MANILA, Philippines—As time ticked for the squabbling partners to meet Friday’s deadline to patch up their differences and salvage a P7.2-billion contract for next year’s automated elections, advisers of the Commission on Elections (Comelec) moved to see to it that the project pulls through.

The Comelec Advisory Council (CAC) said on Thursday the Comelec should consider taking over from Total Information Management Corp. (TIM) should the local partner of the Barbados-based Smartmatic International carry out its threat to withdraw from the deal.

In that event, the Comelec should form a partnership with Smartmatic and proceed with poll automation, a procedure allowed by law, the CAC officials said.

Comelec legal chief Ferdinand Rafanan said hiring Smartmatic and having the Comelec assume the duties of TIM had emerged as the “No. 1 alternative,” even though it meant that the Comelec would have its hands full. “Our tasks will be more,” Rafanan said.

Department of Science and Technology (DOST) Undersecretary Fortunato dela Peña, a CAC member, said the Comelec had the legal right to hire Smartmatic and take over the responsibilities of TIM in the 2010 elections.

“Under the partnership, Smartmatic is responsible for the hardware and technology. TIM is responsible for the deployment of people. If the partner is out, the Comelec can do it. It is not that complicated,” Dela Peña said.

The CAC did not consider manual elections an alternative as the law mandates the Comelec to hold full automation in 2010, Dela Peña said.

Officials said TIM was balking at Smartmatic’s total control of the purse strings and the decision-making process. TIM also reportedly wanted 60-percent ownership of the joint venture company to be set up with Smartmatic that would sign the automation contract with the Comelec.

The Smartmatic/TIM joint venture company was to supply the 82,000 counting machines that would allow the Comelec to come up with election results in two days instead of weeks as in the previous manual balloting.

Comelec Chair Jose Melo had directed the two companies to thresh out their differences by today so that the deal could be signed and the project that is now a month behind schedule could move forward.

A source privy to the discussions told the Inquirer that chances were almost nil that TIM and Smartmatic could reach an agreement any time soon. The source said the dialogue was on its “death throes” as of yesterday afternoon.

“Let’s hope for the best, but expect the worst,” the source said.

However, a Comelec official who requested anonymity because of Melo’s request for a news blackout on the discussions, said that “anything can still happen.”

Talks continuing

A TIM official contacted by the Inquirer last night said that “talks are continuing.”

The Comelec awarded the contract to Smartmatic-TIM on June 10. The P7.2-billion deal was supposed to be signed on June 30, but was canceled because TIM had not signed the incorporation papers.

On Monday, TIM announced that it was leaving the joint venture because it deemed the agreement “lopsided” in favor of Smartmatic and could put the company in a precarious position.

The CAC told the commission en banc on Wednesday to explore the possibility of hiring Smartmatic even without its local partner in case the dispute could not be resolved.

In a two-page resolution, the CAC urged the Comelec to “proceed with the automation of the 2010 Elections with Smartmatic using whatever legal means are available.”

According to the council, chaired by Commission on Information and Communications Technology chief Ray Roxas-Chua III, the “implementation of a free, honest, orderly, peaceful, credible, and informed elections is of paramount interest.”

No time for new bidding

The nine-member CAC struck down the possibility of holding another bidding, noting “there is no sufficient time” for it.

Other advisers of the Comelec echoed the same stance, saying the important thing was to ensure electronic voting in 2010.

Edmundo Casiño of the Philippine Computer Society said a Comelec takeover of TIM’s responsibilities was allowed by law. Casiño said the implementing rules and regulations of the procurement law permitted such an approach.

Both firms liable

Justice Secretary Agnes Devanadera said Thursday that TIM executives could be held criminally liable and open to imprisonment of six to 15 years if they back out of the winning bid.

“There is a penal provision under the Procurement Act. It’s what we follow,” she said.

Devanadera is referring to Article 21, Section 65 of the Procurement Act that contains the penalties for violations committed by those in government and those in the private sector that get involved in procurement of goods and services for the government.

“That’s just an academic information,” she said, indicating that the legal position doesn’t mean the Department of Justice (DOJ) has prejudged the case.

“It’s up to the Comelec. The DOJ can’t act if no complaint is filed,” Devanadera said.

Devanadera previously said that even if only TIM backed out of the project both companies should be jointly liable since the government dealt with the consortium—meaning Smartmatic and TIM combined.

MegaPacific machines

Also Thursday, Jose Midas Marquez, spokesperson of the Supreme Court, said the high tribunal would consider a move by the Comelec and representatives of MegaPacific consortium if they would seek the use in 2010 election machines bought under a P1.3-billion deal that the tribunal had declared void.

Marquez said it would be up to the Comelec and MegaPacific representatives to iron out issues—such as curing the defects of the void contract—and ask the tribunal to allow the use of the machines that were originally meant for the 2004 balloting.

“If it is in the best interest of the country, the Supreme Court would consider a manifestation filed by the Comelec and the supplier if the two sides can come up with an agreement,” Marquez told the Inquirer.

“That means the computers should be returned to the supplier and the payment should be returned to the government,” Marquez said.

He added that there is also a pending case in a regional trial court on the ownership of the counting machines now being kept in a warehouse in Manila.

“The two parties should be able to iron out the issues between the two of them. The court cannot intervene,” Marquez said.