Warranty Period of Infra Projects

Good Day....I need to solicit opinion regarding this matter....Based on RA 9184 , warranty period of a particular infrastructure projects last for a particular periods and it is also stated that one year after is the acceptance of the project for any defects that might happen can be retrofit. My query is after the one year period and project was accepted by the end user , Do the contractor would have to post for a surety for the warranty period ....I believe that surety is callable on demand for a period of one year ...What will be the treatment on this matter?
Thank you very forum contributors for your insights .....
msm326

May I know if you are referring to GGC clause 12.4?
PBDs For Infrastructure
Section III. General Conditions of Contract
GGC Clause 12.Contractor’s Risk and Warranty Security
GGC Clause 12.1 xxxx
GGC Clause 12.2 xxxx
GGC Clause 12.3.After final acceptance of the Works by the PROCURING ENTITY, the Contractor shall be held responsible for structural defects and/or failure of the completed project within the following warranty periods from final acceptance, except those occasioned by force majeure and those caused by other parties:
(a)Permanent Structures: Fifteen (15) years
xxxxx
(b)Semi-Permanent Structures: Five (5) years
xxxxx
(c)Other Structures: Two (2) years
xxxxx
GGC Clause 12.4.The Contractor shall be required to put up a warranty security in the form of cash, bank guarantee, letter of credit, GSIS or surety bond callable on demand, in accordance with the following schedule:
Form of Warranty and the Minimum Amount in Percentage (%) of Total Contract Price
1. Cash deposit, cash bond or letter of credit Five Percent (5%)
2. Bank guarantee Ten Percent (10%)
3. Surety bond Thirty Percent (30%)

GGC Clause 12.5.The warranty security shall be stated in Philippine Pesos and shall remain effective during the applicable warranty period provided in GCC Clause 12.3
12.6.In case of structural defects/failure occurring during the applicable warranty period provided in GCC Clause 12.3, the PROCURING ENTITY shall undertake the necessary restoration or reconstruction works and shall be entitled to full reimbursement by the parties found to be liable, of expenses incurred therein upon demand, without prejudice to the filing of appropriate administrative, civil, and/or criminal charges against the responsible persons as well as the forfeiture of the warranty security posted in favor of the PROCURING ENTITY. For purposes of this clause, the term “structural defects” shall mean major faults/flaws/deficiencies in one or more key structural elements of the Works, which may lead to structural failure of the completed elements or structure. The term “structural failures” is defined as an occurrence where one or more key structural elements in an infrastructure facility fails or collapses, thereby rendering the facility or part thereof incapable of withstanding the design loads, and/or endangering the safety of the users or the general public.

yes

msm326 wrote:Good Day....I need to solicit opinion regarding this matter....Based on RA 9184 , warranty period of a particular infrastructure projects last for a particular periods and it is also stated that one year after is the acceptance of the project for any defects that might happen can be retrofit. My query is after the one year period and project was accepted by the end user , Do the contractor would have to post for a surety for the warranty period ....I believe that surety is callable on demand for a period of one year ...What will be the treatment on this matter?
Thank you very forum contributors for your insights .....
msm326

Yes, the contractor has to post a warranty security after the end of the 1-year defects liability period (when the project has already been accepted and the retention money and performance security have been returned to the contractor).

In the proposed one IRR, there is a provision that posting of the warranty security will only be for a year after acceptance even if the warranty period is either 2 years, 5 years or 15 years, depending on the structure built. In other words, while the contractor is still responsible during the warranty period, the warranty security will only be for a year after acceptance of the project by the procuring entity.

msm326 wrote:Good Day....I need to solicit opinion regarding this matter....Based on RA 9184 , warranty period of a particular infrastructure projects last for a particular periods and it is also stated that one year after is the acceptance of the project for any defects that might happen can be retrofit. My query is after the one year period and project was accepted by the end user , Do the contractor would have to post for a surety for the warranty period ....I believe that surety is callable on demand for a period of one year ...What will be the treatment on this matter?
Thank you very forum contributors for your insights .....
msm326

Yes, its one of those mandatory requirements, it shall remain effective during the warranty period as provided in Section 62.2.2 of the GPRA and returned only after the lapse of the warranty period. But with proposed update on IRR The warranty security period shall be effective for one (1) year from the date of issuance of the Certificate of Final Acceptance by the procuring entity, and shall be returned only after the lapse of the said one (1)-year period.