Republic of the Philippines
House of Representatives
Quezon City
Fifteenth Congress
First Regular Session

8500 759

House Bill No.

Introduced by Hon. RODOLFO W. ANTONINO

EXPLANATORY NOTE

The Philippine stands out as one of the few developing countries that has
created an explicit legal and regulatory frame work for Build-Operate-and
Transfer (BOT) projects. The policy toward private sector participation in
infrastructure was originally prompted by a looming power crisis in the late 1980s
and early 1990s. Executive Order No. 215, Series of 1987 abolished the
monopoly of the National Power Corporation and provided incentives for private
investors to enter the power sector, which was experiencing massive shortfalls in
generating capacity.

In 1990, the Philippine Congress enacted the first BOT law in Asia,
Republic Act No. 6957. In 1994, Congress enacted Republic Act No. 7718, which
amended RA 6957, by increasing the number of variants of BOT contractual
arrangements. Section12 of the Republic Act No. 6957, as amended by Republic
Act No. 7718, otherwise known as the BOT Law, provides that the Coordinating
Council for the Philippine Assistance Program (now the BOT Center) shall be
responsible for the coordination and monitoring of the implementation of all BOT
projects.

Since then, the BOT law has significantly increased private investment in
infrastructure in the Philippines by expanding private sector participation in
infrastructure development in sectors other than power, including ports, toll
roads, airports, and water ulilities, preventing the use of explicit government
guarantees, and limiting the use of public funds so that no more than 50 percent
of the total project cost can come through government financial institutions.

The current drive towards private sector participation and competition in
infrastructure sectors has been driven by general factors, such as high
indebtedness and stringent budget constraints limiting the public sector’s ability

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to meet increasing infrastructure needs; the expansion of international and local
capital markets, with a consequent improvement in access to private funding.

In the present Philippine economic environment, where the reality is that
the only feasible way for most infrastructure to be built is through BOT, privately
financed infrastructure projects are an important tool in meeting national
infrastructure needs. The immediacy and imperative need for BOT as a tool to
make our economy grow has been emphasized by President Gloria Macapagal-
Arroyo, herself one of the authors of the BOT Law, in her State of the Nation
Addresses.

The Medium-Term Philippine Development Plan highlights BOT as a key
policy with which to achieve the country’s economic development and growth
targets. Essential elements of national policies in BOT that investors look at
include the level of competition sought for each infrastructure sector, the way in
which each sector is structured and the mechanisms used to ensure adequate
functioning of infrastructure markets.

Points of concem to the public sector include such matters as continuity in
the provision of public services; adherence to environmental protection, health,
safety and quality standards; fairness of prices charged to the public; and the
flexibility to meet changed conditions, including expansion of the service to meet
additional demand. Points of concern to the private sector n BOT projects include
transparency of laws and regulations and predictability and impartiality in their
application; assurances that private property is respected and not interfered with
other than for reasons of public interest and only if compensation is paid; and
freedom of the parties to agree on commercial terms that ensure a reasonable
return on invested capital commensurate with the risks taken by private
investors.

This bill seeks to further amend the BOT Law. It aims to broaden and
tighten the legal and policy framework of the government to address many of
these points of concer. Specifically, this bill seeks to enunciate a clear-cut policy
on government support, adhere to best practices on risk allocation, set the
reasonable rate of retum for solicited or unsolicited or negotiated projects,
institutionalize a fair, honest and competitive procurement process, establish a
BOT Authority to rationalize the program implementation, and provide penal
provisions for violations of specific offenses enumerated herein.

In view of these compelling reasons, the immediate passage of this bill is
earnestly sought.
/

ILFO WW. ANTONINO


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Republic of the Philippines
House of Representatives
Quezon City
Fifteenth Congress
First Regular Session

sco’ 759

House Bill No.

Introduced by Hon. RODOLFO W. ANTONINO:

AN ACT CREATING THE BOT AUTHORITY,

FURTHER AMENDING REPUBLIC ACT NO. 6957, AS AMENDED BY
REPUBLIC ACT NO. 7718, ENTITLED “AN ACT AUTHORIZING THE
FINANCING, CONSTRUCTION, OPERATION AND MAINTENANCE OF
INFRASTRUCTURE PROJECTS BY THE PRIVATE SECTOR, AND FOR
OTHER PURPOSES”

Be it enacted by the Senate and House of Representative of the Philippines in
Congress Assembled:

SECTION 1. Section 1 of Republic Act No. 6957, as amended, is hereby further
amended to read as follows:
“Sec. 1. Declaration of Policies. — It is the declared policy of the State to
recognize the indispensable role of the private sector as the main engine
for national growth and development and TO provide GOVERNMENT
SUPPORT AND incentives THAT SHALL ALLOW THE PRIVATE
SECTOR TO ACHIEVE A REASONABLE RATE OR RETURN ON
ITS INVESTMENTS IN financing the construction, operation and/or
maintenance of facilities, infrastructure or development Projects normally
financed and undertaken by the Government THROUGH
COMPETITIVE AND TRANSPARENT SELECTION PROCESS.
IT IS ALSO THE POLICY OF THE GOVERNMENT TO
PROTECT THE PUBLIC INTEREST BY ENSURING FAIR AND

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REASONABLE PRICING AND TIMELY DELIVERY OF
QUALITY SERVICES UNDER THE GUIDING PRINCIPLE OF
FULL PUBLIC DISCLOSURE OF ALL TRANSACTIONS, AND
EQUITABLE RISKS ALLOCATION INHERENT IN PROJECTS
UNDERTAKEN THROUGH CONTRACTUAL ARRANGEMENTS
AUTHORIZED IN THIS ACT AND SUCH OTHER VARIATIONS
AS MAY BE APPROVED BY THE PRESIDENT OF THE
PHILIPPINES.

THE GRANT BY THE GOVERNMENT OF ANY FORM OF
SUPPORT TO THE PRIVATE PROPONENT SHALL BE
JUDICIOUSLY AND TRANSPARENTLY ARRANGED
CONSISTENT WITH THE APPROPRIATE ECONOMIC AND
TECHNICAL REGULATORY FRAMEWORKS TO ENSURE
FAITHFUL PERFORMANCE AND DELIVERY OF
CONTRACTUAL OBLIGATIONS. INCENTIVES AND
SANCTIONS, AS PROVIDED BY LAW, SHALL BE
STRINGENTLY APPLIED TO PROMOTE TIMELY
COMPLETION OF INFRASTRUCTURE FACILITIES OR
DEVELOPMENT PROJECTS.

