Friday, 3 August 2007

CA denies Piatco motion to dismiss complaints of Japanese firms

Why Takenaka has dragged its feet
By Mike Frialde
Original article at the Philippine Star

The Court of Appeals yesterday denied the motion of the Philippine International Air Terminals Co. Inc. (Piatco) to dismiss the complaint filed by two Japanese construction firms for the enforcement of a British court ruling granting payment of $82 million for their services in the construction of the Ninoy Aquino International Airport Terminal 3 (NAIA-3).

In a 36-page decision penned by Associate Justice Noel Tijam, the CA’s Sixth Division affirmed the decision of Makati Regional Trial Court Judge Eugene Paras and denied Piatco’s motion to dismiss the complaint filed by Takenaka and Asahikosan on March 1, 2006.

In their complaint filed before the Makati RTC, the Japanese firms sought the enforcement of the orders of High Court of Justice, Queen’s Bench Division, Technology and Construction Court in London, England granting the two suits the contractors filed against Piatco.

In its two orders issued on Feb. 18, 2005 and Dec. 2, 2005, the London court awarded a total of $82 million to the respondents, representing part of their claims from Piatco.

The complaint added that in 1997, by way of a concession agreement, the Philippine government awarded to Piatco the right to build and operate NAIA-3. Piatco then contracted the Japanese firms to construct and install equipment at the new terminal.

The respondents claimed that petitioner made no further payments after May 2002 despite continued performance of their obligations, prompting them to file collection suits before the London court.

The CA ruling, however, favored Piatco’s motions seeking to compel Takenaka executive Takeshi Kurebayashi to testify in court, and to bring the alleged General Framework Agreement (GFA) between Takenaka and Asahikosan and the Philippine government as represented by the Manila International Airport Authority.

Piatco claimed that the complaint filed by the Japanese firms should be dismissed due to defective verification and certification against forum shopping.

It noted that there was no board resolution showing that Kurebayashi was authorized by the respondents to sign the verification and certification of non-forum shopping, and the special powers of attorney executed in favor of Kurebayashi by the executive vice president and president of Takenaka and Asahikosan.

The Supreme Court issued a ruling in December 2005 that allowed the government to take over the operation of NAIA-3 provided that it immediately pays Piatco more than P3 billion, representing the proffered value of the airport.

Meanwhile, Piatco said the government should provide the funds necessary to facilitate the valuation of the NAIA-3, which is now the subject of an expropriation case.

In a nine-page comment filed before the Pasay City Regional Trial Court (RTC), Piatco through its counsels noted that the government should bear the cost of the appraiser.

“It should be remembered that it was the plaintiff (government) who brought this suit of expropriation. It was very well aware that the just compensation for this facility may not be arrived at without the aid of expert appraisers. It will be more consistent with equity and fairness if the party that brought this about should bear the expenses thereof.”

Based on the submitted proposal of DG Jones and Partners Philippines, the court-appointed appraiser, its proposed appraisal fee is $1,900,000.

Piatco’s counsel Eduardo delos Angeles said that the appointment of an appraiser has legal basis contrary to the government’s claim.

He said that, based on Rule 135 of the Rules of Court, the court has more than ample authority under Republic Act 8974 (An Act to Facilitate the Acquisition of Right-of-Way, Site or Location for National Government Infrastructure Projects and For Other Purposes) to appoint DG Jones and Partners Philippines Inc. as the appraiser. – With Rhodina Villanueva

Thursday, 2 August 2007

Broadband deal challenged at SC

Government stance causes Neri pull-out from NEDA
By Maricel V. Cruz
Original report at The Manila Times

Iloilo Vice-Governor Rolex Suplico on Wednesday asked the Supreme Court to nullify the controversial broadband contract between the government and Chinese company ZTE Corp.

In a 129-page petition the former congressman said the $329-million contract to build a National Broadband Network violates the Procurement Act, the Build-Operate-Transfer Law and the Telecommunications Policy Act which calls for the privatization of all telecommunications projects.

Suplico said the contract was also one of the reasons why Romulo Neri was pulled out as Socio-Economic Planning Secretary to temporarily head the Commission on Higher Education.

He said he had anticipated that the Department of Justice would consider the contract as an executive agreement that does not need a public bidding.

In an interview, Suplico said Neri was demoted to CHED to keep him out of the decision-making process on the escalating controversy hounding the NBN project.

“Neri was taken out of the loop on the NBN Project because he now shares a different view on its viability and regularity. He was demoted for giving the right advice to the President,” he said.

