Smartmatic vs. COMELEC

The COMELEC's broad constitutional mandate to enforce and administer election laws does not exempt it from compliance with the GPRA and its 2016 Revised IRR in its procurement activities; disqualifying a prospective bidder prior to bid submission and outside the GPRA's prescribed non-discretionary eligibility procedures constitutes grave abuse of discretion amounting to lack or excess of jurisdiction.

Smartmatic TIM Corporation and Smartmatic Philippines, Inc. (collectively, Smartmatic) were the service providers of the Automated Election System (AES) for the 2010, 2013, 2016, 2019, and 2022 National and Local Elections (NLE). The Government Procurement Reform Act (Republic Act No. 9184, or GPRA) and its 2016 Revised Implementing Rules and Regulations govern all government procurement by all branches and instrumentalities of government, including constitutional commissions, and prescribe specific procedures for eligibility screening, bid evaluation, post-qualification, and disqualification of bidders using non-discretionary pass/fail criteria. Separately, the United States Department of Justice had been conducting a criminal investigation under the PH-US Mutual Legal Assistance Treaty into allegations that former COMELEC Chairperson Juan Andres D. Bautista received bribes in exchange for awarding AES contracts to Smartmatic Corp., culminating in a formal charge in September 2023.

Smartmatic TIM Corporation and Smartmatic Philippines, Inc. (collectively, Smartmatic) were the service providers of the Automated Election System (AES) in the 2010, 2013, 2016, 2019, and 2022 National and Local Elections (NLE). On February 22, 2023, Smartmatic received an invitation from the COMELEC to attend an Election Summit in preparation for the 2025 NLE. Smartmatic attended the Election Summit and the subsequent Procurement Summit and received multiple Requests for Information from the COMELEC regarding the 2025 AES. On October 27, 2023, the COMELEC published the Invitation to Bid for the Lease of Full Automation System with Transparency Audit/Count (FASTrAC) for the 2025 NLE. Smartmatic purchased the bidding documents on October 30, 2023, and SMMT-TIM 2016, Inc., an entity related to but separate from Smartmatic, attended the Pre-Bid Conference on November 13, 2023.

In the meantime, private respondents Eliseo Mijares Rio, Jr., Augusto Cadelina Lagman, Franklin Fayloga Ysaac, and Leonardo Olivera Odoño (Rio, Jr. et al.) filed a petition, supplemental petition, and second supplemental petition before the COMELEC En Banc on June 15, 2023, before the procurement process had begun. Rio, Jr. et al. alleged that the transmission of the results of certain precincts preceded the printing of election results, that a scheme to clone vote counting machine (VCM) transmissions was shown by the fact that the logs reflect the same internet protocol (IP) address for certain machines instead of separate IP addresses, and that Smartmatic's affiliates and/or representatives reportedly met with the representatives of a presidential candidate while Smartmatic's Secure Electronic Transmission Services (SETS) Contract for the 2022 NLE results was still in force, in violation of Clause 5.13 of the SETS Contract. They prayed that Smartmatic's qualifications be reviewed by the Bids and Awards Committee (BAC) and that the COMELEC En Banc order the BAC to disqualify or declare Smartmatic ineligible from participating in the procurement for the 2025 AES if the alleged irregularities were not satisfactorily explained.

On August 10, 2023, the COMELEC En Banc directed its Law Department to review and submit a recommendation. On August 31, 2023, the Law Department opined that there was no legal basis to prohibit Smartmatic from participating in the bidding process. On October 5, 2023, the COMELEC En Banc set the case for hearing on October 17, 2023 and required Smartmatic to comment on the petitions. During the hearing, the COMELEC required the parties to file their respective memoranda and formal offer of evidence within five days, and reply memoranda within three days from receipt of the other party's memorandum.