SECTION 2. Section 2 of the same Act, as amended, is hereby further amended
to read as follows:

“See. 2. Definition of Terms. — The following terms used in this Act shall
have the meanings stated below:

“(a) Public-Private Infrastructure or Development projects — The
general description of infrastructure or development projects normally
financed and operated by the public sector but which will now be wholly
or partly implemented by the private sector, including but not limited to,
power plants, highways, ports, airports, canals, dams, hydropower
projects, water supply, irrigation, telecommunications, railroads and
railways, transport systems, land reclamation projects, industrial estates or
townships, housing, government buildings, tourism projects, markets,



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slaughterhouses, BULK GRAINS HANDLING FACILITY OR
LOGISTIC SUPPORT SYSTEM warehouses, solid waste management,
information technology networks and database infrastructure, education
and health facilities, sewerage, drainage, dredging, and other infrastructure
and development projects as may be authorized by the appropriate agency
pursuant to this Act. Such projects shall be undertaken through contractual
arrangements as defined hereunder and such other variations as may be
approved by the President of the Philippines.

For the construction stage of these infrastructure projects, the project
proponents may obtain financing from foreign and/or domestic sources
and/or engage the services of foreign and/or Filipino contractor:
Provided, That in case an infrastructure or a development facility's
operation requires a public utility franchise, the facility operator must be
Filipino or if a corporation, it must be duly registered with the Securities
and Exchange Commission and owned up to at least sixty percent (60%)
by Filipinos: Provided, further, That in the case of foreign contractors,
Filipino labor shall be employed or hired in the different phases of the
construction where Filipino skills are available: Provided, FURTHER,
That projects which would have difficulty in sourcing funds may be
financed partly from direct government appropriations and/or from
Official Development Assistance (ODA) of foreign governments or
institutions not exceeding fifty percent (50%) of the project cost, and the
balance to be provided by the project proponent. PROVIDED,
FINALLY,THAT IN CASE OF PROJECTS FINANCE PARTLY BY
ODA AN APPROPRIATE REVENUE SHARING SCHEME SHALL
BE STIPULATED IN THE CONTRACT, WHICH SHALL STATE
THAT UPON THE PROPONENT’S REALIZATION’ OF THE
AGREED RATE OF RETURN AS PROPOSED IN THE BID, THE
PROPONENT AND THE IMPLEMENTING AGENCY SHALL
SHARE THE REVENUE. THE GOVERNMENT’S SHARE SHALL
BE REMITTED TO THE NATIONAL TREASURY FOR THE
SOLE PURPOSE OF REPAYING THE SAID ODA FUND.


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“(b) Project proponent — The private sector entity which shall have
contractual responsibility for the project and which shall have an adequate
financial base to implement said project consisting of equity and A
STAND-BY LETTER OF CREDIT (SLC) ISSUED BY reputable
financial institutions to provide, upon award, sufficient AMOUNT to
cover the total estimated cost of the project.

“(c) Contractor — Any entity accredited under the laws which may or
may not be the project proponent and which shall undertake the actual
construction and/or supply of equipment for the project.

“(d) Facility operator — A company registered with the Securities and
Exchange Commission, which may or may not be the project proponent or
its subsidiary, responsible for all aspects of operation and maintenance of
the infrastructure or development facility, including but not limited to the
collection of tolls, fees, rentals or charges from facility users: Provided,
That in case the facility requires a public utility franchise, the facility
operator shall be Filipino or at least sixty per centum (60%) owned by
Filipinos.

“(e) Direct government guarantee — an agreement whereby the
government or any of its agencies or local government units assume
responsibility for the repayment of debt directly incurred by the project
proponent in implementing the project in case of a loan default OR THE
COUNTERPART FUNDING PROVIDED BY THE GOVERNMENT
OR ANY OF ITS AGENCIES OR LOCAL GOVERNMENT UNITS
IN THE CASE OF A BOT PROJECT THAT IS FINANCED
PARTLY FROM ODA, PROVIDED THAT THE INCLUSION OF
ANY DIRECT GOVERNMENT GUARANTEE IN A PROJECT
PROPOSAL SHALL RENDER THE SAME INELIGIBLE AS AN
UNSOLICITED PROPOSAL.

“() INDIRECT GOVERNMENT GUARANTEE - THIS SHALL
REFER TO AN AGREEMENT WHEREBY THE GOVERNMENT
FINANCIAL INSTITUTION (GFT) ASSUMES FULL OR PARTIAL
RESPONSIBILITY TO MAINTAIN THE FINANCIAL STANDING
OR CREDIT WORTHINESS OF THE PROJECT PROPONENT OR


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PROJECT COMPANY IN ORDER THAT THE PROJECT
COMPANY/PROPONENT AVOIDS DEFAULTING ON THE
PROJECT LOANS, SUBJECT TO FULFILLMENT OF THE
PROJECT PROPONENT/COMPANY OF ITS UNDERTAKINGS
AND OBLIGATIONS UNDER THE PROJECT AGREEMENT.

“(g) Reasonable rate of return on investments and operating and
maintenance cost ~ The rate of return that reflects the WEIGHTED
AVERAGE COST OF prevailing cost of capital in the domestic and
international markets PLUS UP TO SIX PER CENTUM (6%) AS
PRIVATE PROPONENT’S PREMIUM IN DOING BUSINESS IN
THE COUNTRY: Provided, That, in case of negotiated contracts, such
rate of return shall be determined by the BOT AUTHORITY PRIOR TO
THE NEGOTIATION AND/OR CALL FOR PROPOSALS: Provided,
further, That for negotiated contracts for public utility projects which are
monopolies, the rate of return on rate base shall be determined by existing
laws, which shall in no case exceed twelve per centum (12%).

“(h) Construction — Refers to new construction, rehabilitation,
improvement, expansion, alteration and OTHER related CIVIL works
and activities including the necessary supply of equipment, materials,
labor and services, and related items.

“() DIRECT GOVERNMENT SUBSIDY - THIS SHALL REFER
TO AN AGREEMENT WHEREBY THE GOVERNMENT, OR ANY
OF ITS AGENCIES OR LOCAL GOVERNMENT UNITS WILL
GIVE AID OR ASSISTANCE, WHETHER FINANCIAL OR
OTHERWISE, TO SUPPORT THE PRIVATE UNDERTAKING
WHICH IS FOUND TO BENEFIT THE PUBLIC.

“() GOVERNMENT EQUITY - THIS SHALL REFER TO THE
SUBSCRIPTION BY THE GOVERNMENT OR ANY OF ITS
AGENCIES OR LOCAL GOVERNMENT UNITS OF SHARES OR
OTHER SECURITIES CONVERTIBLE TO SHARES OF STOCK
OF THE PROJECT COMPANY, WHETHER SUCH
SUBSCRIPTION WILL BE PAID BY MONEY OR ASSETS.


272 “(k) CREDIT ENHANCEMENTS - THIS SHALL REFER TO

273 DIRECT AND INDIRECT SUPPORT TO A DEVELOPMENT
274 FACILITY BY THE PROJECT PROPONENT AND/OR
275 AGENCY/LGU CONCERNED, THE PROVISION OF WHICH IS
276 CONTINGENT UPON THE CONCURRENCE OF CETAIN
277 EVENTS AND/OR RISKS, SUBJECT TO THE APPROVAL OF
278 THE BOT AUTHORITY.

