SPP DOC SPP DOC 2010
SPP 201 METHOD OF COMPENSATION
The Architect’s compensation is based on the
Architect’s / architectural firm’s talents,
skill, experience, imagination, and on the
type and level of professional services
provided. Compensation for Pre-Design
Services may be based on one or more of the
following:
4.1 Multiple of Direct Personnel Expenses
This cost-based method of compensation is
applicable only to non-creative work such as
accounting, secretarial, research, data
gathering, preparation of reports and the
like. This method of compensation is based
on technical hours spent and does not
account for creative work since the value of
creative design cannot be measured by the
length of time the designer has spent on his
work. The computation is made by adding all
costs of technical services (man hour/s x
rate) and then multiplying it by
multiplier to cover overhead and profit.
The multiplier ranges from 1.5 to 2.5
depending on the office set-up, overhead and
experience of the Architect and the
complexity of the Project.
Other items such as cost of transportation,
living and housing allowances of foreign
consultants, out-of-town living and housing
allowances of the local consultants and the
like, are all to be charged to the Client.
At the start of the commission, the
Architect shall make known to the Client the
rate of professionals and personnel who will
UAP-IAPOA DOC 210
METHOD OF COMPENSATION
Different Methods of Compensation are being
applied on the Pre-Design Services as the
volume and range of works varies on each
services. Methods for compensation for
Predesign Services may be based on one or more
of the following:
5.2.1 Multiple of Direct Personnel Expense
5.2.2 Professional Fee Plus Expenses
5.2.3 Lump Sum or Fixed Fee
5.2.4 Per Diem, Honorarium Plus Reimbursable
Expenses
5.2.5 Mixed Methods of Compensation
5.3 Professional Fee
The Architect's compensation is based on the
Architect's / architectural firm's talents,
skill, experience, imagination, and on the type
and level of professional services provided.
a Prior to the start of any Pre-Design Services,
a Professional Service agreement between
Owner/Client and Architect is necessary. The
Architect should request for a five percent
(5%)acceptance fee based on agreed professional
fee (PF) upon signing of the agreement.
Client shall make progress payments upon
request of the Architect within seven (7)
calendar days from the submission of the
statement of the
account.
be assigned to the Project and the
multiplier that has to be applied before
agreeing on this method of Compensation.

FORMULA
Assume:
A = Architect’s rate / hour
C = Consultant’s rate / hour
T = Rate per hour of Technical Staff,
Researchers and others involved in the
Project
AN, CN, TN = No. of hours spent by
Architect, Consultants and Technical Staff
M = Multiplier to account for overhead and
reasonable profit. The value may range from
1.5 to 2.5 depending on the set-up of the
Architect’s office and the complexity of the
Project.
R = Reimbursable expenses such as
transportation, housing and living allowance
of Consultant, transportation, per diem,
housing and living allowance of local
consultants and technical staff if assigned
to places over 100 km. from the area of
operation of the Architect.
Cost of printing of extra set of drawings,
reports, maps, contract documents, etc.
over the five (5) copies submitted to the
Client, overseas and long distance calls,
technical and laboratory tests, licenses,
fees, taxes and similar cost items needed by
the Project.