On November 29, 2023, the COMELEC En Banc ruled in favor of Rio, Jr. et al. It first clarified that at that stage of the procurement process, it could not review Smartmatic's qualifications as head of the procuring entity, noting that under the GPRA, a procuring entity may assess a bidder's qualifications at any stage of the procurement process only if there are reasonable grounds to suspect misrepresentation or a change in the bidder's capacity. It also noted that Rio, Jr. et al. filed their petition before the procurement process began and did not comply with the procedure for blacklisting under the 2016 Revised IRR. Nevertheless, the COMELEC En Banc invoked its constitutional authority under Article IX-C, Section 2(1) to enforce and administer all laws and regulations relative to the conduct of elections, holding that this authority is distinct from its authority as a procuring entity under the GPRA. It narrated that as early as October 2022, it had received requests for official documents relative to an ongoing criminal investigation by the United States Department of Justice (US DOJ) against former COMELEC Chairperson Juan Andres D. Bautista and other individuals and entities, pursuant to the PH-US Mutual Legal Assistance in Criminal Matters treaty. Bautista was formally charged in September 2023 in connection with allegations of receiving bribes in exchange for awarding a contract for election machines to Smartmatic Corp., allegedly laundered through a foreign shell company. Considering these allegations of bribery and compromised procurement processes as independently determined by foreign bodies, the COMELEC En Banc held that there existed an imminent threat to democratic processes and disallowed Smartmatic from participating in any public bidding for elections, referring the matter to the SBAC for possible permanent disqualification and blacklisting. Notably, the COMELEC En Banc categorically rejected Rio, Jr. et al.'s allegations of irregularities in the conduct of the 2022 NLE, stating that the allegations pertaining to the consistency in the ratio of transmitted results, the use of a single IP address, and alleged discrepancies in transmission and election returns had been sufficiently addressed, and that the parallel count conducted by the Parish Pastoral Council for Responsible Voting matched the transmitted results.

Smartmatic filed the present Petition for Certiorari before the Supreme Court. On December 14, 2023, bid submission took place, but the SBAC refused to accept the bid of a joint venture composed of SMMT-TIM 2016 Inc., Smartmatic Holdings Inc., and Jarltech International Inc., pursuant to the assailed Resolution. The sole remaining bidder, Miru Systems Co. Ltd. (in a joint venture with Integrated Computer Systems, St. Timothy Construction Corporation, and Centerpoint Solution Technologies, Inc.), was declared eligible after bid submission on January 8, 2024. On February 29, 2024, the SBAC declared Miru Systems as the post-qualified bidder with the Single Calculated and Responsive Bid, and the COMELEC En Banc approved the recommendation. On March 11, 2024, the COMELEC and Miru Systems signed the 2025 FASTrAC Contract. On March 18, 2024, the COMELEC informed the Court that the US DOJ had unsealed the criminal complaint against Bautista, which alleged that a group of related unnamed corporations made several payments to Bautista to secure the award of the AES contracts for the 2016 NLE.

• Grave Abuse of Discretion: Smartmatic contended that the COMELEC committed grave abuse of discretion amounting to lack or excess of jurisdiction in ruling on the disqualification and blacklisting of Smartmatic outside the procedures prescribed by the GPRA and its 2016 Revised IRR.
• Misapplication of Constitutional Provision: Smartmatic argued that the COMELEC's citation of Article IX-C, Section 2(1) of the Constitution was misplaced because the said provision only permits the COMELEC to enforce and administer existing laws and regulations, not to supplant the procedures provided by the GPRA and its 2016 Revised IRR.
• Violation of Procurement Principles: Smartmatic maintained that government procurement is governed by the principles of transparency, competitiveness, streamlined procurement process, accountability, and public monitoring, and that the COMELEC violated these principles when it refused to apply the GPRA and its 2016 Revised IRR.
• Wrong Party Impleaded: Smartmatic averred that it was Smartmatic TIM, and not Smartmatic PH, that entered into the SETS Contract for the 2022 NLE, but the petitions filed by Rio, Jr. et al. before the COMELEC wrongfully impleaded Smartmatic PH.
• Disqualification on Unraised Grounds: Smartmatic argued that the COMELEC arbitrarily disqualified and blacklisted it based on grounds never raised in the petitions — its alleged involvement in the US government's investigation against Bautista — and despite the COMELEC's categorical finding that no irregularities attended the conduct of the 2022 NLE.
• Right to Participate: Smartmatic claimed it had a clear and unmistakable right to participate in the public bidding for the lease of FASTrAC because it complied with the bidding requirements and its disqualification had no legal basis.
• Irreparable Injury: Smartmatic maintained that implementation of the assailed Resolution would cause grave and irreparable injury to its goodwill and business reputation, as media reports spread false imputations against it following the disqualification.