279 “() PROJECT COST - REFERS TO THE TOTAL COST TO BE
280 EXPENDED BY THE PROPONENT TO PLAN, DEVELOP AND
281 CONSTRUCT THE PROJECT TO COMPLETION, PLUS A
282 WORKING CAPITAL OF SIX (6) MONTHS, INCLUDING BUT
283 NOT LIMITED TO SUCH COSTS AS FEASIBILITY STUDY
284 PREPARATION, DETAILED ENGINEERING AND DESIGN,
285 CONSTRUCTION, IMPROVEMENTS, EQUIPMENT, LAND AND
286 RIGHT-OF-WAY.

287

288 SECTION 3. Section 3 of Republic Act No. 6957, as amended, is hereby further
289 amended to read as follows:

290 “Sec. 3. PRIVATE INITIATIVE IN INFRASTRUCTURE - ALL
291 NATIONAL GOVERNMENT PRIOITY INFRASTRUCTURE OR
292 DEVELOPMENT PROJECTS SHALL BE SUBMITTED TO THE
293 BOT AUTHORITY FOR APPROVAL, WHILE ALL LOCAL
294 GOVERNMENT PRIORITY INFRASTRUCTURE OR
295 DEVELOPMENT PROJECTS SHALL BE SUBMITTED TO THE
296 BOT AUTHORITY FOR INFORMATION ONLY. THE BOT
297 AUTHORITY CREATED UNDER THIS ACT SHALL BE THE
298 SOLE AND EXCLUSIVE APPROVING AUTHORITY FOR
299 NATIONAL GOVERNMENT PRIORITY INFRASTRUCTURE OR
300 DEVELOPMENT PROJECTS, THE PRESIDENT OF THE
301 PHILIPPINES OR HIS DULY AUTHORIZED REPRESENTATIVE
302 SHALL, FOR PURPOSES OF TRANSPARENCY AND
303 ACCOUNTABILITY, EXECUTE THE CONTRACT FOR AND IN

304 BEHALF OF THE REPUBLIC OF THE PHILIPPINES WITH ANY


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DULY PRE-QUALIFIED PROJECT PROPONENT FOR ALL
PROJECTS, PROVIDED, THAT THESE PROJECTS HAVE BEEN
APPROVED BY THE BOT AUTHORITY AND RECOMMENDED
BY THE PUBLIC-PRIVATE INFRASTRUCTURE COMMITTEE
CREATED UNDER THIS ACT. FOR LOCAL GOVERNMENT
PROJECTS, THE LOCAL CHIEF EXECUTIVE DULY
AUTHORIZED BY THE SANGGUNIAN MANIFESTED IN A
RESOLUTION SHALL EXECUTE THE CONTRACT. PROVIDED,
THAT THE PROJECT IS APPROVED BY THE LOCAL
DEVELOPMENT COUNCIL (LDC), AND THE SANGGUNIAN
CONCERNED. PROVIDED, FURTHER, THAT LGU PROJECTS
HAVE BEEN SUBMITTED FOR INFORMATION PURPOSES TO.
THE BOT AUTHORITY. THE BOT AUTHORITY AND THE
PUBLIC-PRIVATE INFRASTRUCTURE COMMITTEE
CREATED UNDER THIS ACT SHALL COMMENCE AND
COMPLETE THEIR REVIEW WITHIN SIXTYCALENDAR DAYS
(60) AND THEREAFTER, ISSUE A CLEARANCE MANIFESTING
COMPLIANCE WITH THE BOT LAW AND ITS IRR. PROVIDED,
FINALLY, THAT THE SUBMITTED PROJECT DOCUMENTS,
LE., FEASIBILITY STUDY, AND THE DRAFT CONTRACT ARE
COMPLIANT WITH THE REQUIREMENTS SET FORTH IN THE
BOT LAW AND ITS IRR. ANY UNDUE DELAY COMMITTED BY
THE CONCERNED REVIEWING OFFICER(S) SHALL BE
ADMINISTRATIVELY DEALT WITH IN ACCORDANCE WITH
EXISTING LAWS.”

SECTION 4. A new section to be numbered as Section 4 of the same Act, as
amended , is hereby added, to read as follows:

“Sec. 4. Contractual Arrangements -

“(a) Build-operate-and-transfer — A contractual arrangement whereby
the project proponent undertakes the construction, including
financing, of a given infrastructure facility, and the operation and
maintenance thereof. The project proponent operates the facility


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“(b)

BO}

‘over the fixed term during which it is allowed to charge facility
users appropriate tools, fees, rentals, and charges not exceeding
those proposed in its bid or as negotiated and incorporated in the
contract to enable the project proponent to recover its investment,
and operating and maintenance expenses in the project. The
project proponent transfers the facility to the government agency
or local government unit concerned at the end of the fixed term
which shall not exceed fifty (50) years. Provided, That in case of
an infrastructure or development facility whose operation requires
a public utility franchise, the proponent must be Filipino or, if a
corporation, must be duly registered with the Securities and
Exchange Commission and owned up to at least sixty percent
(60%) by Filipinos.

“The build-operate-and-transfer shall include a supply-and-operate
situation which is a contractual arrangement whereby he supplier
‘of equipment and machinery for a given infrastructure facility, if
the interest of the Government so requires, operates the facility
providing in the process technology transfer and training to
Filipino nationals.

Build-and-transfer — A contractual arrangement whereby the
Project proponent undertakes the financing and construction of a
given infrastructure or development facility and after its
completion turns it over to the government agency or local
government unit concerned, which shall pay the proponent on an
agreed schedule its total investments expended on the project, plus
a reasonable rate of return thereon. This arrangement may be
employed in the construction of any infrastructure or development
project, including critical facilities which, for security or strategic
reasons, must be operated directly by the Government.
Build-own-and-operate — A contractual arrangement whereby a
project proponent is authorized to finance, construct, own, operate
and maintain an infrastructure or development facility from which
the proponent is allowed to recover its total investment, operating

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“@)

“©

“O

“(e)

and maintenance costs plus a reasonable return thereon by
collecting tolls, fees, rentals or other charges from facility users:
Provided, That all such projects, upon recommendation of the
Investment Coordination Committee (ICC) of the National
Economic and Development Authority (NEDA), shall be approved
by the President of the Philippines. Under this project, the
proponent which owns the assets of the facility may assign its
operation and maintenance to a facility operator.

Build-lease-and transfer — A contractual arrangement whereby a
project proponent is authorized to finance and construct an
infrastructure of development facility and upon its completion
tums it over to the government agency or local government unit
concerned on a lease arrangement for a fixed period after which
ownership of the facility is automatically transferred to the
government agency or local government unit concerned.
Build-transfer-and-operate — A contractual arrangement whereby
the public sector contracts out the building of an infrastructure
facility to a private entity such that the contractor builds the facility
on a turn-key basis, assuming cost overrun, delay, and specified
performance risks.

“Once the facility is commissioned satisfactorily, title is
transferred to the implementing agency. The private entity
however, operates the facility on behalf of the implementing
agency under an arrangement.

