NGCP violated Constitution for allowing Chinese to hold high position – senators

MANILA, Philippines — Senators believe there was a clear violation of the Constitution on the part of the National Grid Corporation of the Philippines (NGCP) for allowing a Chinese national hold the second-highest position in the company, warning of a possible revocation of its franchise.

At the Senate hearing on the operations of the NGCP amid fears that China could remotely access the country’s power grid, Senators Sherwin Gatchalian and Richard Gordon revealed that a certain Wen Bo had signed contracts as chief technical officer (CTO) of the company.

Gordon cited a contract for the Luzon Substation Expansion Project 3 which was signed between the NGCP and the Xian Electric Engineering Company Limited.

He noted that the 2011 document was only signed in the presence of Anthony Almeda, which is now the president and chief executive officer of the NGCP.

“As a lawyer parang umiiwas pusoy yan (he’s evasive). Foreigner ang pumipirma (is signing) and then when you look at the final agreement ang nakalagay pa rin (you can see the) same personalities,” Gordon pointed out.

“I’d like to know why…When you make contracts, walang (there’s no) Pilipino. Parang ang nagpapatakbo yung (It appears that in the corporation ) 40 percent are Chinese, yung (the) 60 percent na Pilipino wala (no Filipinos),” he added.

The NGCP, which runs and maintains the country’s electricity grid, is 40 percent owned by the State Grid Corporation of China.

At this point, Gatchalian, who led the hearing as chair of the Senate energy committee, cited Section 11, Article 12 of the 1987 Constitution which states that “all executive and managing officers of such corporation or association must be citizens of the Philippines.”

He then asked Almeda if there were instances that any Chinese national held executorial or managerial positions in the NGCP.

In response, Almeda said that the NGCP was “100 percent” managed by Filipinos.

But Gatchalian cited the organizational table of the NGCP which showed that the position of the chief technical officer was only “one position below chief executive officer.”

“So that means the chief technical officer is an executive and management position?” Gatchalian asked Almeda.

Almeda answered in the affirmative but quickly noted that Wen Bo was acting as a consultant for the company.

“Sabi niyo kanina walang (You said earlier there’s no) instance na merong (there are) Chinese na nasa (in the) executive and management position as prescribed by the Constitution in this document may isang (but there’s one) Wen Bo,” Gatchalian said, referring to the Luzon Substation Expansion Project 3 contract earlier presented by Gordon.

“And in your table of organization, he’s the second highest. Can you explain this?” he added.

“This is a violation of the Constitution. All executive and managing officers of such corporation or association must be citizens of the Philippines. Very clear ‘yan. That is a safeguard,” he said.

Gatchalian also said Wen Bo made a manpower request under his designation as a chief technical officer.

“As you can see, he’s exercising executive functions by requesting people. It’s enshrined in our Constitution, simply put, that management and executive functions should remain with the Filipinos,” he said.

Atty. Ronald Concepcion, NGCP’s assistant corporate secretary, argued that when NGCP took over the transmission functions of operating the country’s power grid, its Chinese partners were given a special visa.

He said that they were given authority by the Department of Justice to act as chief technical officer “for a certain period.”

“What we’re trying to say is that they were given authority by the DOJ to be chief technical officer…and given a special visa,” he added.

But Gordon and Senator Risa Hontiveros, who called for an inquiry into the operations of the NGCP, were not convinced by the company’s reasoning.

Gordon said it was “still questionable” while Hontiveros stressed the mandate of the Constitution would prevail over a “special visa.”

Concepcion then went on to cite the Anti-Dummy Law which he said “provides exemptions to the exercise of management or executive positions. One of the exemptions is when a foreign national is a technical expert.”

“In that special visa, it was actually found that the person to whom the visa is going to be issued, is a technical expert on the matter,” he added.

But Hontiveros still sees no justification for Wen Bo’s designation as a chief technical officer of the NGCP.

Senator Aquilino Pimentel III echoed the sentiments of his colleagues.

“Even if you can cite a law, that law must fail because, in law versus the Constitution, the Constitution prevails,” he said.

Concepcion agreed with Pimentel but cited another law – the Electric Power Industry Reform Act which stated: “that the Philippines should engage expertise a foreign technical partner.”

“You’re talking about tech assistance. Iba ang technical assistance sa pumipirma. E di tau-tauhan tayo. It violates clearly the Constitution,” Gordon, however, said.

Gatchalian, meanwhile, pointed out that the position of chief technical officer oversees crucial aspects of the NGCP.

Citing the NGCP’s organization chart anew, Gatchalian said the chief technical officers oversee the operations and maintenance of the North and South Luzon; Visayas; and Mindanao grid.

“Ito na ho yung pinatakabutika ng grid e, and then iba po yung nakaposiyon dun sa bituka ng ating transmission line,” he said.

“Bakit ho napunta sa isang dayuhan ang pamamalakad at pamamahala ng bituka ng ating transmission line? Why was a foreigner assigned?” he added.

In response, Almeda assured the Senate that the Philippines “have always controlled the management of the company.”

“Any document that came out I supervised it also we looked into it. On control, it’s always the Filipinos,” he said.

“If ever there are some signatures that are signed it also goes through our office. At the time we needed a technical expert so we rely on their technical expertise,” he added, noting that Wen Bo is not with the NGCP anymore.

A Filipino now holds the position of chief technical officer, Concepcion told the senators.

Allow gov’t audit

Gatchalian, further, reminded the NGCP that the Constitution is the basis of their franchise.

He said that should the NGCP continue to prevent the Department of Energy (DOE) and the National Transmission Corporation (Transco) from conducting an audit of its system operations, it would face a review of its franchise.

“I have a very simple deal. You allow the inspection or else we will proceed reviewing your franchise cause there was clearly a violation of the Constitution, clearly we have established that you violated the Constitution,” he added.

The NGCP had clarified that it was not against the audit, adding it would agree for an inspection if the would be done by the Energy Regulatory Commission (ERC).

“What we want to make clear is that there are certain parameters for different kinds of audit…ERC has been given the power to audit, to oversee, to monitor and to look into the operations of all stakeholders in the power industry,” Concepcion said.

“The power of Transco to inspect the books of the national grid corporation is limited to those activities which are outside the purview of the ERC’s jurisdiction,” he added.

In an interview with reporters after the hearing, Gatchalian said the committee gave the NGCP until Monday next week to allow the government to conduct an audit of the company.

“Assuming hindi nila payagan ang DOE (Department of Energy), tutuloy namin yung aming recommendation na i-revoke ang franchise,” he said.

He said he would move for the revocation of the NGCP’s franchise if proven that there was indeed a violation of the franchise.

“We have to validate the documents first. Kung napatunayan na merong violation sa Constitution natin…kung may violation sa Constitution, there’s a violation on the franchise,” he said.

He said that while there were enough grounds to recommend the revocation of the franchise of the NGCP, it would still be subject to the audit by the government.

“Based on the documents and based sa sagot nila, merong basis tayo and this basis is the violation of the Constitution,” he added.

“But this is subject to the validation of the DOE (Department of Energy, kailangan i-audit pa rin,” he further said.