The government will have to pay Maynilad Water Services, Inc. for revenue losses caused by delayed rate adjustments after Singapore’s Supreme Court upheld a ruling that favored the West Zone concessionaire.
“Maynilad’s Singapore-based counsel formally confirmed … that the decision of the Singapore High Court, (orally) issued on 4 September 2018, dismissing the Philippine Republic’s Setting Aside Application, has become final as of 4 October 2018,” parent firm Metro Pacific Investments Corp. (MPIC) said in a disclosure on Wednesday.
“The decision became final after the Philippine Republic … decided to no longer appeal the dismissal of its Setting Aside Application to the Singapore Court of Appeal within 30 days from 4 September 2018, or until 4 October 2018,” it added.
The court also ordered the government to pay Maynilad S$40,000 (P1.6 million) by way of costs.
Maynilad is majority owned by MPIC. It serves as the agent and contractor of the Metropolitan Waterworks and Sewerage System (MWSS) for the West Zone of the Greater Manila Area and it also serves some cities and towns in Cavite.
Its concession deal allows for regular rate adjustments every five years and the dispute stems from a 2013 MWSS decision denying Maynilad’s proposed increase.
The matter went into arbitration and in July last year, a Singapore tribunal upheld Maynilad’s claim that it lost P3.44 billion.
“The Arbitral Award ordered the Philippine Republic to compensate Maynilad for its revenue losses, commencing on 11 March 2015 onwards, resulting from the refusal of the MWSS to implement Maynilad’s tariff adjustment for the period 2013 to 2017, which tariff adjustment includes corporate income tax,” MPIC noted.
The government asked the Singapore Supreme Court to set aside the ruling earlier this year.
Following the latest development, MPIC said Maynilad would “now work towards an efficient collection of its claim in a manner that recognizes the interest of its various stakeholders including its shareholders and customers, taxpayers and the government.”
MPIC ended up 0.20 percent or six centavos on Wednesday at P5.06 apiece, bucking a 0.86-percent drop for the benchmark Philippine Stock Exchange index.
FROM A REPORT BY JORDEENE B. LAGARE