NPM 016-2005

Requesting Entity: Armed Forces of the Philippines

Issues Concern: Clarification on GPPB Resolution No 02-2004



1. When is the effectivity date of GPPB Resolution No. 02-2004?

The principle is well entrenched that statutes, including administrative rules and regulations, operate prospectively, unless the legislative intent to the contrary is manifest by express terms or by necessary implication. Hence, GPPB Resolution No. 02-2004 is deemed to be the controlling law with regard to all procurement activities commenced after its effectivity date on October 5, 2004, the reckoning point being the date of advertisement of bids. Although the resolution was approved on March 10, 2004, it is deemed effective only upon its posting at the Government Electronic Procurement System (GEPS) website.

2. What are “domestic sources” as contemplated under Republic Act No. 9184 (R.A. 9184)?

[T]he term “domestic sources” may be understood to mean not only domestic or local manufacturers using local raw materials, but also includes suppliers and distributors who are domestic entities organized under the laws of the Philippines or foreign entities doing business in the Philippines.

3. Does the term “domestic sources” pertain to manufacturers only or does it also include suppliers and distributors?

[I]t may be aptly deduced that the term “domestic preference” as understood under the Flag Law pertains to the premium given to domestic or foreign entities using locally produced goods from local raw materials when they are up against domestic entities or foreign suppliers using imported raw materials assuming that all the participating bidders concerned passed the eligibility requirements under R.A. 9184.

4. Can the AFP use alternative methods of procurement if it has complied with all the requirements under Executive Order No. 109-A (E.O. 109-A)?

[T]he conditions mentioned under Section 48-53 of R.A. 9184 must be present. It is not enough that the conditions under E.O. 109-A are met in order to warrant exceptions to public bidding. In fact, Section 3 of E.O. 109-A made reference to the provisions of R.A. 9184 on the use of the alternative methods of procurement, thereby, in effect, reiterating its mandatory application. The provisions of E.O. 109-A must be read side by side with R.A. 9184 because the latter is not deemed to have repealed the former.