• Hierarchy of Courts: The COMELEC argued that Smartmatic's direct resort to the Supreme Court violated the rule on hierarchy of courts, and that Smartmatic failed to file a motion for reconsideration before the COMELEC En Banc, which was a prerequisite to the filing of a petition for certiorari since the COMELEC proceedings were administrative rather than quasi-judicial in nature.
• Constitutional Mandate: The COMELEC maintained that the GPRA and its 2016 Revised IRR restricted its power to disqualify a prospective bidder, and that under the circumstances, it properly and reasonably exercised its broad constitutional powers without violating Smartmatic's right to due process.
• Mootness: The COMELEC moved for dismissal of the petition for being moot and academic, arguing that the act Smartmatic sought to enjoin — preventing Smartmatic from bidding for the lease of FASTrAC — had already been consummated and post-qualification proceedings were underway, culminating in the award of the 2025 FASTrAC Contract to Miru Systems.
• No Right in Esse: The COMELEC opposed Smartmatic's prayer for injunctive relief, maintaining that Smartmatic failed to establish any clear legal right needing protection or any circumstance warranting the issuance of an SQAO on equitable grounds, and that the public stood to suffer greater injury if an injunction were issued, as voters would be deprived of the full benefits of an automated election.
• Adequate Remedy: The COMELEC contended that Smartmatic failed to avail of an ordinary, speedy, and adequate remedy, namely the filing of a motion for reconsideration.
• Electoral Irregularities: Rio, Jr., Lagman, and Ysaac argued that the COMELEC acted within its constitutional mandate in disqualifying Smartmatic, and that the serious irregularities during the transmission of election results in the 2022 NLE were sufficient basis for disqualification. They further argued that Smartmatic failed to establish a clear and unmistakable right to participate in the bidding.

• Hierarchy of Courts: Whether Smartmatic's direct recourse to the Supreme Court via petition for certiorari is proper notwithstanding the doctrine of hierarchy of courts.
• Exhaustion of Administrative Remedies: Whether Smartmatic's failure to file a motion for reconsideration before the COMELEC En Banc is fatal to the petition.
• Injunctive Relief: Whether Smartmatic is entitled to the issuance of a TRO, writ of preliminary injunction, and/or status quo ante order.
• Mootness: Whether the petition was rendered moot and academic by the COMELEC's award of the 2025 FASTrAC Contract to Miru Systems.
• Grave Abuse of Discretion: Whether the COMELEC En Banc acted with grave abuse of discretion amounting to lack or excess of jurisdiction in disqualifying Smartmatic from participating in any public bidding process for elections without following the procedure prescribed by the GPRA and its 2016 Revised IRR.
• Effect of Nullification: Whether the effects of the assailed Resolution, including the 2025 FASTrAC Contract awarded to Miru Systems, should be nullified or sustained under the doctrine of operative fact.

