CMPM_L1_Contracts and Specifications Flashcards
It prescribes policies, guidelines, rules and regulations for government infrastructure contracts.
PRESIDENTIAL DECREE NO. 1594
It is the policy of the government to adopt a
set rules and regulations covering government contracts for
infrastructure and other construction projects which shall:
(a) bring about maximum efficiency in project implementation and
minimize project costs and contract variations through sound practices in
contract management;
(b) promote a healthy partnership between the government and the
private sector in furthering national development; and
(c) enhance the growth of the local construction industry and
optimize the use of indigenous
manpower, materials and other sources.
SECTION 1
POLICY OBJECTIVES
SECTION 2. DETAILED ENGINEERING
No ________ and/or __________ for a construction
project shall be made unless the detailed engineering
investigations, surveys, and designs for the project have
been sufficiently carried out in accordance with the
standards and specifications to be established under the
rules and regulations to be promulgated pursuant to _______ of this Decree so as to minimize quantity and cost
overruns and underruns, change orders and extra work
orders, and unless the detailed engineering documents have
been approved by the _________________________, as the case may be.
*bidding and/or award of contract
*Section 12
*Minister of Public Works, Transportation and Communications, the Minister of Public
Highways, of the Minister of Energy
SECTION 3. PREQUALIFICATION OF PROSPECTIVE
CONTRACTORS
A prospective contractor may prequalified to offer
his bid or tender for a construction project only if he
meets the following requirements:
Legal Requirements
Technical Requirements
Financial Requirements
Filipino participation
The prospective contractor must have been licensed as a
contractor for the current year pursuant to Republic Act
No. 4566,
Must have paid his privilege tax to practice or engage in
the contracting business for the current year,
Must comply with the Administrative Order No. 66 of the
Office of the President of the Philippines, and
Must comply with other existing pertinent laws, rules and
regulations.
LEGAL REQUIREMENTS
The prospective contractor must meet the
following technical requirements to be established
in accordance with the rules and regulations and to
enable him to satisfactorily prosecute the subject
project:
Competence and experience of the contractor in
managing projects similar to the subject project.
Competence and experience of the contractor’s key
personnel to be assigned to the subject project.
Availability and commitment of the contractor’s
equipment to be used for the subject project.
TECHNICAL REQUIREMENTS
The Government shall promote maximum
participation of eligible Filipino contractors in all
construction projects.
FILIPINO PARTICIPATION
The net worth and liquid assets of the prospective
contractor must meet the requirements, to be established
in accordance with the rules and regulations to be
promulgated pursuant to Section 12 of the P.D 1594, to
enable him to satisfactorily execute the subject project.
The prospective contractor may be allowed to cover the
deficiency in the required net worth through a line of
credit fully committed to the subject project by a bank or
financial institution acceptable to the Ministry concerned.
FINANCIAL REQUIREMENTS
SECTION 4. BIDDING.
Construction projects shall generally be undertaken by contract after
____________________.
Projects may be undertaken by administration or force account or by
negotiated contract only in exceptional cases where time is of the
essence, or where there is lack of qualified bidders or contractors, or
where there is a conclusive evidence that greater economy and
efficiency would be achieved through this arrangement, and in
accordance with provision of laws and acts on the matter, subject to
the approval of the Ministry of Public Works, Transportation and
Communications, the Minister of Public Highways, or the Minister of
Energy, as the case may be, if the project cost is less than P1 Million,
and of the President of the Philippines, upon the recommendation of
the Minister, if the project cost is P1 Million or more.
Competitive public bidding.
Under Section 4
A _________________, in an amount to be established in accordance
with the rules and regulations to be promulgated pursuant to
Section 12 of P.D. 1594, shall accompany the bid to guarantee
that the successful bidder shall, within a prescribed period
from receipt of the notice of award, enter into account and
furnish the required performance bond for the faithful and
complete prosecution of the work specified in the contract
documents.
bidder’s bond
SECTION 5. AWARD AND CONTRACT.
The contract may be awarded to the _______________ whose
bid as evaluated complies with all the terms and conditions in the call
for bid and is the most advantageous to the Government.
To guarantee the faithful performance of the contractor, he shall, prior
to the award, post a performance bond, in an amount to be established
in accordance with the rules and regulations to be promulgated under
Section 12 of P.D. 1594.
All awards and contracts duly executed in accordance with the
provisions of P.D. 1594 shall be subject to the approval of the Minister of
Public Works, Transportation and Communications, the Minister of
Public Highways, or the Minister of Energy, as the case may be.
Lowest prequalified bidder
SECTION 6. ASSIGNMENT AND SUBCONTRACT
The contractor shall not (5)_______________________________________ therein
except with the approval of the Minister of Public Works,
Transportation and Communications, the Minister of Public Highways,
or the Minister of Energy, as the case may be.
Approval of the subcontract shall not relieve the main contractor from
any liability or obligation under his contract with the Government nor
shall it create any contractual relation between the subcontractor and
the Government.
Assign, transfer, pledge, subcontract or make
any other disposition of the contract or any part of interest
SECTION 7. RESPONSIBILITY OF THE CONTRACTOR
The contractor shall assume _____________ for the
contract work until its final acceptance by the Government
and shall be held responsible for any damage or destruction
of works except those occasioned by _______________.
Except likewise for force majeure, the contractor shall be
fully responsible for the safety, protection, security, and
convenience of his personnel, third parties, and the public at
large, as well as the works, equipment, installation and the
like to be affected by his construction work
*full responsibility
*force majeure
These are unforeseeable circumstances that prevent someone from fulfilling
a contract
Force majeure
SECTION 8. ADJUSTMENT CONTRACT PRICE
Adjustment of contract price for construction projects may be
authorized by the Minister of Public Works, Transportation and
Communications, the Minister of Public Highways, or the Minister of
Energy, as the case may be, upon recommendation of the __________________, if during the effectivity of the
contract, the cost of labor, equipment, materials and supplies required
for the construction should increase or decrease due to direct acts of
the Government.
The adjustments of the contract price shall be made using appropriate
formulas established in accordance with the rules and regulations to
be promulgated under Section 12 of P.D. 1594.
National Economic and Development Authority
