NPM No. 165-2015

Requesting Entity: Department of Science and Technology - Information Communications Technology Office (DOTC-ICTO)

Issues Concern: Technical Eligibility; Foreign Bidders; and Joint Ventures



If IBMP, a foreign owned company registered with the Philippines SEC and licensed to do business in the Philippines, will act as a subcontractor to a third party bidder, whether the latter can use the technical credentials of the former to meet the technical eligibility requirements stated in the bidding documents.

Bidders are required to submit their own technical eligibility documents for purposes of complying with the eligibility requirements. They cannot merely rely on the technical credentials of their subcontractors or any other bidder. The bidders, on their own credentials, shall be technically eligible to participate in any government procurement, unless the bidder is a joint venture where the technical and financial capacity of one joint venture partner shall be considered as the technical and financial capacity of all joint venturers.

If IBMP will participate as a bidder to the project, whether it will be considered as a local bidder or a foreign bidder.

A corporation that failed to comply with the requirements of being duly organized under the laws of the Philippines and of which at least sixty percent (60%) of the outstanding capital stock belongs to citizens of the Philippines, shall be considered as a foreign consultant.

Whether IBMP is eligible to participate in the procurement project considering that it is registered with the SEC, or IBM US is required to participate as the bidder with IBMP as the company representative.

Participation of a foreign consultant to public bidding is contingent upon the determination of the HOPE that Filipino consultants do not have the sufficient expertise and capability to render the services required under the project, subject to the qualifications under Section 24.3.3. of the IRR of RA 9184.

Whether IBMP, either acting as the bidder or subcontractor of a third party bidder, can use the technical credentials of its affiliates in other countries such as IBM US.

[A] third party bidder cannot use the technical credentials of IBMP if the latter will act as subcontractor of the former, unless they are participating under a Joint Venture Agreement. Similarly, IBMP and any other third party bidder cannot use the technical credentials of other contractors such as the IBM US. To reiterate, the bidder themselves shall be technically, as well as legally and financially, eligible to participate in public bidding.

Whether an unincorporated Joint Venture (JV) is allowed to participate as a bidder to procurement projects, and whether an unincorporated JV is required to be legally incorporated after award of contract.

Registration with the SEC is not necessary to make a JV valid in light of RA 9184; once the validity of the agreement of the JV partners is established, the requirement under the procurement law and rules is satisfied.

How is the 60% Filipino interest computed in an unincorporated JV?

The partners shall reflect in the JVA their respective contributions, which may be in the form of monetary, property or industrial contribution; the determination of the required 60% Filipino participation may be made by examining the terms and conditions of the Joint Venture Agreement and other supporting financial documents submitted by the joint venture.