DOJ review finds onerous provisions in water contracts with Maynilad, Manila Water

Published December 3, 2019, 4:42 PM

by AJ Siytangco

By Rey Panaligan

Justice Secretary Menardo I. Guevarra on Tuesday, December 3, said that after a review, his office has found at least a dozen onerous provisions in the 1997 water concession agreements with Maynilad Water Services and Manila Water.

Justice Secretary Menardo Guevarra (TOTO LOZANO/PRESIDENTIAL PHOTO /MANILA BULLETIN)
Justice Secretary Menardo Guevarra (TOTO LOZANO/PRESIDENTIAL PHOTO /MANILA BULLETIN)

The onerous provisions, he said, were found to be disadvantageous, not only to the government but more so to the water consumers.

He told journalists covering the Department of Justice (DOJ) that “one of the most notable onerous provisions is the prohibition against government interference in rate-setting and the provisions on indemnification for possible losses in the event of such government interference.

Thus, he said, as a result of the onerous provisions, the Singapore arbitration court has ordered the Philippine government to pay Maynilad about P3.6 billion for losses and damages and recently, P7.4 billion to Manila Water on the same issue.

Also, Guevarra said the review conducted by the DOJ on instructions of President Duterte found as irregular the extension of the contracts with the two water distributors until 2037 “considering that the extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022.”

He said the DOJ submitted to the President certain recommendations which were adopted by the Cabinet members.

“The President will make his public statement on this matter very soon,” he added.

“PRRD asked the DOJ to review the concession agreements during the height of the water crisis last summer.

However, the matter was not included in the agenda of the Cabinet until last November, and again last night, December 2, for updates,” Guevarra said.

He said the President was “visibly upset, if not angered” by the onerous provisions, adding the President was set to make a public statement on the government’s intended course of action on the matter.

 
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DOJ review finds onerous provisions in water contracts with Maynilad, Manila Water

Published December 3, 2019, 12:00 AM

by manilabulletin_admin

By Rey Panaligan

Justice Secretary Menardo I. Guevarra on Tuesday, December 3, said that after a review, his office has found at least a dozen onerous provisions in the 1997 water concession agreements with Maynilad Water Services and Manila Water.

Justice Secretary Menardo Guevarra (TOTO LOZANO/PRESIDENTIAL PHOTO /MANILA BULLETIN)
Justice Secretary Menardo Guevarra (TOTO LOZANO/PRESIDENTIAL PHOTO /MANILA BULLETIN)

The onerous provisions, he said, were found to be disadvantageous, not only to the government but more so to the water consumers.

He told journalists covering the Department of Justice (DOJ) that “one of the most notable onerous provisions is the prohibition against government interference in rate-setting and the provisions on indemnification for possible losses in the event of such government interference.

Thus, he said, as a result of the onerous provisions, the Singapore arbitration court has ordered the Philippine government to pay Maynilad about P3.6 billion for losses and damages and recently, P7.4 billion to Manila Water on the same issue.

Also, Guevarra said the review conducted by the DOJ on instructions of President Duterte found as irregular the extension of the contracts with the two water distributors until 2037 “considering that the extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022.”

He said the DOJ submitted to the President certain recommendations which were adopted by the Cabinet members.

“The President will make his public statement on this matter very soon,” he added.

“PRRD asked the DOJ to review the concession agreements during the height of the water crisis last summer.

However, the matter was not included in the agenda of the Cabinet until last November, and again last night, December 2, for updates,” Guevarra said.

He said the President was “visibly upset, if not angered” by the onerous provisions, adding the President was set to make a public statement on the government’s intended course of action on the matter.

 
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