Direct cost = AN + CN + TN
Fee = Direct Cost x M
Total Cost of Service charged to Client =
Fee + R
4.2 Professional Fee Plus Expenses
This method of compensation is frequently
used where there is continuing relationship
involving a series of Projects. It
establishes a fixed sum over and above the
reimbursement for the Architect’s technical
time and overhead. An agreement on the
general scope of the work is necessary in
order to set an equitable fee.
4.3 Lump Sum or Fixed Fee
This method may be applied to government
projects since they entail more paper work
and time-consuming efforts.
4.4 Per Diem, Honorarium Plus Reimbursable
Expenses
In some cases a Client may request an
Architect to do work which will require his
personal time such as:
4.4.1 attending project-related meetings,
conferences or trips;
4.4.2 conducting ocular inspection of
possible project sites; and
4.4.3 conferring with others regarding
prospective investments or ventures and the
like.
For these particular activities, the
Architect as agent of the Owner may be paid
on a per diem and honorarium basis plus out-
of-pocket expenses such as but not limited
to travel, accommodations and subsistence.
4.5 Mixed Methods of Compensation
The SPP provides for more than one method of
compensation on a project.
Each project should be examined to determine
the most appropriate and equitable method of
 compensation.
SPP 202 METHOD OF COMPENSATION METHOD OF COMPENSATION
The Architect’s compensation is based on The Architect's compensation is based on the
the Architect’s / architectural firm’s Architect's / architectural firm's talents,
talents, skill, experience, imagination, and skill, experience, and on the type and level of
on the type and level of professional professional services provided. Compensation
services provided. Compensation for Regular for Regular Design Services may be based on one
Design Services may be based on one or more or more of the following:
of the following:
5.1 Percentage (%) of Project Construction 6.2.1 Percentage (%) of Project Construction
Cost (PCC) Cost (PCC)
The Architect’s Fee based on the PPC shall 6.2.2 Unit Cost Method based on Project
be detailed in the Architect’s Guidelines. Construction Cost
6.2.3 Professional Fee plus Expenses
5.2 Multiple of Direct Personnel Expenses 6.2.4 Lump Sum or Fixed Fee
This cost-based method of compensation is 6.2.5 Per Diem. Honorarium Plus Reimbursable
applicable only to non-creative work such as Expenses
accounting, secretarial, research, data 6.2.6 Multiple of Direct Personnel Expenses
gathering, preparation of reports and the 6.2.7 Mixed Methods of Compensation
like. This method of compensation is based
on technical hours spent and does not 6.3 Recommended Professional Fee (RPF)
account for creative work since the value of Professional architectural work is classified
creative design cannot be measured by the in accordance with the degree of complexity and
length of time the designer has spent on his the creative skill required to meet the
work. The computation is made by adding all requirements of the Client within technical,
costs of technical services (man hour/s x functional, economic and aesthetic constraints.
rate) and then multiplying it by a A grouping of buildings is provided to
multiplier to cover overhead and profit. determine the fair remuneration for the
Architect.
The multiplier ranges from 1.5 to 2.5
depending on the office set-up, overhead and 6.3.1 Group I
experience of the Architect and the Buildings of the simplest utilization and
complexity of the Project. character, which are without complication of
plan/design or detail and which require only a
Other items such as cost of transportation, minimum of architectural finishes, engineering
living and housing allowances of foreign and allied architectural elements:
consultants, out-of-town and housing
allowances of the local consultants and the Armories, Packaging and Processing Plants,
like, are all to be charged to the Client. Bakeries, Parking Structures, Habitable
At the start of the commission, the Agricultural Buildings, Printing Plants, Public
Architect shall make known to the Client the Markets, Service Garages, Hangars, industrial
rate of professionals and personnel who will Buildings, Manufacturing /industrial Plants,
be assigned to the Project and the Simple Loft Type Buildings, Warehouses, Other
multiplier that has to be applied before similar utilization type buildings
agreeing on this method of compensation.
Project Construction Recommended
FORMULA Cost(PCC) Professional Fee (RPF)
Assume: for Detailed
A = Architect’s rate / hour Architectural and
C = Consultant’s rate / hour Engineering Design
T = Rate per hour of Technical Staff, Services (DAEDS)
Researchers and others involved in the P50.0 million and 5%
Project less
AN, CN, TN = No. of hours spent by Over P50.0 million to P2,500,000 plus 4% of
Architect, Consultants and Technical Staff P100.0 million excess of P50.0
M = Multiplier to account for overhead and million
reasonable profit. The value may range from Over P100.0 million to P4,500,000 plus 3% of
1.5 to 2.5 depending on the set-up of the P200.0 million excess of P100.0
Architect’s office and the complexity of the million
Project. Over P200.0 million to P7,500,000 plus 2% of
R = Reimbursable expenses such as P500.0 million excess of P200.0
transportation, housing and living allowance million
of Consultant, transportation, per diem, Over 500.0 million to P13,500,000 plus 1%
housing and living allowance of local P1.0 billion of excess of P500
consultants and technical staff if assigned million
to places over 100km. from area of operation Over P'1.0 billion P18,500,000 plus
of the Architect. 1l2o/o of excess of
P1 .0 billion
Cost of printing of extra set of drawings,
reports, maps, contract documents, etc.
over the seven (7) copies submitted to the
Client, overseas and long distance calls,
 technical and laboratory tests, licenses,
fees, taxes and similar cost items needed by
Project the Project.Recommended
Construction
Cost(PCC) Professional Fee (RPF) 6.3.2 Group 2
Direct cost = forAN + CN + TN Detailed Buildings of moderate complexity of plan/design
Fee = DirectArchitectural
Cost x M Design requiring a moderate amount of research and of
Total Cost of Service
Services(DADS) charged to Client = engineering and allied architectural design.
P50.0 Fee
million + R and 3.0% Art Gallery, Office Buildings/Office
less Condominium, Banks, Exchange and Other
5.3 Professional
Over P50.0 million to Fee Plus
P1,500,000 plusExpenses
2.4o/o Buildings, Park, Playground and Open-Air
This
P100.0 million method of compensation
of excess of P50.0 is frequently Recreational Facilities, Financial
used where there
million is continuing relationship institutions, Residential Condominiums,
involving a series
Over P100.0 million to P2,700,000 plus 1.8%of Projects. It Bowlodromes, Police Stations, Call Centers,
establishes
P200.0 million a fixed sum over
of excess of P100.0 and above the Postal Facilities, Churches and Religious
reimbursement for the Architect’s technical
million Facilities, Private Clubs, City/Town Halls &
time and overhead. An agreement on the Civic Centers, Publishing Plants, College
Over P200.0 million to P4,500,000 plus 1 .
general scope of the work is necessary in Buildings, Convents, Monasteries & Seminaries,
P500.0 million 2o/o of excess of
order to set an equitable fee. Correctional & Detention Facilities, Court
P200.0 million
Houses/Halls of Justice, Dormitories,
Over 500.0 million to P8,100,000 plus 0.6%
5.4 Lump Sum or Fixed Fee Exhibition Halls & Display Structures, Fire
P1.0 billion of excess of P500.0
This method may be applied to government Stations, Laundries & Cleaning Facilities,
million
projects since they entail more paper work Libraries, Malls/Mall Complexes, Motels &
Over P1.0 billion P11,100,000 plus 0.6%
and time-consuming efforts. Apartels, Multi-storey Apartments, Nursing
of excess of P1.0
Homes, Race Tracks, Restaurants/Fast food
billion
5.5 Per Diem, Honorarium Plus Reimbursable Stores, Retail/Wholesale Stores, Schools,
Expenses Serviced Apartments, Shopping Centers,
In some cases a Client may request an Showrooms/Service Centers, Specialty Shops,
Architect to do work which will require his Supermarkets/Hyper-marts, Welfare Buildings,
personal time such as: Mixed Use Buildings, Other buildings of
5.5.1 Attending project-related meetings, similar nature or use
conferences or trips;
5.5.2 Conducting ocular inspection of Project Construction Recommended
possible project sites; and Cost (PCC) Professional Fee(RPF)
5.5.3 Conferring with others regarding for Detailed
prospective investments or ventures and the Architectural and
like. Engineering Design
For these particular activities, the Services (DAEDS)
Architect as agent of the Owner may be paid P50.0 million and 60/.
on a per diem and honorarium basis plus out- less
of-pocket expenses such as but not limited Over P50.0 million to P3,000,000 plus 5%
to travel, accommodations and subsistence. P100.0 million of excess of P 50.0
million
5.6 Mixed Methods of Compensation Over P100.0 million to P5,500,000 plus 4% of
The SPP provides for more than one method of P200.0 million excess of P100.0
compensation on a project. Each project million
should be examined to determine the most Over P200.0 million to P9,500,000 plus 3% of
appropriate method of compensation. P500.0 million excess of P200.0
million
7.4 Per Diem and Traveling Expenses Over 500.0 million to P18,500,000 plus 2%
A per diem plus traveling and living P1.0 billion of excess of P500
expenses shall be chargeable to the Owner million
whenever the Architect or his duly Over P1.0 billion P28,500,000 plus 1olo
authorized representative is required to of excess of P1.0
perform services at a locality beyond 50.0 billion
kilometers (air, straight line or radial
distance) from his established office as it Project Construction Recommended
appears in the Architect’s letterhead. Cost(PCC) Professional Fee (RPF)
for Detailed
7.6 Change/s Ordered by the Owner Architectural Design
If the Architect renders additional Services(DADs)
professional services due to changes ordered P50.0 million and 3.6%
by the Owner after approval of the less
Architect’s outputs, the Owner shall pay the Over P50.0 million to P1,800,000 plus 3.0%
Architect for extra time, resources/ P100.0 million of excess of P50.0
drafting, or other office expenses. million
Over P100.0 million to P3,300,000 plus 2.4%
7.7 Work Suspended or Abandoned
P200.0 million of excess of P100.0
If the work of the Architect is abandoned or
million
suspended in whole or in part, the Owner
Over P200.0 million to P 5, 700,000 plus 1.8%
shall pay the Architect for the services
P500.0 million of excess of P200.0
rendered corresponding to the amount due at
million
the stage of suspension or abandonment of
the work. Over 500.0 million to P11,100,000 plus 1 .
The primary service of the Architect is the P1.0 billion 2% of excess of
preparation of architectural plans/designs, P500.0 million
specifications and other building Over P1.0 billion P17,100,000 plus 0.6%
construction documents. of excess of P'l.0
These are sets of detailed instructions that billion
shall serve as the basis for the General
Contractor to implement the project. Once 6.3.3 Group 3
the Architect has prepared all these Buildings of exceptional character and
documents, the Architect has completed the complexity of plan/design or requiring
Detailed Design and Contract Documents Phase comparatively large amounts of research and of
of his services, which is equivalent to engineering and allied architectural design:
Ninety percent (90%) of his work. When the Airport/ wet & dry ports & Terminal, Mental
Owner therefore fails to implement the plans institutions, Aquariums, Mortuaries,
and documents for construction as prepared Auditoriums, Nuclear Facilities, Breweries
by the Architect, the Architect is entitled Observatories, Cold Storage Facilities, Public
to receive as compensation the sum Health Centers, Convention Facilities, Research
corresponding to ninety percent (90%) of the Facilities, Gymnasiums, Stadia, Hospitals &
Architect’s fee. Medical Buildings, Telecommunication Buildings,
Hotels, Theaters & Similar Facilities,
7.8 Different Periods of Construction Laboratories/Testing Facilities, Transportation
If portions of the building/s are erected at Facilities & Systems, Marinas and Resort
different periods of time, thus increasing Complexes, Veterinary Hospitals, Medical Arts
the construction period and Architect’s Offices & Clinics, Other buildings of similar
burden of services, charges pertaining to nature or use
services rendered during the Construction
Phase shall be adjusted proportionately. Project Construction Recommended
When the suspension of construction exceeds Cost(PCC) Professional Fee (RPF)
a period of six (6) months, the fee for the for Detailed
remaining works shall be doubled. Architectural and
Engineering Design
7.9 Services of Specialist Consultants Services (DAEDS)
If the Owner requires the services of P50.0 million and 7o/o
specialist consultants, they shall be less
engaged with the consent of the Architect. Over P50.0 million to P3,500,000 plus 6%
The cost of their services shall be paid for
separately by the Owner and shall not P100.0 million of excess of P50.0
be deducted from the Architect’s fee. million
Over P100.0 million to P 6,000,000 plus 5%
P200.0 million of excess of P100.0
million
Over P200.0 million P 11,500,000 plus 4%
to P500.0 million of excess of P200.0
million
Over 500.0 million to P23,500,000 plus 3%
P1.0 billion of excess of P500
million
Over P1.0 billion P38,500,000 plus 2% of
excess of P1.0
billion

