THE BANGKO Sentral ng Pilipinas (BSP) will keep an eye on banks’ compliance with a US tax law but has not set any definite sanctions should lenders fail to fulfill their obligations, its chief said.
“The BSP has no defined sanctions for non-compliance,” central bank governor Amando M. Tetangco, Jr. said in an e-mail to reporters in response to a query on how it intends to implement the Foreign Account Tax Compliance Act (FATCA) here.
“The ultimate consequence of non-compliance is the withholding by the US government of 30% of income sourced from the US,” he said.
Mr. Tetangco said that what is within the BSP’s ambit is to direct banks to take measures “should non-compliance result in unfavorable consequences on the operations of banks.”
“The BSP’s actions would be more on working to encourage banks to establish systems that they would need to enable them to comply with the FATCA requirements,” said the BSP chief.
Legislated in the US four years ago, the FATCA is aimed at compelling Americans who are hiding money in offshore accounts to pay the right taxes.
Under FATCA, financial institutions outside the US with accounts of American nationals should register with the Internal Revenue Service (IRS) as foreign financial institutions (FFIs), and are required to audit their accounts and report those that hold US income.
Those that fail to sign up with the IRS by end-June 2014 will be slapped a 30% withholding tax on all US-sourced income starting July 1.
A list published by the IRS early this month showed a total of 148 Philippine financial institutions that registered with the US tax authority by May 5 and secured approvals as of May 23.
All in all, there are 26 universal and commercial banks, 14 thrift banks and three rural banks on the IRS list.
The 148 Philippine FFIs signed up with the IRS in the absence of an intergovernmental agreement (IGA), which is still being negotiated between the Philippines and the US.
The IGA will facilitate the transmission of information from these FFIs to the Philippines’ tax authority, the Bureau of Internal Revenue (BIR), which will then pass on the information to the IRS.
BIR Commissioner Kim S. Jacinto-Henares has said that the Philippines will adopt the “Model 1A IGA,” and that the country has up to the end of the year to sign an agreement. Under this model, institutions will report to the BIR and the agency will give the necessary information to the US IRS for them.
The Philippine financial institutions signed up with IRS under “Model 2,” where they will give information on accounts held by “US persons” with at least an aggregate value of $50,000, in the case of individual account holders, and $250,000, in the case of corporations, directly to the IRS. -- Bettina Faye V. Roc
sourcE: Businessworld
Sunday, June 29, 2014
Overcoming compliance fatigue
EARLIER this month, findings of an Ernst & Young (EY) survey on fraud, bribery and corruption made the headlines. It revealed a concerning picture of some executives’ attitudes towards private sector misconduct in the Philippines and 58 other countries. It is only apt, then, to now discuss how to uncover such unethical practices and minimize their impact on business.
The issue is becoming more important than ever. According to EY’s 13th Global Fraud Survey, “Overcoming compliance fatigue: Reinforcing commitment to ethical growth”, many of the world’s regulators are stepping up investigations against misconduct. Authorities from the United States, United Kingdom, Germany, Italy, France, Japan and even emerging economies like India, Brazil and China are adopting stronger enforcement against violations such as insider trading, money laundering, price manipulation, cartels, and bribery. Here in the Philippines, high-profile cases in the public and private sectors are progressing through the legal systems as well.
Consumers and investors are likewise increasing their scrutiny in the aftermath of the financial downturn. Regulators, in response, are expected to use a broader scope in enforcing good corporate conduct.
However, despite this heightened regulatory pressure, the incidence of fraud and reported levels of corruption do not appear to be declining, according to the EY report. Of the 2,700 executives surveyed across 59 countries from November 2013 to February 2014, 38% believe bribery and corrupt practices happen widely in business. This is the same percentage recorded two years ago. Moreover, more than one in 10 executives surveyed said their company experienced significant fraud in the past two years, a figure similar to that recorded in 2008.
The stagnant results should be taken as a signal that efforts to battle fraud, corruption, and bribery may be losing momentum. There may be few low-hanging fruit left after companies have initiated their preliminary campaigns. From here on, substantial results in deterring and detecting misconduct may be harder to accomplish. What, then, can companies do to bring compliance to the next level? The EY report suggests a six-pronged approach that goes beyond the initial steps of communicating a code of conduct to the organization and conducting company-wide training.
