Solon questions why two firms have lock-down on PCSO supply contracts for 24 yrs
Published Sep 29, 2019 05:26 pm
By Ellson Quismorio
A House leader is asking Congress to probe the contracts entered into by the Philippine Charity Sweepstakes Office (PCSO) with the Philippine Gaming Management Corporation under Berjaya Corporation (PGMC-Berjaya) and the Pacific Online Systems Corporation (Pacific Online) for its National Online Lottery System (NOLS).
(Ali Vicoy / MANILA BULLETIN)
Ang Probinsyano Party-List Rep. Ronnie Ong authored and filed House Resolution (HR) no.359, which questioned how PGMC-Berjaya and the Pacific Online have managed to secure and keep their Equipment Lease Agreements (ELA) with the PCSO for the past 24 years despite various irregularities.
It should be noted that the parent firm of PGMC-Berjaya is Berjaya Corporation Berhad--a Malaysian public limited company.
According to Ong, PCSO’s ELA with the PGMC-Berjaya, which was entered into in 1995 for a period of years (but was actually started in 1999) covering the lease of lotto terminals or equipment for the operation of online lottery in Luzon, was found out to be disadvantageous to the government in a Senate Blue Ribbon committee hearing last 2011.
"It was found that PCSO was renting equipment from PGMC-Berjaya for $148 million when it can buy the same equipment for $25 million," the House Committee on Games and Amusements vice-chairman said in his resolution.
Ong said the Senate, at that time, recommended to the PSCO that it renegotiate the rental fee with both PGMC-Berjaya and Pacific Online.
Despite the Senate recommendation to renegotiate the fee, the PGMC-Berjaya refused to budge, triggering a string of litigation from the trial court, to the Court of Appeals, up to the International Court of Arbitration.
And even after dragging PCSO into a costly and expensive legal battle, Ong said that it came as a big surprise that the company's ELA was even extended by the PCSO from August 22, 2015 to August 21, 2018.
Even more ridiculous, Ong said, was the fact that while PCSO was paying millions to PGMC-Berjaya, the company still pressed on with its legal offensive and managed to secure another court injunction in 2017 to stop the gaming body from conducting a bidding for its P10.9-billion National Online Lottery System (NOLS), which could have already improve the system.
"Saan ka naman nakakita ng ganyan na binabayaran na nga natin sila kahit overpriced, hinahabla pa rin tayo (We have been paying them at an overpriced rate, yet they still sue us). We are paying them so much money so they can sue us. We have to fight this kind of abuse," Ong said.
Ong said the Supreme Court (SC) finally issued a ruling on August 15, 2018 that the PCSO can proceed with the bidding of the NOLS which was later renamed as the Philippine Lottery System (PLS) and with a lesser budget of P8.3 billion.
But instead of finally getting rid of PGMC-Berjaya, the company even managed to secure another extension of its ELA from August 23, 2018 to August 22, 2019 because of PCSO's alleged failure to "timely procure" the said PLS. Pacific Online's ELA for Visayas and Mindanao operations was also extended for the same reason.
PCSO again had a failure of bidding for the PLS last July 2019 and had to resort to another extension of ELA with PGMC-Berjaya and Pacific Online until 2020.
Citing these instances, Ong stressed that it was very important for Congress to step in and ensure that proper procurement are observed and at the same time, rogue and abusive companies like PGMC-Berjaya can no longer exploit government agencies like the PCSO.
"There is a need to stop the irregularities, violations, disadvantageous terms and/or corruption as regards PCSO contracts, gaming activities and bidding in line with the President’s directive to address the corrupt practices at the PCSO and among the operators of various games," the resolution said.
Earlier, Quezon 2nd district Rep. Jay-Jay Suarez told PCSO officials during a budget hearing before the Appropriations Committee to switch to a Filipino private partner for its popular "Lotto" draws.
"Berjaya is a Malaysian-owned corporation...Is it not possible that through the PCSO, we can find maybe a local player based in the Philippines so that we can have the money of the Filipinos revolving within the Philippines and not be brought abroad?" Suarez asked during the hearing.
(Ali Vicoy / MANILA BULLETIN)
Ang Probinsyano Party-List Rep. Ronnie Ong authored and filed House Resolution (HR) no.359, which questioned how PGMC-Berjaya and the Pacific Online have managed to secure and keep their Equipment Lease Agreements (ELA) with the PCSO for the past 24 years despite various irregularities.
It should be noted that the parent firm of PGMC-Berjaya is Berjaya Corporation Berhad--a Malaysian public limited company.
According to Ong, PCSO’s ELA with the PGMC-Berjaya, which was entered into in 1995 for a period of years (but was actually started in 1999) covering the lease of lotto terminals or equipment for the operation of online lottery in Luzon, was found out to be disadvantageous to the government in a Senate Blue Ribbon committee hearing last 2011.
"It was found that PCSO was renting equipment from PGMC-Berjaya for $148 million when it can buy the same equipment for $25 million," the House Committee on Games and Amusements vice-chairman said in his resolution.
Ong said the Senate, at that time, recommended to the PSCO that it renegotiate the rental fee with both PGMC-Berjaya and Pacific Online.
Despite the Senate recommendation to renegotiate the fee, the PGMC-Berjaya refused to budge, triggering a string of litigation from the trial court, to the Court of Appeals, up to the International Court of Arbitration.
And even after dragging PCSO into a costly and expensive legal battle, Ong said that it came as a big surprise that the company's ELA was even extended by the PCSO from August 22, 2015 to August 21, 2018.
Even more ridiculous, Ong said, was the fact that while PCSO was paying millions to PGMC-Berjaya, the company still pressed on with its legal offensive and managed to secure another court injunction in 2017 to stop the gaming body from conducting a bidding for its P10.9-billion National Online Lottery System (NOLS), which could have already improve the system.
"Saan ka naman nakakita ng ganyan na binabayaran na nga natin sila kahit overpriced, hinahabla pa rin tayo (We have been paying them at an overpriced rate, yet they still sue us). We are paying them so much money so they can sue us. We have to fight this kind of abuse," Ong said.
Ong said the Supreme Court (SC) finally issued a ruling on August 15, 2018 that the PCSO can proceed with the bidding of the NOLS which was later renamed as the Philippine Lottery System (PLS) and with a lesser budget of P8.3 billion.
But instead of finally getting rid of PGMC-Berjaya, the company even managed to secure another extension of its ELA from August 23, 2018 to August 22, 2019 because of PCSO's alleged failure to "timely procure" the said PLS. Pacific Online's ELA for Visayas and Mindanao operations was also extended for the same reason.
PCSO again had a failure of bidding for the PLS last July 2019 and had to resort to another extension of ELA with PGMC-Berjaya and Pacific Online until 2020.
Citing these instances, Ong stressed that it was very important for Congress to step in and ensure that proper procurement are observed and at the same time, rogue and abusive companies like PGMC-Berjaya can no longer exploit government agencies like the PCSO.
"There is a need to stop the irregularities, violations, disadvantageous terms and/or corruption as regards PCSO contracts, gaming activities and bidding in line with the President’s directive to address the corrupt practices at the PCSO and among the operators of various games," the resolution said.
Earlier, Quezon 2nd district Rep. Jay-Jay Suarez told PCSO officials during a budget hearing before the Appropriations Committee to switch to a Filipino private partner for its popular "Lotto" draws.
"Berjaya is a Malaysian-owned corporation...Is it not possible that through the PCSO, we can find maybe a local player based in the Philippines so that we can have the money of the Filipinos revolving within the Philippines and not be brought abroad?" Suarez asked during the hearing.