Project Construction Recommended

Cost(PCC) Professional Fee(RPF)
for Detailed
Architectural Design
Services (DADS)
P50.0 million and 4.2%
less
Over P50.0 million to P2,100,000 plus 3.6%
P100.0 million of excess of P50.0
million
Over P100.0 million to P3,900,000plus 3% of
P200.0 million excess of P100.0
million
Over P200.0 million to P6,900.000 plus 2.4%
P500.0 million of excess of P200.0
 million
Over 500.0 million to P14,100,000 plus 1 .8%
P1.0 billion of excess of P500.0
million
Over P1.0 billion P23,100,000 plus 1 .2%
of excess of Pl.0
billion

6.3.4 Group 4
Residences (single-detached, single-attached or
duplex, row-houses or shop houses), small
apartment houses and townhouses.

Recommended
Professional Fee (RPF)
Detailed Architectural 10% of PCC
and Engineering Design
Services (DAEOS)
Detailed Architectural 6% of PCC
Design Services (DADS)

6.3.5 Group 5
Monumental buildings and other facilities
requiring consummate design skill and much
precise detailing.

Exposition & Fair Buildings, Mausoleums,

Memorials, & Monuments, Buildings of similar
nature or use, Specialized decorative,
buildings, Museums

Recommended
Professional Fee (RPF)
Detailed Architectural 12% of PCC
and Engineering
Design Services(DAEDS)
Detailed Architectural 7.5o% of PCC
Design Services (DADS)

6.3.6 Group 6
When the plan/design and related Contract
Documents are re-used for the repetitive
construction of similar buildings without
amending the drawing and the specifications,
the Architect's fee is computed as follows:

Recommended
Professional Fee(RPF)
First (1st) Building 100% of RPF for type
of building
Second (2nd) 50% of RPF for type
Building of building
Third (3rd) Building 40% of RPF for type
of building
Fourth (4th) and 30% of RPF for type
succeeding Buildings of building

Note: Major adjustment due to site condition

will affect the Professional Fee

6.3.7 Group 7
When the Architect is engaged to undertake a
Housing Project involving the construction of
several residential units on a single site with
the use of one (1) set of plans/design,
specifications and related documents, the
Architect's Fee chargeable shall conform with
the following:
No. of Units Detailed Detailed
Architectural & Architectural
Engineering Design
Design Services(DADS)
Services(DAEDS)
First (1st) 10% of PCC 6% of PCC
Unit
From two To Fee for one Fee for one
ten units unit plus unit plus
(2-10) 50% of RPF for 30% of RPF for
each each
additional additional
unit unit
Eleven units Fee for 10 Fee for 10
To thirty units plus units plus
units (11- 40% of RPF for 24% of RPF for
30) each each
additional additional
unit unit
Thirty-one Fee for 30 unit Fee for 30
units To plus units plus
fifty units 25% of RPF for 15% of RPF for
(31-50) each additional each
unit additional
unit
Fifty-one Fee for 50 Fee for 50
units and units plus 15% units plus
above (51+) of RPF for each 9% of RPF for
additional unit each
additional
unit

6.3.8 Group 8
Projects involving extensive detail such as
designs for built-in components or elements,
built in equipment, special fittings,
screens, counters, architectural interiors, and
development planning and/or design.

Recommended Professional
Fee(RPF) 15% of the PCC

6.3.9 Group 9
For alterations, renovations, rehabilitations,
retrofit and expansion/additions to existing
buildings belonging to Groups 1 to 5 enumerated
above, the compensation of services should
be increased to fifty percent (50%) or a
total of one hundred fifty percent (150%)
of the RPF.

6.3.10 Group 10
Where the Architect is engaged to render
opinion or give advice, clarifications or
explanation on technical matters pertaining to
his profession, (also refer to Pre-Design
Services SPP Doc. 201 under Consultation)
the chargeable RPF shall not be less than
One Thousand Pesos (Pl,000.00) per hour
subject to increase depending on the extent
and coverage of service required and the
location where the Architect shall render his
services. When rendering services as an
expert witness, the Architect's fee shall
not be less than Five Thousand Pesos
(P5,000.00) per appearance regardless as to
whether the scheduled hearing took place
or not.
Adjustment of the price shall be made at
the time of the signing of the Architect's
contract of service. The amount excludes
the cost of transportation and
accommodations when and where required.
Another sixty percent (60%) of the amount
shall be charged for the travel period in
case of locations that are in excess of
one hundred kilometers (100.0 km, air
straight line or radial distance) of
the Architect's office (as stated in his
letterhead).
(Note; All references to fixed amount shall
refer to the value of the Philippine Peso
as of October,2014).

6.4 Manner of Payment

Payments to the Architect on account of the
agreed Professional Fee shall be made by
the Owner on the different phases of the
work of the Architect as follows:

6.4.1 Upon signing of the Service Agreement

An amount equivalent to 5% of the agreed
Professional Fee shall be paid by the
Owner as engagement fee or as the acceptance
fee of the Architect that shall cover the
mobilization component of the services. The
Professional Fee shall be computed based on
the Statement of Probable Project Construction
Cost (SPPCC) as included in the Annex of
the Service Agreement.

6.4.2 Upon the completion of the Schematic

Design Phase Upon completion and submission
of the documents under Schematic Design
Phase
as stipulated in the Service Agreement, but
not more than 15 days after submission of
the
documents to the Owner, the Owner shall
pay the Architect a sum equal to fifteen
percent
(15.0%)of the Professional Fee, or a sum
sufficient to increase the total payments
on the fee to twenty (20.0%) percent of
the Professional Fee (amount paid under
Section 6.4.1 shall be deducted from the
total amount). The Professional Fee shall be
computed based on the Statement of Probable
Project Construction Cost (SPPCC) that shall
be part of the documents to be submitted
at this particular stage.

6.4.3 Upon the completion of the Design

Development Phase
Upon completion and submission of the
documents under Design Development Phase as
stipulated in the Service Agreement, but
not more than 15 days after submission of the
documents to the Owner, the Owner shall
pay the Architect a sum equal to twenty
percent
(20.0%) of the Professional Fee, or a sum
sufficient to increase the total payments
on the fee to forty (40.0%) percent of
the
Professional Fee (accumulated amount paid
under Section 6.4.2 shall be deducted from
the total amount). The Professional Fee
shall be computed based on the Statement of
Probable Project Construction Cost (SPPCC)
that shall be part of the documents to be
submitted at this particular stage.

6.4.4 Upon the completion of the Contract

Document Phase
Upon completion and submission of the
documents under Contract Document Phase as
stipulated in the Service Agreement, but not
more than 15 days after submission of the
documents to the Owner, the Owner shall
pay the Architect a sum equal to fifty
percent (50.0%) of the Professional Fee,
or a sum sufficient to increase the total
payments on the fee to ninety (90%)
percent of the
Professional Fee (accumulated amount paid
under Section 6.4.3 shall be deducted from
the total amount). The Professional Fee shall
be computed based on the Statement of
Probable Project Construction Cost (SPPCC)
that shall be part of the documents to be
submitted at this particular stage.

6.4.5 Bidding or Negotiation Phase

Within 15 days after the award to the
winning bidder or bidder the payment to
the Architect shall be adjusted so that it
will amount to a sum equivalent to ninety
(90%) percent of the Professional Fee,
computed
upon the lowest Bona fide Bid or Bids or
upon the winning Bid Price.