One is to step up board engagement. The report urges the board to “ask tough questions” and hold senior management more accountable, especially as the C-Suite is especially exposed to risks. Chief executive officers are three times as likely as other respondents to be asked to pay a bribe, according to the EY report. Chief financial officers, meanwhile, are more likely than any other role to justify changes to assumptions relating to valuations and reserves so as to meet financial targets.
To address this, oversight from the board must be continuous and unrelenting. Presence during an anti-corruption campaign launch is not enough. Board members need to exert ongoing and meaningful pressure to ensure positive behavior becomes the standard in the company.
Second, companies are advised to mine “big data” using forensic data analytics to improve compliance and investigations. Testing can cover accounts payable data, vendor master data, expenses and entertainment transactions, payroll and capital projects data, and even external sources such as social media.
The use of such analytics is key to helping the organization assess risks of fraud, bribery, or corruption and identify the necessary and appropriate safeguards as an early deterrent.
Third is the recommendation to conduct anti-corruption due diligence. Transactions, such as mergers and acquisitions (M&A), can be a high-risk area for bribery and corruption. Unfortunately, nearly 40% of businesses never conduct forensic or anti-corruption due diligence as part of their M&A processes, according to the EY report. Forensic data analysis should be applied in this stage as well, as deal breakers are unlikely to surface through questioning alone.
Fourth, companies need to improve their escalation procedures to respond to whistle-blowers, a cyber fraud incident, and violations to minimize damage and speed up the process by which the board is notified. Board engagement is important at this level as well. They should be concerned with how the business is rewarding ethical behavior and not just the usual growth performance indicators. The remuneration committee, for instance, should consider how to monitor performance against this metric.
The last two recommendations have to do with enhancing training and allotting sufficient budget support. Companies are advised to customize anti-bribery and corruption training programs to the job function and level of seniority of people in their organization. Furthermore, the C-Suite needs to be at the forefront of and attend such trainings.
With regard to budget support, the EY report states that internal audit and compliance functions need to be sufficiently funded as they provide valuable assistance in keeping the company out of trouble.
Companies will be wise to consider such concrete recommendations to battle compliance fatigue. In this era of increased regulatory scrutiny and ever increasing fines and reputational damage, it is not the right time to lower our guard against bribery and corruption and other irregularities. Companies should stay on the right path towards driving ethical growth.
Roderick M. Vega is the partner for fraud investigation and dispute services of SGV & Co.
This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinion expressed above are those of the author and do not necessarily represent the views of SGV & Co.
source: Businessworld
The issue is becoming more important than ever. According to EY’s 13th Global Fraud Survey, “Overcoming compliance fatigue: Reinforcing commitment to ethical growth”, many of the world’s regulators are stepping up investigations against misconduct. Authorities from the United States, United Kingdom, Germany, Italy, France, Japan and even emerging economies like India, Brazil and China are adopting stronger enforcement against violations such as insider trading, money laundering, price manipulation, cartels, and bribery. Here in the Philippines, high-profile cases in the public and private sectors are progressing through the legal systems as well.
Consumers and investors are likewise increasing their scrutiny in the aftermath of the financial downturn. Regulators, in response, are expected to use a broader scope in enforcing good corporate conduct.
However, despite this heightened regulatory pressure, the incidence of fraud and reported levels of corruption do not appear to be declining, according to the EY report. Of the 2,700 executives surveyed across 59 countries from November 2013 to February 2014, 38% believe bribery and corrupt practices happen widely in business. This is the same percentage recorded two years ago. Moreover, more than one in 10 executives surveyed said their company experienced significant fraud in the past two years, a figure similar to that recorded in 2008.
The stagnant results should be taken as a signal that efforts to battle fraud, corruption, and bribery may be losing momentum. There may be few low-hanging fruit left after companies have initiated their preliminary campaigns. From here on, substantial results in deterring and detecting misconduct may be harder to accomplish. What, then, can companies do to bring compliance to the next level? The EY report suggests a six-pronged approach that goes beyond the initial steps of communicating a code of conduct to the organization and conducting company-wide training.
