2016 Revised Implementing Rules and Regulations Annex "A" PDF

The 2016 Revised Implementing Rules and Regulations – Annex “A” accordingly. Section 76. Separability Clause If any provision in this IRR, or application of such provision to any circumstance, is declared invalid or unconstitutional, the other provisions not affected...

The 2016 Revised Implementing Rules and Regulations – Annex “A” accordingly. Section 76. Separability Clause If any provision in this IRR, or application of such provision to any circumstance, is declared invalid or unconstitutional, the other provisions not affected thereby shall remain valid and subsisting. Section 77. Transitory Clause 77.1 In all procurement activities, if the advertisement or invitation for bids was issued prior to the effectivity of the Act, the provisions of E.O. 40 and its IRR, P.D. 1594 and its IRR, R.A. 7160 and its IRR, or other applicable laws, as the case may be, shall govern. 77.2 In cases where the advertisements or invitations for bids were issued before the effectivity of this IRR, Procuring Entities may continue adopting the procurement procedures, rules, and regulations provided in the Revised IRR of 2009 or other applicable laws, as the case may be.(a) Section 78. Effectivity Clause This IRR shall take effect sixty (60) calendar days after its publication in the Official Gazette or in a newspaper of general nationwide circulation and upon filing with the University of the Philippines Law Center of three (3) certified copies of this IRR.(a) 101  The 2016 Revised Implementing Rules and Regulations – Annex “A” ANNEX “A” DETAILED ENGINEERING FOR THE PROCUREMENT OF INFRASTRUCTURE PROJECTS 1. Detailed engineering shall proceed only on the basis of the feasibility or preliminary engineering study made which establishes the technical viability of the project and conformance to land use and zoning guidelines prescribed by existing laws. The findings contained in the feasibility study, if undertaken for the project, shall be examined. If, in the course of this exercise, it is found that changes would be desirable in the design standards of principal features, as proposed, specific recommendations for such changes shall be supported by detailed justifications, including their effects on the cost, and (if necessary) the economic justification. 2. A schedule of detailed engineering activities shall include the following: a) Survey b) Site Investigation c) Soils and Foundation Investigation d) Construction Materials Investigation e) Preparation of Design Plans f) Preparation of Technical Specifications g) Preparation of Quantity and Cost Estimates h) Preparation of Program of Work i) Preparation of Proposed Construction Schedule (and estimated Cash Flow for projects with Schedule over Six (6) Months) j) Preparation of Site or Right-of-Way Plans including Schedule of Acquisition k) Preparation of Utility Relocation Plan l) Preparation and Submission of Design Report m) Environmental Impact Statement for critical project as defined by the Department of Environment and Natural Resources (DENR) n) Preparation of minimum requirements for a Construction Safety and Health Program for the project being considered o) Value Engineering Studies p) Preparation of Bid/Tender Documents(a) 102  The 2016 Revised Implementing Rules and Regulations – Annex “A” 3. Work under detailed engineering shall include, but not necessarily be limited to, the following: a) Design Standards – Design standards shall be in accordance with appropriate standards and accepted detailed engineering practice adopted by the agency concerned. Design standards for structures shall take into account, among other things, the seismicity of the area to determine the optimum safety of structures and to minimize possible earthquake damage. b) Field Surveys and Investigations – Necessary field surveys and investigations which may include aerial, hydrographic, topographic, hydrologic, sub-surface, monumenting and other surveys shall be carried out in accordance with the design guidelines, criteria and standards adopted by the agency concerned. All survey and investigation works shall be prepared in a manner satisfactory to carry out accurate design and production of plans that will permit quantity estimates to be made within plus or minus ten percent (10%) of the final quantities of the completed structure. c) Contract Plans – The following plans shall be prepared for each construction contract in accordance with guidelines and standards adopted by the procuring entity concerned, incorporating at least the following: i) Site development plan ii) Plans and profile sheet iii) Typical sections and details iv) Drainage details where applicable v) Structural plans at appropriate scales indicating all details necessary in order that the complete structure can be set out and constructed vi) Other details which may be required by the head of the agency d) Quantities – All construction quantities shall be computed to a reasonable accuracy of not more than plus or minus ten percent (10%) of the final quantities of the as-built structure. e) Special Provisions – Specifications shall be prepared for specific terms of work or methods of construction, measurement and payment under each contract, which are not covered by Standard Construction and Material Specifications adopted by the procuring entity concerned. f) Unit Prices – These shall be prepared for each contract using costs based on reasonable approved current prices as projected over the proposed construction period, divided into local and foreign exchange costs, as the case may be. 103  The 2016 Revised Implementing Rules and Regulations – Annex “A” g) Approved Budget for the Contract – the ABC to be bid shall be prepared by official(s) duly designated by the Head of the Procuring Entity concerned or by his duly authorized official. It shall be approved by the Head of the Procuring Entity or his duly designated official. Since the contracts are fixed price contracts, the ABC to be bid shall provide for the projected movements of construction costs over the construction period considering the projected inflation and foreign exchange rates as issued by the Development Budget Coordination Committee (DBCC). It shall also show the local and foreign currency requirements, as the case may be. The ABC to be bid shall specify for each major work item, such as earthwork, roadwork, and massive concreting, the components for equipment rentals, fuel, labor, materials and overhead, including the cost of the approved construction safety and health program and warranty premium. h) Bidding Documents – These shall be prepared as provided for in the IRR. i) Program of Work – Before prosecuting any project, the necessary program of work shall be prepared and submitted for approval. In no case shall construction funds be remitted to field offices or construction work on a project be started before the program of work is approved, in accordance with existing laws. No program of work for any project shall be approved without detailed engineering. The program of work shall include, among other things, estimates of the work, items, quantities and costs and a PERT/CPM network of the project activities. The program of work shall cover at least a usable portion of the project and no construction shall be started for portions of the project that are less than usable, except projects requiring stage construction, in which case continuity of construction up to the completion of a usable portion must be assured. j) Contract Time or Duration – In the preparation of the Bidding Documents, the agency shall make an estimate of the actual number of working days required to complete the project through PERT/CPM analysis of the project activities and corrected for holidays and weekends. Likewise, the agency shall make an estimate of the number of rainy/unworkable days considered unfavorable for the prosecution of the works at the site, based on the records of the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA), and incorporate the same in the corrected actual number of working days determined above, which shall be made the basis of the total contract time. The estimated number of rainy/unworkable days considered unfavorable for the prosecution of the works at the site shall be made known before the date of bidding through the Instructions to Bidders for the purpose of guiding the contractor in preparing his bid and as reference to both the GOP and winning contractors taking action on the requests for time extensions. Without the estimated number of rainy/unworkable days established before the bidding date and made known to all participating bidders, the contract time is presumed to have excluded the unfavorable conditions. 