Question & AnswerQ&A (Republic Act No. 11966)
The short title of Republic Act No. 11966 is the 'Public-Private Partnership (PPP) Code of the Philippines.'
The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives for needed investments. It shall provide an enabling environment for the private sector to finance, design, construct, operate, and maintain infrastructure or development projects, ensuring equitable risk allocation, Value for Money (VFM), sustainability, and public welfare.
A PPP Project refers to any public infrastructure or development projects and services implemented under the PPP Code which involve contractual arrangements between an Implementing Agency and a Private Partner to finance, design, construct, operate, and maintain, or any combination thereof, infrastructure or development projects typically provided by the public sector.
Implementing Agencies include departments, bureaus, offices, instrumentalities, commissions, authorities of the national government, state universities and colleges (SUCs), local universities and colleges (LUCs), local government units (LGUs), and government-owned or controlled corporations (GOCCs).
The Code covers contractual arrangements to finance, design, construct, operate, and maintain infrastructure or development projects through PPPs, including joint ventures, toll operation agreements, lease agreements related to government land or facilities, and other arrangements with PPP characteristics as authorized.
Government Undertakings refer to any form of contribution or support the government may extend to a Private Partner for implementing PPP Projects such as subsidies, guarantees, equity, or other aids, as provided under the PPP Code.
Implementing Agencies are authorized to identify, develop, assess, evaluate, approve, negotiate, award, and undertake PPP Projects in accordance with the provisions of the PPP Code.
The 'Most Responsive Bid' refers to the bid that conforms to all material requirements of the bid solicitation and approved bid parameters and is most advantageous to the government.
An Unsolicited Proposal is a project proposal submitted by a Private Proponent to undertake a PPP Project not initiated by the government but subject to the approval and processing by the PPP Center and the appropriate Implementing Agency following specific evaluation and comparative challenge procedures.
Persons committing prohibited acts such as submitting false information, approving disadvantageous contracts, or collusion may be punished with imprisonment from three to six years and fines ranging from One million to Five million pesos, with additional penalties including civil, administrative sanctions, contract termination, and disqualification from future PPP participation.
The PPP Governing Board is composed of key Cabinet secretaries including the Secretary of NEDA as Chairperson, Secretary of DOF as Vice-Chairperson, other department heads, the Executive Director of the PPP Center, and a private sector representative. It serves as the overall policymaking body for PPP-related matters, setting strategic directions and enabling policy environments for PPP programs and projects.
All PPP contracts must include provisions for dispute avoidance and Alternative Dispute Resolution (ADR) mechanisms as provided under Republic Act No. 9283 (Alternative Dispute Resolution Act of 2004), allowing parties to choose ADR methods subject to applicable laws.
Copies of all tender documents and PPP contracts executed under the Code are considered public documents and must be published on the websites of the Implementing Agency and the PPP Center unless the documents contain proprietary or sensitive information that could affect national security or public safety.
Value for Money (VFM) refers to the effective, efficient, and economic use of resources, evaluating costs and benefits, risks, non-price attributes, and life cycle costs to ensure the PPP Project yields optimal value, not based on price alone.
Local PPP Projects are approved by the respective local Sanggunians or boards of LUCs. Local PPP Projects must also be confirmed or endorsed by respective Local Development Councils and Regional Development Councils especially if national government funds or plans are involved.
The PDMF is a revolving fund managed by the PPP Center used for advisory and support services related to preparation, structuring, evaluation, procurement, financial close, and monitoring of PPP Projects, funded through appropriations, official development assistance, or other sources.
The PPP Risk Management Fund is created to ensure fiscal sustainability and to pay contingent liabilities arising from PPP contracts. It is funded by general appropriations, income from PPP projects, and other DBCC-determined sources, managed by the PPP Center.
Failure of the Private Partner to achieve Financial Close within the required period, without government fault, may result in penalties as stipulated in the PPP contract including possible forfeiture of bid securities or award withdrawal.
Splitting any PPP Project to evade approval thresholds or to circumvent limitations on variations, expansions, extensions, or contract changes is prohibited and considered a violation of the PPP Code.