Neri had recommended to President Arroyo that the telecommunication project be implemented by the private sector at no cost to the government. Based on transcripts of their meeting on the Cyber Corridor Initiative in November last year, Mrs. Arroyo agreed with Neri.

But apparently, Neri was forced to endorse the proposal that the project be carried out by ZTE through an alleged government-to-government agreement, and not through a Build-Operate-Transfer (BOT) scheme as had been agreed upon, Suplico said.

“Neri had no choice but to toe the line. There’s nothing much he could do but to endorse it, as he was apparently kept in the dark until the final stages of the ZTE agreement had been drawn-up. But among colleagues and his close circle of friends, he has maintained that this deal was a mistake and that it should be undertaken by the private sector by way of BOT,” Suplico said.

Under the deal, ZTE will set up the network using funds the Philippine government would loan from the Chinese government and turn over its operation to the government after it is completed. The deal also contained a “sovereign guarantee” clause which requires the government to refund ZTE in case of financial losses.

Neri had preferred that instead of loaning money from the Chinese government just to establish a national Internet backbone, the government should have allowed the private sector to build the network.

Sunday, 29 July 2007

Full blast construction of 80.2-km Northrail project starts very soon

Original report at Gov.Ph News

President Gloria Macapagal-Arroyo was assured by Northrail President Jose Cortes Jr. today that the full blast construction of the 80.2-kilometer railway line from old Tutuban Philippine National Railways (PNR) Station to Malolos will definitely start in January 2008.

The President was also assured by Cortes that all the remaining squatters residing along the old train line to be revived shall be "taken out already by December " and that the budget for the project is now available.

The President got these assurance from Cortes when she checked on the status of the $1,125.99-million Northrail Project whose first section spans Caloocan City, Valenzuela City and five towns of Bulacan, namely, Meycauayan, Marilao, Bocaue, Guiguinto and Malolos.

Cortes told the President that "the timetable is still the same" – construction period from February 2007 to February 2010 for Section 1; while Section 2 will be completed a year after.

The project is divided into two sections: Section I spans Caloocan, Valenzuela, Meycauyan, Marilao, Bocaue, the Guiguinto Multi-Modal Station up to Malolos; while Section II starts from Malolos to Calumpit in Bulacan up to Apalit, San Fernando, Angeles and the Clark Multi-Modal Station, all in Pampanga.

Section I is "generally along the PNR ROW (right of way) at-grade (and) partly elevated," specifically along the 3.7-km. Valenzuela Viaduct, the longest viaduct along the Caloocan-Clark railway line.

Section II, on the other hand, is also "generally along PNR ROW, at-grade, partly elevated, partly tunneled."

The Northrail CEO also briefed the President on the architectural perspective of the stations in each of the six local governments covered by the railway line's first section, plus the status of the engineering and construction works and right-of-way acquisition for which Northrail created a task force to "expedite acquisition… to be completed by 31 October 2007."

In the heat of the noonday sun, the President – in a cool blue pantsuit and blue platform slippers – walked without any umbrella shade from the old brick Malolos railway station to the location of the test-file boring machine that will check on the soil's structure-carrying capacity in 28 days.

Section I started ground work in end-June with a four-month pre-construction stage; while the 28-month construction phase will start this month. The four-month testing and commissioning period ends in February 2010.

So far, already "completed" are the project alignment design survey, site investigation, and soil exploration.

Also, "construction drawings for 23 kilometers, including the 1.7-km. Malolos Viaduct Section, and the preliminary drawings for all the six train stations were already issued by the contractor" -- the China National Machinery Equipment Corporation (CNMEG).

Already approved, according to Northrail, is the alignment design for the 1.7-km Viaduct Section in Malolos, plus the methodology for the Bored Piling Works.

Geographic studies of the railway area shows that it is located on the "North Luzon Alluvial Plain with some undulation in topography. These are mainly artificial soil, miscellaneous soil, clay, silky clay, fine round gravel, tuff and tuff claystones," and that the "subgrade of Caloocan station needs to be replaced and miscellaneous soil to be improved."

The total amount of the project is US$1,125.99 million because Section I costs $452.32, while Section II costs 673.67 million.

The project consultants are with the French group, SYSTRA.

The President's chopper from the Subic Bay Freeport Zone landed at the Bulacan State University where she was met by Bulacan Governor Joselito Mendoza.

Also attending the ocular inspection were Bulacan Reps. Lorna Silverio, Marivic Alvarado, and Pedro Pancho – and Bulacan Vice Governor Willy Alvarado and Malolos Mayor Danilo Domingo.

Speaker Jose de Venecia, Senator Richard Gordon and Trade Secretary Peter Favila also attended the briefing ceremonies. (OPS)