6.4.6 Construction Phase

The remaining of the ten (10%) percent of
the Professional Fee is broken down as
follows:
a) Five (5%) percent for Architect's
Liability under the Civil Code, and
b) Five (5%) percent for the Periodic
Construction Supervision (PCS) Progress
Billing can be done on the remaining ten
percent (10%) of the Architect's Fee based
on the original Statement of Probable
Project Construction Cost(SPPCC). Upon
completion of the work (when Certificate of
Completion is issued to Contractor), the
balance of the Architect shall be paid
computed on the Final Project Construction
Cost(FPCC).

Work Phase Breakdown of Cumulative

PF Payments
Upon signing 5% of the 5% of the
of Agreement PF PF1
as the
mobilization
component
Upon the 15% of the 20% of the
completion of PF PF2
the Schematic
Design
Services
Upon the 20% of the 40% ot the
completion of PF PF2
the Design
Development
Services
Upon the 50% of the 90% of the
completion of PF PF2
the Contract
 Documents
Services
Within 15 days 90% of the
after the PF3
awards to
the
Winning
Constructor
Upon 10% of the 100% of the
completion of PF PF4
the work

Note:
1 . Based on the original SPPCC included
as Annex to the Service Agreement.
2. Based on the SPPCC submitted at that
particular stage.
3. Based on the winning Bid price.
4. Based on the FPPCC.

SPP 203 METHOD OF COMPENSATION METHODS OF COMPENSATION

4.1 For projects involving extensive
Compensation for specialized architectural
detailing of AI components such as custom services, all of which may be classified as
floor, wall, ceiling construction and
additional or extra services, shall be
finishes, cabinet design, built-in
computed depending on the complexity of
components, equipment and special fittings,
the works to be undertaken using the
the Architect’s Fee shall be a percentage of
following
the Cost of the AI work. This excludes themethods:
fee of any Engineering and / or Specialist7.2.1.1 Percentage (%) of Cost of Work
Consultants (SCs) working with the
7.2.1.2 Unit Cost Method based on Cost of
Architect. Work
7.2.1.3 Multiple of Direct Personnel Expense
4.2 Should the Client separately hire the 7.2.1.4 Professional Expenses
services of Specialist Consultants (SCs), 7 2 1.5 Lump sum or Fixed Fee
their professional fee shall be for the 7.2.1.6 Retainer
account of the Client. 7.2.1.7 Per Diem, Honorarium Plus Reimbursable
Expenses
4.3 For this Specialized Service, the 7.2.1.8 Mixed Methods Compensation
payment of the Architect’s services shall be
as stated in the Architect’s Guidelines. 7.2.2 When using the Percentage of Cost of
Work, the Architect's Fee excludes the fee
of any Engineering and / or Specialist
METHOD OF COMPENSATION Consultants (SCs) working with the
4.1 The Architect’s Fee for acoustic design Architect. Cost of Work is defined under
services shall depend on the complexity of Annex (Definition of Terms) of this
the works to be undertaken. Guidelines.

4.2 Should the Owner/Client hire separately 7.2.3 Should the Owner/Client hire
the services of other Specialist separately the services of other Specialist
Consultants(SCs), their fee shall be for the Consultants (SCs), their fee shall be on
account of the Owner/ Client and shall be the account of the Owner/ Client and shall
paid directly to the SC. be paid directly to the SC. ln such case,
4.3 For this Specialized Service, the the fee of the Architect for coordinating
payment of the Architect’s services shall be and relating the work of the Specialist
as stated in the Architect’s Guidelines. Consultant to the design concept of the
Architect will be 5% of the SC's fee.
METHOD OF COMPENSATION
4.1 The Architect’s Fee for lighting layout 7.2.4 When using Multiple of Direct Personnel
and design services shall depend on the Expense, the compensation can also be
complexity of the works to be undertaken. computed through man-months i.e. 22 man-
days multiplied by 8 man-hours, and
4.2 Should the Owner/Client hire separately multiplied by a factor to cover other
the services of Specialist Consultants, the direct and indirect costs e.g. overhead,
fee shall be for the account of the etc.
Owner/Client and shall be paid directly to 7.3 Recommended Professional Fee
the Consultant. 7.3.1 Architectural interior (Al), Acoustic
Design, Architectural Lighting Layout and
4.3 “Cost of the Work” means the total cost Design and Site Development Planning(SDP)
of all fixtures and accessories, which were 7.3.1.1 Recommended Professional Fee (RPF)
either designed, specified or procured by is 10% to 15% of the cost of work
the Specialist Architect and/or his depending on the complexity of the work
Specialist Consultants (SCs) for the required by the project.
Owner/Client, and that were used or 7.3.1.2 The Manner of Payment for the above
installed in the project. services shall be as follows:
Upon submission of 30% of the fee
4.4 For this Special Service, the payment of the preliminary
the Architect’s services shall be as stated design
in the Architect’s Guidelines Upon submission of 50% of the fee
the final design
MANNER OF COMPENSATION Upon completion of 50% of the fee
4.1 The Architect’s Fee for site development the project
planning (SDP) services shall depend on the 7.3.1.3 The Architect may bill and be paid
estimated cost of the civil works and for the progress payments during
landscaping works i.e. hardscape and soft construction proportional to the percentage
cape, depending on the magnitude and of progress of completion of the construction
complexity of the work required by the work. Should the work be not completed,
project. If the Architect is also certified the Architect’s hall be paid by the Client
and licensed as a separate RLP e.g. a the amount proportional to the work
Landscape Architect, and is suitably completed at the stage when the project was
experienced, the Architect’s fee shall abandoned.
increase correspondingly, depending on the
magnitude and complexity of the work 7.3.2 Physical Planning for building sites
required by the project. such as industrial Estates, Commercial,
Religious, institutional and Government Civic
4.2 Should the Owner/ Client separately Centers, Sports Complexes, Tourist Centers/
engage the services of a Landscape Tourism Estates/Resorts, Amusement Parks,
Architect, the fee of the said Specialist Educational Facilities, Residential and
Consultant shall be for the account of the Housing Subdivisions and the like.
Owner/Client and paid directly to the SC. 7.3.2.1 The Recommended Professional Fee
(RPF) is P50,000.00 per hectare for the
4.3 For this Specialized Service, the first five (5 has.) hectares net to the
payment of the Architect’s services shall be architect.
as stated in the Architect’s Guidelines. Area Recommended Amount
Professional
2. MANNER OF COMPENSATION Fee (RPF)
The fee structure for Site and Physical Basic rate P5.00 per sq. P250,000.00
Planning Services by the Architect shall be
as stated in the Architect’s Guidelines. for the meter
first
3. MANNER OF COMPENSATION 5 hectares
Compensation for the foregoing specialized or less (1
architectural service shall be through man- hectare:10,000
months i.e. 22 man-days multiplied by 8 man- sq.meters)
hours, and multiplied by a factor to cover Over 5 P4.00 P250,000.00
other direct and indirect costs e.g. hectares up per sq. meter + P40,000.00
overhead, etc. or as prescribed by the to per hectare
Architect’s Guidelines. 10 hectares in excess of
5
General Notes: hectares
METHOD OF COMPENSATION FOR SPECIALIZED Over 10 P3.00 P450,000.00
ARCHITECTURAL SERVICES hectares up per sq. +
Compensation for the foregoing specialized to meter P30,000.00
architectural services, all of which may be 50 hectares per hectare
classified as additional or extra services, in excess of
shall be through man-months i.e. 22 man- 10
days multiplied by 8 man-hours, and hectares
multiplied by a factor to cover other direct Over 50 P1.50 P1,650,000.00
and indirect costs e.g. overhead, etc. or hectares and per sq. meter + P15,000.00
any other applicable mode of determination above per
of the Architect’s fee as stated in Doc. Hectare in
201, Doc. 202 and the Architect’s excess of 50
Guidelines. hectares

7.3.2.2 The rate stipulated above is based on

the assumption that the land to be
developed is moderately flat. However, if
the land is rugged with steep terrain the
fee shall increase by 20o/o lo 30Yo.
7.3.2.3 The following payment schedule is
applied to this service:
Framework Development 30% of RPF
Plan (FRDP)
Conceptual Master 30% of RPF
Development Plan
(CMDP)
Preliminary Master 20% of RPF
Development Plan
(PMDP)
Detailed Master 20% of RPF
Development Plan
(DMDP)

7.3.2.4 The above services pertain only to

physical planning outputs and do not include
engineering services and other allied
services. e.g. landscape design.
transportation planning. environmental
investigations and other services.

