Question & AnswerQ&A (EXECUTIVE ORDER NO. 423)
The main policy is that all government contracts of government agencies shall be awarded through open and competitive public bidding, except in exceptional cases provided by law and applicable rules (Section 1).
A Government Agency refers to various units of the government, including departments, bureaus, offices, instrumentalities, government-owned and/or controlled corporations or their subsidiaries, and state colleges or universities (Section 1 and Executive Order No. 292, Section 2[4]).
The Heads of the Procuring Entities have full authority to approve and enter into all government contracts awarded through public bidding, regardless of the amount, except those required by law to be acted on or approved by the President (Section 2).
The Head of the Procuring Entity must obtain an opinion from the Government Procurement Policy Board (GPPB) that the contract falls within exceptions from public bidding and approval from the Director-General of NEDA before proceeding (Section 4a).
The Heads of Procuring Entities may approve these contracts provided the Department Secretary certifies under oath that the contract complies with all applicable laws and regulations (Section 4b).
They shall be considered contracts entered into without authority, thus invalid and not binding on the government (Section 5).
Such contracts must be submitted with complete documentation to NEDA within 7 days after approval by the Head of the Procuring Entity, NEDA reviews and submits recommendations to the NEDA Board (chaired by the President) within 30 days, and notification is sent within 7 days of the Board's action (Section 6).
Republic Act No. 9184 and its Implementing Rules and Regulations govern these contracts (Section 7a).
No, transactions of government financial institutions in the ordinary course of business are not covered and are subject to applicable laws and Department of Finance guidelines (Section 9).
No, splitting government contracts to evade public bidding and applicable rules is prohibited (Section 11).