One is to step up board engagement. The report urges the board to “ask tough questions” and hold senior management more accountable, especially as the C-Suite is especially exposed to risks. Chief executive officers are three times as likely as other respondents to be asked to pay a bribe, according to the EY report. Chief financial officers, meanwhile, are more likely than any other role to justify changes to assumptions relating to valuations and reserves so as to meet financial targets.
To address this, oversight from the board must be continuous and unrelenting. Presence during an anti-corruption campaign launch is not enough. Board members need to exert ongoing and meaningful pressure to ensure positive behavior becomes the standard in the company.
Second, companies are advised to mine “big data” using forensic data analytics to improve compliance and investigations. Testing can cover accounts payable data, vendor master data, expenses and entertainment transactions, payroll and capital projects data, and even external sources such as social media.
The use of such analytics is key to helping the organization assess risks of fraud, bribery, or corruption and identify the necessary and appropriate safeguards as an early deterrent.
Third is the recommendation to conduct anti-corruption due diligence. Transactions, such as mergers and acquisitions (M&A), can be a high-risk area for bribery and corruption. Unfortunately, nearly 40% of businesses never conduct forensic or anti-corruption due diligence as part of their M&A processes, according to the EY report. Forensic data analysis should be applied in this stage as well, as deal breakers are unlikely to surface through questioning alone.
Fourth, companies need to improve their escalation procedures to respond to whistle-blowers, a cyber fraud incident, and violations to minimize damage and speed up the process by which the board is notified. Board engagement is important at this level as well. They should be concerned with how the business is rewarding ethical behavior and not just the usual growth performance indicators. The remuneration committee, for instance, should consider how to monitor performance against this metric.
The last two recommendations have to do with enhancing training and allotting sufficient budget support. Companies are advised to customize anti-bribery and corruption training programs to the job function and level of seniority of people in their organization. Furthermore, the C-Suite needs to be at the forefront of and attend such trainings.
With regard to budget support, the EY report states that internal audit and compliance functions need to be sufficiently funded as they provide valuable assistance in keeping the company out of trouble.
Companies will be wise to consider such concrete recommendations to battle compliance fatigue. In this era of increased regulatory scrutiny and ever increasing fines and reputational damage, it is not the right time to lower our guard against bribery and corruption and other irregularities. Companies should stay on the right path towards driving ethical growth.
Roderick M. Vega is the partner for fraud investigation and dispute services of SGV & Co.
This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinion expressed above are those of the author and do not necessarily represent the views of SGV & Co.
source: Businessworld
Friday, June 27, 2014
Firm announces oil flow increase in Aloguinsan
CEBU, Philippines - Barely more than two months since its exploration, Australian firm Gas2Grid Limited has announced the increase in oil production in the Malolos-1 Oil Field in Olango, Aloguinsan, Cebu.
The company has advised that it recorded a very encouraging oil flow after unclogging blocked portions of its hole.
"The increased oil production rate indicates that the remedial work has had some success in clearing the perforations to allow an influx of oil from the reservoirs," read a statement posted via the websitewww.gas2grid.com.
"The Malolos-1 well has again demonstrated that it can produce oil at commercial rates," the company said.
The well has previously produced approximately 200 barrels of oil per day on several occasions but only for short periods.
Oil flow has reportedly been impaired when the holes made on the sandstone become clogged.
The company said the well will continue to be tested to establish longer term oil production rates.
"If the oil production rate declines due to down-hole blockage the company will make a decision on future operations, which might include further remedial work or suspension of test operations whilst various alternatives are considered to exploit the proven oil reservoirs," it added.
An extension of one year starting January 2014 on Service Contract 44 covering the oil exploration in southwestern Cebu was issued by the Department of Energy so Gas2Grid could continue operating the Malolos-1 Oil Field.
The company earlier reported a "contingent resource" of oil in the two well bores it made in Aloguinsan with a "low estimate" (1C) of 6.8 million barrels and a "high estimate" (3C) of 68.1 million barrels, with a "best estimate" (2C) of 20.4 million barrels of "total oil initially in place."
Gas2Grid's extended oil production testing program aims to gather sufficient technical information to confirm commercial viability of the Malolos-1 Oil Field to justify the DOE's act of awarding a 25-year production period to the company.
