SENATOR Sherwin T. Gatchalian has filed a bill seeking to amend the 78-year-old Commonwealth Act No. 541 in order to lift restrictions on foreign contractors seeking to bid on domestically-funded government public works projects.
Filed on Aug. 2, Senate Bill No. 1907 removes the provisions in CA No. 541, which gives preference to Filipino or US contractors, and provides for “equal opportunity” in the awarding or negotiation of contracts to qualified Filipino or foreign contractors.
“All branches, offices, and subdivisions of the Government and all government-owned or controlled companies, authorized to contract and make disbursements for the construction or repair of locally-funded public works, including the construction of defense-related structures, shall extend equal opportunities in awarding or negotiating contract for such works to eligible and qualified Filipino and foreign contractors,” the bill reads.
The 10th Foreign Investments Negative List (FINL) issued in 2015 provides for a maximum of 25% foreign equity for contractors awarded domestically-funded public works projects. Foreign firms have had to resort to joint ventures with Filipino-owned companies in order to take on infrastructure projects.
Mr. Gatchalian, who chairs the Senate committee on economic affairs, said the proposed measure is needed to deliver the infrastructure “that will support the country’s initiatives in providing a business climate conducive to investments in the country.”
“This amendment is timely and very much needed given that the current thrust of the government is infrastructure development via the Build, Build, Build Program,” the senator said in a statement.
He said the bill also seeks to attract new investment and to introduce more competition in the construction industry.
“The lack of genuine competition in the public construction industry impairs public welfare as there are fewer incentives for existing domestic firms to innovate and puts at risk the delivery of reliable, safety-compliant and quality public works,” Mr. Gatchalian said. — Camille A. Aguinaldo