PROVIDING ADDITIONAL POLICIES AND GUIDELINES IN THE PROCUREMENT OF GOODS AND SUPPLIES BY THE NATIONAL GOVERNMENT

WHEREAS, the increasing prevalence of information technology in
commercial transactions requires corresponding changes in existing
procurement procedures;

WHEREAS, recent developments in information technology provide
alternative means of procurement using the convenience and
cost-effectiveness of electronic and telecommunications technology;

WHEREAS, the Armed Forces of the Philippines (AFP) Modernization Act
of 1995 mandates the Department of National Defense (DND)-AFP to
strengthen its systems and procedures for equipment acquisition, taking
into account new requirements under the AFP Modernization Program;

WHEREAS, international defense procurement procedures involving
sophisticated defense equipment and weapons systems allow the submission
of bids without a bid bond but with other forms of security, such as
the sovereign guarantee by the bidder’s government;

WHEREAS, there is a need to allow DND-AFP to adopt procurement
procedures that will enable it to procure the best equipment and weapons
systems that its modernization funds can afford from the market;

NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the
Philippines, by virtue of the powers vested in me by law, do hereby
order:

SECTION 1. Section 1 of Executive Order No. 302, series of 1996, is hereby amended to read as follows:

“SECTION 1. A set of rules and regulations covering
contracts for the procurement of goods and supplies for both
project-related and normal/regular operation and maintenance activities
of the National Government be adopted for the following purposes:

a. to purchase goods of acceptable quality at fair and
reasonable prices from qualified and capable
suppliers/manufacturers/distributors, with on time delivery and
satisfactory compliance of all contract terms and conditions;

b. to assure fair and equitable treatment of
suppliers/manufacturers/distributors, including arrangements for prompt
payments;

c. to accomplish procurement through open competitive bidding in the interest of economy and efficiency;

d. to adopt procurement procedures that utilize information technology; and

e. to maintain and collect data for refinement of procurement policies and procedures based on experiences gained.”

SECTION 2. Solely for purposes of procurement
involving sophisticated defense equipment and weapons systems under the
AFP Modernization Program, DND-AFP is hereby authorized to accept bids
with alternative bid securities such as, but not limited to, the
sovereign guarantee of the bidder’s government.

SECTION 3. The Committee on Infrastructure (INFRACOM)
of the NEDA Board shall, subject to approval of the President, formulate
and promulgate the rules and regulations to implement the amendment to
Executive Order No. 302, series of 1996, embodied in Section 1 of this
Executive Order.

SECTION 4. The Secretary of National Defense shall issue rules and regulations to implement Section 2 of this Executive Order.

SECTION 5. If any provision of this Executive Order
and its implementing rules and regulations is held invalid, the other
provisions not affected thereby shall remain valid and continue in
operation.

SECTION 6. All other orders, memorandum circulars,
rules and regulations, and other issuances inconsistent with this
Executive Order are hereby repealed or modified accordingly.

SECTION 7. This Executive Order shall take effect immediately.

Adopted: 18 Jan. 2000

By the President:

(SGD.) RONALDO B. ZAMORA
           Executive Secretary