104  The 2016 Revised Implementing Rules and Regulations – Annex “A” k) Warranty Period – Likewise, the Bidding Documents shall specify the type of project and the corresponding warranty period required by the procuring entity. l) Value Engineering – For major projects as specified by the agency, value engineering shall be conducted according to accepted standards and practices. Value engineering shall analyze alternative schemes of achieving the projects objectives in order to delete or reduce non-essential features and lessen the life cycle costs of the projects without sacrificing the quality and integrity of the structure, while maintaining its essential function, performance, and safety. m) Site or Right-of-Way Acquisition Plans and Resettlement Action Plans – These shall be prepared based on parcellary surveys and socio-economic surveys of households affected by the project. 4. For projects to be implemented by phases, the Procuring Entity shall ensure that there is a clear delineation of work for each phase, which must be usable, and structurally sound. It shall also ensure the conduct of the detailed engineering activities for each phase as provided for in Item 2 of this Guidelines.(n) 5. As a requirement for the procurement of infrastructure works, the concerned consultants/government officials who prepared and approved the detailed engineering shall issue a certification that the detailed engineering surveys and designs have been conducted according to the prescribed agency standards and specifications in conformance with the provisions of this Annex, and that the detailed engineering outputs are adequate for the procurement at hand. The approval by the authorized government officials of detailed engineering surveys and designs undertaken by consultants neither diminishes the responsibility of the latter for the technical integrity of the surveys and designs nor transfer any part of that responsibility to the approving officials. 6. The above rules shall apply to the implementation of infrastructure projects under normal or ordinary conditions. However, under emergency or extraordinary cases involving major calamities and disasters as declared by the President where time is of the essence to save lives and properties and restore damaged infrastructures, detailed engineering works shall be conducted in accordance with the guidelines and procedures, as prescribed by the head of the appropriate infrastructure agency and approved by the Infrastructure Committee of the National Economic and Development Authority Board, to enable quick response to said cases, while maintaining the safety and integrity of the structure. 105  The 2016 Revised Implementing Rules and Regulations – Annex “B” ANNEX “B” GENERAL PRINCIPLES ON CONSULTING SERVICES 1. Definition A natural or juridical person, qualified by appropriate education, training and relevant experience to render any or all of the types and fields of consulting services as defined in this IRR, shall be considered as a “Consultant,” subject to the requirements provided in this IRR for eligibility check and post-qualification. 2. The Need for Consultants The services of consultants may be engaged by any procuring entity for government projects or related activities of such magnitude and/or scope as would require a level of expertise or attention beyond the optimum in-house capability of the procuring entity concerned and consistent with the Government’s policy not to compete with the private sector. 3. Independence of Consultants To ensure the consultant’s professional independence, integrity, and objectivity, consultants, as well as key staff working for the consulting entity, who may be directly or indirectly associated with non-consulting firms that may have an interest in or bias towards the project concerned, shall be selected only if they agree to limit their role to that of consultants and will disqualify themselves and their affiliates for bidding for products and services of the same government project. 4. Hiring of Consultants 4.1 Consultants shall be hired on the basis of their proven expertise, experience and capability. Under certain conditions provided herein, cost may be included as a factor in the selection of consultants. In order to manifest trust and confidence in and promote the development of Filipino consultancy, Filipino consultants shall be hired whenever the services required for the project are within the expertise and capability of Filipino consultants: Provided, however, That in the event Filipino consultants do not have the sufficient expertise and capability to render the services required under the project, as determined by the Head of the Procuring Entity, foreign consultants may be hired. 4.2 In the hiring of foreign consultants, all pertinent laws and regulations of the Philippines shall be followed. 4.3 Technology and knowledge transfer to the procuring entity shall be required in the provision of consulting services, where applicable. 106  The 2016 Revised Implementing Rules and Regulations – Annex “B” 5. Organization of Consultants124 5.1 The umbrella organization of consultants recognized by the Government shall be composed of the various organizations of consultants that may be engaged by the Government under this IRR and shall accredit its members on the types of services and fields of professions where the members are technically and financially qualified to offer their services. The umbrella organization shall prepare and certify a list of fields and expertise in such fields available with the names of the accredited local consultants which shall be updated annually or as often as necessary and disseminate such list to concerned agencies of the Government. It shall likewise regulate its members for the development of the industry. The Government may consult and deal with this umbrella organization on matters relating to the industry. The GPPB shall be the appropriate government body that shall recognize the consultants’ umbrella organization. The umbrella organization may submit its files of accredited consultants to the BAC of the procuring entity in accordance with the form prescribed by the BAC which can serve as registration of the consultants under the next succeeding Subsection: Provided, however, That each such accredited consultant shall comply with the eligibility requirements provided in this IRR. Such qualification statements, together with the list of accredited consultants prepared in accordance with the immediately preceding section, shall guide the BAC in determining the fields where Filipino consultants are already qualified and capable and where foreign consultants may not be required. 6. Types of Consulting Services The services to be provided by consultants can be divided into six (6) broad categories, namely: (a) advisory and review services; (b) pre-investment or feasibility studies; (c) design; (d) construction supervision; (e) management and related services; and (f) other technical services or special studies. 6.1 Advisory and Review Services. These services include advice on particular projects or problems. These will include advice on and review of, among others, planning, design and other professional services, as well as management, production, inspection, testing and quality control. They also include such services as appearances before commissions, boards or other judicial bodies to give evidence or otherwise submit professional opinions. 6.2 Pre-Investment or Feasibility Studies. These are the studies which normally precede decisions to go (or not to go) forward with specific projects. These studies may have as their objectives: a) To establish investment priorities and sector policies - Studies for this objective include, among others, basic resource inventories, such as, river basin surveys, transport sector surveys, and studies of alternative development patterns and of sectors on a regional or nationwide scale. 124 Refer to Appendix 19 for the Revised Guidelines on the Recognition of Umbrella Organization of Consultants. 107 The 2016 Revised Implementing Rules and Regulations – Annex “B” b) To determine the basic features and the feasibility of individual projects - Studies for this objective include, among others, the functional design, project site selection, architectural and space programming and physical layout of specific projects, preliminary design and cost estimates, and the economic, financial and environmental impact analyses required for project evaluation. c) To define and propose changes in governmental policies, operations and institutions necessary for the successful implementation or functioning of investment projects - Studies for this objective include, among others, analysis of project related organizations, administrative problems, planning machinery, regulatory and marketing policies, accounting, and management systems, manpower resources and training requirements. 