7.3.2.5 The detailed design of the

building/s and landscaping elements is not
part of Physical Planning Services and shall
be treated separately under Regular Design
Services SPP Doc. 202 or Specialized
Architectural Services (Site Development
Planning) SPP Doc. 203.

7.3.2.6 The Architect may bill and be paid

for the progress payments for the work
duration proportional to the percentage of
progress of completion of the Specialized
Architectural Services. Should the work be
abandoned or not be completed at a
particular stage of the work of the
Architect, the pro-rated PF component shall
be paid to the Architect by the Client.

7.3.3 Other Specialized Architectural Services

 Basic compensation for the foregoing
Specialized Architectural Services, all of
which are classified as additional or
extra services, shall be through man-
months i.e. 22 man-days multiplied by 8
man-hours, and multiplied by a factor to
cover other direct and indirect costs e.g.
overhead, etc., or using the Multiple of
Direct Personnel Expense
Method.
Other applicable mode of determining the
Architect's fee that is mutually agreed upon
by the Architect and the Client are the
following:
a) Per diem plus reimbursable expenses
b) Retainer plus reimbursable expenses
c) Rate cost times a multiplier plus
reimbursable expenses
SPP 204-A 4. METHOD OF COMPENSATION METHOD OF COMPENSATION
The Architect’s compensation is based on the Compensation or Fulltime Construction
Architect’s / architectural firm’s talents, Supervision Services may be based on one or
skill, experience, and on the type and level more of the following:
of professional services provided. 8.2.1 Percentage of Project Construction Cost
Compensation for Fulltime Supervision 8.2.2 Multiple of Direct Personnel Expense
Services may be based on one or more of the 8.2.3 Professional Fee Plus Expenses
following: 8.2.4 Lump Sum Fixed Fee
8.2.5 Per Diem, Honorarium Plus Reimbursable
4.1 Percentage (%) of Project Construction Expense
Cost (PCC) 8.2.6 Mixed Methods of Compensation
The Architect’s Fee for Fulltime Supervision 8.3 Recommended Professional Fee The
as based on the PPC shall be detailed in the Recommended Professional Fee (RPF) for
Architect’s Guidelines. Fulltime Construction Supervision Services
is 1ok to 1.5% of the Project Construction
4.2 Multiple of Direct Personnel Expenses Cost (PCC).
This cost-based method of compensation is
applicable only to non-creative work such as 8.4 Manner of Payment The Architect may bill =
accounting, secretarial, research, data and be paid for the progress payments
gathering, preparation of reports and the during construction proportional to the
like. This method of compensation is based percentage of progress of completion of
on technical hours spent and does not the construction work. Should the work be
account for creative work since the value of not completed, the pro-rated RPF component
creative design cannot be measured by the shall be paid to the Architect by the
length of time the designer has spent on his Client.
work. The computation is made by adding all
costs of technical services (man hour/s x 8.5 Separate Consultants Should the Client
rate) and then multiplying it by ahire separately the services of the
multiplier to cover overhead and profit. Consultant, the fee of the Consultant shall
be on the account and paid directly by the
The multiplier ranges from 1.5 to 2.5 Client. ln such case, the fee of the
depending on the office set-up, overhead and Architect-of-Record (AoR) for coordinating
experience of the Architect and the and relating the work of the Consultant to
complexity of the Project. the work of the Architect will be 5% of the
Consultant's fee.
Other items such as cost of transportation,
living and housing allowances of foreign
consultants, out-of-town living and housing
allowances of the local consultants and the
like, are all to be charged to the Client.
At the start of the commission, the
Architect shall make known to the Client the
rate of professionals and personnel who will
be assigned to the Project and the
multiplier that has to be applied before
agreeing on this method of compensation.

FORMULA
Assume:
A = Architect’s rate / hour
C = Consultant’s rate / hour
T = Rate per hour of Technical Staff,
Inspectors and others involved in the
Project
AN, CN, TN = No. of hours spent by
Architect, Consultants and Technical Staff
M = Multiplier to account for overhead and
reasonable profit. The value may range from
1.5 to 2.5 depending on the set-up of the
Architect’s office and the complexity of the
Project.
R = Reimbursable expenses such as
transportation, housing and living allowance
of Consultant, transportation, per diem,
housing and living allowance of local
consultants and technical staff if assigned
to places over 100km. from area of
operation of the Architect.

Cost of printing of extra set of drawings,

reports, maps, contract documents, etc. over
the seven (7) copies submitted to the
Client, overseas and long distance calls,
technical and laboratory tests, licenses,
fees, taxes and similar cost items needed by
the Project.

Direct cost = AN + CN + TN
Fee = Direct Cost x M
Total Cost of Service charged to Client =
Fee + R

4.3 Professional Fee Plus Expenses

This method of compensation is frequently
used where there is continuing relationship
involving a series of Projects. It
establishes a fixed sum over and above the
reimbursement for the Architect’s technical
time and overhead. An agreement on the
general scope of the work is necessary in
 order to set an equitable fee.

4.4 Lump Sum or Fixed Fee

This method may be applied to government
projects since they entail more paper work
and time-consuming efforts.

4.5 Per Diem, Honorarium Plus

Reimbursable Expenses
In some cases a Client may request an
Architect to do work which will require his
personal time such as:

7.18.1 attending project-related meetings,

conferences or trips;

7.18.2 conducting ocular inspection of

possible project sites; and

7.18.3 conferring with others regarding

prospective investments or ventures and the
like. For these particular activities, the
Architect as agent of the Owner may be paid
on a per diem and honorarium basis plus out-
of-pocket expenses such as but not limited
to travel, accommodations and subsistence.

4.6 Mixed Methods of Compensation

The SPP provides for more than one method of
compensation on a project. Each project
should be examined to determine the most
appropriate method of compensation.
SPP 204-B METHOD OF COMPENSATION METHODS OF COMPENSATION
Since construction management is not part of Since construction management is not part of
the regular services of the Architect, the the regular services of the Architect, the
services rendered by the Architect as services rendered by the Architect as a
a Construction Manager (CM) shall be Construction Manager (CM) shall be separately
separately compensated. compensated.

9.2.1 The compensation can be based on the

following methods:

9.2.1.1 Percentage of Project Construction

Cost
9.2.1.2 Multiple of Direct Personnel
Expense
9.2.1.3 Professional Expenses
9.2.1.4 Lump Sum or Fixed Fee
9.2.1.5 Per Diem, Honorarium Plus
Reimbursable Expenses
9.2.1.6 Mixed Methods Compensation
9.2.2 To motivate the Construction Manager
to reduce acquisition and operating costs.
the services of the Construction Manager can
also be compensated using Construction
Management Contracting Concepts which includes
a range of incentive type contracts and
provisions. During the initial stages of
the
project, incentive type contracts are
appropriate such as:

9.2.2.1 Award Fee Provisions

The Construction Manager has the
opportunity to obtain an award fee of
specified maximum size if the measured cost
related values meet or exceed the specified
target values.
9.2.2.2 Price Adjustment Provisions
The contract price is adjusted upward or
downward in accordance with a prearranged
formula. The operating and support cost
factor provision provides a direct
incentive on operating and support costs.
For the later stages of a project, contract
types are used to encourage better
construction management services. The
preceding types of contracts for
construction management services are used
according to gross estimates and complexity
of work.

