Table 2-21: Process for Unsolicited Proposals Under RA 7718

Private Sector

Process Flow

LGU

Proponent prepares and submits to the agency/LGU a complete proposal, consisting of at least a feasibility study, company profile, and the draft contract.

SUBMISSION OF A COMPLETE PROPOSAL

Acknowledges receipt and advises the proponent, within 7 cd from submission, if proposal is complete, or if incomplete what additional information is necessary.

EVALUATION OF THE PROPOSAL

If proposal is complete, LGU evaluates the project proposal and advises the proponent in writing, 30 cd, whether it accepts or rejects the proposal. Acceptance gives the proponent the "original proponent" status. The LGU shall inform the Approving Body of its decision to accept or to reject the unsolicited proposal. In case of acceptance, the LGU submits to the Approving Body all pertinent documentation.

NEGOTIATION WITH ORIGINAL PROPONENT

LGU shall negotiate with the original proponent and shall secure confirmation of the indicative reasonable rate of return from the Approving Body prior to negotiation. Negotiations shall be completed within 90 cd from receipt by the original proponent of written notice from the LGU to commence negotiation. At the end of the 90 cd negotiation period, the LGU shall submit a report of the result of its negotiation with the original proponent to the Approving Body.

APPROVAL OF THE PROJECT PROPOSAL AND CONTRACT BY THE APPROVING BODY (ICC, NEDA BOARD OR LOCAL SANGGUNIAN)

Head of LGU endorses the proposal and the contract to the Approving Body. It shall be accompanied by an evaluation by the LGU of the project's merits as justification for accepting the project.

The Approving Body is given 30 cd from receipt of the endorsement by the LGU to render a decision on the project and the contract. The Approving Body shall issue the Notice of Approval to the original proponent

ADJUSTMENTS OF TOLLS/ FEES/ RENTALS / CHARGES

Prior to bidding, the LGU shall secure either the advice of the Regulator or the approval of the Approving Body or both, as the case maybe, for the pre-determined formula and official price indices for the adjustment of tolls, fees, rentals and charges that may be granted during contract implementation.

Within 45 cd from the receipt of the Notice of Approval issued by the Approving Body, the original proponent shall notify the LGU in writing of its acceptance of all the terms and conditions of the approval of the Approving Body. Failure by the original proponent to submit such acceptance in writing shall be deemed a rejection of the unsolicited proposal.

ACCEPTANCE OF TERMS AND CONDITIONS BY THE ORIGINAL PROPONENT

The original proponent posts a bid bond on the first date of the publication of the solicitation for comparative proposals. It reformats and resubmits its proposal according to the requirements of the agreed terms of reference (TOR) for the solicitation of comparative proposals.

ISSUANCE OF INVITATION FOR COMPARATIVE PROPOSALS

The LGU PBAC shall publish the invitation for comparative proposals after receipt of the notification from the original proponent that the latter accepts all the terms and conditions indicated in the Notice of Approval. The invitation shall be published for 3 consecutive weeks in at least 1 newspaper of general circulation. Said invitation shall also be posted continuously in the website of the LGU concerned, if available, during the stated period. For projects costing at least US$10 million, the invitation may also be published at least once in at least 1 international publication.

Comparative proponents are given 60 working days to submit their proposals, reckoned from the date of issuance of tender documents. Proposals shall be prepared and submitted in 3 envelopes:

First envelope - the qualification Documents,

Second envelope - the technical proposal,

including the bid security, and Third envelope - the financial proposal.

PREPARATION AND SUBMISSION OF COMPARATIVE PROPOSALS

The PBAC shall hold a pre-bid conference 10 working days after the issuance of the tender documents.

EVALUATION OF PROPOSALS

The PBAC evaluates the first envelope within 30 cd from the deadline set for the submission of bids. The second envelope of qualified comparative proponents shall be evaluated 30 cd. Finally, the third envelope of technically complying comparative proponents shall be evaluated within 15 cd. If the price of the original proponent was not disclosed in the tender documents, it shall be revealed upon the opening of the financial proposals of the technically complying comparative proponents.

The original proponent shall have the right to match the best proposal within 30 working days upon the official notification by the LGU of the most advantageous financial proposal.

DETERMINATION OF THE WINNING PROPONENT

If the price of the winning comparative proponent is not matched, the winning comparative proponent shall be considered for award. In the event of refusal, inability or failure of the winning comparative proponent to enter into contract with the LGU, the LGU concerned shall consider for award the bidder with the next-ranked complying comparative bid which is better than the offer of the original proponent. The original proponent shall again be given the right to match the comparative proponent's bid. If no other comparative bid is determined to be better than the offer of the original proponent, the project shall immediately be awarded to the original proponent.

APPROVAL OF CONTRACT AWARD

PBAC submits to the Head of LGU recommendations for contract award within 7 cd after completion of the financial evaluation. Head of LGU approves recommendation for contract award within 7 cd after submission of PBAC recommendation. All unsuccessful bidders shall be informed in writing of the results of the bidding.

Winning project proponent receives Notice of Award and shall comply within 30 cd with all the conditions and requirements indicated therein.

ISSUANCE OF NOTICE OF AWARD

Head of LGU signs and issues Notice of Award to winning bidder, indicating, among others, the requirements to be submitted by the winning project proponent within 30 cd from official receipt of the Notice of Award. Within 7 cd upon receipt of the requirements of the award, the Head of LGU shall determine and notify the winning project proponent of its compliance of all conditions stated in the Notice of Award. If deadline is not met, and unless otherwise extended, the LGU could confiscate bid security.

The authorized signatory of the winning project proponent is required to sign the contract within 7 cd from receipt of advice from the LGU that it has complied with all conditions stated in the Notice of Award.

EXECUTION/ APPROVAL OF CONTRACT

The authorized signatory of the LGU is required to sign the contract within 7 cd from receipt by the winning project proponent of the advice from the LGU that the former has complied with all conditions stated in the Notice of Award. The contract shall be effective upon signing by the Head of LGU unless another date is stipulated there. An original signed copy of the contract shall be submitted to the Approving Body within 7 cd after signing.

Complies with conditions precedent for contract implementation (usually includes financial closure).

ISSUANCE OF NOTICE TO COMMENCE IMPLEMENTATION & CONTRACT IMPLEMENTATION

Shall issue the Notice to Commence Implementation of the project to the winning project proponent not later than 7 cd from the date of approval/ signing of the contract by the Head of LGU. LGU complies with conditions precedent for contract implementation.