6.3 Design. This type of services normally consists of three (3) phases: a) Pre-Design Phase – establishes the general size and scope of the project and its location on the site. The services include but are not limited to reconnaissance, topographical and other engineering and land surveys, soils investigations, preparation of preliminary architectural/engineering designs, layouts, outline specifications, preliminary cost estimates and specific recommendations prior to actual design; b) Basic Design Phase – includes the preparation of detailed plans, designs, working drawings, specifications, detailed cost estimates and tender documents required for invitations of bids for construction works and equipment; and c) Support Services During Construction – includes assistance and advice in securing bids, tabulation and analysis of bid results, and making recommendations on the award of construction contracts, and in preparing formal contract documents; preparation of supplementary drawings required to suit actual field conditions; checking detailed construction and as-built drawings, shop and erection drawings submitted by contractors; making periodic visits to check on the general progress of work and quality of materials and workmanship; observing performance tests and start-up and making report thereon; and making a final inspection and reporting of completed project. 6.4 Construction Supervision. These include the following: a) Inspection and expediting of the work; b) Verification and checking of quantities and qualities of work accomplished by the contractor as against the approved plans, specifications, and programs of work; c) Issuance of instruction for corrections of defects on the work; 108 The 2016 Revised Implementing Rules and Regulations – Annex “B” d) Verification and recommendation for approval of statements of work accomplished and certificate of project completed by the contractor; e) Review and recommendation for approval of progress and final billings of the contractor; and f) Provision of record or as-built drawings of the completed projects. The above do not mean direction, superintendence, or management of construction. 6.5 Management and Related Services. These may include the following: a) Sector policy and regional development studies; b) Planning, feasibility, market, economic, financial, technical, operations and sociological studies; c) Project management, including procurement advisory services, impact monitoring, and post-evaluation services; d) Production management, inventory control, and productivity improvement; e) Marketing management and systems; f) Information and communications technology services, including but not limited to, information systems design and development, and network design and installation; g) Institutional strengthening, organization development, manpower requirements, training and technology transfer; h) General management consultancy; and i) Other related services. 6.6 Other Technical Services or Special Studies. The Technical Services may include the following: a) Institution building, including organization and management studies, and business process re-engineering and development; b) Design and execution of training programs at different levels; c) Provision of staff to carry out certain functions and to train their replacements; and 109 The 2016 Revised Implementing Rules and Regulations – Annex “B” d) Tasks relating to economic and financial studies such as those of tariff structures. The Special Studies may include the following and other studies not covered under any of the services and studies described above: a) Soils investigation; b) Studies, tests and process determination performed to establish design criteria for water facilities; c) Detailed mill, shop, and/or laboratory inspection of materials and equipment; d) Land surveys, establishment of boundaries and monuments, and related office computations and drafting; e) Parcellary surveys; f) Engineering surveys (for design and construction) and photogrammetry; g) Assistance in litigation arising from the development or construction of projects and in hearings before various approving and regulatory agencies; h) Investigation involving detailed consideration of the operation, maintenance, and overhead expenses; and the preparation of rate schedules; earning and expense statements, feasibility studies, appraisals, evaluations, and material audits or inventories required for certification of force account construction performed by the agencies; i) Preparation of environmental statements and assistance to the agencies in public hearings; j) Preparation of operating instructions and manuals for facilities and training of personnel and assistance in initial operation of facilities; k) Designs to meet unique and/or above normal requirements brought about by severe earthquakes, tornadoes, or blasts, or satisfy unique or abnormal tolerances, safety requirements, etc.; l) Site and physical planning; m) Environmental and other aspects of planning; n) Housing; o) Interior design; 110 The 2016 Revised Implementing Rules and Regulations – Annex “B” p) Studies on preservation and restoration of historical, cultural, and artworks; q) Landscaping; r) Construction management; and s) Defense systems design, including self-reliance defense program. Technology and knowledge transfer should be considered an important objective in the provision of consulting services. 111  The 2016 Revised Implementing Rules and Regulations – Annex “C” ANNEX “C” RECOMMENDED EARLIEST POSSIBLE TIME AND MAXIMUM PERIOD ALLOWED FOR THE PROCUREMENT OF GOODS AND SERVICES Maximum Minimum Operational Operational Calendar Calendar Timeline Timeline Procurement Days Conditions / Section Days (Recommended (Maximum Activity Allowed Remarks Recommended Earliest for Period for Activity Possible Time) Activity Allowed) Optional for ABC of Pre-Procurement Whenever ₱2,000,000.00 and 20 1 CD Day 0 0 Conference necessary below Advertisement / Start of Availability 21.2.1 Posting of 7 CDs Days 1 to 7 7 CDs Day 1 to 7 of Bidding Invitation to Bid Documents Optional for ABC below ₱1,000,000.00 Not Earlier than 7 CDs from Whenever 22.2 Pre-Bid Conference 1 CD Day 8 Day 8 to 40 Advertisement / necessary Posting 12 CDs before Deadline of Submission and Receipt of Bids Deadline of Last day of Submission and 25.5 1 CD Day 20 45 CDs Day 52 Availability of Receipt of Bids / Bid Opening Bidding Documents 32.4 Bid Evaluation 1 CD Day 21 7 CDs Day 53 to 59 The bidder must submit all Post- Qualification Requirements Post-Qualification Day 60 to 34.8 2 CDs125 Day 22 to 23 45 CDs within 5 CDs from 104 receipt of notice as bidder with LCB in accordance with Sec. 34.2. Approval of Resolution/Issuanc Day 105 to 37.1.2 1 CD Day 24 15 CDs e of Notice of 119 Award Contract Day 120 to 37.2.1 Preparation and 1 CD Day 25 10 CDs 129 Signing Approval of 20 or 30 37.3 contract by higher 1CD If necessary. CDs authority Issuance of Notice Day 130 to 37.4.1 to Proceed 1 CD Day 26 7 CDs 136 TOTAL TIME Excluding Approval 26 CDs 136 CDs of Higher Authority, if applicable. 125 One (1) calendar day is allotted for the BAC to notify the Bidder that it has the Lowest Calculated Bid (LCB). 112  The 2016 Revised Implementing Rules and Regulations – Annex “C” RECOMMENDED EARLIEST POSSIBLE TIME AND MAXIMUM PERIOD ALLOWED FOR THE PROCUREMENT OF INFRASTRUCTURE PROJECTS Operational Maximum Operational Minimum Timeline Calendar Timeline Procurement Calendar Days Section (Recommended Days (Maximum Conditions / Remarks Activity Recommended Earliest Possible Allowed Period for Activity Time) for Activity Allowed) Pre- Procurement Whenever Optional for ABC of 20 1 Day 0 0 necessary ₱5,000,000.00 and below Conference Advertisement / Start of Availability of 21.2.1 Posting of 7 CDs Days 1 to 7 7 CDs Day 1 to 7 Bidding Documents Invitation to Bid Optional for ABC below ₱1,000,000.00 Day 8 to 45 Not Earlier than 7 CDs Pre-Bid Whenever ---- from Advertisement / 22.2 1 CD Day 8 Conference necessary Day 8 to 60 Posting 12 CDs before Deadline of Submission and Receipt of Bids Deadline of 50 CDs126 Day 57 Submission and ---- Last day of Availability of 25.5 1 CD Day 20 ---- Receipt of Bids / 65 CDs127 Bidding Documents Bid Opening Day 72 Day 58 to 64 32.4 Bid Evaluation 1 CD Day 21 7 CDs ---- Day 73 to 79 The bidder must submit all Post-Qualification Day 65 to 109 Post- Requirements within 5 CDs 34.8 2 CDs128 Day 22 to 23 45 CDs ---- Qualification from receipt of notice as Day 80 to 124 bidder with LCB in accordance with Sec. 34.2. Approval of Day 110 to 124 Resolution/Issu 37.1.2 1 CD Day 24 15 CDs --- ance of Notice of Award Day 125 to 139 Contract Day 125 to 134 37.2.1 Preparation and 1 CD Day 25 10 CDs ---- Signing Day 140 to 149 Approval of 37.3 contract by 1CD 20 or 30 CDs If necessary. higher authority Issuance of Day 135 to 141 37.4.1 Notice to 1 CD Day 26 7 CDs ---- Proceed Day 150 to 156 Excluding Approval of 141 CDs or TOTAL TIME 26 CDs Higher Authority, if 156 CDs applicable. 