Cuevas refers FLI’s unpaid share case to legal office

CEBU, Philippines - Cebu City Treasurer Diwa Cuevas yesterday said her office has endorsed the overdue payables of Filinvest Land Inc. to the City Legal Office for its failure to pay almost P1 billion of joint venture shares to the city government.

According to Cuevas, FLI was given extension by Cebu City Mayor Michael Rama to pay until yesterday after the investor’s first payment for the guarantee fee has already lapsed five days from the supposed payment schedule on March 15.

“Kagahapon (March 19) ra unta to pero nagkastorya man sila ni mayor. Mayor told us to wait until today (yesterday) if dili gyod mobayad adto na sa legal. Wa gyod mi mahimo ani kay nagpagahi man sila og bayad,” Cuevas told The Freeman.

Filinvest is one of the biggest investors of the city government. The company plans to put up investments amounting to P50 billion in residential, commercial and BPO centers in Cebu.

In a recent statement addressed to The Freeman, Tristan Las Marias, FLI first vice president for Visayas and Mindanao, said P224.4 million is the actual share of the City Government on the gross amount based on the final payment for the purchase of 10-hectare Pond F at the South Road Properties. FLI bought Pond F in 2009.

“Sa JV contract they will develop sa first phase with guaranteed minimum returns of 1.053 billion at the end of five years,” Cuevas pointed out.

Las Marias recalled that FLI already paid P1.735 billion which includes the P309.71 million representing the city’s revenue share in the 10-hectare joint venture and P1.425 billion for Pond F.

He said the P730.13 million gross share of the city in the joint venture for the first 10-hectars of SRP will only be paid “as soon as the city completes its review and executes the documentation requirements for the release.”

“We have started discussion with the city as early as Feb. and we are awaiting for the city’s review so that we can make the payments,” Las Marias said.

Cuevas for her part disagreed, saying the city will only be submitting these documents after the FLI’s project will be completed and operational.

“We differ... upon completion of the project of the development the parties will sit down and reconcile the necessary records. Completed or not they have to pay the minimum guaranteed returns without such documents,” she said, citing the provision under the JV agreement.

Las Marias said proper documentation of all transactions related to the SRP joint venture is particularly important.

“As a publicly listed company, it is our responsibility that any fund releases are properly reconciled and documented by both paying and receiving parties and done in accordance to the joint venture agreement,” he said.

“FLI welcomes every opportunity to contribute to the progress and economic growth of Cebu. We believe that Cebu has the potential for even greater achievements and as one of the city’s biggest investors, we look forward to a business friendly, harmonious and fruitful relationship with the city government as we pursue this joint venture in SRP,” he added.  (FREEMAN)