Water firms still liable even if onerous provisions scrapped

Presidential Spokesperson and Chief Presidential Legal Counsel Salvador Panelo (PCOO File Photo)

MANILA — Malacañang on Tuesday said Maynilad Water Services Inc. and Manila Water Co. may still face economic sabotage charges even if the supposed onerous provisions in the water concession agreements are scrapped.

“When a crime has been committed, even if you return (the money) there is still a crime and the President is mandated to enforce the law and the law says any transgression will have to be prosecuted,” Presidential Spokesperson Salvador Panelo said in a Palace briefing.

Panelo, however, said President Rodrigo Duterte would first want to speak to water concessionaire owners and government lawyers involved in the drafting of the water deals.

“Siguro, he wants to know why they allowed these provisions to be agreed upon by their principle. I think they’re (the government lawyers) still around so I don’t think that’s a problem,” Panelo said.

He explained that the government is studying options to remove the alleged onerous provisions in the contracts whether it would or would not require going to the courts.

Due to the provisions, the government was ordered by the Singapore arbitration court to pay Maynilad about PHP3.6 billion and, recently, PHP7.4 billion to Manila Water as compensation for losses and damages.

“The President wants the onerous provisions removed. If that can be done without going to the courts then we have no problem. But if it cannot be done, then we have to go to the courts,” Panelo said.

There will be “no compromise” for the scrapping of the onerous provisions, he said.

Panelo, also Chief Presidential Legal Counsel, said the owners of water concessionaires should agree to remove the provisions because they have already earned from the contract for several years.

“I think the concessionaires will have to agree. First, kumita na sila ng malaki.

Several years na. Hindi na so hindi na siguro sila lugi doon (They already earned so much for several years. They won’t go bankrupt because of it),” he added.

Against extension

Panelo, meanwhile, said the Palace is against any extension of the water concession agreements he described as “anomalous.”

The Department of Justice (DOJ) earlier said another onerous provision in the contract is the extension of these contracts to 2037 considering that the extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022.

“We are against the extension because it has not even expired meron agad (there’s already an) extension. We find that anomalous,” Panelo said.

He said the government may rescind the water deals which contained provisions such as the “prohibition against government interference in rate-setting, and the provision on indemnity for possible losses in the event of such government interference.”

“Of course. It can always file rescission if the agreement is contrary to public policy, public interest, public health, public safety,” he added.

Justice Secretary Mernardo Guevarra said the government is looking into the possibility of appealing the ruling of the Singapore arbitration favoring Manila Water.

“First, the plan is those onerous provisions should be removed. Number two, with respect to the arbitration award in Singapore, we intend to file an appeal before the Supreme Court of Singapore or if they will enforce it in the Philippines by filing a petition in our lower courts then we will oppose it,” Panelo said.

Panelo said the government may take over the operation of water utilities if proven that the water deals are indeed onerous.

“Kung walang iba di (If there is no one else to take over then) initially government muna (will do it) then most likely after that there will be biddings for a private company to take over,” Panelo said.

He assured the government will put on notice that other private companies cannot do anything that will be contrary to the interest of the Filipino people.

Ex-presidents not off the hook

Aside from water concessionaires and government lawyers, former presidents may also face charges over the alleged onerous water deals if proven that they are part of the “conspiracy”, Panelo said.

The water concession agreement was signed during the term of President Fidel Ramos in 1997.

Presidents who came after Ramos were Joseph Estrada (1998-2001), Gloria-Macapagal Arroyo (2001-2010), and Benigno “Noynoy” Aquino III (2010-2016).

“Against all nga e. Everybody that is involved in the drafting and approving of that concessionaire [sic] agreement,” Panelo said.

Asked if Ramos and Arroyo may also face charges, Panelo said: “If they are part of the conspiracy. But if they are not, they cannot be included.”