126 For Infrastructure Projects ₱50,000,000.00 and below. 127 For Infrastructure Projects above ₱50,000,000.00. 128 One (1) calendar day is allotted for the BAC to notify the Bidder that it has the LCB. 113  The 2016 Revised Implementing Rules and Regulations – Annex “C” RECOMMENDED EARLIEST POSSIBLE TIME AND MAXIMUM PERIOD ALLOWED FOR THE PROCUREMENT OF CONSULTING SERVICES Operational Maximum Operational Minimum Timeline Calendar Timeline Procurement Calendar Days Section (Recommended Days (Maximum Conditions / Remarks Activity Recommended Earliest Possible Allowed Period for Activity Time) for Activity Allowed) Pre- Optional for ABC of Procurement Whenever ₱1,000,000.00 and 20 1 CD Day 0 0 necessary below. Conference Advertisement / Posting of Start of Availability of 21.2.1 Request for 7 CDs Days 1 to 7 7 CDs Day 1 to 7 Bidding Documents Expression of Interest Eligibility Check 24.5.4 and Shortlisting 1 CD Day 8 20 CDs Day 8 to 27 Optional for ABC below ₱1,000,000.00 Not Earlier than 7 CDs Pre-Bid Whenever from determination of 22.2 1 CD Day 15 Day 34 to 70 Conference necessary shortlisted consultants. 12 CDs before Deadline of Submission and Receipt of Bids Deadline of Submission and 75 CDs Last day of Availability of 25.5 1 CD Day 27 Day 82 Receipt of Bids / Bidding Documents Bid Opening 33.4 Bid Evaluation 1 CD Day 28 21 CDs Day 83 to 103 Approval of 33.2.1 Ranking by the 1 CD Day 29 2 CDs Day 104 to 105 HoPE Notification for Negotiation 1 CD Day 30 3 CDs Day 106 to 108 33.2.5 Negotiation 1 CD Day 31 10 CDs Day 109 to 118 The bidder must submit all Post-Qualification Requirements within 5 Post- 34.8 2 CDs129 Day 32 to 33 30 CDs Day 119 to 148 CDs from receipt of Qualification notice as the bidder with the HRB in accordance with Sec. 34.2. Approval of Resolution/Issu 37.1.2 ance of Notice 1 CD Day 34 15 CDs Day 149 to 163 of Award Contract 37.2.1 Preparation and 1 CD Day 35 10 CDs Day 164 to 173 Signing Approval of 37.3 contract by 1CD 20 or 30 CDs If necessary. higher authority Issuance of 37.4.1 Notice to 1 CD Day 36 7 CDs Day 174 to 180 Proceed Excluding Approval of TOTAL TIME 36 CDs 180 CDs Higher Authority, if applicable. 129 One (1) calendar day is allotted for the BAC to notify the Bidder that it has the Highest Rated Bid (HRB). 114  The 2016 Revised Implementing Rules and Regulations – Annex “D” ANNEX “D” CONTRACT IMPLEMENTATION GUIDELINES FOR THE PROCUREMENT OF GOODS, SUPPLIES AND MATERIALS 1. Amendment to Order 1.1 Subject to the conditions set forth below, amendments to order may be issued at any time by the procuring entity concerned. If any such order increases or decreases the cost of, or the time required for executing any part of the work under the original contract, an equitable adjustment in contract price and/or delivery schedule shall be mutually agreed upon between the parties concerned, and the contract modified in writing. 1.2 An amendment to order may be issued only in emergency cases or during fortuitous events requiring necessary adjustments within the general scope of the contract in any one or more of the following is required in order to fully meet the requirements of the project: a) drawings, design or specifications, if the goods to be furnished are to be specifically manufactured for the Government in accordance therewith; b) method of shipment or packing; or c) place of delivery. 1.3 An amendment to order may also be issued by the concerned procuring entity where there are additional items needed and necessary for the protection of the goods, which were not included in the original contract. Payments for these additional items shall be based on the unit prices in the original contract for items of goods similar to those in the original contract. If the contract does not contain any rate applicable to the additional items, then suitable prices shall mutually be agreed upon between the parties. Request for payment by the supplier for any additional items shall be accompanied by a statement with the approved supporting forms, giving a detailed accounting and record of amount for which it claims payment. The contract time shall likewise be extended if the acquisition of such additional items so warrants. 1.4 Under no circumstances shall a supplier proceed to commence work under any amendment to order unless the same has been approved by the Head of the Procuring Entity concerned or his duly authorized representative. As an exception to the rule, the Regional Director/Head concerned may authorize the immediate start of work under any amendment to order in the event of emergencies to avoid detriment to public service, or damage to life and/or property or when time is of the essence: Provided, however, That the same is valid only on items up to the point where the cumulative increase in the contract cost which has not yet been duly fully approved by the Head of the Procuring Entity concerned or his duly authorized representative does not exceed five percent (5%) of the original contract cost: Provided, further, That the corresponding amendment to order shall immediately be prepared and submitted for approval to the Head of the Procuring Entity concerned or his duly authorized representative. For an amendment to order involving a cumulative amount exceeding five percent (5%) of the original contract price, no work thereon shall be commenced unless the same has been 115  The 2016 Revised Implementing Rules and Regulations – Annex “D” approved by the Head of Procuring Entity concerned or his duly authorized representative: Provided, That, the said cumulative amount does not exceed ten percent (10%) of the original contract price. 2. Suspension of Work 2.1 The procuring entity may suspend the work wholly or partly by written order for a certain period of time, as it deems necessary due to force majeure or any fortuitous events as defined in the contract. The supplier shall take all reasonable steps to minimize the costs allocable to the work covered by such order during work stoppage. 2.2 Before the suspension order expires, the procuring entity concerned shall either lift such order or terminate the work covered by the same. If the suspension order is lifted, or if the period of the order expires, the supplier shall have the right to resume work. Appropriate adjustments shall be made in the delivery or contract schedule, or contract price, or both, and the contract shall be modified accordingly. 3. Liquidated Damages 3.1 When the supplier fails to satisfactorily deliver goods under the contract within the specified delivery schedule, inclusive of duly granted time extensions, if any, the supplier shall be liable for damages for the delay and shall pay the procuring entity liquidated damages, not by way of penalty, an amount equal to one-tenth (1/10) of one percent (1%) of the cost of the delayed goods scheduled for delivery for every day of delay until such goods are finally delivered and accepted by the procuring entity concerned. The procuring entity need not prove that it has incurred actual damages to be entitled to liquidated damages. Such amount shall be deducted from any money due or which may become due to the supplier, or collected from any securities or warranties posted by the supplier, whichever is convenient to the procuring entity concerned. In case the total sum of liquidated damages reaches ten percent (10%) of the total contract price, the procuring entity concerned may rescind the contract and impose appropriate sanctions over and above the liquidated damages to be paid.130 4. Advance Payment 4.1 In accordance with Presidential Decree 1445, advance payment shall be made only after prior approval of the President, and shall not exceed fifteen percent (15%) of the contract amount, unless otherwise directed by the President; Provided, however, that for cases mentioned under 4.3, 4.4, and 4.5 of these guidelines, no prior approval by the President shall be necessary. 4.2 All progress payments shall first be charged against the advance payment until the latter has been fully exhausted, unless otherwise approved by the President. 4.3 A single advance payment not to exceed fifty percent (50%) of the contract amount shall be allowed for contracts entered into by a procuring entity for the following services where requirement of down payment is a standard industry practice: a) Hotel and restaurant services; 130 As amended by GPPB Resolution No. 02-2020, dated 27 February 2020, published in the Philippine Star on 22 April 2020. 116  The 2016 Revised Implementing Rules and Regulations – Annex “D” b) Use of conference/seminar and exhibit areas; and c) Lease of office space. 