SC upholds Mactan airport project deal

The Supreme Court has dismissed the consolidated petitions seeking to stop the Department of Transportation and Communications (DOTC) from awarding the Mactan-Cebu International Airport (MCIA) project to the consortium of GMR Infrastructure Ltd. and Megawide Construction Corp.

In a 39-page decision, the court’s Third Division unanimously dismissed for lack of merit and legal factual bases the petitions of Sen. Sergio Osmeña III and the Business for Progress Movement (BPM) that accused the DOTC of arbitrariness for its decision to award the contract to the GMR-Megawide consortium.

The high court pointed out that the government had the discretion in choosing who among the bidders can offer the most advantageous terms.

“Courts will not interfere therewith or direct the committee on bids to do a particular act or to enjoin such act within its prerogatives, except when in the exercise of its authority, it gravely abuses or exceeds its jurisdiction, or otherwise commits injustice, unfairness, arbitrariness or fraudulent acts,” stated the decision dated Jan. 13 and written by Justice Martin Villarama Jr.

The MCIA project was opened for bidding in 2012. On April 3, 2014, the prequalification, bids and awards committee (PBAC) issued a resolution recommending GMR-Megawide Consortium (GMC) as the winning bidder. The next day, the DOTC and the Mactan-Cebu International Airport Authority (MCIAA) issued the notice of award to the consortium.

The consortium submitted and complied with the post-award requirements, including payment of the P14.4 billion bid amount to MCIA. The concession agreement was executed on April 22 and the DOTC turned over the operation and maintenance of the MCIA on Nov. 1.

In his petition filed on April 3, Osmeña asked the high court to stop the implementation of or nullify the award. The BPM filed its suit later in October.

The petitioners claimed the new operator had a poor track record, a history of financial operating losses, and committed conflict-of-interest violations under the bidding rules.

It was alleged that an official of the Malaysian partner of another participant in the MCIA project was also a director of two airports that GMR’s mother company operates in India. GMR denied the allegation.

The high court noted, however, that the issues about GMR’s Male Airport case and Megawide’s financial capability have been fully ventilated during the postqualification stage.