Contract-add-and-operate - A contractual arrangement whereby
the project proponent adds to an existing infrastructure facility
which it is renting from the government. It operates the expanded
project over an agreement franchise period. There may, or may not
be, a transfer arrangement in regard to the facility.
Develop-operate-and-transfer — A contractual arrangement
whereby favorable conditions external to a new infrastructure
project which is to be built by a private project proponent are


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integrated into the arrangement by giving that entity the right to
develop adjoining property, and thus, enjoy some of the benefits
the investment creates such as higher property or rent values.
Rehabilitate-operate-and-transfer — A contractual arrangement
whereby an existing facility is turned over to the private sector to
refurbish, operate and maintain for a franchise period, at the expiry
of which the legal title to the facility is tumed over to the
government. The terms also used to describe the purchase of an
existing facility from abroad, importing, refurbishing, erecting and
consuming it within the host country.
Rehabilitate-own-and-operate - A contractual arrangement
whereby an existing facility is turned over to the private sector to
refurbish and operate with no time limitation imposed on
ownership. As long as the operator is not in violation of its
franchise, it can continue to operate the facility in perpetuity.
CONCESSION —- A CONTRACTUAL ARRANGEMENT
WHEREBY THE PROPONENT UNDERTAKES THE
FINANCING AND CONSTRUCTION OF A NEW
FACILITY AND/OR REHABILITAION OF AN EXISTING
FACILITY AFTER THE TURNOVER THEREOF BY THE
TA/LGU, AND INCLUDES THE OPERATION,
MAINTENANCE, MANAGEMENT AND IMPROVEMENT,
IF ANY, OF THE FACILITY FOR A FIXED TERM
DURING WHICH THE PROJECT PROPONENT
GENERALLY PROVIDES SERVICE DIRECTLY TO
FACILITY USERS AND IS ALLOWD TO CHARGE AND
COLLECT THE APPROVED TOLLS, FEES, TARIFFS,
RENTALS OR CHARGES. THE IA/LGU MAY RECEIVE A
CONCESSION OR FRANCHISE FEE DURING THE TERM
OF THE CONTRACT AND/OR OTHER CONSIDERATION
FOR THE TRANSFER, OPERATION OR USE OF ANY
FACILITY. THERE MAY OR MAY NOT BE A TRANSFER

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ARRANGEMENT FOR THE FACILITY AFTER THE
‘CONCESSION PERIOD HAS ENDED.

“(k) JOINT VENTURE - A CONTRACTUAL ARRANGEMENT

“oO

“(m)

WHEREBY THE PROJECT PROPONENT AND THE
IA/LGU CONTRIBUTE ASSETS OR OTHER LEGAL
CONSIDERATION AND SHARE RISKS TO JOINTLY
UNDERTAKE THE FINANCING (UP TO THE EXTENT
ALLOWED UNDER THIS ACT), CONSTRUCTION,
REHABILITATION, AND/OR OPERATION,
MAINTENANCE AND MANAGEMENT OF A NEW
AND/OR EXISTING FACILITY, IT INVOLVES A
COMMUNITY OR POOLING OF INTERESTS IN THE
PERFORMANCE OF THE SERVICE, FUNCTION,
BUSINESS OR ACTIVITY, WITH EACH PARTY HAVING
A RIGHT TO DIRECT AND GOVERN THE POLICY IN
CONNECTION THEREWITH AND WITH A VIEW TO
SHARING BOTH PROFITS AND LOSSES, SUBJECT TO
AGREEMENT BY THE PARTIES.

MANAGEMENT OR SERVICE CONTRACT - A
CONTRACTUAL ARRANGEMENT INVOLVING THE
MANAGEMENT OR PROVISION BY THE PROJECT
PROPONENT OR OPERATION AND MAINTENANCE OF
RELATED SERVICES FOR A LIMITED PERIOD TO AN
EXISTING INFRASTRUCTURE OR DEVELOPMENT
FACILITY OWNED OR OPERATED BY THE IA/LGU.
THE PROJECT PROPONENT RECEIVES A
MANAGEMENT OR SERVICE FEE DURING THE
CONTRACT TERM.

LEASE OR AFFIRMAGE - A CONTRACTUAL
ARRANGEMENT PROVIDING FOR OPERATION,
MAINTENANCE, AND MANAGEMENT SERVICES BY
THE PROJECT PROPONENT INCLUDING WORKING
CAPITAL AND/OR IMPROVEMENTS TO AN EXISTING

H


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INFRASTRUCTURE OR DEVELOPMENT FACILITY
LEASED BY SAID PROPONENT FROM THE IA/LGU FOR
A FIXED TERM. THEN PROJECT PROPONENT PAYS
THE IA/LGU A RENTAL FEE AND RECEIVES THE
APPROVED TOLLS, FEES, RENTALS OR CHARGES
FROM FACILITY USERS, IT MAY OR MAY NOT HAVE A
PURCHSE OPTION AT THE END OF THE LEASE
PERIOD. IF SUCH ARRANGEMENT CONSTITUTES
FINANCIAL LEASING UNDER SPECIAL LAWS, IT
SHALL BE APPROVED BY THE CONCERNED
GOVERNMENT AGENCIES IN ACCORDANCE WITH
SAID LAWS.”

SECTION 5. Section 4 of the same Act, as amended, is hereby renumbered as
Section 5 and further amended to read as follows:

“Sec. 5. Priority Projects. — All concerned government agencies,
including government-owned and -controlled corporations and local
government units, shall include in their development programs those
priority projects that may be financed, constructed, operated and
maintained by the private sector under the provisions of this Act. It shall
be the duty of all concemed government agencies AND LOCAL
GOVERNMENT UNITS to SUBMIT TO THE BUILD-OPERATE-
AND TRANSFER (BOT) AUTHORITY LIST OF PROJECTS
ELIGIBLE FOR FINANCING UNDER THIS ACT FOR
CENTRALIZED PUBLICATION AND ROAD SHOW
PRESENTATION ABROAD.

THE BOT AUTHORITY AND THE PUBLIC - PRIVATE
INFRASTRUCTURE COMMITTEE CREATED UNDER THIS ACT
SHALL, WITHIN THE MANDATORY PERIOD OF SIXTY
CALENDAR DAYS (60) COMPLETE ITS REVIEW AND
THEREAFTER, ISSUE A CLEARANCE MANIFESTING
COMPLIANCE OF THE BOT LAW IRR. FAILURE TO ACT


500 WITHIN THE PRESCRIBED PERIOD THE SAME SHALL BE

501 DEEMED APPROVED.”
502

503 SECTION 6. Section 4-A of Republic Act No. 6957, as amended, is hereby
504 renumbered as Section 5-A and further amended to read as follows:

505 “Sec.5-A. Unsolicited Proposals. — Unsolicited proposals for
506 projects may be accepted by any government agency or local government
507 unit, WHICH SHALL BE FORWARDED TO THE BOT
508 AUTHORITY FOR APPROPRIATE ACTION WITHIN FIFTEEN
509 (15) WORKING DAYS UPON RECEIPT THEREOF: PROVIDED,
510 THAT NO DIRECT GOVERNMENT GUARANTEE, SUBSIDY OR
su EQUITY IS REQUIRED: PROVIDED FURTHER, THAT THE
512 UNSOLICITED PROPOSAL SHALL BE SUBJECT TO OPEN
513 COMPARATIVE OR COMPETITIVE TENDER PROCESS. A
514 PERIOD OF FORTY-FIVE (45) TO ONE HUNDRED TWENTY
515 (120) DAYS MAY BE PRESCRIBED FOR THE PREPARATION
516 OF COMPARATIVE OR COMPETITIVE PROPOSALS.