9.2.2.3 Firm Fixed Price

The Owner will pay the Construction Manager
a fixed fee. The fee will be unaffected by
variations between the estimate and the
bids or by change orders during the
construction
phase unless the Owner initiates an
increase in scope.

9.2.2.4 Fixed Price incentive

The Owner will pay the Construction
Manager a fixed fee which is adjusted
according to the difference between the
final allowable costs and the target costs.

9.2.2.5 Cost plus incentive Fee(CPIF) or

Cost plus Adjusted Fee (CPAF)
Cost reimbursement type contracts with
provisions for a fee that is adjusted by
"sharing" formulas applied to the
difference between the final allowable costs
and the target costs.

9.2.2.6 Cost Plus Fixed Fee

The Owner will pay the Construction
Managers fixed fee plus reimbursement of
 certain expenses incurred in the
performance of basis services.

9.3 Recommended Professional Fee

The services of the Architect as
Construction Manager can be compensated by
a Recommended
Professional Fee (RPF) of 1.5% to 3% of the
Project Construction Cost (PCC).

9.4 Manner of Payment

The Architect may bill and be paid for the
progress payments during construction
proportional to the percentage of progress
of completion of the construction work.
Should the work be not completed, the
pro-rated RPF component shall be paid to
the Architect by the Client.

9.5 Separate Consultants

Should the Client hire separately the
services of the Consultant, the fee of
the Consultant shall be on the account and
paid directly by the Client. ln such case,
an additional compensation for the
Architect-of-Record (AoR) for coordinating
and relating the work of the Consultant to
the work of the Architect-of-Record (AoR)
can be computed using time-based methods or
percentage basis equivalent to 5% of the
Consultant's fee.

SPP 205 METHOD OF COMPENSATION METHOD OF COMPENSATION

4.1. Percentage of gross rentals, The Architect performing Post Construction
maintenance and security fees; and/or Services or engaged as the Building
Administrator and/ or Property Manager can
 4.2. Monthly salary/ fee. be
compensated using the following methods:
10.2.l Value-pricing or Percentage of gross
rentals, maintenance and security fees
10.2.2 Monthly salary/ fee
10.2.3 Multiple of Direct Personnel Expense
10.2.4 Retainer plus Reimbursable Expenses
10.2.5 Professional Fee Plus Expenses
10.3 Recommended Professional Fee
The Recommended Professional Fee (RPF) based
on value-pricing is from 4% to 6% of gross
rental. This incentive-type of management
fee will ensure more efficient and
economical
operation and maximize building revenues.

SPP 206 METHOD OF COMPENSATION METHOD OF COMPENSATION

13.1 The Project Manager is compensated on a The Architect as Project Manager can be
percentage basis, as shall be described in compensated using the following methods:
the Architect’s Guidelines. 11.2.1 Percentage of Construction Cost Project
11.2.2 Multiple of Direct Personnel Expense
13.2 If the Architect as Project Manager 1l.2.3 Professional Expenses Fee plus
(PM) performs regular design services for 11.2.4 lump Sum or Fixed Fee
the same project, he shall be compensated 11.3 Recommende Professional Fee
separately for these services as stipulated 11.3.1 The Recommended Professional Fee (RPF)
in SPP Document 202. for Project Manager is 2% to 5% of
Project Construction Cost (PCC).
11.3.2 lf the Architect as Project Manager
performs Regular Design Services for the
same
project, he is compensated separately for
these services as stipulated in SPP DOC.
202.
SPP 207 METHOD OF COMPENSATION METHOD OF COMPENSATION
5.1 The manner of payment to the Architect Compensation for the Architect performing
follows the progress of construction. All Design-Build Services can be based on the
costs for labor and materials are paid following:
directly by the Client. The Architect does 12.3.1 Percentage of Construction Cost Project
not advance any money for payment of 12.3.2 Multiple of Direct Personnel Expense
expenditures connected with the work. 12.3.3 Professional Expenses Fee plus
Generally, a revolving fund is given to the 12.3.4 Lump Sum or Fixed Fee
Architect beforehand and is accounted for 12.3.5 Per Diem, Honorarium Plus Reimbursable
and subject to periodic auditing by the Expenses
Client. 12.3.6 Mixed Methods of Compensation
12.3.7 Built-in in the Guaranteed Maximum
5.2 Cost of all permits, licenses and other Cost
incidentals to the work are paid by the 12.4 Recommended Professional Fee
Owner/ Client. 12.4.1 The Recommended Professional Fee (RPF)
for an Architect doing Design-Build
5.3 The Architect may appoint, subject to Services by Administration shall be 7% of the
the Owner/ Client’s approval, a construction Project Construction Cost (PCC), exclusive
superintendent, purchasing agent, timekeeper of the Architect's Fee for the Regular
and property clerk aside from the usual Design Services.
labor personnel required. Salaries of such 12.4.2 The Recommended Professional Fee (RPF)
persons are paid by the Owner/ Client and for an Architect doing Design-Build
not deductible from the Architect’s Fee Services
under this SPP. on a Guaranteed Maximum Cost shall be 10%
of the Project Construction Cost (PCC), or
5.4 The method of compensation may be is already built-in in the Guaranteed
modified by using the relevant Maximum
alternatives detailed in SPP Doc. 202. Cost, exclusive of the Architect's Fee for
the Regular Design Services
12.5 Manner of Payment
12.5.1 The manner of payment to the
Architect follows the progress of
construction. The Architect may bill and be
paid for the progress payments during
construction proportional to the percentage
of progress of completion of the
construction work. Should the work be not
completed, the pro-rated RPF component
shall be paid to the Architect by the
 Client.
12.5.2 The Client directly pays all costs
for labor and materials. The Architect
does not advance any money for payment of
expenditures connected with the work.
Generally, a revolving fund is given to the
Architect beforehand and is accounted for
and subject to periodic auditing by the
Client.
12.5.3 The Owner/Client shall pay for the
cost of all permits, licenses and other
incidentals to the work.
12.5.4 The Architect may appoint, subject to
the Owner/ Client's approval, a construction
superintendent, purchasing agent, timekeeper
and property clerk aside from the usual
labor personnel required. Salaries of such
persons are paid by the Owner/ Client and
not deductible from the Architect's Fee
under the SPP.

