Who must secure a PCAB License?
All contractors, including sub- and specialty contractors as well as project owners constructing without the services of a contractor (subject to the “personal use” exemption dealt with separately) must secure a PCAB license prior to engaging in the business of contracting in the country.
What is and who qualifies as a contractor?
The term “Contractor” is defined as follows in RA 4566 (The Contractors’ License Law). “Contractor” is deemed synonymous with the term “builder” and, hence, any person who undertakes or offers to undertake or purports to have the capacity to undertake or submits a bid to, or does himself or by or through others, construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, railroad, excavation or other structure, project, development or improvement, or to do any part thereof, including the erection of scaffolding or other structures or works in connection therewith. The term contractor includes subcontractor and specialty contractor.
This definition is extremely wide and encompasses every conceivable act of what can be deemed to be construction and/or building including the erection of scaffolding. Section 35 of RA 4566 even goes one step further (when dealing with offence) by including “assumes charge in a supervisory capacity of a construction work” and the Rules & Regulations under RA 4566 also specifically includes project owners constructing without the services of a contractor (subject to the exemption dealt with separately).
Who is exempt from RA 4566?
Public personnel — The Act shall not apply to an authorized representative of the Republic of the Philippines or any incorporated town, city, province, or other municipal or political corporation or subdivision of the Republic of the Philippines.
Finished products— The Act shall not apply to any sale or installation of any finished products, materials or articles or merchandise, which are not actually fabricated into and do not become a permanent and fixed part of the structure.
Personal property — The Act shall not apply to any construction, alteration, improvement of repair of personal property. This is however qualified by the Rules & Regulations promulgated under RA 4566 which requires of a Project Owner constructing a project intended for sale, lease, commercial/industrial use or any other income generating purpose without the services of a contractor, to secure a Special License from the Board for such work.
Any construction, alteration, improvement or repair of personal property as defined in Article 416 of the Civil Code, or any construction of any project or alteration, improvement or repair of any structure, undertaken by the owner thereof without the service of a licensed constructor, which is not intended for sale, lease, commercial/industrial use or any other income generating purpose.
Minor Work — Any work or operation on one undertaking or project by one or more contracts, with an aggregate contract price of less than ten thousand pesos (P10,000.00) for the labor materials and all other items. That this exemption shall not apply in any case wherein the work or construction is only part of a larger or major operation, whether undertaken by the same or a different constructor or in which a division of the operation is made in contracts of amounts less than ten thousand pesos (P10,000.00) for the purpose of evading or otherwise violating the provisions of the Law.
Small Scale Constructors — Corollary to exemption of Minor Work, a person or firm whose annual aggregate value of accomplished construction contract work does not exceed twenty-five thousand pesos
Material Men — The Act shall not apply to any person who only furnishes materials or supplies without fabricating them into, or consuming them in the performance of, the work of the contractor
Architects and Engineers — This Act shall not apply to a registered civil engineer or a licensed architect acting solely in his professional capacity. This exemption does not give Architects and Engineers license to construct without a license as it is limited to “acting solely in a professional capacity”. When an Architect or Engineer acts as a contractor for his profit or loss and/or advertises himself as a contractor and/or enters into a design and build contract and/or has organized himself as a contractor and/or employs personnel and/or labor to carry out construction work, etc. then, such Architect or engineer is no longer acting solely in his professional capacity and is required to secure a license from PCAB.