NPM 025-2014

Requesting Entity: Commission on Elections

Issues Concern: Lease-to-Own Agreement of Motor Vehicles under Section 53.5 (Agency-to-Agency Agreements) of the revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No. 9184



Whether a private corporation wholly-owned by a government-owned and controlled corporation (GOCC) may be considered as a Servicing Agency under an agency-to-agency procurement modality.

Negotiated Procurement under Section 53.5 (Agency-to-Agency Agreements) of the IRR of RA 9184 allows a government entity to procure from another government entity without need of public bidding, subject to compliance with the prescribed conditions and procedures under existing rules and Guidelines on Agency-to-Agency Agreements (Guidelines), to wit:

1.Conduct of a Cost-benefit Analysis by the Procuring Agency indicating that entering into an Agency-to-Agency Agreement with the Servicing Agency is more efficient and economical for the government;

2.Total amount of all goods, consulting, and infrastructure projects undertaken or to be undertaken through Agency-to-Agency Agreements shall not exceed twenty-five percent (25%) of the Procuring Entity’s total procurement budget for each category (i.e., goods, infrastructure, or consulting) as reflected in its approved APP;

3.Servicing Agency has the mandate to deliver the goods and services required to be procured or to undertake the infrastructure project or consultancy required by the Procuring Agency; and 4. Servicing Agency owns or has access to the necessary tools and equipment required for the project .

Accordingly, a private corporation wholly-owned by a GOCC, may be considered as a Servicing Agency under an Agency-to-Agency Agreement relative to the Lease-to-Own of Motor Vehicles, provided that the foregoing conditions set by the Guidelines have been complied with.