- a:-

RePublic of the

PhiliPPines

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

lCr,rh

lntramuros. Manila

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;i, ;:Iiil0Yi?iEii

Seryrci Ceilnl ii9;0.:!3 Secion4SD

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

ADVfSORY No. 01-20312

UNIFORM IMPLEMENTAfION OF DEPARTMENT ORDER NO.
SERIES OF 2011

FOR

ALL REGIONAL DIRECTORS

DATE

20 March 2012

To harmonize the imPlementation

please be guided by the following:

1.

istr

Renewal of

18.A,

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

nder Deoartment

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

of

con

istration

wi

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.

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.

3.

its

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

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

Thus to be considererj substanlially capitalized, corporations, partnerships

or

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

' 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

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

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

capitalization under D.O.

p{ah

substantiaf

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

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

including cooperatives engaged in contracting or subcontracting anangements.

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

suc!l

d>.

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

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.

the

) c-lt"
RE'

-)
Page 3 of 3

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

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.

Regional Offices are directed to publish a notice to the public of

subcontractorsicontractors with expired or expiring registration based on the Registry

All
of

Legitimate Subcontractors/Contractors/Service Providers

in the

Region.

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:

.
.
.

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

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

18-A,

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