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BURI denies installing ‘fake’ MRT-3 parts

/ 08:42 PM October 04, 2017


Transportation Undersecretary Cesar Chavez testifies at the House of Representatives’ investigation on the alleged installation of fake train parts for the Metro Rail Transit Line 3. Charles Mercado, the corporate secretary of maintenance provider Busan Universal Rail, Inc. (in tan suit at far left), looks on. Philippine Daily Inquirer / Vince F. Nonato.

Metro Rail Transit (MRT) Line 3 maintenance provider Busan Universal Rail, Inc. (BURI) denied installing P4-million worth of anomalous train safety parts, but a ranking member of the House of Representatives questioned the firm’s compliance with procurement rules.


The House committee on good government’s inquiry on Wednesday centered on BURI’s procurement of two vehicle logic units (VLU) from Diamond Pearl Development and Manufacturing Corporation.

VLUs form the core hardware of the MRT signaling system, the automated component that prevents over speeding and manages distances between trains.


BURI corporate secretary Charles Mercado told lawmakers that the questioned VLUs were pulled out by Diamond Pearl from the MRT-3 depot on August 24 because the latter failed to submit the prerequisites required of them by the Department of Transportation (DOTr).

These prerequisites included the certificate of origin, factory inspection report, certificate of warranty, and bill of lading.

Mercado denied DOTr’s claim that his firm billed the government for the two VLUs that were not used due to the procedural issues.

Although the firm installed two VLUs on MRT Cars No. 06 and 63, Mercado claimed these were not the ones procured from Diamond Pearl. The VLU for Car No. 06 was supposedly left in stock by a previous maintenance contractor, but he could not state with certainty the source of the other VLU bought in October 2016.

Deputy Speaker Gwendolyn Garcia, however, questioned why one VLU would be purchased from “Supplier X,” yet the two anomalous VLUs would be bought from another supplier only a month later in November 2016.

Mercado explained the proprietary part originally supplied by Bombadier Transportation Signal Ltd. was already out of the local market and thus, had to be purchased from traders who would only have a part or two in stock. He added Diamond Pearl had regularly supplied other train parts.

Although Rep. Jericho Jonas Nograles’ House Resolution No. 1212 pointed to the alleged installation of “fake train safety equipment,” DoTr Undersecretary Cesar Chavez clarified that the VLU purchased by BURI “appears to be original.” Yet, he assailed the irregularity of its procurement.


“It appears to be original. As to where it was procured, that was not substantiated. Therefore, the supply, the delivery is questionable,” Chavez said.

Zooming in on this point, Garcia asked why the VLUs and other purchases from Diamond Pearl did not have the supporting documents.

Mercado reasoned out that the documents were not required from previous maintenance contractors and they only became necessary “when Usec. Chavez took over.”

This prompted Garcia to ask if Mercado was questioning the necessity of the documents to ensure the quality of the VLU.

Mercado replied that “what we work with are the terms and conditions stated in the contract, the technical specifications on the spare parts.” He maintained that even without the requirements that were supposedly just imposed by Chavez, the government would still check the parts anyway.

The committee subsequently issued a subpoena for Diamond Pearl owner Marlo dela Cruz, whom Nograles described as the “alleged political operator of defeated presidential candidate Manuel Roxas and the alleged ‘mystery man’ behind the questionable maintenance service contract.”                /kga

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TAGS: BURI, House of Representatives, investigation, MRT, train parts, VLU
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