PPP Center pushes alternative ways to settle disputes

MANILA, Philippines — The Public-Private Partnership (PPP) Center is pushing for the use of alternative dispute resolution (ADR) mechanisms in PPP contracts for the better management of disputes.

In a social media post, the PPP Center said the agency’s executive director, Ma. Cynthia Hernandez, has encouraged firms to use ADR mechanisms in PPP contracts in her keynote address during the Philippine Institute of Construction Arbitrators and Mediators’ Philippine Construction Arbitration Conference 2023.

ADR mechanisms refer to a process or procedure used to resolve a dispute other than through the court. These include arbitration and mediation.

For Hernandez, the use of ADR mechanisms would help avoid and better manage construction disputes.

“It will also allow contractors to effectively participate in the rich opportunities of the PPP project pipeline,” the PPP Center said.

Under the proposed PPP Act, which is backed by the PPP Center, all PPP contracts will be required to include provisions on the use of dispute avoidance and ADR mechanisms.

Contracting parties will be given the freedom to choose which ADR mechanisms and venue will govern the dispute.

The proposed measure will also require PPPs to adopt contract management and risk mitigation plans to manage fiscal risks arising from the projects.

The proposed PPP Act seeks to provide an enabling environment to promote PPPs for infrastructure and other development projects.

In December last year, the House of Representatives approved its version of the proposed measure on third and final reading.

The proposed PPP Act is among the priority bills being pushed by the government and targeted to be passed within the year.

Last month, the National Economic and Development Authority (NEDA) board approved a new list of infrastructure flagship projects (IFPs) amounting to  P9 trillion.

NEDA Secretary Arsenio Balisacan said 45 of these IFPs are to be financed through PPPs.