Senate Office of the Secretary TWENTIETH CONGRESS OF THE 25 SEP 10 P2:11 REPUBLIC OF THE PHILIPPINES First Regular Session RECEIVED BY. SENATE Senate Bill No. 1373 Introduced by Senator Erwin T. Tulfo AN ACT STRENGTHENING THE CONTRACTOR'S LICENSE LAW, FURTHER AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 4566, AS AMENDED, AND FOR OTHER PURPOSES EXPLANATORY NOTE Republic Act No. 4566, as amended, otherwise known as the Contractor's License Law, was enacted in 1965 to regulate the construction industry through the licensing of contractors and the establishment of the Philippine Licensing Board for Contractors, now known as the Philippine Contractors Accreditation Board (PCAB). To strengthen this framework, Republic Act No. 11711 was enacted in 2022, increasing penalties for prohibited acts and rationalizing license renewals. Despite these reforms, recent legislative inquiries and media reports have uncovered persistent anomalies in public infrastructure and flood control projects, including substandard and ghost projects, collusive bidding, and contractors acting as dummies. Testimonies
have implicated construction firms owned by the same individuals in orchestrated bidding schemes' , while other construction firms have been linked to ghost projects worth billions of pesos. These revelations highlight systemic weaknesses that allow unscrupulous contractors and complicit officials to evade accountability, waste public funds, and endanger communities with defective or non-existent infrastructure. To address these issues, the bill restructures and strengthens the PCAB, introduces stricter qualifications and terms of office for its members, enhances its powers, and lengthens the prescriptive period for filing cases against contractors. It also clarifies conditions for the restoration or renewal of licenses. In light of these, the immediate passage of this measure is earnestly sought. ERWIN T. TULFO Ferreras, Vince Angelo, "Sarah Discaya admits owning 9 construction firms that bid for same projects", September 01. 2025, retrieved from: https://www.gmanetwork.com/news/topstories/nation/957675/sara-discaya- 9-construction-lirms-bidding-for-same-project/story/, retrieved on September 09, 2025. Taguines. Andrea, "3 contractors, Bulacan engineers could face raps before Ombudsman over ghost or substandard projects. September 08, 2025. retrieved from: https://www.abs-ebn.com/news/nation/2025/9/8/3-contractors-face-raps-before-ombudsman-over-ghost-or- substandard-projects- 1423, retrieved on September 09, 2025
Sendie Difier of the excretary TWENTIETH CONGRESS OF THE SEP 10 • P2:11 REPUBLIC OF THE PHILIPPINES First Regular Session RECEIVED BY: SENATE Senate Bill No. 1373 Introduced by Senator Erwin T. Tulfo AN ACT STRENGTHENING THE CONTRACTOR'S LICENSE LAW, FURTHER AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 4566, AS AMENDED, AND FOR OTHER PURPOSES Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:
SECTION 1. Section 2 of Republic Act No. 4566, as amended
by Section 4 of Presidential Decree No. 1746, is hereby further amended to read as follows: "Section 4. The Philippine Contractors Accreditation Board. There is hereby created a Philippine Contractors Accreditation Board under the jurisdiction and supervision of the Authority. The Philippine Contractors Licensing Board is hereby abolished and all its funds and records are hereby transferred to the Philippine Contractors Accreditation Board. (a) Composition. The Board shall be composed of a Chairman and [two (2) FOUR (4) members to be appointed by the President upon re bre andoined bys Authority: PROVIDED, THAT THE CHAIRMAN SHALL BE SELECTED FROM THE LIST
OF NOMINEES OF THE RECOGNIZED CONTRACTORS' ASSOCIATIONS. The present Board of the Philippine Contractors Licensing Board shall continue to hold office as the Board of the Philippine Contractors Accreditation Board until their respective successors have been duly appointed. THE FOLLOWING MEMBERS ARE AS FOLLOWS: 1. ONE REPRESENTATIVE FROM THE DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS; 2. ONE REPRESENTATIVE FROM THE SECURITIES AND EXCHANGE COMMISSION; 3. ONE REPRESENTATIVE FROM THE DEPARTMENT OF BUDGET AND MANAGEMENT; AND 4. ONE REPRESENTATIVE FROM THE ACADEME. xXx
SEC. 2. Section 3 of Republic Act No. 4566 is hereby amended
to read as follows: "Section 3. Qualifications of members. Each member of the Board shall [be of recognized standing in his branch of the contracting business for ten years, or more, a citizen and resident of the Philippines for at least eight years immediately prior to his appointment, at least thirty five years of age and possessed of a good moral character. JAT THE TIME OF HIS APPOINTMENT:
1. BE A NATURAL BORN CITIZEN AND RESIDENT OF THE PHILIPPINES FOR AT LEAST TEN (10) YEARS; 2. BE AT LEAST THIRTY-FIVE (35) YEARS OF AGE AND OF GOOD MORAL CHARACTER; 3. NOT BE AN OWNER, OFFICER, OR A STOCKHOLDER OF A CONSTRUCTION COMPANY ENGAGED IN THE BUSINESS OR TRANSACTION WITH THE GOVERNMENT. WHEN A CONFLICT OF INTEREST ARISES, THE MEMBER SHALL DIVEST HIS/HER POSITION, SHAREHOLDINGS, INTEREST, CONTROL, OR OWNERSHIP IN THE CONSTRUCTION COMPANY INVOLVED WITHIN THIRTY (30) DAYS UPON ASSUMPTION OF OFFICE."