• Hierarchy of Courts: Yes. Direct recourse to the Court was justified because the petition raises genuine issues of constitutionality of transcendental importance involving a pure question of law, and the factual background is undisputed.
• Exhaustion of Administrative Remedies: No, the failure to file a motion for reconsideration is not fatal. The COMELEC's exercise of its powers under Article IX-C, Section 2(1) was administrative in nature, rendering the COMELEC Rules of Procedure inapplicable; moreover, exceptions to the motion for reconsideration requirement apply given the urgent necessity and public interest involved.
• Injunctive Relief: No. Smartmatic, as a prospective bidder, did not possess a clear and unmistakable right in esse, and the injury it claimed — loss of goodwill and business reputation — is compensable in damages and therefore not irreparable.
• Mootness: No. The assailed Resolution disqualified Smartmatic from participating in any public bidding process for elections, not merely the 2025 FASTrAC bidding, so the controversy remains live.
• Grave Abuse of Discretion: Yes. The COMELEC gravely abused its discretion by disregarding the GPRA and its 2016 Revised IRR and imposing its own discretionary pre-qualification regime, disqualifying Smartmatic before it submitted any bid and without reference to the applicable eligibility requirements and non-discretionary pass/fail criteria.
• Effect of Nullification: The assailed Resolution is reversed, but its effects — including the 2025 FASTrAC Contract with Miru Systems — are sustained under the doctrine of operative fact, and the ruling is applied prospectively from the date of finality of the Decision.

• Hierarchy of Courts: While the doctrine of hierarchy of courts generally prevents parties from randomly selecting a forum, the Court has recognized exceptions, including when genuine issues of constitutionality must be addressed immediately, when issues are of transcendental importance, when the case involves a pure question of law, and when the petition reviews an act of a constitutional organ. Here, the petition questions the COMELEC's non-compliance with the GPRA during procurement of the lease of FASTrAC for the 2025 NLE, while the COMELEC cites its constitutional mandate to justify disregarding the GPRA. The controversy raises genuine constitutional issues of transcendental importance. The factual background is undisputed, and the only issue is a pure question of law — whether the COMELEC erred in disqualifying Smartmatic without following the GPRA procedure. Section 58 of the GPRA does not bar the Court's jurisdiction because the "protests contemplated in Article XVII" refer to protests against BAC decisions filed before the head of the procuring entity, and the assailed Resolution was not such a protest resolution but an original action before the COMELEC En Banc.

• Exhaustion of Administrative Remedies: In Querubin vs. Commission on Elections, the Court held that the COMELEC's conduct of procurement is administrative, not quasi-judicial, in nature, and that a petition under Rule 65 — not Rule 64 — is the proper remedy. The COMELEC Rules of Procedure, including the prohibition on motions for reconsideration in quasi-judicial proceedings, do not apply to administrative proceedings such as those that led to the assailed Resolution. Section 5 of the COMELEC Rules of Procedure enumerates only ordinary actions, special actions, special cases, special reliefs, and contempt — proceedings of the type at bar are not included, and by expressio unius est exclusio alterius, they are excluded. Even if a motion for reconsideration were required, exceptions apply: there is urgent necessity for resolution given the impending 2025 NLE, the issue is purely one of law, and public interest is involved because the integrity of automated elections depends on the AES supplier.

• Injunctive Relief: The requisites for a writ of preliminary injunction are: (a) a clear and unmistakable right in esse; (b) a material and substantial invasion of such right; (c) urgent need for the writ to prevent irreparable injury; and (d) no other adequate remedy. Smartmatic failed on the first and third elements. As in Amalgamated Motors Philippines, Inc. vs. Secretary of the Department of Transportation and Communications, Smartmatic is merely a prospective bidder whose alleged right is at best speculative — it has no "actual, clear, and positive right" to injunctive protection. Granting injunctive relief would have preempted the Court's ruling on the principal issue, constituting a prejudgment of the main case. On irreparable injury, Smartmatic cited Evy Construction and Development Corp. vs. Valiant Roll Forming Sales Corp. for the proposition that loss of goodwill and business reputation is irreparable, but that very case upheld the denial of injunctive relief because the damage was compensable in damages. Article 2205 of the Civil Code expressly provides that damages may be awarded for injury to a plaintiff's business standing or commercial credit, and Tanay Recreation Center and Development Corp. vs. Fausto confirmed that such injury, while difficult to quantify, is compensable as temperate damages. Smartmatic also failed to substantiate its claim with evidence of actual or impending injury. The same reasoning defeats the prayer for an SQAO.

