Government procurement is notoriously prone to corruption. In order to curb this, various statutes requiring public bidding have, from as early as the 1900s, been enacted, amended and supplemented. The latest incarnation of such legislation (after more than 100 years) is Republic Act 9184 or the Government Procurement Reform Act (GPRA).
The state policy is essentially the same: public bidding is required for all government contracts. It is meant to ensure that the government and, more important, the public, get value for their money and obtain goods and services at the most advantageous terms. It is designed to afford greater transparency, competition and accountability in the process of selection and award of contracts.
The general rule requiring the conduct of public bidding is subject only to very limited and well-defined exceptions under GPRA (Article XVI) and other laws. More often than not, resort to these exceptions results in controversy or dispute.
Possibly the most contentious exception to public bidding, of late, has been the exemption given under Section 4 of the GPRA to “treaties or international or executive agreements.” This provision, in effect, allows procurement and infrastructure projects undertaken pursuant to such agreements, if their terms so provide, to be excluded from the coverage of the GPRA and be exempted from the requirement of public bidding.
The Department of Justice (DOJ), taking its cue from Supreme Ccourt rulings, seems liberal in its construction of what constitute “executive agreements.” In its Opinion 46, s. 2007, reiterated in DOJ Opinion 33, s. 2009, it found its way clear to allowing the designation of a contractor without public bidding by echoing the justification that “executive agreements involving infrastructure projects to be funded by a foreign- lending institution do not fall within the scope of RA 9184.”
But what is an “executive agreement?”
A treaty is an international agreement that requires legislative ratification after executive concurrence. Upon ratification by the Senate, it acquires the status of law and may as such amend or repeal prior laws.
An executive agreement, on the other hand, while entered into by the Executive branch of government, does not require ratification by the Senate. It has the force and effect of law but must comply or remain consistent with stated policies in law. It cannot alter or work to amend or repeal prior laws.
The GPRA is categorical in its policy: all procurement shall be done through competitive bidding, subject only to defined exceptions. The exceptions do not include purchases from foreign suppliers handpicked or controlled by foreign governments. Since the executive agreement, as written, cannot alter the stated policy of or exclusions under the law, it cannot exempt the supply contract from the requirement of public tender.
The author of this report, Atty. Manuel L. Manaligod Jr. is a senior partner at CVCLAW-Villaraza Cruz Marcelo & Angangco (web site: www.cvclaw.com).
Labels and Tags
Accountability (69) Adequate documentation (6) ADR in procurement (3) Allocation of risks (5) Best interest of government (11) Best practices (19) Best value (15) Bidder prejudice (11) Blanket purchase agreement (1) Bridge contract (2) Bundling (6) Cancellation and rejection (2) Centralized procurement structure (12) Changes during bid process (13) Clarifications vs Discussions (1) Competence (9) Competition vs Efficiency (29) Competitive position (2) Compliance (33) Conflict of interest (31) Contract administration (25) Contract disputes (1) Contract extension or modification (8) Contract terms (2) Contract types (6) Contract vs solicitation dispute (2) Contractor responsibility (19) Conviction (3) Cooperative purchasing (3) Cost and pricing (13) Debarment (4) Determinations (8) Determining responsibility (34) Disclosure requirements (7) Discussions during solicitation (9) Disposal of surplus property (3) Effective enforcement requirement (35) Effective procurement management (3) Effective specifications (36) Emergency procurement (14) eProcurement (5) Equitable tolling (2) Evaluation of submissions (22) Fair and equitable treatment (14) Fair and reasonable value (23) Fiscal effect of procurement (14) Frivolous protest (1) Good governance (8) Governmental functions (26) Guam (14) Guam procurement law (12) Improper influence (11) Incumbency (12) Integrity of system (29) Interested party (7) Jurisdiction (1) Justification (1) Life-cycle cost (1) Limits of government contracting (5) Lore vs Law (4) market research (7) Materiality (3) Methods of source selection (32) Mistakes (4) Models of Procurement (1) Needs assessment (11) No harm no foul? (8) Other procurement links (14) Outsourcing (33) Past performance (12) Planning policy (33) Politics of procurement (48) PPPs (6) Prequalification (1) Principle of competition (93) Principles of procurement (24) Private vs public contract (15) Procurement authority (5) Procurement controversies series (78) Procurement ethics (19) Procurement fraud (27) Procurement lifecycle (9) Procurement philosophy (16) Procurement procedures (30) Procurement reform (63) Procurement theory (11) Procurement workforce (2) Procurment philosophy (6) Professionalism (17) Protest - formality (2) Protest - timing (12) Protests - general (37) Purposes and policies of procurement (10) Recusal (1) Remedies (16) Requirement for new procurement (4) Resolution of protests (4) Responsiveness (13) Restrictive specifications (5) Review procedures (12) Scope of contract (16) Settlement (2) Social preference provisions (59) Sole source (47) Sovereign immunity (2) Staffing (7) Standard commercial products (2) Standards of review (2) Standing (6) Stays and injunctions (6) Structure of procurement (1) Substantiation (9) Surety (1) Suspension (6) The procurement record (1) The role of price (10) The subject matter of procurement (22) Trade agreements vs procurement (1) Training (32) Transparency (60) Uniformity (6) Unsolicited proposals (2)
Monday, June 7, 2010
Procurement reform -- Philippines
Public bidding and executive agreements
Labels: Politics of procurement