Subic row continues

The importance of the Subic Bay port as a potentially competitive international service and logistics center in Southeast Asia, and the sad fact that after the Americans left Subic in 1991 following the expiry of the RP-US Military Bases treaty, nothing seems to have been done to tap this potential, is beyond dispute.

We earlier reported that improving Subic Bay’s existing ports to make them world-class facilities was the driving force behind the decision of the Harbour Centre Port Terminal Inc.’s (HCPTI) in submitting an unsolicited proposal to Subic Bay Metropolitan Authority (SBMA) to develop and manage parts of the naval supply depot in the Freeport.

But HCPTI’s proposal is facing rough sailing. Subic cargo operator Amerasia International Terminal Services, Inc. (Amerasia) has reportedly filed criminal cases against SBMA and its private sector partner in connection with a contract to develop development of five ports within the SBMA’s jurisdiction.

According to Amerasia, the contract which was signed in February of this year and grants HCPTI the right to be SBMA’s exclusive cargo handler of bulk, break-bulk and general cargo for a period of 25 years will effectively result in HCPTI monopolizing Subic ports to the detriment of the Freeport locators and cargo handlers.

Amerasia, one of the oldest cargo operators at the Freeport with a 25-year lease and cargo handling operations contract with SBMA, earlier said the SBMA-HCPTI contract will prejudice their contractual and vested rights to operate at the Freeport.

The Subic firm said that the SBMA Board approved the contract knowing fully well that HCPTI is not bringing in any new cargo business and will just effectively take over the clientele and cargoes of existing operators.

Amerasia further claimed that the deal did not undergo due process, with SBMA showing manifest partiality towards HCPTI, and that the contract was approved on evident bad faith, gross inexcusable negligence, and has committed violations with regard to the law’s prohibition on monopolies, restraint of trade, commerce and free competition.

It said the process of considering and approving the SBMA-HCPTI contract which granted monopoly to HCPTI also violated the Bill of Rights per the 1987 Constitution which says that no one should be deprived of property without due process of law.

The firm also held that held that the joint venture violated Principle No. 9 on Free Competition of the 2008 Office of the Government Corporate Counsel (OGCC) Joint Venture Guidelines which states that the JV agreement should not prevent potential players from profitably entering the market.

Similarly situated cargo operators which have joined Amerasia in opposing the Subic deal are Mega Subic Terminal Services, Inc. (MSTSI), Subic Seaport Terminal, Inc. (SSTI), Global Terminals and Development, Inc. among others.

SBMA head Armand Arreza earlier vowed to make the future agreement transparent, aboveboard, and in accordance with existing laws, even as he stressed that the process follows the joint-venture guidelines promulgated by the Office of the Government Corporate Counsel and the National Economic and Development Authority.

He has also allayed fears that the HCPTI’s proposal will jeopardize existing contracts with cargo handlers and locators saying their contracts will still be respected.

Many are hoping that all parties involved come to an understanding and settle the controversy amicably because valuable time is being wasted. Subic has the potential of being an internationally competitive trading hub and time is of the essence. 

From the readers 

“You praised some lawyers in your May 26, 2010 column entitled ‘On Noynoy’s Team’ for allegedly ‘the breaking up of the behemoth PLDT monopoly during the Ramos administration.’ However, you failed to give credit to the efforts of one lawyer which predated the accomplishments of those you extolled in your column. It was Atty. Francisco I. Chavez (in his capacity as Solicitor General), who argued (and won the case) before the Supreme Court in PLDT vs. National Telecommunications Commission decided October 18, 1990 who was responsible for dismantling the PLDT monopoly. In said case, penned by the venerable Justice Ameurfina Melencio Herrera, the SC clearly stated that: ‘Art. II, 2, Section 24 of the 1987 Constitution recognizes the vital role of communication and information in nation building… Free competition in the industry may also provide the answer to a much-desired improvement in the quality and delivery of this type of public utility, to improved technology, fast and handy mobile service, and reduced user dissatisfaction. After all, neither PLDT nor any other public utility has a constitutional right to a monopoly position in view of the Constitutional proscription that no franchise certificate or authorization shall be exclusive in character or shall last longer than 50 years.’ This is relayed to you for your information and, in the interest of objectivity and fairness.”                          

- Luis Angel G. Aseoche

Not so hidden agenda

Congratulations are in order for DDB/DM9 Jayme Syfu which is Campaign Brief Asia’s Philippine Agency of the Year in their latest creative rankings, beating the likes of BBDO Guerrero and TBWA/SMP.

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