• Mootness: A case is moot when it ceases to present a justiciable controversy such that a declaration would be of no practical use or value. The assailed Resolution disqualified Smartmatic from participating in any public bidding process for elections — not merely the 2025 FASTrAC bidding. The award of the 2025 FASTrAC Contract to Miru Systems therefore does not render the petition moot, because the disqualification's scope extends beyond that single procurement.

• Grave Abuse of Discretion: Grave abuse of discretion exists when a tribunal capriciously or whimsically exercises judgment equivalent to lack of jurisdiction, or when the abuse is so flagrant as to amount to a refusal to perform a duty or act as provided by law. The GPRA applies to all branches and instrumentalities of government without exception for the COMELEC. Its plain language governs procurement of infrastructure projects, goods, and consulting services by all branches and instrumentalities of government, and the Court cannot judicially legislate an exception. The GPRA's core design requires that a bidder's eligibility be determined by the BAC using non-discretionary pass/fail criteria based solely on the bidding documents submitted — not through any pre-qualification or accreditation regime. The GPPB, as the agency charged with administering the GPRA, has consistently opined that accreditation or pre-qualification systems are antithetical to the GPRA's competitive bidding principles, because they limit participation to pre-screened suppliers. The legislative history confirms that the GPRA was designed to reduce discretion and corruption by standardizing the procurement process across all government entities. In Querubin, the Court expressly held that the COMELEC is mandated to comply with the GPRA in its procurement of AES-related supplies and services, citing Pabillo vs. COMELEC. By disqualifying Smartmatic before it submitted any bid and without reference to the SBAC's eligibility requirements, the COMELEC implemented a discretionary pre-qualification regime antithetical to the GPRA. The COMELEC's constitutional mandate under Article IX-C, Section 2(1) authorizes it to enforce and administer existing laws — it does not permit the COMELEC to cast aside the GPRA. The GPRA itself provides remedies: Section 23.6 of the 2016 Revised IRR allows a procuring entity to review a bidder's qualifications at any stage if there are reasonable grounds to believe in misrepresentation, and Section 25.3 requires bidders to execute an Omnibus Sworn Statement declaring they did not give or pay any consideration to any government official. Had Smartmatic been allowed to submit a bid, the COMELEC could have disqualified it if it had reasonable grounds to believe the Omnibus Sworn Statement was a misrepresentation. The COMELEC's knowledge of the US DOJ criminal complaint does not give it carte blanche to bypass the GPRA.

• Effect of Nullification: The SBAC completed the bidding process and the COMELEC awarded the 2025 FASTrAC Contract to Miru Systems. An order requiring the COMELEC to accept Smartmatic's bid would be futile, as there is no ongoing bidding. Nullifying the procurement and ordering a new round would be unjust to Miru Systems, which was awarded the contract after proper SBAC review and post-qualification under the GPRA, and would place Smartmatic and other bidders on unequal footing since Miru Systems' bid details are publicly available. It would also gravely undermine the COMELEC's preparations for the 2025 NLE, given the complex and time-sensitive implementation calendar. The doctrine of operative fact — which recognizes that an act prior to its nullification may have produced consequences that cannot always be erased — applies by analogy. As held in Araullo vs. Aquino, Macalintal vs. Commission on Elections, Film Development Council of the Philippines vs. Colon Heritage Realty Corp., and Hacienda Luisita, Inc. vs. Presidential Agrarian Reform Council, the doctrine applies not only to legislative acts but also to decisions of constitutional commissions, which have the force and effect of law and may produce acts and consequences that must be respected. The assailed Resolution led to the SBAC's conduct of public bidding without Smartmatic's participation — an act that must be respected. The Court's ruling is prospective in application and without prejudice to any future disqualification or blacklisting procedure that the COMELEC may initiate against Smartmatic in accordance with the GPRA and its 2016 Revised IRR.

