NPM No. 041-2015

Requesting Entity: Western Visayas College of Science and Technology System (WVCST)

Issues Concern: Procurement of Accident Insurance Policy; Approved Budget for the Contract; Reference to Brand Names; and Change of Specifications



1. Whether the Bids and Awards Committee (BAC) of WVCST can apply for an accident insurance policy for the protection of its members while on travel, especially during post qualification, considering that Republic Act No. (RA) 9184 only provides for legal assistance and indemnification;

The only insurance policy expressly sanctioned under RA 9184 and its associated rules is liability insurance, though Procuring Entities (PEs) are not precluded from obtaining other insurance policies. We note, however, that apart from this liability insurance, all government officials and employees, in general, are included in the mandatory insurance coverage under RA 8291 or the Government Service Insurance System Act of 1997.

In this regard, it is incumbent upon the PE to determine whether the existing insurance coverage under RA 8291 and RA 9184 is not sufficient to address the insurance needs of the BAC members and support staff. Otherwise stated, the PE must thoroughly revisit and examine if, given all the surrounding circumstances, the application for a separate accident insurance policy is still necessary.

2. In the determination of Approved Budget for the Contract (ABC), how much would be the most reasonable profit the end-user may consider for the suppliers;

RA 9184 and its associated rules and issuances made no mention of a specific amount or percentage that would provide the most reasonable supplier's profit. Thus, what constitutes the most reasonable supplier's profit in each and every procurement lies within the sound determination of the PE.


In determining the most reasonable supplier's profit, the PE may consider such amount that is sufficient to encourage and attract market participants, without prejudicing the property rights of the suppliers, and with reference to applicable accounting and auditing rules.

3. Whether the end-users can clearly identify specific brand of software or vehicle, or indicate their specifications in the minutest details; and

Section 18 of RA 9184 and its IRR mandates that reference to brand names shall not be allowed and thus, specifications for the procurement of goods shall be based on relevant characteristics and/or performance requirements. This mandate cannot be circumvented by setting specifications that point out to only one brand of goods or items, though without mentioning the name of the brand.


While PEs can make technical specifications in their bid documents more detailed, they cannot, however, "tailor fit" to a particular brand because it defeats the very essence and purpose of competitive bidding.

4. Whether a change in the specifications which involves inclusion of additional features but without change in ABC necessitates revisions of Annual Procurement Plan (APP) and Project Procurement Management Plan (PPMP), and consequently the approval by the Head of the Procuring Entity (HOPE).

If the APP and PPMP contain very specific details of items to be procured, including the specifications to be changed, then it is necessary to revise or update the APP and PPMP to reflect the intended changes. On the other hand, if the specifications to be changed are not indicated in the APP or PPMP, such that both contain general description of the items to be procured, then, no revision is necessary. In both instances, the PE must always ensure that the items being procured fits and is consistent with the description or specifications indicated in the APP and PPMP.