SPP 208 PRIZES, HONORARIA AND MENTIONS Competition Secretariat

8.1 The Conditions must state the amount and The body formed by the Owner and approved
number of prizes. The prizes awarded must be by the Professional Advisor, to assist the
related to the size and complexity of the Professional Advisor and the Jury in the
project, the amount of work involved and the administrative conduct of the ADC. This
expense incurred by Competitors. may include the following:
13.1.1 Secretary/Receptionist
8.2 It is important for the Owner to allot 13.1.2 Encoder/Researcher
adequate prize money to compensate all the 13.1.3 Support Staff/OJTs
Competitors for their work. For Ideas 13.2 Professional Advisor
Competition only, it may be the sole 13.2.1 A Professional Advisor is an Architect
remuneration received by the first (1st) nominated/ appointed and paid by the Owner
prize winner. and approved by the IAPOA National Board of
Directors (NBD) thru its ADC Committee to
8.3 The Owner undertakes to accept the organize the ADC on behalf of the Owner.
decisions of the Jury and to pay the prizes 13.2.2 His role is the supervision of the
allotted within one (1) month of the conduct of the ADC and the preparation of
official announcement of the ADC results. the Conditions. His function includes insuring
that the ADC timetable is adhered to,
8.4 Each participant in a limited ADC by supervising the receipt of Competitor's
invitation shall receive an honorarium in questions, the dispatch of reply to all
addition to the prizes awarded. Competitors and the receipt of competition
8.5 In two (2)-stage competitions, a entries, and safeguarding the anonymity of
reasonable honorarium shall be paid to each Competitors at all times
of the Competitors selected to take part in 13.2.3 He will assist the Jury and will be
the second (2nd) stage. This sum, which is present during its deliberations but he will
intended to reimburse them for the have no vote.
additional work carried out in the second 13.2.4 His responsibilities will be limited
(2nd) stage, shall be stated in the to the organization and the conduct of the
Conditions and shall be in addition to the competition.
prizes awarded. 13.3 Technical Advisors
Technical Advisors are Specialist personnel
8.6 The Conditions shall state the use to who may be consulted by the Jurors during
which the Owner will put the winning the conduct of the ADC to permit them to
plan/design scheme/s. ADC-generated obtain all necessary relevant information.
plans/designs may not be used or altered in 13.4 Jury
any way except by agreement with the author. 13.4.1 The people appointed by the Owner to
The Owner or his agents are not free to pick assess the entries to the competition.
out portions of the entries to compose The members of the Jury are called Jurors.
another plan/ design due to applicable 13.4.2 It consists of a majority of
ownership and copyright provisions under registered and licensed architects (RLAs,
Secs. 20 (4) and 33 of R.A. No. 9266 (The hereinafter referred to as "Architect/s")
Architecture Act of 2004) and of R.A. No. assisted by a lay Juror to represent and
8293 (Intellectual property Code of the voice the intention of the Owner.
Philippines) and their respective IRRs. 13.4.3 They are nominated by the Owner and
approved by the Integrated and Accredited
8.7 In Project ADCs, the award of first Professional Organization of Architects
prize to a plan/design places the Owner (IAPOA).
under an obligation to entrust the Author of 13.5 Competition Budget costs
the plan/design with the commission for the 13.5.1 A budget must be earmarked For the
Project. If the winning Competitor is unable salary of the Secretariat throughout the
to satisfy the Jury of his ability to carry duration of the Competition, from the time
out the plan/ design work, the Jury may it is launched and up to the end of the
require the winner to collaborate with Exhibition, Awarding
another Architect of the winning 13.5.1.1 Salary can be on a monthly basis for
Competitor’s the temporary staff and weekly allowance for
choice, duly approved by the Jury and Owner. support staff like ojt who assists in the
Judging, Exhibit and Awarding ceremonies.
8.8 In Project ADCs, provisions shall be 13.5.1.2 A budget can also be earmarked
made in the ADC Conditions for the first for office overhead cost, including office
prize winner to receive compensation of a rental (if necessary), transportation,
further sum equal to the amount of the first office supplies and meals.
prize, if no contract has been signed within 13.5.2 The Professional Advisor shall be
twelve (12) months of the announcement of provided with an Honorarium per month
the Jury’s award. In so compensating the during the duration of the Competition.
first prize winner, the Owner does not Expenses for board and lodging,
acquire the right to carry out the project transportation and airfare, if travel for
except with the collaboration of its Author. the Advisor is so required the
Competition, shall be reimbursed by the
8.9 In an Ideas Competition, if the Owner Owner.
decides to make use of all or part of the 13.5.3 The Technical Advisor shall also be
winning scheme, he should do so with the provided with an Honorarium as Consultation
collaboration of the Author. The terms of Fee.
collaboration must be acceptable to the 13.5.4 The Jurors shall also be provided
latter. with an Honorarium to cover the period for
the Judging. Expenses for accommodation,
food, transportation and airfare shall also
be on the account of the Owner.
13.6 Prizes, Honoraria and Mentions
13.6.1 The prizes awarded must be related to
the size and complexity of the project, the
amount of work involved and the expense
incurred by Competitors. It is important
for
the Owner to allot adequate prize money to
compensate all the Competitors for their
work.
13.6.2 For Ideas Competition only, it may
be possible to remunerate only the first
(1st)
prize winner.
13.6.3 The Owner undertakes to accept the
decisions of the Jury and to pay the
prizes allotted within one (l) month of the
official announcement of the ADC results.
13.6.4 Each participant in a limited ADC by
invitation shall receive an honorarium in
addition to the prizes awarded.
13.6.5 ln two (2)-stage competitions, a
reasonable honorarium shall be paid to
each of the Competitors selected to take
part in the second (2nd) stage. This sum,
which is intended to reimburse them for
the additional work carried out in the
second (2nd) stage, shall be stated in
the Conditions and shall be in addition to
the prizes awarded.
13.6.6 The Conditions shall state the use
to which the Owner will put the winning
plan/design scheme/s. ADC-generated
plans/designs may not be used or altered
in any way except by agreement with the
author. The Owner or his agents are not
free to pick out portions of the entries
to compose another plan/ design. This is
covered by applicable ownership and
Copyright provisions under Secs.20 (4) and
33 of R.A.
No. 9266 (The Architecture Act of 2004) and
of R.A. No. 8293 (intellectual property Code
of the Philippines) and their respective
lRRs.
13.6.7 ln Project ADCS, the award of first
 prize to a plan/design places the Owner
under
an obligation to entrust the Author of the
plan/design with the commission for the
Project. lf the winning Competitor is
unable to satisfy the Jury of his ability
to carry out the plan/ design work, the
Jury may require the winner to collaborate
with another Architect of the winning
Competitor's choice, duly approved by the
Jury and Owner.
13.6.8 ln Project ADCS, provisions shall be
made in the ADC Conditions for the first
prize winner to receive compensation of a
further
sum equal to the amount of the first prize
if no contract is signed within twelve
(12)
months of the announcement of the Jury's
award. ln so compensating the first prize
winner, the Owner does not acquire the
right to carry out the project except with
the
collaboration of its Author.
13.6.9 ln an ideas Competition, if the
Owner decides to make use of all or part of
the winning scheme, he should do so with
the collaboration of the Author. The terms of
collaboration must be acceptable to the
latter.
SPP 209 COMPENSATION OF PACS METHOD OF COMPENSATION
24.1 The computation of the compensation of 14.2.1 A Professional Consulting Architect
fees for professional architectural (PCA) may provide services directly or
consulting services (PACS) shall depend on indirectly to the Client in the manner
the type of services to be rendered and the prescribed, suggested
conditions under which they are to be or promulgated by the Commission/Board
performed; through the IAPOA.
14.2.2 Compensation of a professional
24.2 Compensation for PACS that require only consulting Architect (PCA) may be computed
one kind of expertise/specialization or based on one or a combination of the
related types of expertise shall be treated following methods, with modifications
differently from those services that require applicable to the types of services and/ or
the use of more than one type of expertise; specific cases, if and when needed:
14.2.2.1 Pet Diem or Hourly Basis
24.3 Compensation and allowances shall be 14.2.2.2 Retainer
comparable with foreign consulting service 14.2.2.3 Salary cost times a multiplier,
compensation standards; plus direct cost or reimbursable expenses
14.2.2.4 Fixed/Lump Sum payment
24.4 For the same scope of work, there shall 14.2.2.5 Percentage Project cost
be no disparity in the compensation between 14.3 Recommended Professional Fee
Filipino professional consulting Architects 14.3.1 The computation of the compensation
