The deal to operate the longest toll road in the Philippines will see a better offer after President Aquino ordered to place the contract under a competitive challenge.
Four years after Metro Pacific Investments Corp. (MPIC) won the contract to operate and maintain the Subic-Clark-Tarlac Expressway (SCTEx) under the past administration, President Aquino has finally decided to subject the deal to a Swiss Challenge, Bases Conversion and Development Authority (BCDA) President Arnel Paciano D. Casanova said.
“We are drafting the terms of reference [TOR] for the price challenge based on the President’s instructions. We may start the publication of the TOR by early December,” he said.
Manila North Tollways Corp. (MNTC) President Rodrigo E. Franco said his company has been informed of the President’s decision, but has not yet seen the order released by Malacanang.
“We have to study the details. We are not yet clear on what has been approved by the President,” he said.
Under a price challenge, another company may offer a higher concession fee. This means that the government may get a better deal, should the group of businessman Manuel V. Pangilinan decide to match the challenge price. Earlier, Metro Pacific Tollways Corp. President Ramoncito S. Fernandez called the plan to subject the deal under a price challenge as “grossly unfair and without legal basis.”
He noted that the deal was a solicited project, with the bidding conducted aboveboard.
MNTC bagged the SCTEx contract during the Arroyo administration, but Mr. Aquino suspended the deal on concern about the revenue-sharing scheme.
Under the original terms of the contract, state-run BCDA shall assign to MNTC the management, operations and maintenance of SCTEx, as well as the government agency’s rights in the Toll Operations Agreement, including the right to collect toll revenues for 25 years, renewable for another eight years.
MNTC, which operates the SCTEx and the North Luzon Expressway, had proposed a 50-percent revenue-sharing scheme, which the Department of Finance endorsed to President Aquino for approval last year.
In November 2012 MNTC raised BCDA’s revenue share to P90 billion from the original proposal of P64 billion.
MNTC also provided a longer period—from the earlier endpoint of 2016 to the new schedule of 2019— within which the company would subsidize payment of BCDA’s existing P31-billion debt to the Japan International Cooperation Agency. The loan, which was used to build the SCTEx, will mature in 2041.
Lorenz S. Marasigan