517 “PROVIDED, FINALLY, THAT IN THE EVENT THAT THE
518 CONTRACT IS AWARDED TO A CHALLENGER WHICH
519 SUBMITS A LOWER PRICE PROPOSAL, THE FORMER SHALL
520 REIMBURSE THE ACTUAL DEVELOPMENT COST EXPENDED
521 BY THE ORIGINAL PROPONENT ON THE PROJECT WHICH
522 SHALL BE DISCLOSED DURING THE COMPARATIVE OR
523 COMPETITIVE TENDER PROCESS.”

524

525 SECTION 7. Section 5 of the same Act, as amended, is hereby renumbered as
526 Section 6 and further amended to read as follows:

527 “Sec. 6. Public Bidding of Projects. - Upon approval of the subjects
528 mentioned in Section 5 of this Act, the head of the BOT AUTHORITY,
529 FOR NATIONAL INFRASTRUCTURE OR DEVELOPMENT
530 PROJECTS, SHALL FORTHWITH CAUSE TO BE PUBLISHED,

S31 ONCE EVERY WEEK FOR THREE (3) CONSECUTIVE WEEKS,
532


533
534
535
536
537
538
539
540
S41
542
543
544
545

_ 546
547
548
549
550

552
553
554
555
556
S57)
558
559
560
561
562
563
564
565

IN AT LEAST TWO (2) NEWSPAPERS OF GENERAL
CIRCULATION AND IN AT LEAST ONE (1) LOCAL
NEWSPAPER WHICH IS CIRCULATED IN THE REGION,
PROVINCE, CITY OR MUNICIPALITY IN WHICH THE
PROJECT IS TO BE CONSTRUCTED, A NOTICE INVITING ALL
PROSPECTIVE INFRASTRUCTURE OR DEVELOPMENT
PROJECT PROPONENTS TO PARTICIPATE IN A
COMPETETIVE PUBLIC BIDDING FOR THE PROJECTS SO
APPROVED. FOR LGU PROJECTS, THE LOCAL CHIEF
EXECUTIVE SHALL FORTHWITH CAUSE TO BE PUBLISHED,
ONCE EVERY WEEK FOR THREE (3) CONSECUTIVE WEEKS,
IN AT LEAST TWO (2) NEWSPAPERS OF GENERAL
CIRCULATION AND IN AT LEAST ONE (1) LOCAL
NEWSPAPER, A NOTICE INVITING ALL PROSPECTIVE
INFRASTRUCTURE OR DEVELOPMENT PROJECT
PROPONENTS TO PARTICIPATE IN A COMPETETIVE PUBLIC
BIDDING FOR THE PROJECTS SO APPROVED.

“In the case of a build-operate-and-transfer arrangement, the contract shall
be awarded to the bidder who, having satisfied the minimum financial,
technical, organizational and legal standards required by this Act, has
submitted the lowest bid and most favorable terms for the project, based
on the present value of its proposed tolls, fees, rentals and charges over a
fixed term for the facility to be constructed, rehabilitated, operated and
maintained according to the prescribed minimum design and performance
standards, plans and specifications. For this purpose, the winning project
proponent shall be automatically granted by the appropriate agency the
franchise to operate and maintain the facility, including the collection of
tolls, fee, rentals, and charges in accordance with Section 6 hereof.

“In the case of a  build-and-transfer or build-lease-and-transfer
arrangement, the contract shall be awarded to the lowest applying bidder
base on the present value of its proposed schedule of amortization
Payments for the facility to be constructed according to the prescribed
minimum design and performance standards, plans and specifications:

16


566
567
568
569
570
S71
Siz.
573
574
S75
576
577
578
579
580
581
582
583
584
585
586
587
588
589
590
591
592
593
594
595

Provided, however, That a Filipino contractor who submits an equally
advantageous bid with exactly the same price and technical specifications
as those of a foreign contractor shall be given preference

“In all cases, a consortium that participates in a bid must present proof that
the members of the consortium have bound themselves jointly and
severally to assume responsibility for any project. The withdrawal of any
member of the consortium prior to the implementation of the project could
be a ground for the cancellation of the contract.

“The public bidding must be conducted under a two-envelope/two-stage
system: the first envelope to contain the technical proposal and the second
envelope to contain the financial proposal. The procedures for this system
shall be outlined in the implementing rules and regulations of this Act.

“A copy of a duly executed contract involving a project entered into under
this Act shall forthwith be submitted by the Implementing Agency or
Local Government Unit to Congress and BOT Authority for its
information.”

SECTION 8. Section 5-A of the same Act, as amended, is hereby renumbered as
Section 6-A and further amended to read as follows:

“Sec. 6-A. Direct Negotiation of Contracts. — Direct negotiation
shall be resorted to when there is only one complying bidder left as
defined hereunder:

“(a) _ Ifafler advertisement, only one bidder applies for pre-qualification
and it meets the pre-qualification requirements, after which it is
required to submit a bid/proposal which is subsequently found by
the agency/local government unit (LGU) to be complying.

“(b) If, after advertisement, more than one bidder applied for pre-
qualification but only one meets the prequalification requirements,
after which it submits bid/proposal which is found by the
agency/LGU to be complying.


596
597
598
599

601
602
603
604
605
606
607
608
609
610
61
612
613
614
615
616
617
618
619
620
621
622
623
624
625
626
627
628

“(©) If, after pre-qualification of more than one bidder, only one
submits a bid which is found by the agency/LGU to be complying.

“(4) If, after pre-qualification, more than one bidder submit bids but
only one is found by the agency/LGU to be complying: Provided,
That, any of the disqualified prospective bidder may appeal the
decision of the implementing agency/LGUs Pre-qualification Bids
and Awards Committee within fifteen (15) working days to the
head of the agency, in case of national projects; to the
CONCERNED LOCAL CHIEF EXECUTIVE, in case of local
projects, from the date the disqualification was made known to the
disqualified bidder: Provided, furthermore, That the implementing
agency concerned or CONCERNED LOCAL CHIEF
EXECUTIVE concerned should act on the appeal within seven (7)
calendar days from receipt thereof.”

