Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 1870)
The main purpose of Presidential Decree No. 1870 is to authorize the government to take over by administration delayed infrastructure projects or to award the contract to other qualified contractors in order to expedite completion within the contract schedule.
The implementing agency may take over the contract work if the contractor incurs a 15% or more negative slippage based on its approved PERT/CPM schedule.
The Minister concerned or the Head of the Implementing Agency has the discretion to undertake the unfinished work by administration or to award the contract to another qualified contractor through negotiated contract at the current valuation price.
The Minister concerned or Head of the Implementing Agency shall notify the contractor to immediately undertake such work activity. If the contractor fails to start within 15 days and shows no satisfactory performance, the government may take over the work.
If the contractor fails, refuses, or neglects to supply necessary tools, materials, supplies, equipment, facilities, or labor, the government has the option to take over the project in whole or in part and complete it, either by administration or awarding it to another qualified contractor.
Yes, the cost of the work done by the government after takeover shall be deducted from the contract price. If the contract price balance is insufficient, the contractor must pay the difference.
No, subletting or assignment of the contract or any part thereof without prior written consent of the government is prohibited and is a ground for the government to take over the project.
The timely completion serves to meet financial projections, ensure proper cash flow, and fulfill the public welfare purposes that government infrastructure projects are designed to promote.
The 15-day period allows the contractor to rectify delays by starting the work and demonstrating satisfactory performance before the government proceeds to take over the project.