QuestionsQuestions (MEMORANDUM ORDER NO. 171)
Memorandum Order No. 171 derives authority from the President’s powers vested by law, and it is implemented in the context of RA 9184’s Section 75, which directs the Government Procurement Policy Board (GPPB) to formulate the IRR-A. The amendment was also favorably endorsed by GPPB via Resolution No. 013-2004.
It amends Section 23.11.2 No. 3 of the IRR-A of RA 9184 by revising the rule on the value of the prospective bidder’s largest single completed contract, including an exception related to Small A and Small B categories and the use of ARCC.
The value of the prospective bidder’s largest single completed contract, adjusted to current prices using the National Statistics Office (NSO) consumer price indices available at the G-EPS website, and similar to the contract to be bid, must be at least fifty percent (50%) of the approved budget for the contract to be bid.
It explains the need to adjust the rule because the joint congressional oversight participation in formulation of the IRR was declared unconstitutional by the Supreme Court, thereby necessitating revisions in the procurement regulatory process and/or content.
If the contractor belongs to Small A or Small B categories and has no similar experience on the contract to be bid, the contractor may still be allowed to bid if the cost of such contract is more than fifty percent (50%) of the Allowable Ranges of Contract Costs (ARCC) of his registration.
For Small A and Small B contractors without similar experience, the usual requirement tied to the bidder’s largest similar completed contract is relaxed and replaced by a threshold based on the ARCC tied to the contractor’s registration.
ARCC stands for Allowable Ranges of Contract Costs. It functions as the reference ceiling/range for contract costs based on the contractor’s PCAB registration, and is used to determine whether Small A/Small B contractors without similar experience may bid for a given contract.
The Philippine Contractors Accreditation Board (PCAB) is expressly mentioned as prescribing the guidelines for classification of contractors vis-à-vis the ARCC.
The contract value must be adjusted to current prices using the National Statistics Office (NSO) consumer price indices available at the G-EPS website.
It sets a substantive condition that the bidder’s largest completed contract must be of a similar type/scope to the contract being bid; otherwise, the general 50% requirement applies only when “similar experience” exists, with the Small A/Small B exception allowing bidding under different criteria.
Compute the prospective bidder’s largest single completed contract value adjusted to current prices. The adjusted value must be at least 50% of the approved budget for the contract to be bid.
Eligibility is allowed if the cost of the contract to be bid is more than 50% of the ARCC of the contractor’s PCAB registration.
All other provisions of the IRR-A of RA 9184 remain unchanged.
It takes effect immediately upon issuance. In procurement, immediate effect is important because eligibility and qualification rules impact bid submission and award decisions; delays could affect ongoing procurement activities.
The GPPB-Technical Support Office formulated and proposed the amendment, and the GPPB endorsed it through Resolution No. 013-2004 dated August 20, 2004.
It amends the bidder qualification/eligibility rule on allowable contract value ranges by incorporating ARCC-based thresholds—particularly benefiting Small A and Small B contractors without similar experience—consistent with PCAB classification guidelines.