Procurement Integrity Bill and RA 12009: What Suppliers Must Do in 2026

1What happened: a renewed push for the procurement integrity bill

On 4–5 November 2026, Senate President Sherwin Gatchalian publicly urged the enactment of Senate Bill No. 1962, the proposed Government Contracting and Procurement Integrity Act, according to a Manila Times report syndicated on 5 November 2026. The measure would bar relatives of public officials, up to the fourth civil degree of consanguinity or affinity, from contracting with the government offices where those officials hold functions or influence. Gatchalian, one of the bill's authors, was quoted calling it a "vital safeguard to transparency in government contracts" and saying it should be enacted "as soon as possible."

The bill is not new. The Senate approved it on third and final reading on 2 September 2026, with all 15 senators present voting in favour, as reported by the Daily Tribune. Its principal author and sponsor was Senator Chiz Escudero, with co-authors including Gatchalian and Senators Bong Go, JV Ejercito, Loren Legarda, Joel Villanueva, Bato dela Rosa and Kiko Pangilinan. The same report said that a House counterpart, filed by Ilocos Norte Representative Sandro Marcos, remained pending at the committee level.

The November statement matters to businesses because SB 1962 is still only a bill. Its rules apply only if the House passes a version, the two chambers reconcile the texts (through a bicameral conference committee if needed), and the President signs it or lets it lapse into law. Meanwhile, suppliers already face tighter rules under Republic Act No. 12009, the New Government Procurement Act (NGPA). Those rules are in force today and are often the bigger compliance issue for companies that bid now.

2What SB 1962 would do, and how it differs from current law

Based on the Senate-approved version as described in the Tribune and Manila Times reports, SB 1962 has four main elements:

• Covered officials: elected national and local officials; Cabinet secretaries, undersecretaries and assistant secretaries; officers and board members of government-owned or -controlled corporations; and officials of state universities and colleges, including designated alternates.
• Covered transactions: contracts for goods, services, supplies, machinery and infrastructure, plus joint ventures and public-private partnerships that involve public funds or government property. Covered relatives also could not join as subcontractors, consortium members or joint-venture partners.
• Carve-out: officials and personnel with no role in procurement, contract award, or contract execution or implementation would not be covered by the penalties.
• Penalties: imprisonment of up to three years, a fine reported as ₱100,000, and a permanent ban from government procurement for private parties. Public officials would face the same penalties plus perpetual disqualification from public office. The two reports describe the fine slightly differently ("at least" versus a flat amount), so the final enrolled text must be checked.

The policy debate is not one-sided. At a House Committee on Revision of Laws hearing reported by BusinessWorld on 12 May 2026, a GPPB division chief warned that broader bans could shrink the pool of bidders and disqualify firms with no actual influence over a project. A DEPDev governance official suggested that stronger institutions and data systems might work better than wider bans. Party-list Representative Jose Manuel Diokno supported stricter conflict-of-interest rules and said the pool of government contractors is already small. Any enacted version may therefore narrow or widen the current Senate text.

3The backdrop: flood-control controversies and the reform push

The renewed focus on procurement integrity follows the controversy over flood-control projects that became public in mid-2025. According to the Tribune's 2 September 2026 report, investigations found that relatives of public officials, including members of Congress, had obtained large government contracts over the years, including for infrastructure and anti-flood works. In October 2025, Budget Secretary Amenah Pangandaman called for strict enforcement of the NGPA's lifetime blacklisting rule. Per a PNA report republished by SunStar on 8 October 2025, this came as investigations widened into alleged collusion between officials and private contractors on multi-billion-peso flood-control projects.

The data used in the policy debate came partly from procurement regulators themselves. In an October 2025 Philstar report, the GPPB Technical Support Office (GPPB-TSO) was quoted as finding that, in a random sample of 180 procuring entities, 65.8% of bidders had common owners and 71.6% were related to government officials. Those figures came from an agency sampling exercise reported in the press. They are not court findings.

Several criminal and administrative cases arising from the flood-control controversy are pending before the Ombudsman and the Sandiganbayan. Everyone charged is presumed innocent until proven guilty by final judgment, and several named persons and firms have publicly denied wrongdoing. For companies, the practical lesson is simpler. Lawmakers and regulators now examine ownership links, family relationships and repeated bidding patterns much more closely than they did under the old regime of RA 9184. For background on prosecution trends, see our pieces on the DOJ anti-corruption task force and prosecution strategy and Sandiganbayan priority anti-graft cases.

