GOVERNMENT  PAYS  P3  BILLION,  TAKES  NAIA-3

MANILA, SEPTEMBER 12, 2006
(STAR) By Aurea Calica and Paolo Romero - The government takes full control of the Ninoy Aquino International Airport Terminal 3 (NAIA-3) in Parañaque City with the payment of P3 billion to its builder Philippine International Air Terminals Co. (Piatco) and the issuance of a "writ of possession" by a Pasay City court.

Pasay City Regional Trial Court Branch 117 Judge Jesus Mupas released the "writ of possession" effectively setting the stage for the full government control of NAIA-3.

The issuance of the writ came at about the same time as the release of the P3-billion check to Piatco by the Manila International Airport Authority (MIAA).

"We’ll just have to wait now for the full compensation," Piatco lawyer Eduardo de los Angeles told The STAR. "Let us see first if we can clear the check."

"We can now intensify our efforts to prepare the terminal for a possible opening by the first quarter of next year," MIAA general manager Alfonso Cusi told reporters after the release of the "writ of possession."

In Helsinki, Finland, Malacañang officials said the P3 billion was "a reasonable price to pay" for the interest of the public. President Arroyo and some officials are attending the 6th Asia-Europe Meeting.

"The international business community certainly had brought this matter (NAIA-3 controversy) to us because they themselves are keen on seeing the terminal open. In fact, they told us now that this will send a very strong signal that back home, we really can get things done," Trade Secretary Peter Favila told a press conference here.

Solicitor General Antonio Nachura said the payment would also satisfy the Singapore-based International Chamber of Commerce Arbitration Tribunal’s ruling that government pay Piatco before taking over the facility. It was Piatco that brought the case to the ICC.

He said any case arising from the ICC ruling would now be "moot and academic." He said he could not see any more legal obstacle to government’s control of NAIA-3.

Executive Secretary Eduardo Ermita said copies of the writ of possession would also be sent to the International Centre for Settlement of Investment Disputes in Washington where Fraport AG is pursuing a separate arbitration. Fraport demands a compensation of $465 million for the project.

"So that will definitely favorably affect the litigation going on in the international arbitration courts," Ermita said.

At a press briefing in Helsinki, Favila stressed that Mrs. Arroyo had a high respect for international law but would not hesitate to take legal measures to defend the interest of the Filipinos. He was apparently referring to the government’s disregard for a ruling last month by ICC allowing Piatco to take over NAIA-3.

Press Secretary Ignacio Bunye, for his part, said government’s readiness to pay P3 billion to Piatco reflected the administration’s adherence to law.

"Our decision to pay the P3 billion set by the court as just compensation is all about adherence to the rule of law and the interest of the people," he said.

"We may be parting with a huge sum of money but this is a reasonable price to pay compared to what we are set to gain once we fully start its (NAIA-3) operation," Bunye said.

"We believe it is high time now to settle this issue once and for all in order to serve the interest of the public with regard to the use of this facility," he added.

Signal to investors

Finance Secretary Margarito Teves said the opening of the new terminal "would convey a signal that we are serious in inviting investors."

Teves said the government is prepared to give "just compensation" to Piatco for the state’s takeover the airport facility.

"We talked already with DBP (Development Bank of the Philippines) and LandBank (of the Philippines) and they are prepared to provide the funds to support the balance within a 30-45 day notice," Teves said.

"We just have to wait for the full report and recommendation of the international valuation of the structure. So once it is given (and the) Philippine government has agreed to it, then we can work on the balance, whatever that amount is, so it will be taken from the financial institutions and maybe including commercial banks," Teves said.

He said paying Piatco "should not be difficult because it is something that they have already explored."

Teves said the exact balance to be paid by the government would only have to be determined by the valuators.

Sen. Joker Arroyo earlier said the airport contract was only $300 million and that the government should not be paying for a project that had been declared illegal by the Supreme Court.

Meanwhile, Nachura chided Arroyo for his wrong computation of the compensation Piatco was entitled to.

"I think his computation is wrong. If you divide P3 billion by P50, it is $60 million not $600 million," Nachura said.

"He added one more zero. We’re definitely not going to pay more than what we should. The valuators will have to appraise the facility to determine the amount we have to pay," Nachura said.

Budget Secretary Rolando Andaya said the MIAA would use its revenues to pay for the initial P3 billion and not be shouldered by the national government.

Despite the administration’s assurances, Senator Arroyo said it was still unclear as to where would the government get the $60 million to pay Piatco.

"We never know that it is just an initial deposit so it may go up to seven, eight, nine, ten billion, I don’t know," Arroyo said. The amount is not included in the supplemental budget or any appropriations measure, the senator noted.

He said not even Andaya had an idea where to get the P3 billion needed for Piatco.

Arroyo said he had consulted with Sen. Franklin Drilon who informed him that there was no budget to pay for Piatco. Drilon is the head of the Senate committee on finance, which is reviewing the 2006 budget and supplemental appropriations.

Drilon sponsored last night the passage of the P46.9-billion supplemental budget which did not have appropriations for the Piatco deal.

"Where is the source of it?" Senator Arroyo asked, adding that "P3-billion is just too big."

"The mystery and the tragedy of this case is that the Supreme Court said that the contract is null and void, ergo, those who committed the fraud should be punished but yet they cannot be punished because they have practically won all the cases, and the government is going to pay them," Senator Arroyo said.

The Court of Appeals lifted Friday the temporary restraining order on the government’s payment of P3 billion to Piatco.

Over the weekend, Arroyo criticized the government’s move to take over NAIA-3 despite the controversy. "There is something fishy about the way the government is handling the Piatco deal... " said Arroyo, who chairs the Senate Blue Ribbon Committee that investigated and later declared as null and void the Piatco deal a few years ago.

The senator said he found it strange that government was pushing for the takeover despite the Supreme Court ruling that declared the government approved contract for building Terminal 3 as null and void.

In Pasay City, the issuance of the writ by Judge Mupas was preceded by a long closed-door meeting with Piatco and government representatives. Mupas’ order was actually a reinstatement of the writ of possession issued by his predecessor, the late Judge Henrick Guingoyon, in December 2004.

MIAA officials actually handed over the LandBank manager’s check worth P3,002,125,000 to Piatco representatives through Mupas.

Mupas had earlier formed a committee headed by former public works secretary Fiorello Estuar to determine the amount of "just compensation" to Piatco.

The government took over NAIA-3 in late December 2004 shortly after the Supreme Court nullified its build-operate-transfer contract with Piatco. The Arroyo administration junked the Piatco contract citing some anomalous provisions inserted into the deal during deposed President Joseph Estrada’s term. — With Christina Mendez, Rainier Allan Ronda


Chief News Editor: Sol Jose Vanzi

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