NPM 027-2005

Requesting Entity: Department of Science and Technology

Issues Concern: Clarification on the provisions of R.A. 9184 and its IRR-A



1. Whether or not the security agency which was awarded the contract during the bidding conducted by the Department of Science and Technology (DOST) Central Office be automatically employed by other DOST agencies

It bears stressing that every procurement opportunity opened to the public should sufficiently describe the exact requirement of the procuring entity and the approved budget for the contract. Interestingly, the procurement undertaking by the DOST Central Office, as defined in its Annual Procurement Plan (APP) and its Procurement Project Management Plan (PPMP), makes specific reference to its own requirements and does not contemplate that of the other agencies.

Parenthetically, by advertising the procurement opportunity, DOST Central Office opened an opportunity only to the extent of its own requirements. And, to allow the attached agencies to conveniently contract with the awardee in the procurement undertaking of DOST Central Office to dispense with the bidding process required for the procurement, would amount to a violation of the principle of open and public competition in government procurement.

In light of the foregoing premises, the DOST Central office and the other Agencies may consider a joint undertaking on the hiring of the services of a single security agency to manage the whole compound, as a single procurement project. Following this suggestion, it may be wise that participating agencies, including DOST Central Office, agree on the terms of their joint undertaking.

2. Whether or not a two-stage bidding procedure may be conducted for the services abovementioned

Under [the Two-Stage Competitive Bidding Procedure], the procuring entity concerned shall prepare the bidding documents, including the technical specifications only in the form of performance criteria. Prospective bidders are then requested to submit their respective Letter of Intent (LOI), their eligibility requirements if needed and their initial technical proposals. During this stage, no price tenders are required. The BAC shall then evaluate the technical merits of the proposals received from eligible bidders vis-a-vis the required performance standards. After this, a meeting/discussion shall be held by the BAC with those eligible bidders whose technical tenders meet the minimum required standards stipulated in the bidding documents for purposes of drawing up the final revised technical specifications/requirements of the contract. This revised technical specification shall become the reference requirements for bidding among eligible bidders who are then required to submit revised technical tenders including price proposals, in accordance with the rules on competitive bidding under the IRR-A.

The detailed procedure above is manifest as to the intention of the law in allowing the use of a two-stage competitive bidding process. The procedure is exclusive to situations where preparing a complete and detailed technical specification at the outset is undesirable or virtually impractical, by reason of the likely occurrence of technically unequal bids. It is specific to procurement undertakings involving complex items or services and comes as an exceptional remedy to address limited conditions. Thus, it does not contemplate procurement of general services where specifications may be easily determined from the beginning, as in the case of security services.