4RA 12009 and its IRR: where the rules stand

The New Government Procurement Act (RA 12009) was approved on 20 July 2024 and replaced the twenty-year-old Government Procurement Reform Act (RA 9184). It took effect on 13 August 2024. The GPPB approved the implementing rules on 4 February 2025 (PNA via DEPDev). In Public Advisory No. 09-2026 (31 July 2026), the GPPB-TSO confirmed that the official IRR is the one approved through GPPB Resolution No. 02-2025, published in the Official Gazette on 10 February 2025 and effective on 25 February 2025. The same advisory withdrew an unofficial "1st Edition, as of 31 March 2026" compilation and told suppliers not to cite or rely on it. Companies should check that their bid teams are working from the correct text.

1. 2024-07-20
   RA 12009 approved. Published 29 July 2024 in two newspapers of general circulation.
2. 2024-08-13
   The Act takes effect. RA 9184 rules continue to apply until the new IRR takes effect (Sec. 113).
3. 2025-02-25
   IRR (GPPB Res. No. 02-2025) takes effect.
4. 2025-10-06
   GPPB Res. No. 11-2025 authorises a beneficial ownership registry on PhilGEPS.
5. 2026-02-03
   GPPB Res. No. 10-2026 adopts Circular 06-2026 on documentary requirements.
6. 2026-09-02
   Senate passes SB 1962 on third reading.
7. 2026-11-05
   Senate President renews call for enactment.

Features suppliers should know

• Digital procurement through PhilGEPS. The Act lists electronic bidding and an electronic marketplace among PhilGEPS features (Sec. 20). It also allows the e-marketplace to serve as a consignment platform for goods and equipment (Sec. 40). The rollout of specific e-marketplace and e-bidding modules depends on PS-DBM, so suppliers should check current availability for their category.
• Award on value, not only price. Besides the lowest calculated responsive bid, the law allows award to the most economically advantageous responsive bid. Under that method, price weight runs between 15% and 40% of the evaluation (Sec. 61).
• Open contracting. For goods above ₱10 million, infrastructure above ₱20 million and consulting above ₱5 million, bidding conferences must be video-recorded, the preliminary examination and bid opening must be livestreamed, and recordings must be kept for at least five years (Sec. 38). At least two observers, from the private sector and from civil society, must sit in BAC proceedings (Sec. 43).
• Sustainable procurement. The Act sets up green public procurement and lifecycle-cost analysis (Secs. 13, 72–74).

The GPPB has continued to issue implementing guidance. Resolution No. 10-2026 (3 February 2026) adopted Circular No. 06-2026, which consolidates the exclusive list of eligibility documents for direct contracting, small value procurement and several negotiated procurement modes. Procuring entities may not require extra documents. A PhilGEPS Platinum certificate may also stand in for certain permits. For more on earlier transparency measures, see our overview of public procurement transparency reforms.

5Beneficial ownership disclosure: the new gatekeeper

RA 12009 requires suppliers, contractors and consultants to submit beneficial ownership information to take part in government procurement. It also directs that this information be kept in a public online registry (Secs. 5(b), 82). A beneficial owner is the natural person who ultimately owns or dominantly influences the management or policies of a juridical entity. Under GPPB Resolution No. 11-2025 (6 October 2025), the GPPB gave the PS-DBM interim authority to publish the Beneficial Ownership Information Registry through PhilGEPS. Entries must be validated against SEC records, and publication must be coordinated with the National Privacy Commission.

The first enforcement step had already come. According to Philstar (21 October 2025), 6,003 of the 12,769 firms registered under PhilGEPS Platinum, about 47%, failed to submit beneficial ownership documents. Their Platinum registrations were automatically suspended. Because a valid PhilGEPS Platinum registration underpins eligibility in most modes, a firm that misses this filing may be shut out of bidding.

Corporate-side rules have also changed. SEC Memorandum Circular No. 15, series of 2025, effective 1 January 2026, sets a 20% ownership threshold and nine categories (A to I) of beneficial owners. It requires disclosure of nominee arrangements and timely reporting of changes, with fines reaching ₱2 million for false information. The SEC told House lawmakers in May 2026 that it supports the beneficial ownership provisions of the pending anti-nepotism bills (as reported by BusinessWorld). For bidders, this means the ownership data they file with the SEC and with PhilGEPS should match. A mismatch can prompt questions during post-qualification or a blacklisting inquiry. Our guide to SEC ownership reporting requirements covers the corporate filing side.

6Sanctions: suspension, blacklisting and perpetual disqualification

Article XXI of RA 12009 sets out a graduated system of administrative sanctions for private parties: corrective measures, suspension and blacklisting (Sec. 98). These apply without prejudice to criminal and civil liability under other laws.

