THE government has approved P19.16 million in advisory support to evaluate and prepare a proposed public-private partnership (PPP) for the modernization of the country’s Fuel Marking Program.
The Project Development and Monitoring Facility (PDMF) Committee approved the funding, inclusive of taxes, according to Sicpa Société Anonyme, the technology provider currently implementing the program for the Department of Finance (DOF).
Sicpa is a Swiss company that supplies security inks and authentication features for majority of the world’s banknotes The funding will cover due diligence, preparation of tender documents and assistance during bidding. Advisory services will continue after the contract is signed until the project reaches financial close.
The proposed PPP stems from an unsolicited proposal submitted by Sicpa to continue and modernize the Fuel Marking Program, which was established under the Tax Reform for Acceleration and Inclusion Act to combat fuel smuggling and tax evasion.
The program uses chemical markers in petroleum products to help authorities determine whether fuel has been properly declared and taxed.
Sicpa’s proposal covers technology and operational upgrades, additional field-testing units, and expanded training for personnel of the Bureau of Customs and Bureau of Internal Revenue.
The provisional grant of PDMF assistance does not mean the proposal has been approved or awarded. The transaction remains subject to due diligence, competitive procurement and other requirements under the government’s PPP framework.
Managed by the PPP Center, the PDMF is a revolving fund that helps government agencies develop PPP projects. It may finance feasibility studies, business cases, tender documents and transaction advisory services.
The fuel-marking proposal was among three projects recently granted PDMF support. The others were Bataan province’s Pylon (Bunker II) Project, and the rehabilitation, expansion and modernization of the Iligan City Waterworks System.