GPPB'S definition of Exclusive dealership.

What constitute exclusive dealership for purposes of resorting to Direct Contracting as an alternative mode of procurement?

The GPPB has recently issued a policy clarifying the term "exclusive dealer". It envoked Sec. 50(c) of IRR-A, that an exclusive dealer is one which does not have sub-dealers selling at lower prices and for which no suitable substitute can be obtained at more advantageous terms to the government.

The GPPB also cited the guidelines prescribed in the Generic Procurement Manual Vol. II, "that procurement unit or office should first study the supply market by conducting an extensive survey of the industry in order to confirm the exclusivity of the source, prior to engaging in Direct Contracting. The GPM also emphasizes that exclusive dealership does not per se give rise to the use of Direct Contracting. The supplier/contractor/manufacturer must prove, through proper documentation, that it is the sole source of said goods, equipment or services required".

Procurement can commence even prior to issuance of SARO.

We have since received several queries on the issue of whether a procuring national agency will first have to wait for the issuance of Special Allotment Release Order (SARO) before they can commence the procurement process.

The GPPB has issued a clarification through Circular No. 02-2008 dated 1 August 2008 on the matter. The said circular clarifies that "procurement may commence as long as such activity is included in the APP of the procuring entity concerned. Prior issuance of the SARO is not pre-condition to the advertisement and/or posting of the invitation to apply for eligibility and to bid, in the case of public bidding, or posting of the notice of procurement, in the case of alternative methods of procurement." Issuance of the SARO is, however, required before issuance of the notice of award by the procuring entity.