Procurement board clarifies rules on software subscription

MANILA, Philippines — The Government Procurement Policy Board (GPPB) said procurement rules, cited by the Philippine Health Insurance Corp. (PhilHealth) as the reason for the vulnerability of its data to hacking, apply only to online subscriptions.

“PhilHealth earlier stated that they have an existing subscription for an antivirus software. This means that they have an existing contract with a locally available supplier, which, therefore, means that the cited GPPB Resolution will not apply,” GPPB said in a statement.

A locally available provider pertains to any supplier or distributor, whether local or foreign, that is authorized to do business in the Philippines.

“The rules set by the Government Procurement Policy Board through Resolution No. 05-2022 pertains only to online subscriptions where there is no locally available provider,” it added.

“It can only be directly purchased online using a credit card, subject to the issuance of a certification by the head of the procuring entity that it is the more expeditious and inexpensive mode of payment as required by COA Circular No. 2021-014,” the GPPB said.

“Hence, PhilHealth is authorized to conduct public bidding or adopt any of the alternative methods of procurement, as may be applicable, depending on their project requirements, or, at their option, avail the Guidelines on the Renewal of Regular and Recurring Services issued through GPPB Resolution No. 06-2022,” the statement read.

Furthermore, the GPPB said the decision on the project requirements and procurement modality to be adopted is based on procurement management decision of PhilHealth as the procuring entity.

“It is likewise worthy to note that procurement rules, particularly the modalities available, are not limiting and are designed to enable the adoption of the most appropriate modality given the requirements of the procuring entity, which they, themselves, set in their bidding documents,” it added.

The board said that its communication lines are always open to colleagues in government, as well as to other stakeholders, should they have questions or needed information.

PhilHealth on Monday said it failed to renew its antivirus software licenses last year, making its computer system outdated and vulnerable to cyberattacks, due to new government procurement rules.

Eli Santos, executive vice president and chief operating officer of PhilHealth, said that the state insurer failed to proceed with the renewal of subscription licenses for the antivirus software, citing new rules set by the GPPB.