NPM 012-2013

Requesting Entity: Insurance Commission (IC)

Issues Concern: Advance Payment for Infrastructure Projects



Whether advance payment may be allowed pursuant to Section 4 of the Contract Implementation Guidelines for the Procurement of Infrastructure Projects (Guidelines) under Annex "E" of the revised Implementing Rules and Regulations (IRR) of Republic Act (RA) No. 9184 notwithstanding the proscription against advance payment, except with the prior approval of the President, on government contracts under Section 88 of Presidential Decree No. 1445.

[R]equirement for prior approval of the President was addressed through the issuance of Memorandum Order No. 119 by then President Gloria Macapagal-Arroyo approving IRR Part A of RA 9184, which contained the exact provision now referred to in Section 4 of the Guidelines embodied in the revised IRR of RA 9184.

[C]onsidering that in the procurement of infrastructure projects, the President approved advance payment not exceeding fifteen percent (15%) of the total contract price, we are of the considered view that advance payment may be granted by upon compliance with the requirements under Section 4 of the Guidelines.