• Doctrine of Hierarchy of Courts — The doctrine prevents parties from randomly selecting a forum among courts with concurrent jurisdiction; direct resort to the Supreme Court is generally improper because it is a court of last resort. Exceptions include: (a) genuine issues of constitutionality requiring immediate address; (b) issues of transcendental importance; (c) cases of first impression; (d) constitutional issues better decided by the Supreme Court; (e) time element or exigency; (f) petitions reviewing acts of a constitutional organ; (g) absence of other plain, speedy, and adequate remedy; and (h) questions dictated by public welfare, advancement of public policy, broader interest of justice, patent nullities, or clearly inappropriate appeal. The Court applied this doctrine's exceptions to permit Smartmatic's direct recourse, as the petition raised a pure question of law of transcendental importance involving the COMELEC's compliance with procurement laws.

• Non-Discretionary Pass/Fail Criterion in GPRA Procurement — Under Section 23 of the GPRA, the BAC shall determine bidder eligibility using non-discretionary pass/fail criteria based solely on the requirements and conditions indicated in the IRR and the corresponding Bidding Documents. The purpose is to remove any form of discretion on the part of the BAC and promote fairness and equality among all bidders. The Court relied on this principle to hold that the COMELEC's pre-qualification disqualification of Smartmatic — before bid submission and without reference to published eligibility requirements — was antithetical to the GPRA and constituted grave abuse of discretion.

• Doctrine of Operative Fact — As an exception to the general rule that a void or unconstitutional law produces no legal effect, the doctrine recognizes that prior to judicial declaration of invalidity, an act carried the presumption of validity and may have produced consequences that cannot always be erased, ignored, or disregarded. It applies as a matter of equity and fair play, protecting those who relied in good faith on the invalid act. The Court applied this doctrine by analogy to the COMELEC's assailed Resolution, sustaining the effects of the SBAC's procurement proceedings and the 2025 FASTrAC Contract with Miru Systems, and making its ruling prospective in application. The doctrine extends to decisions of constitutional commissions, which have the force and effect of law.

• Right in Esse for Injunctive Relief — A writ of preliminary injunction requires, among other elements, that the applicant possess a clear and unmistakable right in esse — an actual, existing right, not merely speculative. A prospective bidder in a government procurement does not possess such a right, as its interest is at best speculative until its bid is submitted and evaluated. Any hint of doubt or dispute on the asserted legal right precludes the grant of injunctive relief, as issuing a writ that would effectively dispose of the main case constitutes prejudgment.

• "The COMELEC's constitutional mandate does not permit it to cast aside procurement laws and regulations, and impose its own pre-qualification regime, disqualifying an interested private contractor prior to the latter's submission of its bid and the SBAC's evaluation of its eligibility documents." — This passage states the ratio decidendi: the COMELEC's Article IX-C powers cannot override the GPRA's mandatory procurement procedures.

• "In choosing to disregard the procedures prescribed by the GPRA and its 2016 Revised IRR and disqualifying Smartmatic before the latter had submitted any bid, without any reference to the applicable eligibility requirements and non-discretionary pass/fail criteria prescribed by the SBAC, the COMELEC implemented a discretionary pre-qualification regime antithetical to the very essence of the GPRA." — This defines the specific act constituting grave abuse of discretion and articulates why the COMELEC's approach violated the GPRA's core design.

• "The doctrine of operative fact recognizes the existence of the law or executive act prior to the determination of its unconstitutionality as an operative fact that produced consequences that cannot always be erased, ignored or disregarded. In short, it nullifies the void law or executive act but sustains its effects." — This is the canonical formulation of the operative fact doctrine as applied in this case to sustain the procurement proceedings conducted under the void COMELEC Resolution.

