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RePublic of the

PhiliPPines
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DEPARTMENT OF LABOR AND EMPLOYMENT'1.;';[,,

lntramuros. Manila

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ADVfSORY No. 01-20312
UNIFORM IMPLEMENTAfION OF DEPARTMENT ORDER NO. SERIES OF 2011

ti ti;i' 2012 __ll:]h4tu -..-12

18.A,

FOR
DATE

:
:

ALL REGIONAL DIRECTORS

20 March 2012

To harmonize the imPlementation please be guided by the following:

of Deoartment Order No. 18-A, Series of 2011'

nder Deoartment

1.

Renewal of

istr

r 18. series of

Contractors/subcontractors with unexpired registration under D.O, 18, Series of 2002' could register under D.O. 18-A, Series of 2011, upon application and compliance with the requirements under the new issuance. Thus, where a contractor/subcontractor with unexpired D.O. 18-02 registration applies for registralion under D.O; 18-A, the same may be processed accordingly'
Upon issuance of the D.O. 18-A registration, the unexpired registration under D.O' 1802 is deemed cancelled.

2.

Renewal

recruitment and placeqlent agencv (PRPA) licens-e.

Gontractorslsubcontractors could no longer engage in both contracting and recruitment and placement activitieg pursuant to Department Order No. 18-A, Series ol 2011.

of

con

istration

wi

Contractors/subcontractors with unexpired PRPA License under the Rules governing

pRpA for Locat Employment issued on 5 June 1997 could no longer renew registration under D.o. 18-A without abandoning its PRPA License.

its

3.

Pho3 Million CaPitalization

"substantial capital' refers to paid-up capital stocks/shares of at least Three Million pesos (p3,000,d00.00) in the case of corporations, partnerships and cooperatives; in the case of single proprietorship, a net worth of at least Three Million Pesos
(P3,000,000.00).1

Thus to be considererj substanlially capitalized, corporations, partnerships

cooperatives must have fully paid subscribed capital stocks of equivalent to 3 Million'

,,paid-up capital" refers ro the subscribed capital stocks, which have been fully paid up.

or

' Section 3(l), D.O. 18-lr

r &'u

qF.

Page 2 of 3

ADVISORY No.01-20312
UNIFORM IMPLEMENTATION OF DEPARTMENT ORDER NO. 18-A, SERIES OF 2011

The following documents can serve as proof that a company engaged

contractin g/s u bcontracting is substantially ca pitalized
:

in

. . . '

Audited financial staternents Income Tax Return (lTR) SEC certification of capitalization CDA certification of capitalization

of the paid-up capital for purposes of compliance with the minimum

capitalization under D.O.

Hence, corporate assets or properties, whether personal or real, are not considered

substantiaf

p{ah I

18-A.

In case of sole proprietorship, net worth refers to the total assets minus total liabilities,l which can be proven by the following documents:

. '. . . . 4.

Audited financial statements income Tax Return (lTR)

Certificate of title/proof"of ownership of real property with assessed fair market value from BIR Stock Certificate which shall be considered on its face value
Certificate of bank deposits DTI certificate of capitalization

Coveraqe
including cooperatives engaged in contracting or subcontracting anangements.

D.O. 18-A applies to alJ parties of contracting and subcontracting arrangements

D.O. 1B-A, as clarified in the attached Department Circular No. 01, Series of 2012, does not cover lhe following:

. .

Contractor/subcontractor Rules and Regulations

in the Construction Industry licensed under

PCAB

lnformaiion Technology-enabled services involving entire business process

d>.

suc!l

o o o o o o o

Business Process Outsourcingi Knowledge Process Outsourcing; Legal Process Outsourcing; Hardware and/or software support;

MedicaltranscriPtion; Animation services; and

Back office oPerationsisuPPort
the

D.O. 18-A does not cover Canteen Concessionaires whose relationship with
principal is in the nature of a lease contract or contract to operate.

) c-lt"
RE'

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ADVISORY No.01-20312
UNIFORM IMPLEMENTATION OF DEPARIMENT OROER NO. 18.A, SERIES OF 2011 Page 3 of 3

5.

Orientation
Orientations conducted on D. O. 18-A by associations, organizations and other entities in cooperation with the DOLE shall be considered as compliance to the requirement of the last paragraph of Section 15 of the Department Order. In such cases, applicants should only be subjected to probing questions on their appreciation and understanding of their responsibilities and obligations as employers under D.O. 18-A.

6.

Publi-cation

of the List of 9ubggntractors/Contractors with Expirinq and Expired

Reqistration in the Regiql.

All of

Regional Offices are directed to publish a notice to the public of subcontractorsicontractors with expired or expiring registration based on the Registry
Subcontractors/contractors with expired registration are directed to cease and desis!/f from engaging in contracting/subcontracting activities while those with expiringfl -, registration are directed to renew their Certificate of Registration thirty (30) days before the expiration of their registration to remain in the roster of legitimate service contractors' as required in Section 21 of D.O. 1B-A. The information to be published should include
the following:

Legitimate Subcontractors/Contractors/Service Providers

in the

Region.

. . .

Name or business name of the contractor/subcontractor and the registered place of business Name/s of the owner/s or proprietor/s for sole proprietorship Name of the President, General Manager or Chief Executive Officer in the case of corporation, partnership or cooperative
18-A,

The notice should also state thal pursuant to Section 20 of D.O.

subcontractor/contractor operating in a region other than where it is registered should obtain a duly authenticated copy of its Certificate of Registration from the registering

DOLE Regional Office, and submit the same, together with a copy of the Service

Agreement, to the Regionall Office where it is operating for inclusion in the Registry of Legitimate Subcontractors/Contractors/Service Providers in the Region.

For guidance and strict cornpliance.

DES M. TRASMONTE

Undersecretary