House panel OKs bill amending Contractors' License Law

The House Committee on Trade and Industry on Tuesday approved the measure seeking to amend certain provisions of the Contractors' License Law in order to "rectify existing infirmities."

During its virtual meeting, the chamber approved House Bill 1911, proposed by Deputy Speaker Aurelio "Dong" Gonzales, amending Sections 38, 39, and 40 of RA 4566, or the Contractors' License Law.

According to Gonzales, the law provides that no contract should engage in the business of contracting without first securing a license to conduct business from the Philippine Contractors Accreditation Board (PCAB).

"The purpose of RA 4566 is to ensure that only qualified and reliable contractors are allowed to undertake construction in the country," he said.

"The law also aims to promote, for the benefit of the public and private sectors for the national interest, the orderly growth of the contracting sector and the upgrading of construction capability," he added.

Under Gonzales' proposal, a fine of not less than P50,000 if the cost of the project is not more than P500 million, and a fine of not less than P500,000 if the project costs more than P500 million will be imposed on contractors who engage in joint ventures without first obtaining additional license and other requirements.

The bidder will likewise be automatically disqualified for award of contract.

The measure also proposed higher fees of licensing, registration of application and renewal to address inflation and rising operation costs and expenses of the PCAB and support additional mandates, services and programs.

In particular, the fee for obtaining an original license will be increased to P5,000, while the payment for the examination of the applicant and renewal of license will be set to P6,000 and P5,000 respectively.

Gonzales noted that the fees prescribed under RA 4566 have not been changed since its enactment in 1965.

Moreover, the measure also provides that the contractor's license is now valid for one year from the date of its issuance, and it may be renewed by filing an application for renewal at least one month before its expiry date.

Following the approval of the measure in the committee level, it will be sent to the plenary for its own deliberation and approval. —KG, GMA News