4.4 Advance payment not to exceed fifteen percent (15%) of the contract amount, unless otherwise directed by the President, shall also be allowed for procurement of goods required to address contingencies arising from natural or man-made calamities in areas where a “State of Calamity” has been declared by appropriate authorities. 4.5 Upon submission of an irrevocable letter of credit or bank guarantee issued by a Universal or Commercial Bank, advance payment not to exceed fifteen percent (15%) of the contract amount shall be allowed and paid within sixty (60) calendar days from signing of the contract. The irrevocable letter of credit or bank guarantee must be for an equivalent amount, shall remain valid until the goods are delivered, and accompanied by a claim for advance payment. 5. Other Rules and Guidelines The rules and regulations for the other aspects of contract implementation shall be included in the manuals to be issued by the GPPB, such as, but not limited to, the following: a) Incidental Services; b) Spare Parts; c) Delays in the Supplier’s Performance; d) Purchaser’s Responsibilities; e) Prices; f) Payment; g) Taxes and Duties; h) Subcontracts; i) Standards; j) Packing; k) Insurance; l) Transportation; m) Inspections and Tests; n) Patent Rights; o) Limitations of Liability; p) Termination for Default; q) Termination for Insolvency; r) Termination for Convenience; and s) Assignment. 117  The 2016 Revised Implementing Rules and Regulations – Annex “E” ANNEX “E” CONTRACT IMPLEMENTATION GUIDELINES FOR THE PROCUREMENT OF INFRASTRUCTURE PROJECTS 1. VARIATION ORDERS - CHANGE ORDER/EXTRA WORK ORDER 1.1 Variation Orders may be issued by the procuring entity to cover any increase/decrease in quantities, including the introduction of new work items that are not included in the original contract or reclassification of work items that are either due to change of plans, design or alignment to suit actual field conditions resulting in disparity between the preconstruction plans used for purposes of bidding and the "as staked plans" or construction drawings prepared after a joint survey by the contractor and the Government after award of the contract, provided that the cumulative amount of the positive or additive Variation Order does not exceed ten percent (10%) of the original contract price. The addition/deletion of works under Variation Orders should be within the general scope of the project as bid and awarded. The scope of works shall not be reduced so as to accommodate a positive Variation Order. A Variation Order may either be in the form of either a change order or extra work order. 1.2 A Change Order may be issued by the implementing official to cover any increase/decrease in quantities of original work items in the contract. 1.3 An Extra Work Order may be issued by the implementing official to cover the introduction of new work necessary for the completion, improvement or protection of the project which was not included as items of work in the original contract, such as, where there are subsurface or latent physical conditions at the site differing materially from those indicated in the contract, or where there are duly unknown physical conditions at the site of an unusual nature differing materially from those ordinarily encountered and generally recognized as inherent in the work or character provided for in the contract. 1.4 Any cumulative positive Variation Order beyond ten percent (10%) of the original contract price shall be subject of another contract to be bid out if the works are separable from the original contract. In exceptional cases where it is urgently necessary to complete the original scope of work, the Head of the Procuring Entity may authorize a positive variation order that will make the cumulative value of the positive Variation Orders go beyond ten percent (10%) but not more than twenty percent (20%) of the original contract price, subject to the guidelines to be determined by the GPPB: Provided, however, That appropriate sanctions shall be imposed on the designer, consultant or official responsible for the original detailed engineering design which failed to consider the Variation Order beyond ten percent (10%). 1.5 In claiming for any Variation Order, the contractor shall, within seven (7) calendar days after such work has been commenced pursuant to Item 3.2 hereof; or, within twenty eight (28) calendar days after the circumstances or reasons justifying a claim for extra cost shall have occurred, deliver a notice giving full and detailed particulars of any extra cost in order that it may be investigated at that time. Failure to provide either of such notices in the time stipulated shall constitute a waiver by the contractor for any claim. The preparation and submission of Variation Orders are as follows: 118  The 2016 Revised Implementing Rules and Regulations – Annex “E” a) If the procuring entity’s representative/Project Engineer believes that a Change Order or Extra Work Order should be issued, he shall prepare the proposed Order accompanied with the notices submitted by the contractor, the plans therefore, his computations as to the quantities of the additional works involved per item indicating the specific stations where such works are needed, the date of his inspections and investigations thereon, and the log book thereof, and a detailed estimate of the unit cost of such items of work, together with his justifications for the need of such Change Order or Extra Work Order, and shall submit the same to the Head of the Procuring Entity for approval. b) The Head of the Procuring Entity or his duly authorized representative upon receipt of the proposed Change Order or Extra Work Order shall immediately instruct the appropriate technical staff or office of the procuring entity to conduct an on-the-spot investigation to verify the need for the work to be prosecuted and to review the proposed plan, and prices of the work involved. c) The technical staff of appropriate office of the procuring entity shall submit a report of their findings and recommendations, together with the supporting documents, to the Head of the Procuring Entity or his duly authorized representative for consideration. d) The Head of the Procuring Entity or his duly authorized representative, acting upon the recommendation of the technical staff or appropriate office, shall approve the Change Order or Extra Work Order after being satisfied that the same is justified, necessary, and in order. e) The timeframe for the processing of Variation Orders from the preparation up to the approval by the procuring entity concerned shall not exceed thirty (30) calendar days. 2. ADDITIONAL/EXTRA WORK COSTING 2.1 For Variation Orders, the contractor shall be paid for additional work items whose unit prices shall be derived based on the following: a. For additional/extra works duly covered by Change Orders involving work items which are exactly the same or similar to those in the original contract, the applicable unit prices of work items original contract shall be used. b. For additional/extra works duly covered by Extra Work Orders involving new work items that are not in the original contract, the unit prices of the new work items shall be based on the direct unit costs used in the original contract (e.g., unit cost of cement, rebars, form lumber, labor rate, equipment rental, etc.). All new components of the new work item shall be fixed prices, provided the same is acceptable to both the Government and the contractor, and provided further that the direct unit costs of new components shall be based on the contractor's estimate as validated by the procuring entity concerned via documented canvass in accordance with existing rules and regulations. The direct cost of the new work item shall then be combined with the mark-up 119  The 2016 Revised Implementing Rules and Regulations – Annex “E” factor (i.e., taxes and profit) used by the contractor in his bid to determine the unit price of the new work item. 2.2 Request for payment by the contractor for any extra work shall be accompanied by a statement, with the approved supporting forms, giving a detailed accounting and record of amount for which he claims payment. Said request for payment shall be included with the contractor's statement for progress payment. 3. CONDITIONS UNDER WHICH CONTRACTOR IS TO START WORK UNDER VARIATION ORDERS AND RECEIVE PAYMENTS 3.1 Under no circumstances shall a contractor proceed to commence work under any Change Order or Extra Work Order unless it has been approved by the Head of the Procuring Entity or his duly authorized representative. 