Int’l court orders gov’t to pay Manila Water P7.4-B

An international court has ordered the Philippine government to pay Manila Water P7.4 billion covering four years of losses the company suffered from disapproved rate increases.

In a disclosure to the Philippine Stock Exchange on Friday, Manila Water said it has received from lawyers a notice of award from a Singapore arbitral tribunal constituted under the Permanent Court of Arbitration.

“The Tribunal ruled that Manila Water has a right to indemnification for actual losses suffered by it on account of the Republic’s breach of its obligation,” the concessionaire said. 

“The Tribunal ordered the Republic to indemnify Manila Water the amount of P7,390,000,000 representing the actual losses it suffered from 1 June 2015 until 22 November 2019,” it added.

The government was also ordered to pay the entire amount  Manila Water paid the PCA as well as 85% of the company’s other claimed costs.

The Office of the Solicitor General (OSG) confirmed the ruling, but said the award is not yet final and executory.

“The OSG is studying all the remedies available to the Republic in assailing the award,” the OSG said in the statement. Manila

Water, on the other hand, said it will work with the government “for an orderly and managed satisfaction of the award.”

The award was handed down more than two years after the court ordered the government to reimburse Maynilad Water Services, another water concessionaire, P3.424 billion in revenue losses from January 1, 2013 to March 10, 2015.

The water concessionaires separately brought the government to court after the Metropolitan Waterworks and Sewerage System (MWSS) denied their petitions to increase water rates in their respective concession areas and instead reduced the rates.

Though they won before an international tribunal, Manila Water and Maynilad are appealing a loss dealt against them by the Philippine Supreme Court (SC) last August. The SC ordered the companies to pay more than P921 million each for violating the Philippine Clean Water Act.

The SC ruled that Maynilad and Manila Water failed to connect all existing sewage lines in establishments and households to an available sewerage system within the period set by law.

In their motions for reconsideration, the firms said it is “impossible” to establish a complete centralized sewerage system within five years and warned against the impact of such an undertaking on Metro Manila’s traffic.

The companies claimed that government agencies failed to cooperate with the concessionaires to meet their legal obligations. —VDS, GMA News