SEC. 3. Section 4 of Republic Act No. 4566 is hereby amended
to read as follows: "Section 4. Term of office. The Chairman and members of the Board shall hold office for a term of three (3) years WITHOUT REAPPOINTMENT. The members of the Board first appointed shall hold office for the following terms: Chairman for three years; one member for two years; and the other member for one year. Any member of the Board may be removed by the President of the Philippines for neglect or dereliction of duty, incompetence, malpractice, and unprofessional, unethical, immoral or dishonorable conduct: Provided, That in the course of investigation, the President of the Philippines shall have the power to suspend such member under investigation and designate a temporary member in his place. Vacancies in the Board shall be filled for the period of the unexpired term only."
SEC. 4. Section 5 of Republic Act No. 4566 is hereby amended
to read as follows: "Section 5. Powers and duties of the Board. The Board is vested with authority to issue, suspend and revoke licenses of contractors, to investigate such violations of this Act and the regulations thereunder [as may come to its knowledge] MOTU PROPIO OR UPON VERIFIED COMPLAINT and, for this purpose, issue subpoena and subpoena duces tecum to secure appearance of witnesses in connection with the charges presented to the Board, and to discharge such other powers and duties affecting the construction industry in the Philippines. The Board may, with the approval of the President of the Philippines, issue such rules and regulations as may be deemed necessary to carry out the provisions of this Act, to adopt a code of ethics for contractors and to have an official seal to authenticate its official documents."
SEC. 5. Section 30 of Republic Act No. 4566 is hereby amended
to read as follows: "Section 30. Prescription. All accusations or charges against [licensees)ANY INDIVIDUAL FOR VIOLATIONS OF THIS ACT shall [be filed PRESCRIBE within one year TEN (10) YEARS [after the] FROM THE DISCOVERY OF THE act or omission [alleged as the ground therefor, except that with respect to an accusation alleging a violation of subsection (e) of section twenty eight the accusation may be filed within two years after the discovery] by the Board [of the alleged faets constituting the fraud or misrepresentation]."
SEC. 6. Section 31 of Republic Act No. 4566 is hereby amended
to read as follows: "Section 31. Restoration or renewal of licenses. After suspension of the license upon any of the grounds set forth in
this Act, the Board may lift such suspension upon proof of compliance by the contractor with the requirements and conditions set forth by the Board. After revocation of a license upon any of the grounds set forth in this Act, it shall be renewed or reissued within a period of one year after the final decision of revocation upon proper showing OF DEMONSTRABLE FINANCIAL AND OPERATING CAPACITY TO LAWFULLY AND COMPETENTLY ENGAGE IN THE CONTRACTING BUSINESS AND that all losses caused by the act or omission for which the license was revoked have been fully satisfied and that all conditions imposed by the decision of revocation have been complied with."
SEC. 7. Separability Clause. - Should any provision or part of
this Act be declared unconstitutional or invalid, the other provisions and parts hereof, insofar as they are separable from the invalid ones, shall remain in full force and effect.
SEC. 8. Repealing Clause. - All laws, decrees,
orders, proclamations, rules and regulations, or parts thereof, which are inconsistent with this Act are hereby repealed, amended, or modified accordingly.
SEC. 9. Effectivity. - This Act shall take effect fifteen (15) days
after its publication in the Official Gazette or in at least two (2) newspapers of general circulation. Approved,