NPM No. 027-2016

Requesting Entity: AB Law Office

Issues Concern: Advance Payment



1. Is the sixty-day period mentioned in Section 4.5 of the Contract Implementation Guidelines for the Procurement of Goods, Supplies, and Materials (Guidelines), a mandatory requirement such that the release of the mobilization fee must be made within such period?


[C]onsidering the purpose of Advance Payment of forestalling any delay in the delivery of goods and rendition of services and the use of the word “shall” which connotes command or compulsion, it is mandatory for the procuring entity to comply with the sixty (60) day period from the signing of contract in allowing Advance Payment, provided that the required security and claim for Advance Payment was submitted by the supplier within the same sixty (60) day period. In all instances, the conditions laid down in Section 4.5 of the Guidelines shall be strictly complied with.


2. May the procuring entity extend the sixty-day period in order to grant the request for release of mobilization fee?


[B]ased on its own needs, and the interrelated factors to be considered relative to such needs, it is incumbent upon the procuring entity, after a careful assessment and scrutiny of all the attending circumstances, to decide whether to allow for an extension of the period or not. In no case shall the Advance Payment be granted if the supplier has already commenced the implementation of the project.