NPM No. 005-2018

Requesting Entity: Procurement Service Department of Budget and Management (DBM-PS)

Issues Concern: Non-Compliance with the Advertisement Requirement



Clarification on the advertisement requirement for procurement of common-use supplies and equipment (CSE) conducted through Public Bidding as provided in Section 21.2.1 of the 2016 revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No. 9184, the Government Procurement Reform Act.

Section 21.2.1 of the 2016 IRR of RA No. 9184 provides the rules on posting of the Invitation to Bid (IB) and the Request for Expression of Interest (REI), including the advertisement thereof in a newspaper of general nationwide circulation depending on the ABC. In this regard, we wish to clarify that the phrase “Except as otherwise provided in Section 54.2 of this IRR and for the procurement of common-use goods and supplies” embodied in Section 21.2.1 of the 2016 IRR pertains to: a) the rule that PEs may dispense with advertisement in the newspaper, and posting requirement for alternative methods of procurement, unless otherwise required; and b) the exception of advertisement or posting for the procurement of common-use goods and supplies from the DBM-PS; which means that procuring entities are not required to advertise or post its IB when procuring their CSEs from the DBM-PS, which is mandated to conduct a centralized procurement of CSEs for purchase by government agencies.

. . . Accordingly, the DBM-PS shall still follow the prescribed rules on advertisement and posting relative to its procurement of goods and equipment, categorized as CSE, through public bidding.

Clarification on the effect of the failure to advertise the Invitation to Bid (IB) or Request for Expression of Interest (REI) in a newspaper of general nationwide circulation where the Purchase Order (PO) and Notice of Award (NOA) were already issued to the winning bidders.

[I]t is our considered view that such non-compliance with a mandatory provision of the Procurement Law and its associated 2016 IRR is a material defect that will affect the validity of the procurement process. The use of the word “shall” for the posting and advertisement of the IB or REI makes the requirement mandatory. The word shall means ought to, must, or an obligation used to express a command or exhortation used in laws, regulations or directives to express what is mandatory. In common or ordinary phraseology, the term “shall” is a word of command one which has a compulsory meaning and is generally imperative of mandatory, unless the contrary intent appears. Article 5 of the Civil Code of the Philippines, on the other hand, provides that “[a]cts executed against the provisions of mandatory or prohibitory laws shall be void, except when the law itself authorizes their validity.”