Court of Appeals clears Piatco, Fraport in NAIA-3 monopoly case

MANILA, Philippines - Top executives of the Philippine International Air Terminals Co. Inc. (Piatco) and its German partner, Fraport AG, cannot be indicted on charges of monopolizing services at the Ninoy Aquino International Airport Terminal 3 (NAIA-3), the Court of Appeals (CA) ruled.

In affirming the Department of Justice resolution, the CA dismissed the criminal complaint filed by lawyer Jose Bernas, counsel of one of the parties in the cases related to NAIA 3, against Piatco and Fraport officers.

The CA ruled that Justice Secretary Raul Gonzalez was correct in upholding the resolution of Manila Assistant City Prosecutor Raymunda Cruz-Apolo dismissing the complaint for violation of Article 186 of the Revised Penal Code (monopolies and combinations in restraint of trade) filed against Fraport and Piatco executives and shareholders for insufficiency of evidence.

It is very clear that under the 2000 National Prosecutorial Service Rules on Appeal the justice secretary may reverse, affirm, or modify resolutions of public prosecutors that are brought to his office by the petitioner for review, the CA added.

Bernas claimed while it was Piatco’s exclusive responsibility to finance, construct, manage and operate NAIA-3, there is nothing in the amended and restated concession agreement (ARCA) that expressly granted Piatco the sole and exclusive right to provide airport-related services.

Bernas accused Tony King, Nilo Pena, Antonio Pacis, Henry Go, Remy Tigulo, Cheng Yong, Jefferson Cheng, Rolando Esguerra, Jose Lotilla, William Bender, Bernd Struck, and Oscar Lopez Dee of arrogating upon themselves “the exclusive right to provide ground handling, catering and fuelling services and to operate a warehouse for air-cargo handling and related services” within the airport terminal complex, when they executed an “addendum to the Piatco Shareholders Agreement” on July 6, 1999.

The addendum to the Piatco Shareholders Agreement, according to the complaint, constituted combination in restraint of trade.

The CA said it appears from the records of the case that the respondents were motivated only by lawful business purposes — to ensure an efficient operation of the NAIA 3.

“We concur, with the contention of the private respondents that the provisions of the addendum, as executed by them, are lawful undertakings among the shareholders of Piatco arising from the contractual commitments that Piatco obtained from the government under the concession agreement and the ARCA,” read the CA decision.

Associate Justice Isaias Dicdican wrote the CA decision, with Associate Justices Edgardo Cruz and Marlene Gonzales-Sison concurring.

On July 13, 2006, the city prosecutor reversed Apolo’s resolution and directed the filing of criminal charges against the Piatco and Fraport executives before the Manila Municipal Trial Court.

The complaint was withdrawn following Gonzalez’s decision reinstating the September 2004 resolution of Apolo.