• Suspension (Sec. 99): one year for a first offence and two years for a second. Grounds include failure to post performance security and delivery of inferior goods. The bid or performance security is forfeited.
• Blacklisting (Sec. 100): one year for a first offence and two years for a second. Grounds include submitting false information, using another's name, colluding with other bidders and failing to disclose relationships under Sec. 81.
• Perpetual disqualification (Sec. 101): imposed for a third blacklisting offence, or for failure to repair defects in infrastructure within 90 calendar days of an order from the head of the procuring entity. The DBM has described this as the NGPA's "lifetime ban."
• Automatic suspension (Sec. 102): applies while blacklisting proceedings are pending.
• Reach to affiliates (Sec. 105): sanctions extend to entities in which a sanctioned person holds a controlling interest, and to its beneficial owners.

Section 105 has the widest practical effect. Under it, a group of companies with shared owners cannot simply move a blacklisted business into a sister company. Sanctions are imposed through an administrative process before the procuring entity, and the supplier has the right to be heard. A firm facing a notice should therefore treat the response period as a litigation deadline and get counsel involved early. Our civil litigation practice handles contested procurement disputes and related court remedies.

7Compliance checklist for companies bidding for government contracts

Suppliers should work through the following list before their next bid. It reflects RA 12009 and its IRR as of 6 November 2026, and it anticipates SB 1962 without assuming the bill will pass in its current form.

• Confirm the governing text. Use only the GPPB-approved IRR (Res. No. 02-2025) and current GPPB resolutions and circulars. Retire any unofficial compilations, as Public Advisory No. 09-2026 directs.
• Keep PhilGEPS Platinum active. Check that beneficial ownership information has been filed and accepted and that membership is not suspended. Diarise renewals and the expiry dates of permits, tax clearances and PCAB licences.
• Reconcile ownership records. Make sure the SEC beneficial ownership declaration under MC No. 15-2025, the GIS, PhilGEPS entries and the bid documents identify the same natural persons, nominees and control arrangements.
• Run a relationship screen for each bid. Before submission, map shareholders, directors, officers and key personnel against the procuring entity's HoPE, BAC, TWG, Secretariat, PMO head, end-user and consultants up to the third civil degree, as Sec. 81 requires. Consider extending the screen to the fourth degree and to the elected and appointed officials SB 1962 would cover.
• Document affiliate and joint-venture exposure. Keep a register of related companies and JV or consortium partners. Under Sec. 105, a partner's sanction history can affect you.
• Tighten bid-integrity controls. Adopt written rules against sharing pricing with affiliates bidding for the same lot, and keep a record of who prepared and approved each bid.
• Manage contract performance risk. Track performance-security deadlines, delivery specifications and defect-repair orders. Missed deadlines here are among the listed grounds for suspension and perpetual disqualification.
• Prepare for open contracting. Assume that bid openings will be livestreamed and kept on record for five years, and that observers will be present. Statements made at conferences become evidence.
• Set an escalation path. Name the people who will respond to notices of disqualification, suspension or blacklisting, and decide in advance when outside counsel is brought in.

For corporate groups, much of this work falls on the board and the corporate secretary. Our corporate law team assists with ownership restructuring, beneficial ownership filings and internal compliance policies for government contractors.

8What to watch next

Three developments will shape the compliance picture in the coming months. First, House action on its counterpart of SB 1962. As of 6 November 2026, we have not confirmed that the House has passed a version, and any enacted text may differ from the Senate bill on the degree of relationship, the officials covered and the penalties. Second, any GPPB amendments to the IRR that formalise the PhilGEPS beneficial ownership registry, which Resolution No. 11-2025 described as under review. Third, the integration of the SEC's new beneficial ownership registry with PhilGEPS, which would allow automated cross-checking of supplier disclosures.

• SB 1962 is a Senate-approved bill, not a law. As of 6 November 2026 it still needs House passage, reconciliation and presidential action.
• RA 12009 already disqualifies bids where a relationship up to the third civil degree exists with key procurement personnel, and it penalises non-disclosure with blacklisting.
• Beneficial ownership filing is a gatekeeping requirement. Thousands of PhilGEPS Platinum registrations were suspended in 2025 for non-submission.
• Repeat offences can lead to perpetual disqualification, and sanctions can reach affiliates and beneficial owners.
• Consistent SEC and PhilGEPS ownership records and a documented relationship screen are the most useful protections right now.

If your company bids for national or local government contracts and wants a review of its ownership disclosures, relationship-screening process or response to a procurement sanction, you may contact Abanto Law Firm or learn more about our corporate law services.

9Frequently asked questions