• "Article IX-C, Section 2(1) of the Constitution authorizes the COMELEC to enforce and administer all laws and regulations relative to the conduct of elections, plebiscites, initiatives, referenda, and recall—it does not permit the COMELEC to cast aside the GPRA and its 2016 Revised IRR in favor of its own discretionary procurement process." — This delineates the boundary between the COMELEC's constitutional mandate and its statutory obligation to comply with procurement law.

• Querubin vs. Commission on Elections, 774 Phil. 766 (2015) — Controlling precedent holding that the COMELEC's procurement activities are administrative, not quasi-judicial, in nature, and that the COMELEC is mandated to comply with the GPRA in procuring AES-related supplies and services. The Court relied on this case to establish both that Rule 65 (not Rule 64) is the proper remedy and that the COMELEC cannot cite its constitutional mandate to justify non-compliance with the GPRA.

• Pabillo vs. COMELEC, 758 Phil. 806 (2015) — Followed precedent holding that the requirement to comply with "existing laws" under the Automated Elections Law refers to the GPRA, which is designed to govern all cases of government procurement and mandates competitive bidding. Cited in Querubin and relied upon to reinforce the COMELEC's duty to follow the GPRA.

• Amalgamated Motors Philippines, Inc. vs. Secretary of the Department of Transportation and Communications, G.R. No. 206042, July 4, 2022 — Controlling precedent on the right in esse requirement for injunctive relief. The Court applied this case to hold that Smartmatic, as a prospective bidder, was bereft of any actual, clear, and positive right warranting injunctive relief, just as AMPI was merely a prospective bidder whose alleged right was at best speculative.

• Araullo vs. Aquino, 737 Phil. 457 (2014) — Leading precedent on the doctrine of operative fact. The Court cited this case for the principle that the doctrine recognizes the existence of a law or executive act prior to its declaration of invalidity as an operative fact that produced consequences that cannot always be erased, and applied it by analogy to the COMELEC's assailed Resolution.

• Macalintal vs. Commission on Elections, G.R. Nos. 263590 & 263673, June 27, 2023 — Followed precedent on the operative fact doctrine as applied to election-related legislation. The Court cited this case for the principle that the operative fact doctrine operates on reasons of practicality and fairness, recognizing that prior to judicial nullification, acts carried the presumption of constitutionality and regularity.

• Hacienda Luisita, Inc. vs. Presidential Agrarian Reform Council, 676 Phil. 518 (2011) — Followed precedent extending the operative fact doctrine to decisions of the executive branch. The Court relied on this case for the broader understanding that the doctrine can be applied to decisions of administrative agencies and constitutional commissions, which have the force and effect of law and may produce consequences that must be respected.

• Estrella vs. Commission on Audit, G.R. No. 252079, September 14, 2021 — Cited for the purpose of the GPRA: to promote transparency in the procurement process, provide a platform of competitiveness, and preclude suspicion of favoritism and anomalies in the execution of public contracts.

• Evy Construction and Development Corp. vs. Valiant Roll Forming Sales Corp., 820 Phil. 123 (2017) — Distinguished. Smartmatic cited this case for the proposition that loss of goodwill and business reputation constitutes irreparable injury, but the Court noted that the case actually upheld the denial of injunctive relief because the damage was compensable in damages.

• Article IX-C, Section 2(1), 1987 Constitution — Grants the COMELEC the power to enforce and administer all laws and regulations relative to the conduct of elections, plebiscites, initiatives, referenda, and recall. The COMELEC invoked this provision to justify disqualifying Smartmatic outside the GPRA procedure. The Court held that this provision authorizes the COMELEC to enforce and administer existing laws — it does not permit the COMELEC to cast aside the GPRA and its 2016 Revised IRR in favor of its own discretionary procurement process.

