SC affirms Comelec’s P2.2B deal with Smartmatic for additional 23K vote-count machines

MANILA, Philippines — The Supreme Court has affirmed the Commission on Elections awarding last June to the Smartmatic-Total Information Management Corp. of a P2.2-billion contract for the lease of additional 23,000 vote-counting machines for this year’s national and local polls.

Voting 14-0, the court en banc, in a 41-page decision dated Dec. 8 but released last week, denied for lack of merit the certiorari case filed by former Comelec commissioner Augusto Lagman, Leo Querubin and Ma. Corazon Akol, conveners of the poll watchdog Automated Election Systems Watch, to nullify the contract award.

The high court said Smartmatic-TIM was able to prove that it was 60 percent Filipino-owned and that its participation in the bidding while its articles of incorporation (AOI) was being amended was not enough legal basis to nullify its winning the contract.

The Comelec en banc earlier reversed the decision of the agency’s bids and awards committee to disqualify Smartmatic-TIM for submitting a “defective” AOI, which only stated that the joint venture’s primary purpose was for the automation of the 2010 elections.

The AES Watch filed the Supreme Court suit after the Comelec refused to reconsider its decision.

But according to the Supreme Court, the Comelec rules and government procurement regulations do not at all require the submission of AOIs.

“A perusal of the bidding documents would readily reveal that the procuring entity, the Comelec in this case, did not impose such a requirement [a]s can be gleaned in the instruction to bidders,” the court said in the ruling written by Justice Presbitero Velasco Jr.

The court also said that the 2010 contract required Smartmatic-TIM to provide Comelec continuing technical support beyond 2010, thus prolonging the company’s corporate life.

The issue has been mooted when Smartmatic-TIM was able to submit its amended AOI to Comelec before the contract was signed last December, the court added.

The justices also said the petitioners failed to “offer any relevant evidence to substantiate their claim: that the joint venture did not meet the 60-percent Filipino ownership requirement for bidders of government contracts.

Documents presented by Smartmatic-TIM showed that its Filipino owners have been holding more than 60 percent of the joint venture’s shares of stocks and has always been a legitimate Philippine corporation.

The “fatal flaw,” in the petition, the justices said, was that it did not challenge the nationality of the companies and individuals said to own the shares.

The P2.2-billion contract for the lease of 23,000 optical mark reader machines was originally meant to supplement the 81,000 Precinct Count Optical Scan machines leased for the 2010 elections and purchased by Comelec in 2012.

In April last year, the Supreme Court voided, for lack of public bidding, the direct contract entered into by Comelec’s with the Smartmatic-TIM for the refurbishing of the 81,000 old PCOS machines.

This led Comelec to conduct a new bidding for the lease of 70,977 new OMR machines instead. The contract, worth, P.787-billion, was won by Smartmatic-TIM in August.  SFM