3.2 However, under any of the following conditions, the procuring entity’s representative/Project Engineer may, subject to the availability of funds and within the limits of his delegated authority, allow the immediate start of work under any Change Order or Extra Work Order: i) In the event of an emergency where the prosecution of the work is urgent to avoid detriment to public service, or damage to life and/or property; and/or ii) When time is of the essence; Provided, however, That such approval is valid on work done up to the point where the cumulative increase in value of work on the project which has not yet been duly fully approved does not exceed five percent (5%) of the adjusted original contract price; Provided, further, That immediately after the start of work, the corresponding Change Order or Extra Work Order shall be prepared and submitted for approval in accordance with the above rules herein set. Payments for works satisfactorily accomplished on any Change Order or Extra Work Order may be made only after approval of the same by the Head of the Procuring Entity or his duly authorized representative. Provided, finally, That for a Change Order or Extra Work Order involving a cumulative amount exceeding five percent (5%) of the original contract price, no work thereon may be commenced unless said Change Order or Extra Work Order has been approved by the Head of the Procuring Entity or his duly authorized representative. 4. ADVANCE PAYMENT 4.1 The procuring entity shall, upon a written request of the contractor which shall be submitted as a contract document, make an advance payment to the contractor in an amount not exceeding fifteen percent (15%) of the total contract price, to be made in lump sum or, at the most, two installments according to a schedule specified in the Instructions to Bidders and other relevant Tender Documents. 120  The 2016 Revised Implementing Rules and Regulations – Annex “E” 4.2 The advance payment shall be made only upon the submission to and acceptance by the procuring entity of an irrevocable standby letter of credit of equivalent value from a commercial bank, a bank guarantee or a surety bond callable upon demand, issued by a surety or insurance company duly licensed by the Insurance Commission and confirmed by the procuring entity. 4.3 The advance payment shall be repaid by the contractor by deducting fifteen percent (15%) from his periodic progress payments a percentage equal to the percentage of the total contract price used for the advance payment. 4.4 The contractor may reduce his standby letter of credit or guarantee instrument by the amounts refunded by the Monthly Certificates in the advance payment. 5. PROGRESS PAYMENT 5.1 Once a month, the contractor may submit a statement of work accomplished (SWA) or progress billing and corresponding request for progress payment for work accomplished. The SWA should show the amounts which the contractor considers itself to be entitled to up to the end of the month, to cover (a) the cumulative value of the works it executed to date, based on the items in the Bill of Quantities, and (b) adjustments made for approved variation orders executed. Alternatively, the Procuring Entity may require in the Bidding Documents that statement of work accomplished or progress billing and the corresponding request for progress payment may only be submitted upon actual completion of the infrastructure project or a specific portion, segment, milestone or phase thereof.131(a) 5.2 The procuring entity’s representative/project engineer shall check the contractor’s SWA and certify the amount to be paid to the contractor as progress payment. Except as otherwise stipulated in the Instruction to Bidders, materials and equipment delivered on the site but not completely put in place shall not be included for payment.132(a) 5.3 The procuring entity shall deduct the following from the certified gross amounts to be paid to the contractor as progress payment: a) Cumulative value of the work previously certified and paid for. b) Portion of the advance payment to be recouped.133(a) c) Retention money in accordance with the condition of contract. d) Amount to cover third party liabilities. e) Amount to cover uncorrected discovered defects in the works. 6. RETENTION MONEY 6.1 Progress payments are subject to retention of ten percent (10%) referred to as the "retention money." Such retention shall be based on the total amount due to the contractor prior to any deduction and shall be retained from every progress payment until fifty percent (50%) of the value of works, as determined by the procuring entity, are completed. If, after fifty percent (50%) completion, the work 131 As amended by GPPB Resolution No. 07-2018, dated 18 May 2018, published in the Official Gazette on 20 August 2018. 132 Ibid. 133 Ibid. 121  The 2016 Revised Implementing Rules and Regulations – Annex “E” is satisfactorily done and on schedule, no additional retention shall be made; otherwise, the ten percent (10%) retention shall be imposed. 6.2 The total "retention money" shall be due for release upon final acceptance of the works. The contractor may, however, request the substitution of the retention money for each progress billing with irrevocable standby letters of credit of from a commercial bank, bank guarantees or surety bonds callable on demand, of amounts equivalent to the retention money substituted for and acceptable to Government, provided that the project is on schedule and is satisfactorily undertaken. Otherwise, the ten percent (10%) retention shall be made. Said irrevocable standby letters of credit, bank guarantees and/or surety bonds, to be posted in favor of the Government shall be valid for a duration to be determined by the concerned implementing office/agency or procuring entity and will answer for the purpose for which the ten percent (10%) retention is intended, i.e., to cover uncorrected discovered defects and third party liabilities. 7. CONTRACT COMPLETION Once the project reaches an accomplishment of ninety-five (95%) of the total contract amount, the procuring entity may create an inspectorate team to make preliminary inspection and submit a punch-list to the contractor in preparation for the final turnover of the project. Said punch-list will contain, among others, the remaining works, work deficiencies for necessary corrections, and the specific duration/time to fully complete the project considering the approved remaining contract time. This, however, shall not preclude the procuring entity's claim for liquidated damages. 8. NEGATIVE SLIPPAGE134 The Procuring Entity shall ensure the timely implementation of infrastructure projects by monitoring the performance of the contractors.135 When the contractor incurs negative slippage during the contract duration, the Procuring Entity shall implement the calibrated measures provided under GPPB Circular No. 03-2019 dated 8 March 2019, entitled “Guidance on Contract Termination due to Fifteen Percent (15%) Negative Slippage by the Contractor in Infrastructure Projects.”136 9. LIQUIDATED DAMAGES 9.1 Once the contract duration expires, including any time extension duly granted, and137 the contractor refuses or fails to satisfactorily complete the work, the Procuring Entity shall impose upon the contractor in default liquidated damages. Liquidated damage is an amount equal138 to at least one tenth (1/10) of one (1) percent of the cost of the unperformed portion of the works for every day of delay. 9.2 In computing for liquidated damages, the Procuring Entity determines the usability of the project.139 A project or a portion thereof may be deemed usable when it starts to provide the desired benefits as certified by the targeted end- users and 134 As amended by GPPB Resolution No. 02-2020, dated 27 February 2020, published in the Philippine Star on 22 April 2020. 135 Ibid. 136 Ibid. 137 Ibid. 138 Ibid. 139 Ibid. 122  The 2016 Revised Implementing Rules and Regulations – Annex “E” the concerned Procuring Entity. 9.3 To be entitled to such liquidated damages, the Procuring Entity does not have to prove that it has incurred actual damages. Such amount shall be deducted from any money due or which may become due the contractor under the contract or collect such liquidated damages from the retention money or other securities posted by the contractor, or a combination thereof,140 whichever is convenient to the Procuring Entity. 