SECTION 9. Section 6 of the same Act, as amended, is hereby renumbered as
Section 7 to read as follows:

“See. 7. Repayment Scheme — For the financing, construction,
operation and maintenance of any infrastructure projects undertaken
through the build-operate-and-transfer arrangement or any of its variations
pursuant to the provisions of this Act, the project proponent shall be repaid
by authorizing it to charge and effect reasonable tolls, fees, and rentals for
the use of the project facility not exceeding those incorporated in the
contract and, where applicable, the proponent may likewise be repaid in
the form of a share in the revenue of the project or other non-monetary
payments, such as, but not limited to, the grant of a portion or percentage
of the reclaimed land, subject to the constitutional requirements with
respect to the ownership of land: Provided, That for negotiated contracts,
and for projects which have been granted a natural monopoly or where the
public has no access to alternative facilities, the appropriate government
regulatory bodies, shall approve the tolls, fees, rentals, and charges based
on a reasonable rate of return: Provided, further, That the imposition and
collection of tolls, fees, rentals, and charges shall be for a fixed term as

18


629
630
631
632
633
634
635
636
637
638
639
640
641
642
643
644
645
646
647
648
649
650
651
652
653
654
655
656
657
658
659
660
661

proposed in the bid and incorporated in the contract but in no case shall
this term exceed fifty (50) years: Provided, furthermore, That the tolls,
fees, rentals, and charges may be subject to adjustment during the life of
the contract, based on a predetermined formula using official price indices
and included in the instructions to bidders and in the contract: Provided,
also, That all tolls, fees, rentals, and charges and adjustments thereof shall
take into account the reasonableness of said rates to the end-users of
private sector-built infrastructure: Provided, finally, That during the
lifetime of the franchise, the project proponent shall undertake the
necessary maintenance and repair of the facility in accordance with
standards prescribed in the bidding documents and in the contract. In the
case of a built-and-transfer arrangement, the repayment scheme is to be
effected through amortization payments by the government agency or
local government unit concerned to the project proponent according to the
scheme proposed in the bid and incorporated in the contract.”

SECTION 10. A new section to be numbered as Section 8 of the same Act, as
amended, is hereby added to read as follows:

“See. 8. PROJECT DEVELOPMENT FACILITY. - THERE IS
HEREBY CREATED A PROJECT DEVELOPMENT FACILITY
(PDF) THAT SHALL SERVE AND BE OPERATED AS A
REVOLVING FUND TO FINANCE THE PROPER
IDENTIFICATION, STUDY, VALIDATION, DEVELOPMENT,
AND PREPARATION FOR PUBLIC BIDDING OR OTHER
COMPETITIVE PROCESS, OF PRIVATE SECTOR
INFRASTRUCTURE OR DEVELOPMENT PROJECTS
IMPLEMENTED UNDER THIS ACT OR OTHER LAWS. THE
PDF SHALL BE ADMINISTERED BY AN INTER-AGENCY
STEERING COMMITTEE UNDER THE BOT AUTHORITY, AND
SHALL BE SUBJECT TO THE CONDITIONS PRESCRIBED BY
LAW ON REVOLVING FUNDS AND OTHER APPLICABLE
GOVERNMENT RULES AND REGULATIONS.”


662 SECTION 11. Section 7 of the same Act, as amended, is hereby renumbered as
663 Section 9 and further amended to read as follows:

664 “Sec. 9. CONTRACT TERMINATION. - IN THE EVENT THAT A
665 CONTRACT IS TERMINATED THROUGH NO FAULT ON THE
666 PART OF THE PROJECT PROPONENT, THE GOVERNMENT
667 SHALL COMPENSATE THE SAID PROJECT PROPONENT FOR
668 ITS ACTUAL EXPENSES INCURRED IN THE PROJECT PLUS A
669 REASONABLE RATE OF RETURN NOT EXCEEDING THAT
670 STATED IN THE CONTRACT AS OF THE DATE OF SUCH
671 TERMINATION.

672 “IN THE EVENT THAT THE PROJECT PROPONENT
673 DEFAULTS ON CERTAIN MAJOR OBLIGATIONS IN THE
674 CONTRACT AND SUCH FAILURE IS NOT REMEDIABLE OR IF
675 REMEDIABLE SHALL REMAIN UNREMEDIED FOR AN
676 UNRESONABLE LENGTH OF TIME, THE GOVERNMENT MAY,
677 BY PRIOR NOTICE TO THE PROJECT PROPONENT,
678 TERMINATE THE CONTRACT. THE GOVERNMENT SHALL
679 CALL ON THE PERFORMANCE SECURITY POSTED BY THE
680 PROJECT PROPONENT AS PROVIDED FOR IN THE
681 CONTRACT.”

682

683 SECTION 12. Section 8 of the same Act, as amended, is hereby renumbered as
684 — Section 10 to read as follows:

685 “Sec. 10. Regulatory Boards. — The Toll Regulatory Board which
686 was created by Presidential Decree No. 1122 is hereby attached to the
687 BOT AUTHORITY WITH THE DIRECTOR-GENERAL AS
688 CHAIRMAN.”

689

690 SECTION 13. Section 10 of the same Act, as amended is hereby renumbered as
691 — Section 11 to read as follows:

692 “See. 11. Investments Incentives. — Among other incentives,

693 projects in excess of One billion pesos (P1,000,000,000) shall be entitled

20


694
695
696
697
698
699
700
701
702
703
704
705
706
707
708
709
710
m1
712
713
714
715
716
737
718
719
720
721
722
723
724
725,

to incentives as provided by the Omnibus Investments Code, upon
registration with the Board of Investments.”

SECTION 14. A new section to be numbered as Section 12 of the same Act, as
amended, is hereby further added to read as follows:

“Sec. 13. WARRANTY TO UPHOLD THE VALIDITY OF THE
CONTRACT. — THE REPUBLIC OF THE PHILIPPINES OR
LOCAL GOVERNMENT UNITS SHALL BE BOUND TO UPHOLD
THE VALIDITY AND ENFORCEABILITY OF A DULY
EXECUTED CONTRACT, UNLESS PROVEN OTHERWISE. IN
THE EVENT OF A CHANGE OF ADMINISTRATION, THE
PRESIDENT OF THE PHILIPPINES OR LOCAL CHIEF
EXECUTIVE MAY INQUIRE AND REVIEW THE TERMS AND
CONDITIONS SET FORTH IN THE SUBSISTING CONTRACT,
AND IF IT CAN BE FOUND THAT THE PROCESSES LAID
DOWN IN THIS ACT AND ITS IRR ARE NOT COMPLIED, THE
PRESIDENT, UPON RECOMMENDATION OF THE CHIEF
LEGAL COUNSEL OR THE CHIEF LOCAL EXECUTIVE SHALL
CAUSE THE RESCISSION OF THE AGREEMENT.