Gas2Grid earlier said proving commercial production at the oil field would have a very significant impact on the value of the company and would benefit the Philippine economy. source: Freeman
Monday, June 23, 2014
2014 RP GDP predicted
The Philippine export sector is headed for double-digit growth for the third quarter of 2014 as an effect of the improving United States economy but the gross domestic product (GDP) for this year will be “disappointing,” leading publication Market Call predicted in its latest issue.
The publication’s issue this June sees many possibilities, ranging from effects of slow rehabilitation of the Yolanda-hit areas to higher inflation for the end of second quarter due to rice crisis and nonstop increases of fuel in the world market.
Market Call, the joint publication of First Metro Investments Corp., the investment banking arm of Metrobank and the University of Asia and the Pacific capital markets research, said its bold predictions were based on thorough research and market trends.
Though the publication didn’t predict the country’s GDP for 2014, the paper insisted that it is due to “unexciting Q1 2014 earnings result.”
“With Q1 2014 GDP coming at a slower clip versus market’s expectations, we do not see these high market multiples to be sustained in the near future.
Unexciting Q1 2014 earnings results, which failed to meet expectations, support our view that valuations may come down.
In light of the disappointing GDP numbers, we see glamor stocks losing their leadership roles,” the publication said.
If the publication will not be short of its prediction, it will support the foresight of the Philippine Exporters Confederation (PhilExport) of better export figure for next year and 2016.
PhilExport expects export revenues for the merchandise and services sectors to still reach $92 billion and $28 billion by 2016, respectively.
“The hope for booster from the relief and reconstruction spending in Yolanda-stricken areas has to wait for late Q2, as national government has just completed its comprehensive plan,” the publication said.
The entity said the uncontrollable rise in fuel prices in the world market remains a major challenge to the national government. “This, together with revived exports, should easily enable the economy to grow faster (at around 6.3 percent) in Q2.
The entity said the uncontrollable rise in fuel prices in the world market remains a major challenge to the national government. “This, together with revived exports, should easily enable the economy to grow faster (at around 6.3 percent) in Q2.
Fuelled by rising rice prices, due to the delayed decision to import rice and crude oil prices remaining high due to the Middle East and Ukranian crises, inflation would likely pick up pace in Q2.
However, we will likely see it peak at the same time, as rice and oil prices stabilize. With the solid economic data emanating from the US economy and the escape of the Eurozone from a two-year recession, we expect exports to take a double-digit growth path all the way to Q3,” the publication said.
Inflation, the rise of prices of main commodities, is also a major scenario to watch, it said.
“While we are seeing a bumping up of headline inflation rates, supply factors have primarily caused this.
We think inflation rates, unless they unexpectedly jump, may take a back seat in determining bond yields. Besides, with US Treasuries now expected to be soft for the rest of the year, we see a slight to moderate easing of longer-dated bond yields in Q3.
It is also likely NG will resume issuing progressively longer tenor bonds as yields have stabilized. With more issues, secondary trading should also become more active,” Market Call added.
source: Tribune
UBS keeps Philippine forecasts
PHILIPPINE economic growth is expected to remain robust this year, Swiss financial services firm UBS AG yesterday said, but this could slow next year as financial conditions tighten.
Edward Teather, senior economist for ASEAN at UBS, said in a teleconference that the firm was forecasting Philippine gross domestic product (GDP) growth of 6.5% this year and 5.8% in 2015.
The figures are unchanged from April, or before the announcement of the first quarter’s weaker-than-expected 5.7%. Last December, UBS projected growth to reach just 6% this year and 5.3% next year.
“The Philippine economy has shrugged off natural disasters and difficult global economic conditions, and we continue to expect growth in the country to be strong,” Mr. Teather said.
“First quarter expansion was a bit disappointing, but we do not see growth slowing sharply from here.”
The government is targeting GDP growth of 6.5-7.5% this year and 7-8% in 2015.
“[W]e see manufacturing activity bouncing back in the second quarter,” Mr. Teather said.
“Reconstruction efforts for last year’s calamities will also help growth, as well as an expected pickup in exports due to the ongoing global economic recovery,” he added.
This world recovery, which could spur the normalization of easy monetary policies in advanced economies, could lead to tighter domestic financial conditions that will dampen growth.
