THE COUNTRY OR 
STATE OF WHICH THE FOREIGN CONTRACTOR IS A SUBJECT 
OR CITIZEN, SPECIFICALLY PERMITS FILIPINO CONTRACTORS 
TO PRACTICE WITHIN ITS TERRITORIAL LIMITS ON THE SAME 
BASIS AS THE SUBJECTS OR CITIZENS OF SAID FOREIGN 
COUNTRY OR STATE UNDER RECIPROCITY AND UNDER 
INTERNATIONAL AGREEMENTS; PROVIDED FURTHER, THAT 
SUCH FOREIGN CONTRACTOR SHALL DULY ESTABLISH ITS 
BUSINESS 
IN 
THE 
PHILIPPINES, 
AND 
SHALL 
ENSURE 
TECHNOLOGY TRANSFER AND CAPACITY BUILDING OF LOCAL 
CONTRACTORS. ”
Sec. 6. The succeeding sections of R.A. 4566 are hereby renumbered 
accordingly.
Sec. 7. Implementing Rules and Regulations. -  The Board, in conformity 
with the Authority, and in consultation with concerned sectors shall issue or


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revise implementing rules and regulations within thirty (30) days from the 
effectivity of this Act.
Sec. 8. Separability Clause. -  If any portion of this Act is declared invalid 
or unconstitutional, the portions or provisions which are not affected shall 
remain valid and subsisting.
Sec. 9. Repealing Clause. -  All laws, decrees, executive issuances, rules 
and regulations inconsistent with this Act are hereby repealed or modified 
accordingly.
Sec. 10. Effectivity. -  This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation.
Approved,