NPM 092-2013

Requesting Entity: Department of Trade and Industry (DTI)

Issues Concern: Applicability of Blacklisting Order to the Affiliate/Sister Company of a Blacklisted Entity



Whether the affiliate/sister company of a blacklisted bidder may also be considered as blacklisted.

The affiliate/sister company of a blacklisted bidder may only be considered as blacklisted upon determination by the procuring entity that the blacklisted entity has that degree of relationship or extent of representation mentioned in Section 2 of the Uniform Guidelines for Blacklisting of Manufacturers, Suppliers, Distributors, Contractors and Consultants (Guidelines) existing in the affiliate/sister company. The prohibition against a person/entity that is blacklisted by a procuring entity and/or included in the GPPB Consolidated Blacklisting Report under Section 2 of Guidelines also applies to a joint venture or consortium which is blacklisted or which has blacklisted member/s and/or partner/s, as well as a person/entity who is a member of a blacklisted joint venture or consortium. In the case of corporations, a single stockholder, together with his/her relatives up to the third civil degree of consanguinity or affinity, and their assignees, holding at least twenty percent (20%) of the shares therein, its chairman and president, shall be blacklisted after they have been determined to hold the same controlling interest in a previously blacklisted corporation or in two corporations which have been blacklisted; the corporations of which they are part shall also be blacklisted.

It has to be established that the blacklisting entity is a member or partner of its affiliate/sister company if the latter is a joint venture or consortium, or that the blacklisted entity is a stockholder holding at least twenty percent (20%) of the shares of the affiliate/sister company if the latter is a corporation.

If the blacklisted entity and its affiliate/sister company are sole proprietorships owned by the same person, the blacklisting order applies to the affiliate/sister company since a sole proprietorship does not have a separate juridical nor legal personality from its owner, and it is thru the individual doing business under the name and style of the sole proprietorship who would in effect be blacklisted under the Guidelines.