, FEBRUARY 8, 2007 (STAR) By Marvin Sy - With the controversy over the cancelled $329-million national broadband network (NBN) deal with China’s ZTE Corp. once again at the doorstep of Malacañang, President Arroyo has ordered the Department of Justice (DOJ) to determine who may be liable for violation of procurement and anti-graft laws in pursuit of the deal.

The order of the President came as her husband, First Gentleman Jose Miguel “Mike” Arroyo, challenged Rodolfo Lozada Jr. and Jose “Joey” de Venecia III to file a case in court if they have hard evidence about his alleged involvement in the deal.

Press Secretary Ignacio Bunye said Mrs. Arroyo has also directed the Philippine National Police and the National Bureau of Investigation to discuss with Congress the possibility of entering into a memorandum of agreement on the service of warrants issued by Congress.

Chief Presidential Legal Counsel Sergio Apostol said the directive of the President should not be taken as a move to preempt the Senate in its inquiry into the deal.

Apostol said that the DOJ’s investigation would determine if there is prima facie evidence to file criminal or administrative charges against any individual in relation to the cancelled deal.

Lozada has implicated the First Gentleman in the NBN deal just as former Speaker Jose De Venecia Jr.’s son, Joey, did during his earlier testimony on the same issue at the Senate.

Unlike Joey’s testimony, which directly implicated the First Gentleman as having pressured him to “back off” from the deal, Lozada’s statement provided a vague description of Mr. Arroyo’s involvement in the project.

During his press conference yesterday, Lozada said that former Commission on Elections Chairman Benjamin Abalos called up the First Gentleman to discuss his opinion about how the project should go through the build-operate-transfer process.

Lozada said that he did not hear what the person on the other end of Abalos’ phone call was saying.

After that phone call, Lozada said that he was invited to a dinner at the Shangri-La Hotel in Makati City by Abalos and that Joey De Venecia and the First Gentleman were present.

The discussion was once again on the NBN project but according to Lozada, the First Gentleman did not say much.

After the revelations of De Venecia at the Senate, Abalos opted for an early retirement.

In October last year, the President informed China’s President Hu Jintao about her decision to cancel the NBN-ZTE deal.

The ongoing Senate inquiry has caused a strain on the relationship between the Senate and Malacañang as the former attempted to arrest Commission on Higher Education chairman Romulo Neri because of his refusal to attend the hearing.

Neri evaded arrest and brought the issue up to the Supreme Court, which in turn issued a status quo order, effectively preventing the Senate from arresting him.

No legal action

First Gentleman Jose Miguel Arroyo is not bothered by Lozada’s statements linking him to the NBN deal as he instead challenged Lozada and Joey De Venecia to take the matter to court.

In a press conference, Mr. Arroyo’s lawyer, Ruy Alberto Rondain, said the First Gentleman was “irritated” by Lozada’s tirade.

“If Joey or any other person has hard evidence against First Gentleman Arroyo, file it in court and we can litigate it at the right forum. Not like this, hit and run and then someone will retract,” Rondain said.

Rondain said there would be no legal action in the meantime against anyone in connection with Lozada’s statements since the latter did not make any direct accusation against Mr. Arroyo.

“He (Lozada) was careful in saying that it he was not sure that it was First Gentleman on the telephone,” he said. “I read part of it, part of the transcript and there was no direct accusation against Mr. Arroyo. Although he is irritated, it does not keep him up at night. There is a little irritation, like how you and me or any normal human being would react when lies are thrown at you,” Rondain said adding that Mr. Arroyo still has a jet lag from his trip to Europe.

“Lozada is not also sure if FG is involved. He said what he remember was that chairman Abalos called on somebody and he said that he was not even sure who is on the other line of the phone. So, there is really nothing to react to,” Rondain said.

Rondain said his client will not appear in the Senate hearing because his doctors will not allow it as he has not yet fully recovered from his operation last April.

Justice Secretary Raul Gonzalez said the Justice department will initially review the transcripts of the Senate hearings on the ZTE deal as part of its probe on the alleged anomalous deal.

“We will look at the transcripts of the Senate hearing and determine who are the people to be considered as involved. So we will not unnecessarily burden people who are distant from this but are linked by innuendos,” said Gonzalez.

Gonzalez added that the DOJ will still have to get a more complete picture of the allegations made by Lozada, particularly on the alleged participation of Abalos.

Gonzalez said there is still a need to substantiate the claim of Lozada that Abalos had called Mr. Arroyo.

Meantime, an official of the Department of Transportation and Communications (DOTC) brushed off Lozada’s allegations.

DOTC Assistant Secretary Lorenzo Formoso III, in a press statement, described Lozada’s revelations as “unsubstantiated allegations” that have been tackled in previous Senate hearings.

Formoso also cast doubts on Lozada’s possession of “any real, untainted and unbiased information about the NBN contract” as he questioned the basis for

the appointment of the erstwhile president and chief executive officer of the Philippine Forest Corp. (PFC) as consultant by then National Economic Development Authority (NEDA) director general Romulo Neri.

“I’ve never met him,” said Formoso, who headed the DOTC technical working group that submitted the project to the NEDA for approval.

“He [Lozada] supposedly is a technical assistant to Secretary Neri, but during the evaluation by NEDA, both at the ICC level and the full NEDA board, Mr.

Lozada was not there,” he stressed.

Formoso pointed out that Neri would have no need for Lozada as a technical consultant for the NBN project because NEDA has a technical and infrastructure group, headed by assistant director general Ruben Reinoso, that evaluates proposals.

Formoso said that Lozada and De Venecia had used the difference between the $262 million and P329-million contract price to buttress their claim.

However, Formoso said that the comparison did not take into account the increase in coverage of the NBN infrastructure that will be set up under the contract.

Formoso explained that the contract price of $262 million would only cover 30 percent of the NBN needs of the government, while $329 million would provide 100 percent NBN coverage covering all municipalities, first class to the sixth class, nationwide.

“To dispel all of these [accusations of overpricing], I think the best thing to do is look at the bill of quantities and compare. Have an independent panel look at it and see whether the price is right, so to speak,” Formoso said.

National Security Adviser Norberto Gonzales also shrugged off the possible threat to national security that the revelations of Lozada may bring.

“It is really nothing. It is no security threat at all. The President is not threatened at all by whatever he has to say and will say,” Gonzales said.

However, despite government’s dismissal of Lozada’s claims, the PNP has been placed on high alert. - With Paolo Romero, Rainier Allan Ronda, Jose Rodel Clapano, Edith Regalado, Mike Frialde

Chief News Editor: Sol Jose Vanzi

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