Deep dive into PPPs (2)

Deep dive into PPPs (2) | Daily Tribune

We continue our discussion on PPPs, this time focusing on Unsolicited Proposals.

Unsolicited Proposals are now allowed for projects identified in the government’s List of PPP Projects, except those that have already been approved by the approving body. This abandons the previous rule wherein Unsolicited Proposals could only be accepted for projects not included in the government’s priority list, except when involving a new concept or technology. If the Implementing Agency has already incurred any development costs for a project that is the subject of an Unsolicited Proposal, the winning Private Proponent shall reimburse the Implementing Agency for the development costs, which should not exceed six percent of the Project Cost.

As regards the process, all Unsolicited Proposals must first be submitted by the Private Proponent through the Unsolicited Proposals Submission Portal on the PPP Center website. The PPP Center has 10 days to determine the completeness of the Unsolicited Proposal and the appropriate Approving Body; otherwise, it shall be deemed incomplete. A completeness checklist for Unsolicited Proposals is available on the PPP Center’s website.

A new requirement under the PPP Code IRR is a Certification that the Unsolicited Proposal does not include prohibited Government Undertakings. Nonetheless, it should be noted that right-of-way-related costs and/or contribution of assets, properties, and/or rights — including usufruct — as long as the government receives appropriate compensation, are exceptions to the general rule that Government Undertakings are not allowed for Unsolicited Proposals.

Once the submission is acknowledged by the PPP Center, no supplementary submissions or documents from the Private Proponent shall be considered in the completeness check. Note also that an Unsolicited Proposal may only be submitted for determination of completeness to the PPP Center on a maximum of three occasions. If deemed complete, the PPP Center shall then endorse the Unsolicited Proposal to the appropriate Implementing Agency, which has the option either to reject it or proceed with the detailed evaluation. The Implementing Agency shall inform the Private Proponent in writing of its decision within 10 days from receipt of the Unsolicited Proposal from the PPP Center.

On the other hand, if the Unsolicited Proposal is incomplete, the PPP Center shall notify the Private Proponent and list down the lacking information and/or requirements. The decision of the PPP Center to return the Unsolicited Proposal is final and non-appealable, without prejudice to the right of the Private Proponent to resubmit the same.

Should there be similar Unsolicited Proposals, they may only be entertained if submitted within the 10-day completeness check by the PPP Center. In case all are endorsed by the PPP Center, the Implementing Agency shall determine the most advantageous proposal for the government and the public. However, if submitted beyond such period, the said submission shall no longer be assessed for completeness and shall be returned to the Private Proponent, without prejudice to its right to participate in the comparative challenge process.

If the Implementing Agency decides to continue processing the Unsolicited Proposal, it shall conduct a detailed evaluation within 90 days from the issuance of its written decision. After the detailed evaluation, the Implementing Agency shall again decide whether to accept or reject the Unsolicited Proposal, with the option to bid out the project as a Solicited Project. The decision of the Implementing Agency shall be made known to the Private Proponent within three days from the end of the detailed evaluation period, and such decision shall likewise be final and non-appealable.

In case of acceptance, the Private Proponent must notify the Implementing Agency and the PPP Center of its duly authorized representatives within seven days from receipt of the Notice to Commence Negotiations. The Implementing Agency and the Private Proponent shall then proceed with and complete negotiations within a period of 80 days but not less than 30 days, which may be mutually extended to a period of 150 days.

If negotiation is successful, the original proponent status shall be granted to the Private Proponent for a period not exceeding one year. The Implementing Agency and the Private Proponent shall likewise submit to the appropriate Approving Body the complete set of requirements, including the negotiated Parameters, Terms and Conditions, for approval within 30 days from the end of negotiation. In case of failure of negotiation, the Unsolicited Proposal shall be rejected, and the Implementing Agency may either accept a new Unsolicited Proposal or bid out the project as a Solicited Project. If the Implementing Agency fails to act during the negotiation period, such shall be deemed a failure of negotiation.

For more of Dean Nilo Divina’s legal tidbits, please visit www.divinalaw.com. For comments and questions, please send an email to cad@divinalaw.com.