“Recovery in the US is a double-edged sword. It means less easy policy on the horizon. Our view is that the Federal Reserve will finish tapering its stimulus by the fourth quarter and start raising rates by the second quarter of 2015,” Mr. Teather noted.
“While countries in Asia like the Philippines will benefit from the recovery, especially in terms of trade, the positive credit cycle brought about by easy policy in the US is likely to turn and have negative side effects.”
The Philippines, he said, is among the countries that have reaped the benefits of loose monetary policy.
“Overly easy monetary policy conditions -- both domestic and external -- have supported the Philippines’ growth. There are some concerns of a maturing credit cycle, and our outlook of higher inflation supports this,” Mr. Teather said.
UBS sees domestic inflation this year averaging at 4.2% and, in 2015, at 4.5%.
The Bangko Sentral ng Pilipinas (BSP) aims to keep inflation within 3-5% this year and 2-4% next year.
“We think these inflationary pressures will compel the BSP to increase policy rates, taking the overnight borrowing rate to 4% by end-2014 and then to 5% at the end of next year,” Mr. Teather said.
“During its last meeting, the BSP raised SDA (special deposit account) rates and not the overnight rate. But we think for the next meeting, it will be inclined to raise both SDA and overnight rates...,” he added.
Last June 19, the policy-setting Monetary Board raised SDA rates across all tenors to 2.25% from 2%. Overnight borrowing and lending rates were kept at 3.5% and 5.5%, respectively.
An oil price shock arising from the conflict in Iraq could also prompt a rate hike. The upcoming 2016 elections, meanwhile, would spur government spending next year, which could help offset the rate hike’s impact on growth.
source: Businessworld
Edward Teather, senior economist for ASEAN at UBS, said in a teleconference that the firm was forecasting Philippine gross domestic product (GDP) growth of 6.5% this year and 5.8% in 2015.
The figures are unchanged from April, or before the announcement of the first quarter’s weaker-than-expected 5.7%. Last December, UBS projected growth to reach just 6% this year and 5.3% next year.
“The Philippine economy has shrugged off natural disasters and difficult global economic conditions, and we continue to expect growth in the country to be strong,” Mr. Teather said.
“First quarter expansion was a bit disappointing, but we do not see growth slowing sharply from here.”
The government is targeting GDP growth of 6.5-7.5% this year and 7-8% in 2015.
“[W]e see manufacturing activity bouncing back in the second quarter,” Mr. Teather said.
“Reconstruction efforts for last year’s calamities will also help growth, as well as an expected pickup in exports due to the ongoing global economic recovery,” he added.
This world recovery, which could spur the normalization of easy monetary policies in advanced economies, could lead to tighter domestic financial conditions that will dampen growth.
“Recovery in the US is a double-edged sword. It means less easy policy on the horizon. Our view is that the Federal Reserve will finish tapering its stimulus by the fourth quarter and start raising rates by the second quarter of 2015,” Mr. Teather noted.
“While countries in Asia like the Philippines will benefit from the recovery, especially in terms of trade, the positive credit cycle brought about by easy policy in the US is likely to turn and have negative side effects.”
The Philippines, he said, is among the countries that have reaped the benefits of loose monetary policy.
“Overly easy monetary policy conditions -- both domestic and external -- have supported the Philippines’ growth. There are some concerns of a maturing credit cycle, and our outlook of higher inflation supports this,” Mr. Teather said.
UBS sees domestic inflation this year averaging at 4.2% and, in 2015, at 4.5%.
The Bangko Sentral ng Pilipinas (BSP) aims to keep inflation within 3-5% this year and 2-4% next year.
“We think these inflationary pressures will compel the BSP to increase policy rates, taking the overnight borrowing rate to 4% by end-2014 and then to 5% at the end of next year,” Mr. Teather said.
“During its last meeting, the BSP raised SDA (special deposit account) rates and not the overnight rate. But we think for the next meeting, it will be inclined to raise both SDA and overnight rates...,” he added.
Last June 19, the policy-setting Monetary Board raised SDA rates across all tenors to 2.25% from 2%. Overnight borrowing and lending rates were kept at 3.5% and 5.5%, respectively.
