Court stops airports' PPP bidding (Business Mirror (Philippines))

A Davao City court has ordered the suspension of the auction for the P108.2-billion deal to develop five regional airports, although the Department of Transportation and Communications (DOTC) still opted to proceed with the qualification exercises on Monday.

The public-private partnership (PPP) project attracted six prospective bidders.

Transportation Spokesman Michael Arthur C. Sagcal said the department has received a temporary restraining order (TRO) from the Regional Trial Court (RTC) in Davao City, stopping the agency from conducting the bidding for the airport contract. A certain citizen, he said, sought for the stay order.

We received a TRO issued by the RTC in Davao City, but the Bids and Awards Committee has taken the position that proceeding with today’s activity does not violate any court issuance, he said.

Sagcal noted that the transportation department will have to wait for the legal opinion of the Office of the Secretary General (OSG) before it takes any other move in light of the stay order.

We will have to wait for the advice of our legal counsel, the OSG, he said. This is not the first time that the transport department received such an order for a major infrastructure deal.

According to a decision penned by Supreme Court Associate Justice Teresita J. Leonardo-de Castro in 2010, only the High Tribunal has the power to issue a TRO against a national government project.

But a local court could issue a stay order against a national government project if it involves a matter of

extreme urgency involving a constitutional issue, such that unless a TRO is issued, grave injustice and irreparable injury will arise.

Six parties submitted their qualification requirements to the DOTC, signifying their interest to bid for the PPP deal.

The six groups are the Philippine Airports Consortium, led by Metro Pacific Investments Corp. and Aeroports de Paris Management SA; the Union Equities-ACSA Consortium; the SMHC-HAC Airport Consortium of San Miguel Corp.; the Maya Consortium, led by Aboitiz Equity Ventures Inc. and Vinci Airports; the Filinvest-Jaco-Sojitz Consortium; and the GMR Infrastructures and Megawide Consortium.

Initially, eight companies bought bid documents for the bundled airport development deals.

The government launched the bidding for the aviation hubs late last year, with the intention of addressing the growing demand for air connectivity around tourist spots and business hubs. The state decided to bundle the contracts into two to make the project more enticing to investors.

The first package consists of the Bacolod-Silay Airport, P20.26 billion; and the Iloilo Airport, P30.40 billion; while the second bundle is composed of the New Bohol or Panglao Airport, P2.34 billion; the Laguindingan Airport, P14.62 billion; and the Davao Airport, P40.57 billion.

The Bacolod Airport, also known as Bacolod-Silay Airport, commenced operations in 2008 and is one of the recently completed airports in the Philippines with modern facilities. The airport is in Silay City, Negros Occidental, and generally caters to traffic for Negros Island-including Bacolod City-which is one of the most populous cities in the Western Visayas region.

Tourism is one of the main industries in Negros Occidental and is fast growing, with domestic tourists reaching 1.33 million in 2013.

The Iloilo Airport, on the other hand, is in Cabatuan, province of Iloilo, and is among the top 5 airports in the Philippines in terms of traffic. It started its commercial operations in 2007, providing both domestic and international connectivity, with seven domestic destinations and two international destinations. The airport served roughly 1.87 million passengers in 2013.

Seen to start its commercial operations by 2017, the P3.36-billion New Bohol Airport in Panglao is designed to accommodate 1 million passengers annually. The contract to construct the new aviation hub in Bohol was awarded to the Japanese joint venture of Chiyoda Corp. and Mitsubishi Corp. last month.

Found on the northern tip of Misamis Oriental, the Laguindingan Airport has a design capacity of 1.6 million passengers annually. It started its operations in 2013. It replaced the Lumbia Airport in Cagayan de Oro, which was among the five busiest airports in the Philippines in terms of passenger traffic.

Also known as the Francisco Bangoy International Airport, the Davao airport is the third-busiest airport in the Philippines after the Ninoy Aquino International Airport and the Mactan-Cebu International Airport. Located in Catitipan, Davao City, the airport has been operational for more than 15 years, currently serving both domestic and international operations.

The Davao region is one of the faster-growing tourism destinations in the country, with passenger traffic settling at 2.79 million in 2013.

The winning concessionaires for each bundle will handle the operations and maintenance of the airports for 30 years and will undertake expansion of facilities, as most of the airports are operating beyond their design capacity. These improvements are needed to enhance passenger safety and convenience, as well as to ensure more efficient airport operations.

The opening of bids is scheduled for January 2016, while the award will follow in February.