• Section 3, Republic Act No. 9184 (GPRA) — Sets forth the principles governing all government procurement: transparency, competitiveness, streamlined procurement process, accountability, and monitoring. The Court found that the COMELEC violated these principles by implementing a discretionary pre-qualification regime.

• Section 4, Republic Act No. 9184 (GPRA) — Provides that the GPRA applies to all branches and instrumentalities of government, including government-owned and/or controlled corporations and local government units, regardless of source of funds. The Court held that this provision contains no exception for the COMELEC.

• Section 23, Republic Act No. 9184 (GPRA) — Provides that the BAC shall determine the eligibility of prospective bidders based on the bidder's compliance with the eligibility requirements in the Invitation to Bid, using non-discretionary pass/fail criteria. The Court relied on this provision to hold that eligibility must be determined based solely on submitted bidding documents, not through any pre-qualification procedure.

• Section 55, Republic Act No. 9184 (GPRA) — Governs protests on decisions of the BAC, filed before the head of the procuring entity. The Court cited this provision to show that the "protests contemplated in Article XVII" of the GPRA refer to BAC protests, not to the original actions filed by Rio, Jr. et al. before the COMELEC En Banc.

• Section 58, Republic Act No. 9184 (GPRA) — Provides that court action may be resorted to only after protests under Article XVII are completed, and that the regional trial court has jurisdiction over final decisions of the head of the procuring entity. The Court held that this provision does not bar the Court's jurisdiction because the assailed Resolution was not a decision resolving a BAC protest.

• Section 23.6, 2016 Revised IRR of RA 9184 — Allows a procuring entity to review a bidder's qualifications at any stage of the procurement process if there are reasonable grounds to believe in misrepresentation or a change in capacity. The Court noted this provision as the proper mechanism the COMELEC could have used if it had reasonable grounds to believe Smartmatic misrepresented its qualifications.

• Section 25.3, 2016 Revised IRR of RA 9184 — Requires every bidder to execute an Omnibus Sworn Statement declaring, among others, that it did not give or pay any commission, amount, fee, or consideration to any government official in relation to any procurement project. The Court cited this provision to show that the GPRA provides a mechanism for addressing corrupt practices in bidding.

• Article 2205, Civil Code — Provides that damages may be recovered for injury to the plaintiff's business standing or commercial credit. The Court cited this provision to hold that Smartmatic's claimed injury to goodwill and business reputation is compensable in damages and therefore not irreparable for purposes of injunctive relief.

• Section 12, Republic Act No. 8436, as amended by Republic Act No. 9369 (Automated Elections Law) — Authorizes the COMELEC to procure supplies, equipment, materials, software, facilities, and other services "in accordance with existing laws." The Court, citing Querubin and Pabillo, held that the requirement to comply with "existing laws" refers to the GPRA.

Gesmundo, C.J., Leonen, SAJ., Caguioa, Hernando, Lazaro-Javier, Inting, Zalameda, M. Lopez, Gaerlan, Rosario, J. Lopez, Dimaampao, and Singh, JJ., concurred.

Kho, Jr., J. filed a separate concurring opinion agreeing with the ponencia that the COMELEC gravely abused its discretion in disregarding the GPRA and its IRR. Justice Kho additionally opined that even assuming the COMELEC had allowed Smartmatic to submit bidding documents, there would still be no sufficient ground to disqualify Smartmatic at that stage, because the US DOJ findings against Bautista were merely preliminary and would still undergo scrutiny in a US criminal trial where the accused enjoys the presumption of innocence; any definitive adverse findings would have, at best, persuasive effect only in Philippine jurisdiction. Justice Kho urged the COMELEC to adopt more flexible timetables in preparing for elections to avoid repeated reliance on the operative fact doctrine, and noted that the application of the doctrine allowing the use of Miru Systems' AES for the 2025 NLE is without prejudice to any appropriate petition directly challenging the award of the 2025 AES to Miru Systems.