An oil price shock arising from the conflict in Iraq could also prompt a rate hike. The upcoming 2016 elections, meanwhile, would spur government spending next year, which could help offset the rate hike’s impact on growth.
source: Businessworld
AEV consortium wins Davao water contract
ABOITIZ Equity Ventures, Inc. (AEV) and its partner have been awarded the contract to supply bulk water to the Davao City Water District (DCWD), the listed holding firm said on Monday.
AEV said J.V. Angeles Construction Corp. (JVACC) received on behalf of the Jose V. Angeles Construction Consortium the Notice of Award (NoA) from DCWD for “the financing, design, construction, and operations of the Tamugan Surface Water Developments Project.”
“The JVACC-AEV Consortium will have to comply with the requirements in the NoA before the Joint Venture Agreement with DCWD can be executed,” AEV said.
AEV in May 2013 announced that it will be undertaking the bulk water project in Davao City under a joint venture with JVACC.
“The proposed venture includes the construction of both a hydroelectric-powered bulk water treatment facility and the conveyance system needed to deliver treated bulk water to numerous DCWD delivery points,” AEV had said earlier.
The holding firm had said JVACC has submitted a proposal to DCWD for the supply of 300 million liters per day of potable bulk water.
JVACC has also tapped AEV affiliate Hedcor, Inc. to provide the necessary technical and operational expertise for the hydroelectric components of the projects.
Hedcor engages in the development of hydropower projects across the country.
JVACC is one of the leading contractors in the Philippines with 48 years of experience in the construction and development of water-related infrastructure.
AEV, the holding firm of the Aboitiz family’s businesses, said it has set aside around P88 billion for its capital expenditures this year, up from P59 billion a year earlier.
AEV lost P1.25 or 2.22% to close at P55.15 on Monday. -- Claire-Ann Marie C. Feliciano
source: Businessworld
AEV said J.V. Angeles Construction Corp. (JVACC) received on behalf of the Jose V. Angeles Construction Consortium the Notice of Award (NoA) from DCWD for “the financing, design, construction, and operations of the Tamugan Surface Water Developments Project.”
“The JVACC-AEV Consortium will have to comply with the requirements in the NoA before the Joint Venture Agreement with DCWD can be executed,” AEV said.
AEV in May 2013 announced that it will be undertaking the bulk water project in Davao City under a joint venture with JVACC.
“The proposed venture includes the construction of both a hydroelectric-powered bulk water treatment facility and the conveyance system needed to deliver treated bulk water to numerous DCWD delivery points,” AEV had said earlier.
The holding firm had said JVACC has submitted a proposal to DCWD for the supply of 300 million liters per day of potable bulk water.
JVACC has also tapped AEV affiliate Hedcor, Inc. to provide the necessary technical and operational expertise for the hydroelectric components of the projects.
Hedcor engages in the development of hydropower projects across the country.
JVACC is one of the leading contractors in the Philippines with 48 years of experience in the construction and development of water-related infrastructure.
AEV, the holding firm of the Aboitiz family’s businesses, said it has set aside around P88 billion for its capital expenditures this year, up from P59 billion a year earlier.
AEV lost P1.25 or 2.22% to close at P55.15 on Monday. -- Claire-Ann Marie C. Feliciano
source: Businessworld
Sunday, June 22, 2014
Three bidders for LTO IT project submit ‘proofs of concept’
THREE bidders for the P3.4-billion Information Technology (IT)
project of the Land Transportation Office (LTO) have submitted their
“proofs of concept” to transport authorities.
These companies are the group of Kaisa Consulting Co. Inc.-FPT Information Systems Corporation-NTT Data Corporation; the Indra Sistemas S.A.-Metro Pacific Tollways Corp. joint venture; and the group of Avesco Marketing Corp. and Sung Gwang Co. Ltd.
Avesco and Sung Gwang’s group earlier failed the initial bidding process, but the Bids and Awards Committee (BAC) later decided to grant its motion for reconsideration.
The upgrading of the LTO’s IT system is expected to minimize red tape and make it more convenient for the public to deal with the transport office.
“Unnecessary steps will be cut out, online transactions will be enabled and human intervention will be minimized in order to curb corrupt practices,” according to Secretary Joseph Emilio Abaya of the Department of Transportation and Communications (DOTC).
