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After revocation of water concession, ball is now in Maynilad, Manila Water’s court

/ 07:15 PM December 11, 2019

MANILA, Philippines – Justice Secretary Menardo Guevarra said it is now up to Maynilad and Manila Water to determine the actions to take after the Metropolitan Waterworks and Sewerage Administration revoked the memorandum of agreement (MOA) that extended the period of water concession to 2037.

“The ball is now in the concessionaires’ court. Take note that the proper time to renew the contract is upon expiration of the concession agreements in 2022, as expressly provided in the agreements themselves,” Guevarra said Wednesday.

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READ: MWSS revokes extension of Maynilad, Manila Water concession deals

Guevarra said the MWSS’ act of revoking the MOA extending the period of the concession was upon President Rodrigo Duterte’s directive and the Department of Justice’s (DOJ) recommendation which states that the extension had no legal basis in the concession agreement.

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The DOJ has found a dozen provisions in the 1997 concession agreement that was onerous and disadvantageous to the government and the consuming public.

“Most notable were the prohibition against government interference in rate-setting and the provision on indemnity for possible losses in the event of such government interference,” Guevarra said.

Guevarra said the DOJ also found the “extension of these contracts to 2037 irregular, considering that the extension was granted 12-13 years before the original expiration of the 25-year concession agreements in 2022.

The concession agreement took effect in 1997 during the term of President Fidel Ramos and covers a 25-year period, which ends in 2022. President Gloria Macapagal-Arroyo extended the concession agreement for another 15 years in 2009 or until 2037.

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TAGS: concession, DoJ, Manila Water, Maynilad, memorandum of agreement, MWSS
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