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 
November 24, 2022
5:23 pm
6375


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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 MATERIEL, 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: 
a.
Expeditious and specialized process in the acquisition of
defense materiel, systems, military facilities and installations,
and services;
b.
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;
c.
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;
d.
Self-reliant defense posture to support defense requirements
of the Department of National Defense (DND) and its bureaus
6375


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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. 
 
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: 
a. 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. 
 
b. 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. 
 
 
c. Materiel — refers to all items with military specifications that are 
necessary for the equipment, maintenance, services, operation and 
support of governmental and military activities. 
 
d. Services — refers to all defense related services. 
 
e. 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. 
 
f. Military specifications — refers to the project/product standard 
based on local/international publication recognized and/or made by 
the AFP. 


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g. Ordnance — refers to all items needed by the Navy, Air Force and 
Army defense requirements. 
h. 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. 
 
j. 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. 
 
k. 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. 
 
 
l. 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 programs 
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 jn 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. 


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6.1.1.1. For 
the 
AFP, 
the 
approving authority shall be the Chief of Staff, Armed 
Forces of the Philippines. 
6.1.1.2. For 
DND 
Civilian 
Bureaus, the approving authority shall be the Head 
Bureaus. 
6.1.1.3. 
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: 
6.2.1. 
For Foreign Suppliers. — The modes 
of payment shall be limited to Local Letters of Credit and Electronic 
Wire Transfer. 
6.2.2. 
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: 


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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 taking 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 
singlesourced 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 


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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 14. 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. 
14.1. 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. 


8 
Section 15. 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 16. 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 17. Acquisition Requirements. — The acquisition requirements shall 
be determined in accordance with the DSOM process prescribed by the SND. 
17. 1. Determination of the Mode of Acquisition. — The end user shall 
recommend the mode of acquisition for approval of the HAE. 
17.2. 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 18. Awarding of Contract. — The DAC shall recommend award of 
contract to the supplier with the Best Rated Offer. 
18.1. Contract Signing. — The HAE shall be the signing authority to 
enter into a contract with the supplier with the Best Rated Offer. 
 
Section 19. 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 20. 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 21. 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 22. 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. 


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Section 23. Security and Confidentiality. — Whenever necessary, an offeror 
or bidder may be required to sign a Non-Disclosure Agreement. 
ARTICLE VI 
SANCTIONS FOR DEFAULT 
Section 24. 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 25. 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: 
a. 1 st Blacklisting — five (5) years 
b. 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 26. 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 27. 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 28. 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 29. 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 30. 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 


10 
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 31. 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 32. 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 33. 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 34. 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 35. 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 36. 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 37. 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. 


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Section 38. 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 39. 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 40. 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 41. 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 42. 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 43. 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 
44. 
Implementing 
Rules 
and 
Regulations: 
Supplementary 
Regulations. — Within 60 days from the promulgation of this Act, the necessary rules 


12 
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 45. 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 46. Repealing Clause. —All provisions of existing laws, orders and 
regulations contrary to or inconsistent with this Act are hereby repealed or modified 
accordingly. 
Section 47. 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 48. — 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,