9.4 In case the total sum of liquidated damages reaches ten percent (10%) of the total contract price, the Procuring Entity has the following options:141 9.4.1 Terminate the contract pursuant to the Guidelines on Termination of Contract and forfeit the erring contractor’s performance security. After termination, the Procuring Entity may either (i) take over the contract; or (ii) resort to any of other alternative methods of procurement provided under R.A. No. 9184 and its 2016 revised rules and regulations; or142 9.4.2 Allow the contractor to continue the works without prejudice to the continued imposition of liquidated damages until the works have been completed. This does not, however, preclude the Procuring Entity in resorting to Termination of Contract under Annex I of the 2016 revised IRR of RA No. 9184.143 10. SUSPENSION OF WORK 10.1 The procuring entity shall have the authority to suspend the work wholly or partly by written order for such period as may be deemed necessary, due to force majeure or any fortuitous events or for failure on the part of the contractor to correct bad conditions which are unsafe for workers or for the general public, to carry out valid orders given by the procuring entity or to perform any provisions of the contract, or due to adjustment of plans to suit field conditions as found necessary during construction. The contractor shall immediately comply with such order to suspend the work wholly or partly. 10.2 The contractor or its duly authorized representative shall have the right to suspend work operation on any or all projects/activities along the critical path of activities after fifteen (15) calendar days from date of receipt of written notice from the contractor to the district engineer/regional director/consultant or equivalent official, as the case may be, due to the following: a. There exist right-of-way problems which prohibit the contractor from performing work in accordance with the approved construction schedule. b. Requisite construction plans which must be owner-furnished are not issued to the contractor precluding any work called for by such plans. c. Peace and order conditions make it extremely dangerous, if not possible, 140 Ibid. 141 Ibid. 142 Ibid. 143 Ibid. 123  The 2016 Revised Implementing Rules and Regulations – Annex “E” to work. However, this condition must be certified in writing by the Philippine National Police (PNP) station which has responsibility over the affected area and confirmed by the Department of Interior and Local Government (DILG) Regional Director. d. There is failure on the part of the procuring entity to deliver government- furnished materials and equipment as stipulated in the contract. e. Delay in the payment of contractor's claim for progress billing beyond forty- five (45) calendar days from the time the contractor's claim has been certified to by the procuring entity’s authorized representative that the documents are complete unless there are justifiable reasons thereof which shall be communicated in writing to the contractor. 10.3 In case of total suspension, or suspension of activities along the critical path, which is not due to any fault of the contractor, the elapsed time between the effective order of suspending operation and the order to resume work shall be allowed the contractor by adjusting the contract time accordingly. 11. EXTENSION OF CONTRACT TIME 11.1 Should the amount of additional work of any kind or other special circumstances of any kind whatsoever occur such as to fairly entitle the contractor to an extension of contract time, the procuring entity shall determine the amount of such extension; provided that the procuring entity is not bound to take into account any claim for an extension of time unless the contractor has, prior to the expiration of the contract time and within thirty (30) calendar days after such work has been commenced or after the circumstances leading to such claim have arisen, delivered to the procuring entity notices in order that it could have investigated them at that time. Failure to provide such notice shall constitute a waiver by the contractor of any claim. Upon receipt of full and detailed particulars, the procuring entity shall examine the facts and extent of the delay and shall extend the contract time completing the contract work when, in the procuring entity's opinion, the findings of facts justify an extension. 11.2 No extension of contract time shall be granted the contractor due to (a) ordinary unfavorable weather conditions and (b) inexcusable failure or negligence of contractor to provide the required equipment, supplies or materials. 11.3 Extension of contract time may be granted only when the affected activities fall within the critical path of the PERT/CPM network. 11.4 No extension of contract time shall be granted when the reason given to support the request for extension was already considered in the determination of the original contract time during the conduct of detailed engineering and in the preparation of the contract documents as agreed upon by the parties before contract perfection. 11.5 Extension of contract time shall be granted for rainy/unworkable days considered unfavorable for the prosecution of the works at the site, based on the actual conditions obtained at the site, in excess of the number of rainy/unworkable days pre-determined by the government in relation to the original contract time during 124  The 2016 Revised Implementing Rules and Regulations – Annex “E” the conduct of detailed engineering and in the preparation of the contract documents as agreed upon by the parties before contract perfection, and/or for equivalent period of delay due to major calamities such as exceptionally destructive typhoons, floods and earthquakes, and epidemics, and for causes such as non-delivery on time of materials, working drawings, or written information to be furnished by the procuring entity, non-acquisition of permit to enter private properties within the right-of- way resulting in complete paralization of construction activities, and other meritorious causes as determined by the Government's authorized Engineer and approved by the procuring entity. Shortage of construction materials, general labor strikes, and peace and order problems that disrupt construction operations through no fault of the contractor may be considered as additional grounds for extension of contract time provided they are publicly felt and certified by appropriate government agencies such as DTI, DOLE, DILG, and DND, among others. The written consent of bondsmen must be attached to any request of the contractor for extension of contract time and submitted to the procuring entity for consideration and the validity of the performance security shall be correspondingly extended. 12. ACCREDITATION OF TESTING LABORATORIES 12.1 To help ensure the quality of materials being used in infrastructure projects, the Bureau of Research and Standards (BRS) of the DPWH, Department of Science and Technology (DOST), or Department of Trade and Industry (DTI) shall accredit, in accordance with industry guidelines, the testing laboratories whose services are engaged or to be engaged in infrastructure projects. All government infrastructure project owners must accept results of material test(s) coming only from DOST/BRS accredited laboratories. 13. EVALUATION OF CONTRACTORS PERFORMANCE 13.1 Subject and Scope All Procuring Entities implementing government infrastructure projects are mandated to evaluate the performance of their contractors using the NEDA- Approved Constructors Performance Evaluation System (CPES) Guidelines for the type of project being implemented. These guidelines cover all infrastructure projects awarded by the government regardless of contract amount and funding source. CPES evaluation shall be done during construction and upon completion of each government project. To ensure continuous implementation of CPES, all Procuring Entities concerned are required to include in their Projects’ Engineering and Administrative Overhead Cost the budget for the implementation of CPES pursuant to NEDA Board Resolution No. 18 (s. 2002). 13.2 Evaluation Guidelines For project types which do not have specific CPES Guidelines, the Procuring Entities concerned may formulate and adopt their own implementing Guidelines specific to their needs provided the NEDA-INFRACOM poses no objections to their adoption, and provided further that said Guidelines are made known to all prospective bidders. 125  The 2016 Revised Implementing Rules and Regulations – Annex “E” 13.3 Implementation Mechanism for CPES All Procuring Entities implementing infrastructure projects are required to establish CPES Implementing Units (IUs) in their respective offices/agencies/corporations. The CPES Implementing Units shall be responsible for the implementation of the CPES Implementing guidelines, including but not limited to, the supervision of Constructors Performance Evaluators (CPEs) to be accredited by the Construction Industry Authority of the Philippines (CIAP). The procuring entity’s CPES IU shall be responsible for the following: a) pre-screening of applications of CPEs, b) funding for CPEs accreditation training and seminars; and c) yearly evaluation of CPEs. 13.4 Submission and Dissemination of Evaluation Results All Procuring Entities implementing CPES shall submit the results of their performance evaluation to the CIAP on a monthly basis or as often as necessary. The procuring entity’s CPES-IU shall likewise develop and maintain a databank and disseminate the CPES reports to the concerned units/departments within the procuring entity and to other interested users. 