THE Permanent Court of Arbitration (PCA) has sided with Maynilad Water Services Inc. over its case of tariff-rate increase the water concessionaire of the west side of Metro Manila should have implemented beginning 2013.
The three-man international tribunal also ordered the government of the Philippines to pay Maynilad some P3.42 billion as reimbursement over what the water concessionaire called the losses it incurred from March 11, 2015 through August 31, 2016, after the government prevented it from the upward adjustment of rates.
Maynilad earlier claimed the government owes it some P4.9 billion.
The said amount awarded by the tribunal will be paid “without prejudice to any rights that Maynilad may have to seek recourse against MWSS [Metropolitan Waterworks and Sewerage System, the regulator of the water concessionaires] for losses incurred from January 1, 2013 to March 10, 2015.”
The tribunal also ruled that Maynilad is entitled to recover from the Republic its losses from September 1, 2016 onward. “In case a disagreement on the amount of such losses arises, Maynilad may revert to the tribunal for further determination,” it said.
Maynilad President and CEO Ramoncito S. Fernandez said the decision of the tribunal is an affirmation of the trust and confidence that Maynilad has placed in the concession agreement (CA).
“We will continue to honor our commitments under the CA and pursue the capital-expenditure projects that will improve further the quality of service to our customers, as well as support the government’s initiative in ensuring the sustainability of our country’s water resources,” Fernandez said.
In the coming days, Maynilad will coordinate and cooperate with the government in finding the most efficient way to implement the judgment, he added.
In early December 2016, the PCA held a hearing at the facilities of Maxwell Chambers in Singapore, in the arbitration between Maynilad and the Republic of the Philippines.
The arbitration, for which the PCA acts as registry, was conducted pursuant to the 1976 United Nations Commission on International Trade Law Arbitration Rules. The Tribunal is composed of V.V. Veeder QC, Justice Roberto A. Abad (Ret.) and Kap-You Kim, who acts as the presiding arbitrator.