(FPCAs) and their foreign consultant (FC) of fees for professional architectural
counterparts; consulting services (PACS) shall depend on
the type of
24.5 Professional Consulting Architects services to be rendered and the conditions
(PCAs) shall adhere to and be governed by under which they are to be performed;
the relevant provisions pertaining to 14.3.2 Compensation for PACS that require
compensation as provided for under the Codes only one kind of expertise/specialization or
of Ethical Conduct (CEC) and the other related types of expertise shall be treated
Standards of Professional Practice (SPP); differently from those services that require
the use of more than one type of
24.6 All entities, whether in the expertise;
Government, private sector or CSOs and the 14.3.3 Compensation and allowances shall be
international community (with projects on comparable with foreign consulting service
Philippine soil) sh all respect and take compensation standards:
cognizance of said CEC and SPPs; 14.3.4 For the same scope of work, there
24.7 Compensation of a professional shall be no disparity in the compensation
consulting Architect (PCA) may be computed between Filipino professional consulting
based on one or a combination of the Architects (FPCAS) and their foreign
following methods, with modifications consultant(FC) counterparts;
applicable to the types of services and/ or 14.3.5 Professional Consulting Architects
specific cases, if and when needed: (PCAS) shall adhere to and be governed by
 the relevant provisions pertaining to
24.7.1 Per Diem or Hourly Basis compensation as provided for under the
This method is particularly suited to Codes of Ethical
engagements involving intermittent personal Conduct (CEC) and the other Standards of
service. When such consulting services are Professional Practice (SPP);
furnished, the Professional Consulting 14.3.6 All entities, whether in the
Architect (PCA) is compensated for all the Government, private sector or CSOs and the
time he devotes to the work, including international community (with projects on
travel Philippine soil) shall respect and take
time. The per diem charge should be based on cognizance of said
the complexity of the work involved and the CEC and SPPS;
extent of his experience/specialization. In
addition to the compensation based on per RULE IV
diem, his expenses for travel, subsistence, GENERAL PROVISIONS
and other out-of-pocket expenses incurred Sec. 15: COLLECTION OF PROFESSIONAL FEES
while away from his home/office shall be It shall be unlawful for any unlicensed
reimbursed by the Client. and unregistered person to collect a fee
for architectural services as provided for
24.7.2 Retainer in R.A. 9266.
This method of remuneration is used when the Sec. 16: INTEREST DUE ON LATE PAYMENT OF
services of a Professional Consulting FEES
Architect (PCA) is expected to be required The Architect shall be entitled to
at interest at the prevailing rate set by the
intervals over a period of time. It is a Bangko Sentral ng Pilipinas (BSP) and
means of ensuring in advance that his mutually agreed upon by the Architect and
services will be available to the Client his client, on all fees, other charges and
when required. Under this method, a reimbursements due and not paid within
stipulated amount is paid at regular thirty (30) days from receipt of billing.
intervals for which the PCA is obligated to Sec. 17: GOVERNMENT TAXES ON SERVICES
render a certain service or to spend a The Architect's fee as stipulated in the
certain amount of time on Client’s Methods of Compensation and Schedule of
requirements. The compensation is usually Fees is net to the Architect. Any tax
enough to pay for the minimum services (exclusive of income tax), i.e., Value-
required by the Client. All additional Added Tax (VAT) that the national and/or
services are paid separately. In addition to local government/s may impose on the
the retainer, the PCA may be reimbursed for Architect as a consequence of the services
travel, subsistence and other out-of-pocket performed for the Project shall be paid by
expenses incurred while away from his the Owner.
home/office. Sec. 18: PROFESSIONAL AND CIVIL
RESPONSIBILITY
24.7.3 Salary cost times a multiplier, plus The Architect is legally and professionally
direct cost or reimbursable expenses. This responsible before the State and civilly
method is based on the total basic salaries liable on the architectural design part of
of all PCAs and their staff multiplied by a the project and shall be responsible for
factor from 3.0 as a multiplier plus cost of the conduct and performance of higher
certain items that are reimbursable to the services to their clients, whether in the
PCA classified under “Direct Cost” or government, private sector or civil society.
“Reimbursable Expenses”. The following 18.2 where applicable, the Architect may
formula is used to compute the fee: secure locally their professional liability
insurance or malpractice insurance or their
Fee = Salary Cost x Multiplier + acceptable equivalent in bond commensurate
Reimbursable Expenses with the nature and magnitude of their
This method of remuneration is best suited project involvement and their compensation.
for Projects for which the costs are Such cost shall form part of the total
difficult to pre-determine, or in cases project cost chargeable to the Client.
where it may become necessary to undertake 18.3 Legal liabilities of the Architect
additional experimental or investigative shall
work, the result of which may further alter be based on the Civil Code of the
the scope of the project. Philippines.
The method however, cannot be used as a Sec. 19: ARBITRATION
measure of compensation for services which 19.1 ln case of any dispute between the
cannot be measured by the length of time Architect and the Client with regards to
spent on his work. the provision of services as stipulated in
The other part of the remuneration by this the Service Agreement, the settlement shall
method is made up of the reimbursable direct be submitted in accordance with the
costs. These costs are billed to the provisions of R.A. No. 9285, otherwise known
Client supported, if required by receipts as the Alternative Dispute Resolution (ADR)
and other documents. Act of 2004 and as provided for under
E.O. No.1000, governing Construction (and
24.7.4 Fixed/ Lump Sum payment Consulting) industry Arbitration, as well as
This method of compensation may be used when the applicable provisions of the New Civil
the scope of PACS required can be clearly Code.
and fully defined. Two methods may generally 19.2 ln case of any dispute concerning the
be used to arrive at a lump-sum compensation Service Agreement, the Parties may then
for the basic PACS. venture into a negotiation period for
These two methods are frequently used fourteen (14) calendar days, failure of
concurrently with one serving as a check on which would authorize any of the parties
the other. to engage in mediation/conciliatory
a. computation of a lump-sum as an discussions (with a neutral 3rd party as
appropriate percentage of the an active participant in seeking the
estimated total cost of the project resolution of the dispute) within another
b. direct development of a fixed amount 14 calendar days, or to immediately seek
of compensation by estimating the arbitration modes of ADR under the
individual elements of the cost Construction industry Arbitration
outlines, plus a reasonable margin of Commission(CIAC), which also handles
profit, all expressed as a single dispute concerning professional or consulting
lump-sum Where compensation is given services, guaranteeing a resolution of the
on a lump-sum basis, the agreements issues presented within a six (6) month
should contain a clearly stated time period, after which the losing party may
limit during which the service/s will file a Petition for Review before the
be performed, and a provision for Court of Appeals (CA).
additional compensation for extra time 19.3 The exclusive venue of such ADR
used. In design assignments, these proceedings shall be the CIAC Office at
should be a provision for charges corners Sen. Gil Puyat Ave. and Makati Ave.
required after the approval of in Makati City, PH.
preliminary designs, with a clear
understanding as to where the final
approval authority lies.

24.7.5 Percentage of total project cost

The remuneration under this method is
calculated as an agreed percentage of the
ultimate cost of the project/service. The
validity of the Percentage of Total Project
Cost Method rests upon the assumption that
consultancy costs vary in proportion to the
total project cost regardless of the type or
location of the project.
Therefore, this method should be applied
only where experience has established some
approximate correlations between consultancy
costs and project costs.

24.8 Fees for services that require inputs

of an artistic, innovative and creative
endeavor shall not be determined in the same
manner as services that involve purely
technical and scientific undertakings

24.9 Criteria for Establishing Method of

Compensation
The criteria for establishing method/s of
compensation shall be promulgated, approved
and adopted by the IAPOA.

24.10 Interest Due on Late Payment of Fees

The Professional Consulting Architect (PCA)
shall be entitled to interest at the
prevailing rate set by the Bangko Sentral ng
Pilipinas (BSP) in additional to a
percentage as may be determine by the
IAPOA unless otherwise mutually agreed
upon by the PCA and his Client, on all
fees, other charges and reimbursements due
and not paid within 30 days from receipt of
billing.