13.5 Utilization of Evaluation Results 13.6 The CIAP shall consolidate all of the CPES evaluation results received and shall disseminate the same to all Procuring Entities concerned. The CPES rating and other information shall be used by the concerned government agencies for the following purposes: (a) pre-qualification/eligibility screening of constructors; (b) awarding of contracts; (c) project monitoring and control; (d) issuance of Certificate of Completion; (e) policy formulation/review; (f) industry planning; (g) granting of Incentives/Awards, and, in adopting measure to further improve performance of contractors in the prosecution of government projects. 14. OTHER RULES AND GUIDELINES The rules and regulations for the other aspects of contract implementation shall be included in the manuals to be issued by the GPPB, such as, but not limited to, the following: a) Sub-contracting; b) Interference with Traffic and Adjoining Properties; c) Clearance of Project Site of Obstruction; d) Inspection and Testing; e) Daywork; f) Measurement of Works; and g) Other Implementation Aspects. 126  The 2016 Revised Implementing Rules and Regulations – Annex “F” ANNEX “F” CONTRACT IMPLEMENTATION GUIDELINES FOR THE PROCUREMENT OF CONSULTING SERVICES 1. Advance Payment for Mobilization The Government, as it considers fair and reasonable, may allow advance payment to the Consultant in the amount which shall not exceed fifteen percent (15%) of the contract amount to cover the cost of mobilization, subject to the posting of an irrevocable standby letter of credit issued by an entity acceptable to the agency and of an amount equal to the advance payment. The advance payment shall be repaid by the Consultant by deducting from his progress payments such sum as agreed upon during the contract negotiations until fully liquidated within the duration of the contract. 2. Cost of Consulting Services All Consultancy contracts shall be fixed price contracts. Any extension of contract time shall not involve any additional cost. 3. Other Rules and Guidelines The rules and regulations for the other aspects of contract implementation shall be included in the manuals to be issued by the GPPB. 127  The 2016 Revised Implementing Rules and Regulations – Annex “G” ANNEX “G” GUIDELINES FOR THE PROCUREMENT AND IMPLEMENTATION OF CONTRACTS FOR DESIGN AND BUILD INFRASTRUCTURE PROJECTS 1. SCOPE AND APPLICATION These guidelines shall govern the procurement and implementation of contracts for design and build infrastructure projects and shall supplement applicable provisions of Republic Act No. 9184 (RA 9184) and its Revised Implementing Rules and Regulations (IRR) in particular Section 17.6 and Annex E. 2. PURPOSE These guidelines are formulated to determine the conditions for the use of the design and build scheme for infrastructure projects and the procedures for the implementation thereof. 3. GUIDING PRINCIPLES The procuring entity, prior to resorting to the design and build scheme, should consider the following advantages and disadvantages of said scheme: 3.1 Advantages: a) Since both design and construction are in the hands of the contractor, there is a single point of responsibility for quality, cost, and schedule adherence, including the risks related to design. This precludes buck- passing and finger-pointing between the designer and the builder. b) Because design and construction periods can overlap, the total design and construction time, as well as the final project cost, will be significantly reduced. c) The procuring entity is assured of quality considering that the larger responsibility implicit in the design-build scheme serves as motivation for high quality of the facility to be provided. Once the requirements of the procuring entity are defined in performance terms, the designer-builder is responsible for producing the results accordingly. The designer-builder warrants to the procuring entity that the design documents are complete and free from error. d) The procuring entity does not need to spend much time and money in seeing to it that the work is done by the contractor exactly as indicated by the design documents prepared by the designer, and in coordinating and arbitrating between separate design and construction contracts. 3.2 Disadvantages: a) Procuring Entities should, however, take into account that in utilizing the design and build scheme for a particular project, contractors are given too much discretion in determining the project cost and there is difficulty in predicting its final cost until the actual commencement of construction. This, however, can be addressed by prescribing that the bid/contract price should not exceed the Approved Budget for Contract (ABC) of the 128  The 2016 Revised Implementing Rules and Regulations – Annex “G” procuring entity and that the contract price is a fixed lump sum amount. b) Considering that the extent of the integration of design and construction of the project is exceptionally dependent on the contractor, there may be cases when the end-result may not be exactly in accordance with what the procuring entity has required. These cases can be avoided if the procuring entity adequately defines the output or performance specifications and parameters. 4. DEFINITION OF TERMS a. Approved Budget for the Contract (ABC). This shall be a lump sum amount that shall cover the cost of design and construction works (at the option of the procuring entity) based on the conceptual design and performance specifications and in accordance with applicable provisions of the law or agency guidelines. The ABC shall be calculated based on either the approximate quantities of work of the conceptual design, from standardized designs or from cost records of previous projects of similar kind. b. Bidding Documents for Design and Build Scheme. These shall basically be similar to the Bidding Documents for infrastructure projects and shall also include the performance specifications and parameters to be followed by the design and build contractors and the method for allocation of risks for the design and build contract, among others. c. Conceptual Design. This shall describe the general idea of the procuring entity with regard to the completed facility and shall identify the scope or physical components and structures, specific outputs and requirements of the structures and proposed methods of construction, where necessary. d. Design and Build Projects. This refers to infrastructure projects where the procuring entity awards a single contract for the architectural/engineering design and construction to a single firm, partnership, corporation, joint venture or consortium. e. Performance Specifications and Parameters. The procuring entity shall define the required performance specifications and criteria and its means of measurement based on the operating outputs and in accordance with appropriate design and construction standards, legal and technical obligations and any other relevant government commitments as required by existing laws and regulations. It shall not be drawn up to favor a particular solution, design and construction method. f. Preliminary Investigations. These shall include, among others, information on soil, geotechnical, hydrologic, hydraulic, seismic, traffic, and environmental conditions that shall be used to define project design criteria, to set the basis for any changed conditions and establish preliminary project cost estimates. g. Preliminary Survey and Mapping. These shall determine boundaries and provide stationing along control lines to establish feature and design criteria location, and identify existing and future right-of-way limits and construction easements associated with the procuring entity’s conceptual design. 129  The 2016 Revised Implementing Rules and Regulations – Annex “G” h. Project Description. This shall define the objectives, purpose, limitations or constraints, as well as the allocation of risks between the procuring entity and the winning bidder. i. Utility Locations. The procuring entity shall provide information on existing utilities in and around the project’s area. 5. CONDITIONS FOR THE USE OF THE DESIGN AND BUILD SCHEME 5.1 The Design and Build scheme shall be applied under any of the following cases: a) For flagship, priority and fast track projects that need to be completed on a tight completion schedule, as included in the Medium-Term Public Investment Program (MTPIP) for national projects and in the Regional Development Investment Plan (RDIP) for regional a