PSE woes

Did the Philippine Stock Exchange (PSE) unnecessarily place its reputation at serious risk when it stepped into the controversy hounding Landbank’s shares in the Manila Electric Co.?

This seems to be the question wracking the already-nervous business community after the PSE board suspended last week the trading of Meralco shares after Landbank got itself into what appears to be a “double-sale” mess.

It will be recalled that Landbank let out a big howl after Meralco’s corporate secretary cancelled several stock certificates covering some 42 million Meralco shares of stocks in Landbank’s name and issued new stock certificates in the name of one Josefina Lubrica.

It appears Meralco was implementing the decision of the Supreme Court released last month which ordered all parties concerned “to immediately and without delay issue the corresponding certificates and/or transfer the ownership or registration of the subject securities in the most expeditious and efficient manner in the name of the purchaser at Sheriff’s auction Josefina S. Lubrica.”

The way the business community understands it, Lubrica won a legal battle against Landbank’s refusal to relinquish the ownership of the Meralco shares. So, the quarrel is between Lubrica and Landbank, and Meralco merely got caught in the middle of the proverbial maelstrom?

The PSE’s move to suspend the trading of Meralco shares in the aftermath of the Lubrica-Landbank row led many to suspect that the decision was “highly political.” The question is whether or not this is merely the new chapter in the unfinished war for control of the giant power distribution firm.

And did the PSE allow itself to be an unwitting tool in the battle for Meralco control where one of PSE’s directors prominently figured?

It will be recalled that the failed bid by the Government Service Insurance System (GSIS) to wrest control of Meralco turned out to be a battle royale between this PSE director and her chief bourse rival. The latter reportedly helped the anti-GSIS group stave off the take-over while the other worked alongside the state pension fund, using her network to generate valuable proxy votes.

Speculations are rife that the said PSE director may have used her influence over the PSE board to take the drastic action. The speculations may be unfair to her and to the rest of the PSE board. The impression that she can push the entire board to take a very political move is certainly debatable.

But the view is that the suspension of trading of Meralco shares has been most unfair to Meralco’s small shareholders and to the stock market in general.

Given the global nervousness concerning the economy, was it prudent for the PSE to take a drastic move that can only be interpreted as highly political? Isn’t this supposed to be a time for prudence and sobriety in order to keep the capital market calm?

At the end of the day, it wasn’t just Meralco’s shareholders who got caught in the middle in the Lubrica-Land Bank legal tussle.

The unfortunate impression is that PSE’s perceived political move got us all caught in the crossfire.

Justice prevails

Nobody believed it could be done, and fast.

But when the House of Representatives Electoral Tribunal (HRET) voted 7-2 in favor of granting a petition for quo warranto filed by an ordinary resident of Laguna against then incumbent first district Rep. and former actor Dan Fernandez resulting in the latter’s ouster from his seat, the common tao rejoiced.

After all, it is not everyday that a David-Goliath battle results in David emerging victorious.

The HRET, which is the sole body tasked to decide on questions involving the election, returns, and qualifications of members of the House of Representatives, ruled that Fernandez failed to meet the one-year residency requirement for congressional candidates.

What is more laudable is the fact that the HRET acted fast, way before the end of Fernandez’ term in 2010. In many cases, decisions involving election, returns, and qualifications become moot and academic because the parties involved have ended their term.

The HRET found that Fernandez’ permanent residence remains to be Pagsanjan located in the fourth district of Laguna, and not Sta. Rosa in the first district as he indicated when he filed his certificate of candidacy in 2007. In fact, in his previous certificates in 1998, 2001, and 2004, Fernandez declared under oath that his domicile is Pagsanjan.

The tribunal thus ruled that Fernandez recited a detailed pattern of shuttling occupancy from one property to another, which is more for his convenience, business and political agenda/strategy.

Furthermore, HRET decided that he should not be allowed to avail of any lame or flimsy excuse to disregard or evade the constitutional requirement if only to enable him to run for representative of the first district of Laguna, to which he does not legally, permanently belong.

Vox Populi or the voice of the people cannot prevail over this constitutional requirement, according to the tribunal.

We take our hats of to the bravery shown by Vicente, a retired Meralco employee. He and other witnesses insisted that Fernandez never stepped foot on the premises he leased in Sta. Rosa City. Their concern for the future of their hometown gave them the courage to fight for what is just and right.

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