The LTO IT project initially cost P8.2-billion but a failure of bidding prompted DOTC to separate the bid components. The first part covers only the software and data center components.
The next bidding stage will be for the nationwide rollout, including hardware requirements.
At the first stage of the bidding, seven groups failed to comply with various requirements of the procurement law and bidding rules and were declared ineligible.
They are: Avesco Marketing Corporation-Sung Gwang Co. Ltd.; Omniprime Marketing and Heitech Padu Berhad; Strategic Planning, Applied Management Konsult, Inc. and Accesos Holograficos SS de CV; Infotech Global Pte. Ltd.-Infotech Private Limited; Oberthur Technologies-Comfac Corporation; NPMI-NEC; and, DVK Philippines Enterprises and Leidos Holdings, Inc.
DOTC’s BAC, using the non-discretionary “pass/fail” criterion mandated by the procurement law, declared three firms as eligible.
One-on-one meetings will soon be held with the eligible bidders to finalize the project’s specifications. A pre-bid conference will then be held to discuss the final technical specifications of the project.
The three firms presented their respective proofs of concept for the Driver’s Licensing System and Motor Vehicle Registration System to the BAC last week to confirm their eligibility to bid for the project.
Bid submission of technical and financial proposals is targeted for the last week of August 2014, after which the complying bids will be evaluated and post-qualified in accordance with procurement law.
The DOTC aims to have the entire LTO IT project fully operational by the third quarter of 2015, in order to deliver more user-friendly, convenient services to the public.
A legal case seeking to stop the government from proceeding with the project is now pending with the Regional Trial Court of Mandaluyong City. The DOTC is confident the court will rule in its favor.
SOURCE: Business Mirror
These companies are the group of Kaisa Consulting Co. Inc.-FPT Information Systems Corporation-NTT Data Corporation; the Indra Sistemas S.A.-Metro Pacific Tollways Corp. joint venture; and the group of Avesco Marketing Corp. and Sung Gwang Co. Ltd.
Avesco and Sung Gwang’s group earlier failed the initial bidding process, but the Bids and Awards Committee (BAC) later decided to grant its motion for reconsideration.
The upgrading of the LTO’s IT system is expected to minimize red tape and make it more convenient for the public to deal with the transport office.
“Unnecessary steps will be cut out, online transactions will be enabled and human intervention will be minimized in order to curb corrupt practices,” according to Secretary Joseph Emilio Abaya of the Department of Transportation and Communications (DOTC).
The LTO IT project initially cost P8.2-billion but a failure of bidding prompted DOTC to separate the bid components. The first part covers only the software and data center components.
The next bidding stage will be for the nationwide rollout, including hardware requirements.
At the first stage of the bidding, seven groups failed to comply with various requirements of the procurement law and bidding rules and were declared ineligible.
They are: Avesco Marketing Corporation-Sung Gwang Co. Ltd.; Omniprime Marketing and Heitech Padu Berhad; Strategic Planning, Applied Management Konsult, Inc. and Accesos Holograficos SS de CV; Infotech Global Pte. Ltd.-Infotech Private Limited; Oberthur Technologies-Comfac Corporation; NPMI-NEC; and, DVK Philippines Enterprises and Leidos Holdings, Inc.
DOTC’s BAC, using the non-discretionary “pass/fail” criterion mandated by the procurement law, declared three firms as eligible.
One-on-one meetings will soon be held with the eligible bidders to finalize the project’s specifications. A pre-bid conference will then be held to discuss the final technical specifications of the project.
The three firms presented their respective proofs of concept for the Driver’s Licensing System and Motor Vehicle Registration System to the BAC last week to confirm their eligibility to bid for the project.
Bid submission of technical and financial proposals is targeted for the last week of August 2014, after which the complying bids will be evaluated and post-qualified in accordance with procurement law.
The DOTC aims to have the entire LTO IT project fully operational by the third quarter of 2015, in order to deliver more user-friendly, convenient services to the public.
A legal case seeking to stop the government from proceeding with the project is now pending with the Regional Trial Court of Mandaluyong City. The DOTC is confident the court will rule in its favor.
SOURCE: Business Mirror
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