SECTION 15. Section 11 of the same Act, as amended, is hereby
renumbered as Section 13 and further amended to read as follows:

“Sec. 13. Implementing Rules and Regulations. — A committee
‘composed of one (1) representative each from the Department of Public
Works and Highways, the Department of Transportation and
Communications, the Department of Energy, the Department of
Environment and Natural Resources, the Department of Agriculture, the
Department of Trade and Industry, the Department of Finance, the
Department of the Interior and Local Government, the National Economic
and Development Authority, the BUILD-OPERATE-AND-TRANSFER
(BOT) AUTHORITY, and other concerned government agencies shall,
within sixty (60) days from the effectivity of this Act, formulate and

21


726
RI
728
729
730
731
732
733
734
735
736

738
739
740
TAL
742
743
744
745,
746
747
748
749
750
751
752
753
754
755

prescribe, after public hearing and publication as required by law, the
implementing rules and regulations including, among others, the criteria
and guidelines for evaluation of bid proposals, list of financial incentives
and arrangements that the Government may provide for the project, in
order to carry out the provisions of this Act in the most expeditious
‘manner.

“The Chairman of this committee shall be appointed by the President of
the Philippines from its members.

“From time to time the committee may conduct, formulate and prescribe,
after due public hearing and publication, amendments to the implementing
rules and regulations, consistent with the provisions of this Act.”

SECTION 16. A new section to be numbered as Section 14 of the same Act, as
amended, is hereby further added to read as follows:

“Sec. 14.0 - PUBLIC-PRIVATE INFRASTRUCTURE
DEVELOPMENT COMMITTEE. - THE PUBLIC-PRIVATE
INFRASTRUCTURE DEVELOPMENT COMMITTEE
(HEREINAFTER REFERRED TO AS THE COMMITTEE) SHALL
BE CREATED AS A POLICY-MAKING BODY TO PERFORM
THE FOLLOWING FUNCTIONS:

1. FORMULATE MAJOR POLICIES IN REGARD TO
PRIVATE SECTOR INVESTMENTS IN
INFRASTRUCTURE;

2. ESTABLISH AND MODIFY THE ANNUAL, MEDIUM AND
LONG TERM INFRASTRUCTURE PLANS FOR PRIVATE
SECTOR PARTICIPATION;

3. ESTABLISH AND MODIFY THE INSTRUCTION FOR
PROPOSAL FOR PRIVATE PARTICIPATION IN
INFRASTRUCTURE PROJECTS / DEVELOPMENT

2


756
757
758
759
760
761
762
763
764
765
7166
167
768
769
770
™
772
773
774
775
716
777
778
779
780
781
782
783
784

786
787

FACILITIES WHICH MEET THE REQUIREMENTS AS
PRESCRIBED BY THIS ACT: AND
4. PROMOTE PRIVATE INVESTMENT PROJECTS

14.1.- COMPOSITION AND OPERATION OF THE BOARD

THE BOARD SHALL BE HEADED BY THE PRESIDENT OF
THE PHILIPPINES AS EX OFFICIO CHAIRMAN; CO-CHAIRED BY
THE NEDA SECRETARY AND THE BOT AUTHORITY DIRECTOR-
GENERAL, AND COMPOSED OF FOURTEEN (14) MEMBERS AS
FOLLOWS: THE SECRETARIES OR THEIR REPRESENTATIVES
OF THE DBM, DILG, DA, DPWH, DENR, DTI, AND DOJ; THE
PRESIDENTS OF THE LEAGUE OF PROVINCIAL GOVERNORS,
THE LEAGUE OF CITY MAYORS, AND THE LEAGUE OF
MUNICIPAL MAYORS, PRESIDENT OF THE PHILIPPINE STOCK
EXCHANGE, REPRESENTATIVE OF THE BANGKO SENTRAL NG
PHILIPPINES, CHAIRMAN OF THE COMMISSION ON AUDIT,
PRESIDENT OF THE BANKERS ASSOCIATION OF THE
PHILIPPINES, NATIONAL PRESIDENT OF THE FEDERATION OF
CHAMBER OF COMMERCE AND INDUSTRY, AND PRESIDENT OF
THE PHILIPPINE CONTRACTORS ASSOCIATION,

1. THE BOARD SHALL TRANSMIT TO THE BOT
AUTHORITY THE APPROVED POLICY AND
PROGRAM FOR PRIVATE SECTOR PARTICIPATION;
AND,

2. THE FUNDS FOR THE OPERATION OF THE BOARD
SHALL BE TAKEN FROM THE BUDGET OF THE BOT
AUTHORITY.

14.2 CONVERSION OF THE BOT CENTER TO BOT
AUTHORITY

1. THE BOT CENTER, AN AGENCY CURRENTLY
ATTACHED TO THE DEPARTMENT OF TRADE AND

23


788
789
790
791
792
793
794
795
7196
797
798
799
800
801
802
803
804
805
806
807
808
809
810
8il
812
813
814
815
816
817
818
819
820

INDUSTRY (DTI) PURSUANT TO EO 144,S.2002, SHALL
BE CONVERTED INTO THE BUILD-OPERATE-AND-
TRANSFER (BOT) AUTHORITY (HEREINAFTER
REFERRED TO AS THE “AUTHORITY”) AND ITS
ATTACHMENT IS HEREBY REVERTED TO THE
OFFICE OF THE PRESIDENT, FOR EFFECTIVE
PROGRAM IMPLEMENTATION.

THE BOT AUTHORITY SHALL ACT AS THE CENTRAL
BODY OF THE GOVERNMENT FOR ALL BOT/PSP
PROJECTS.

2. HEAD QUARTERS. —- THE HEAD QUARTERS OF THE
BOT AUTHORITY SHALL BE AT THE EDPC BUILDING,
BSP COMPLEX, A. MABINI STREET, MALATE,
MANILA, UNTIL SUCH TIME THAT THE BOT
AUTHORITY BE PROVIDED WITH SUFFICIENT FUNDS
FOR THE CONSTRUCTION OF ITS PERMANENT
PREMISES AND HEADQUARTERS UNDER THE GAA.

3. CONSTITUTION OF THE AUTHORITY. - THE
AUTHORITY SHALL BE HEADED BY A DIRECTOR-
GENERAL, WHO SHALL BE APPOINTED BY THE
PRESIDENT OF THE PHILIPPINES. THE DIRECTOR-
GENERAL SHALL BE ASSISTED BY TWO DEPUTY
DIRECTOR-GENERALS, ONE EACH FOR TECHNICAL
SERVICES; AND FOR ADMINISTRATION, FINANCE
AND OPERATIONS. THE PRESENT
ORGANIZATIONAL STRUCTURE AND PERSONNEL
COMPLEMENT OF THE BOT CENTER UNDER
EXECUTIVE ORDER NO. 144, SERIES OF 2002 SHALL
BE ABSORBED AUTOMATICALLY INTO THE BOT
AUTHORITY SUBJECT TO CIVIL SERVICE RULES AND
REGULATIONS.

4. BUDGET. — THE INITIAL ANNUAL BUDGET FOR THE
OPERATIONS OF THE AUTHORITY IS PESOS: FOUR

24


821
822
823
824
825
826
827
828
829
830
831
832
833
834
835,
836
837
838
839
840
841
842
843
844
845
846
847
848
849
850
851
852

HUNDRED EIGHTY MILLION (PHP 480,000,000.00)
WHICH WILL BE TAKEN FROM THE GAA.

