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(NAR) VOL.8 NO. 2 / APRIL - JUNE 1997

[ PITC MEMORANDUM CIRCULAR NO. CT- 97.4/01, April 17, 1997 ]




In relation to Section 9.0 of the Implementing Rules and  Regulations (IRR) of E.O. 120 s. 1993 providing for the accreditation of Philippine manufacturers, exporters and contractors (hereinafter referred to as “Philippine Supplier”) nationwide who may wish to participate in countertrade transactions as suppliers of Philippine products and services, the following rules of accreditation are hereby promulgated.



Requirements for Accreditation

Philippine Suppliers who wish to participate in countertrade transactions as suppliers of Philippine products and services under E.O. 120 s. 1993 and its Implementing Rules and Regulations (hereinafter  referred to as the “Program”) must meet the following criteria/requirements for accreditation prior to offering products/services under this Program.

1.         OWNERSHIP

The Philippine Supplier must be at least fifty one percent (51%) Owned or Controlled by individual or group of Filipino Citizens unless the products and/or services required can only be sourced from a Filipino-Owned or Controlled Philippine Supplier, PROVIDED: that the required product or service is among the priorities of the Philippine Government as  certified to by PITC in consultation with appropriate government and private entities.


The Philippine Supplier must be engaged in any of the following:

2.1       Engaged in the manufacture or production of Philippine products for exports and is duly registered under the laws of the Philippines;

2.2       Engaged in service contracting whether locally or for export and is duly registered under the laws of the Philippines;

2.3       Acting as an exclusive marketing or exporting agent of a Philippine manufacturer or producer and is duly registered under the laws of the Philippines.


The Philippine Supplier must have a minimum authorized capitalization of PESOS: ONE MILLION (P1,000,000.00).


The Philippine Supplier must have a minimum production capacity equivalent to UNITED STATES DOLLAR: FIFTY THOUSAND DOLLARS (US$50,000.00) worth of products or services per transaction.

5.         LOCAL CONTENT

Products and services produced must have a minimum local content of at least fifty one percent (51%) except for products and services resulting from offset transactions where the required minimum local content shall be twenty five percent (25%).

6.         TRACK RECORD

The Philippine Supplier must have a track record of at least one (1) year in manufacturing and exporting the required product and/or service.  If the track record is less than one (1) year, the Philippine Supplier must present a credit line and/or guarantee of performance for consideration by the Philippine International Trading Corporation (PITC).


The Philippine Supplier must have a good credit standing as evidenced by its credit  line with any major commercial bank operating in the Philippines.


Procedures for Accreditation

1.         All Philippine Suppliers interested to participate under this Program shall secure the Accreditation Form from the Countertrade and Offset Group of PITC.

2.         The Accreditation Form shall be completely accomplished/filled up in two copies and signed by an authorized representative of the Philippine Supplier applying for accreditation under the Program and shall be submitted to PITC for evaluation/approval.

3.         The following documentary requirements shall be submitted together with the accomplished/filled up and signed Accreditation Form;

a.      Secretary’s Certificate authorizing signatory of the Accreditation Form to sign for and on behalf of the Philippine Supplier applying for Accreditation;

b.      Company Profile;

c.       Copies of the Audited Financial Statement for the last two (2) years;

d.      Copy of Business Name Registration;

e.      SEC Registration, Articles of Incorporation and By-Laws;

f.        BOI Registration, if applicable;

g.      Track Record of Export Performance, if applicable.

h.       Current Mayor’s Permit

4.         All the required documentation together with two (2) sets of duly accomplished Accreditation Form shall be submitted to the Countertrade and Offset Group of PITC. Submission shall be accompanied with a non-refundable processing fee for accreditation as prescribed under Section D of this Memorandum Circular.

5.         Processing and validation of the duly accomplished Accreditation Form and related documents shall be completed within ten (10) working days.

6.         An Accreditation Certificate shall be given to the Philippine Supplier upon approval of its application by PITC.


Accreditation Fees

PITC shall be authorized to impose and collect non-refundable processing fee for accreditation of PESOS: TWO THOUSAND FIVE HUNDRED (P2, 500.00) and an annual renewal fee of PESOS: ONE THOUSAND FIVE HUNDRED (P1, 500.00) from a Philippine Supplier who wish to participate under this Program, subject to modifications as may be necessary. Said fees may be changed by PITC Management as shall be necessary in the future.

