Meeting with Rep. Lobregat – 5 April

April 11, 2017 ECCP@Work

ECCP, with Joint Foreign Chambers and various business groups, met with House Committee Chair for Public Works Rep. Celso Lobregat.

The discussions focused on HB 5720, filed by Rep. Pantaleon Alvarez.

Presently, winning project proponent is granted a franchise to operate and maintain the facility (including collection of tolls, fees, rental and charges).

HB 5270’s salient points include:

  • HB 5270 seeks to remove the automatic grant of franchise. Instead, project proponent should first secure a legislative franchise for public utilities from Congress for it to qualify as bidder, and in order to operate, and maintain the facilities.
  • Entities presently operating and maintain public utilities shall be given one year from the effectivity of the law to secure a legislative franchise for public utilities from Congress in order to continue their operations.
  • Franchise should only be valid for a period of 25 years, subject to renewal.
  • In case of BOT arrangement, the contract shall be awarded to the bidder who, having satisfied the minimum financial, technical, organization, and legal standards required by this Act, has submitted the bid that is most advantageous to the government and provides the most favorable terms for the project, based on the present value of its proposed tolls, fees, rentals and charges over a fixed term for the facility to be constructed, rehabilitated, operated, and maintained according to the prescribed minimum design and performance standards, plans and specification.

Various business groups initially expressed their concerns for the said House Bill as implementation of HB 5720 may cause further delay of PPP Projects / program, which is contrary to the goal of the current Administration of speedy implementation of infrastructure projects.