5. ESTABLISHMENT OF REGIONAL OFFICES. - THE
AUTHORITY SHALL ESTABLISH REGIONAL OFFICE
IN LUZON, VISAYAS AND MINDANAO.

6. ACCOUNTS AND AUDIT. - THE ACCOUNTS OF THE
AUTHORITY SHALL BE PREPARED AND
MAINTAINED IN ACCORDANCE WITH GOVERNMENT
ACCOUNTING AND AUDITING RULES AND
PROCEDURES.

7. APPROVAL AND RECOMMENTATION BY THE
AUTHORITY. - ALL PROJECT PROPOSALS AND
CONTRACTS INVOLVING CONTRACTUAL
ARRANGEMENTS PROPOSED TO BE IMPLEMENTED
UNDER THIS LAW SHALL BE SUBMITTED BY
NATIONAL GOVERNMENT IMPLEMENTING
AGENCIES AND LGUS TO THE BOT AUTHORITY. THE
BOT AUTHORITY SHALL BE THE SOLE AND
EXCLUSIVE APPROVING AUTHORITY FOR BOT/PSP
PROJECTS FOR NATIONAL GOVERNMENT
AGENCIES AND SHALL BE RECOMMENDATORY FOR
BOT/PSP PROJECTS OF LGUS.

8. ONE-STOP SHOP. - THE AUTHORITY SHALL
ESTABLISH A ONE-STOP SHOP FOR INVESTORS TO
PROCURE ANY AND ALL NATIONAL GOVERNMENT
LICENSES, PERMITS AND APPROVALS, OF
WHATSOEVER NATURE AND DESCRIPTION, FOR
BOT/PSP projects, HOUSED WITHIN AND OPERATED
BY THE BOT CENTER. THERE SHALL ALSO BE
WITHIN THE ONE-STOP SHOP, REGIONAL DESKS
CONTAINING COMPREHENSIVE LISTINGS, CHECK-
LISTS AND FORMS OF SUCH LGU LICENSES,

25


854
855
856
857
858
859
860
861
862
863
864
865
866
867
868
869
870
871
872
873
874
875
876
877
878
879
880
881
882
883
884

PERMITS AND APPROVALS AS MAY BE REQUIRED BY
EACH LGU.

9. COORDINATION AND MONITORING OF PROJECTS. —

THE AUTHORITY SHALL COORDINATE, MONITOR
AND FACILITATE THE IMPLEMENTATION OF ALL
PROJECTS WITH CONTRACTUAL ARRANGEMENTTS
COVERED BY THIS ACT.
AT THE END OF EVERY CALENDAR YEAR, THE BOT
AUTHORITY SHALL REPORT TO THE PRESIDENT AND
TO CONGRESS ON THE PROGRESS OF THE
IMPLEMENTATION OF ALL PROJECTS WITH
CONTRACTUAL ARRANGEMENTTS COVERED BY THIS
ACT.

14.3 PENAL PROVISIONS

1, A PERSON WHO FALLS UNDER ANY OF THE
FOLLOWING SUBPARAGRAPH SHALL BE PUNISHED IN
ACCORDANCE WITH THE APPLICABLE PROVISIONS
OF THE REVISED PENAL CODE, R.A. NO. 3019, AS
AMENDED, AND R.A. NO. 6713

2, MISREPRESENTATION. - A PERSON WHO, IN
BEHALF OF THE PROJECT COMPANY, REPRESENTS
AND WARRANTS THAT IT HAS THE NECESSARY
CAPITALIZATION TO COMMENCE WORK OR THE
PROJECT WITH IN THIRTY (30) DAYS FROM NOTICE
TO PROCEED WHICH TURN OUT TO BE FALSE IN
MATERIAL RESPECT;

3. CONTRACT FALSIFICATION. - ANY PERSON,
REPRESENTING FOR AND IN BEHALF OF THE BOT
AUTHORITY OR NATIONAL GOVERNMENT
AGENCIES OR LOCAL GOVERNMENT UNITS FOUND
TO HAVE COOPERATED, CONSPIRED, OR COLLUDED
WITH THE PRIVATE PROPONENT TO CAUSE THE

26


885
886
887
888
889
890
891
892
893
894
895
896
897
898
899
900
901
902
903
904
905
906
907
908
909
910
911
912
913,
914

144
SECTION 18.
renumbered as

INSERTION OF CERTAIN PROVISION(S) IN THE FINAL
BOT ARRANGEMENT/CONTRACT, WHICH IN EFFECT,
MADE THE AGREEMENT/CONTRACT MATERIALLY
AND SUBSTANTIALLY DIFFERENT FROM THE
APPROVED DRAFT BOT AGREEMENT/CONTRACT BY
THE LOCAL SANGGUNIAN OR THE BOT AUTHORITY,
WHICHEVER IS APPLICABLE, WHICH FORM A PART
OF THE AGENCY’S/LGU’S REQUEST FOR PROPOSAL
(RFP) FOR SOLICITED PROJECT OR REQUEST FOR
COMPARATIVE PROPOSAL (RCP) FOR UNSOLICITED
PROJECT.

ANY OFFICER OF THE BOT AUTHORITY WHO IS
FOUND TO HAVE EXTENDED ANY FORM OF
ASSISTANCE TO A PRE-QUALIFIED BIDDER OF A
PARTICULAR PROJECT, SPECIFICALLY IN THE
PREPARATION OF THE BIDDER’S TECHNICAL AND
FINANCIAL PROPOSALS FOR PUBLICLY BID
PROJECT, AND ASSISTANCE TO THE PROJECT
PROPONENT IN CRAFTING PROPOSED MATERIAL
AND SUBSTANTIAL AMENDMENT(S) TO THE DULY

EXECUTED ‘CONCESSION AGREEMENT/BOT
CONTRACT.
MISCELLANEOUS PROVISION

FEES. THE AUTHORITY IS HEREBY AUTHORIZED TO
CHARGE APPROPRIATE FEES AS MAY BE PROVIDED
FOR UNDER THE IMPLEMENTING RULES AND
REGULATIONS OF THIS LAW.

Section 13 of the same Act, as amended, is hereby
Section &. to read as follows:

27


915
916
917
O18
919
920
921
922
923
924
925
926
927
928

“Sec. 15. Repealing Clause. — All laws or parts of any law inconsistent
with the provisions of this Act are hereby repealed or modified
accordingly.”

SECTION 19. Section 14 of the same Act, as amended, is hereby renumbered as
Section 16 to read as follows:
“Sec. 16. Separability Clause. — If any provision of this Act is held
invalid, the other provisions not affected thereby shall continue in
operation.”

SECTION 20. Section 15 of the same Act, as amended, is hereby renumbered as
Section 17 to read as follows:
“Sec. 19. Effectivity Clause, — This Act shall take effect fifteen (15) days
after its publication in at least two (2) newspapers of general circulation.”

28