The aforesaid processing and annual renewal fees shall be paid through manager’s check, cashier’s check or cash.


Renewal of Accreditation

Subject to Section F hereof, PITC accreditation hereunder shall be subject to renewals on a yearly basis, based on a review of the performance and track record of the accredited Philippine Supplier for the past year and subject to payment of corresponding fees therefor.  Renewal of accreditation may be refused or existing accreditation may be cancelled/revoked by PITC for any of the reasons stated in the next succeeding section.


Cancellation, Revocation, Withdrawal and

Non-Renewal of Accreditation

1.         An existing accreditation may be cancelled, revoked or renewal of accreditation may be denied by PITC for any of the following grounds:

1.1  The accredited Philippine Supplier has failed or refused to meet its supply/delivery commitments to PITC and/or buyers or clients of the Program for any reason other than for reasons of force majeure or mutually agreed termination clauses;

1.2. The accredited firm or entity has been blacklisted by any Philippine government office or agency or charged before any judicial, quasi-judicial or administrative body of the government for violation of laws or regulations pertinent to or regulating its line of business, including but not limited to the Bureau of Customs, Garments and Textile Export Board, Department of  Trade and Industry, Department of Labor and Employment, etc.;

1.3  Revocation, expiration or surrender of government licenses or permits to operate or conduct the accredited firm or entity’s business pertinent to the Program;

1.4  Bankruptcy of insolvency or assignment in favor of creditors of the accredited firm or entity, whether judicially declared or not;

1.5  Closure of the business of the accredited firm or entity;

1.6  Failure of the accredited firm or entity to meet/sustain the requirements set forth in Section B of this Circular.

1.7  Causes analogous to the foregoing.

2.         Upon the happening of any of the above and subject to the validation or verification thereof, PITC shall notify the concerned firm or entity of the cancellation or non-renewal of its accreditation under the Program.

3.         Nothing herein shall be construed as to prohibit an accredited firm or entity from voluntarily withdrawing from the Program upon due written notice to PITC, PROVIDED: that it has fullfilled/served all pending orders or commitments with buyers or clients under the Program and PROVIDED FURTHER: that the withdrawal from the Program is not for the purpose of circumventing the rules herein established.


Countertrade Supply Network

1.         To ensure availability of adequate and acceptable supply of Philippine products, goods and services to enable the Philippines to meet the supply requirements of the Program, all Philippine Suppliers duly accredited by PITC in accordance with these rules, shall sign and/or marketing agreements with PITC confirming their commitments to make available, on a priority basis, their products or services to PITC under the Program.

2.         The signing of the aforesaid supply and/or marketing agreement shall be within thirty (30) days from award of the Accreditation Certificate. Failure to sign said supply and/or marketing agreement shall automatically nullify the accreditation of the Philippine supplier.

3.         PITC shall include the products or services of these accredited Philippine Suppliers under its supply base/network and shall endeavor to promote/market these products or services for export/utilization by foreign firms or entities with countertrade obligations with the Philippine government. In this regard, PITC shall be authorized to charge mutually agreed marketing/service/commission base on concluded/implemented business transactions.


Related Matters

1.         All foreign suppliers or their designated countertraders with counterpurchase commitments with the Philippine government under E.O. 120 S. 1993, are hereby required/directed to source their products/services requirements under the Program from the list of PITC-accredited Philippine Suppliers. Only purchases from said accredited Philippine Suppliers, including PITC, shall be credited against counterpurchase commitments with the Philippine government. Any claims for exemptions from this requirement shall first be submitted to PITC for approval prior to actual purchases and only if the products/services cannot be sourced in sufficient quantity or specifications from PITC accredited Philippine Suppliers as subsequently validated/certified to by PITC in coordination with concerned Philippine government authorities and industry sectors.

2.         PITC shall from time to time issue updates or advisories to its accredited Philippine Suppliers under the Program on counter purchase requirements under the Program including latest developments on countertrade in the Philippines.


Suppletory Document

This Circular shall be considered as a binding supplement to the IRR and shall form an integral part thereof.



This Circular shall take effect immediately.

Adopted: 17 April 1997


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