Solon questions lack of legislative franchise of water concessionaires

MANILA, Philippines — Water concessionaires Manila Water and Maynilad should have been required to secure a legislative franchise to operate since both are public utilities and provide a public service, Gabriela party-list Rep. Arlene Brosas said Wednesday.

At the joint hearing of the House of Representatives’ committees on good government and accountability and public accounts, Brosas said that under the 1987 Constitution, firms must acquire a franchise to be granted by Congress if they will be in the business of providing “basic commodity indispensable to the interest of the general public.”

“Dapat kung public utility siya, public service siya, mayroong franchise. Para mag-operate siya na nagpro-provide ng water service to the public, dapat may legislative franchise tayong requirement under the 1987 Constitution,” she said.

(If it’s a public utility, and providing a public service, it should have a franchise. For it to operate in providing water service to the public, it is mandated to acquire a legislative franchise under the 1987 Constitution.)

Since both water concessionaires had not been required to get a legislative franchise, they were able to easily get away or skirt public accountability, she said.

Brosas further claimed the two water firms are “in violation of the 1987 Constitution” since they do not have a legislative franchise.

“Hindi pwede ‘yung representations or taking refuge doon sa usapin na agents lang. Samantalang pinag-uusapan natin ay tubig eh. Sabi nga natin ay public interest ito at public service,” the party-list lawmaker said.

Maynilad and Manila Water had reasoned that they are not public utilities, but are instead “agents” of a public utility, which is the Metropolitan Waterworks and Sewerage System (MWSS).

Senior State Counsel Rosario Cuevas of the Department of Justice said that it is the department’s position that the two water firms are public utilities.

“As to whether the two concessionaires are considered as public utilities or agents, it is our position that both concessionaires are public utilities performing public service,” Cuevas said.

However, she added that the DOJ did not tackle whether the grant should have been a franchise.

“We did not take up the legality of the delegation or privatization of the MWSS,” she said.

Manila Water and Maynilad distribute water in Metro Manila and parts of Cavite and Rizal provinces under agreements signed with the MWSS in 1997 during the Ramos administration following what was then called “the world’s largest water privatization.”