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After Manila Water agreement, Maynilad to deliberate new deal with govt

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Mika Navallo, ABS-CBN News

MANILA — The ball is now in Maynilad’s court, Justice Secretary Menardo Guevarra said Wednesday, when asked for an update regarding a new water concession agreement with the water distributor.This comes almost a month after the Philippine government and Manila Water signed a new concession agreement (CA) aimed at providing “better overall service and more reasonable charges to consumers.”“As starting point for discussion, the government panel sent a copy of the revised CA with Manila Water to Maynilad for its consideration. I understand that Maynilad has referred the said CA to its principals and is presently awaiting their comments,” Guevarra told reporters Wednesday.“Thereafter, the two sides will come together and commence their discussions,” he added, without specifying a timeline. Maynilad’s original concession agreement will expire in 2022.The review of the water concession agreements was prompted by President Rodrigo Duterte’s rants against the 2 water distribution firms.In a speech in December 2019, he claimed the Philippine government “surrendered everything” to Maynilad and Manila Water in granting them supposedly onerous contracts.<ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/news/12/05/19/duterte-ph-surrendered-everything-to-maynilad-manila-water">Duterte: PH surrendered &#x27;everything&#x27; to Maynilad, Manila Water</a></li></ul>Duterte even threatened to file economic sabotage charges against the 2 firms.A water crisis in April 2019 “piqued” his interest in the water contracts, the President said, which prompted a review by the Justice Department of the provisions of the water concession agreements.Guevarra earlier noted “onerous or disadvantageous” provisions regarding the distributors&#x27; business taxes, payments for debt service, penalty for noncompliance obligation passed on to consumers, among others.The DOJ also found irregular the extension of the water distributors&#x27; contracts by 15 years to 2037. The extension was granted in 2009 for Manila Water and in 2010 for Maynilad, years before the original expiration of the agreements in 2022.He warned, in December 2019, that the Duterte government will pursue legal action against them if no agreement is reached.<ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/news/12/05/19/govt-mulls-legal-actions-vs-water-distributors-over-compensation-ruling">Gov&#x27;t mulls legal actions vs water distributors over compensation ruling</a></li></ul>The Singapore-based Permanent Court of Arbitration had earlier ordered the Philippine government to pay P3.4 billion to Maynilad and P7.4 billion to Manila Water as compensation for losses the water concessionaires incurred due to denied rate increases.But these awards are among those waived in the revised Manila Water concession agreement, which requires a deed of settlement and release to be signed by both sides. “But this release pertains only to the claims arising from the contract itself like for example yung mga in-award ng Singapore arbitration tribunal ay wini-waive na and other claims arising from the old concession agreement,” Guevarra said on April 5. “But if you are referring to criminal liability, that is a totally different matter and that needs further studies,” he added.<div>SALIENT FEATURES OF MANILA WATER CONCESSION AGREEMENT</div>Among the salient features of the revised Manila Water concession agreement are: <ul>	<li>the exclusion of the corporate income tax from the fees that may be charged to consumers</li>	<li>no increase in water rates or tariffs until December 31, 2022</li>	<li>water rates will no longer be adjusted based on the consumer price index of the inflation rate (only a third of that)</li>	<li>fluctuations in foreign exchange rates will not be considered in determining water charges.</li></ul>“Sa government side malaki ang pagbabago at ang pinakamahalaga rito ay ang pagtanggal sa onerous na non-interference clause na hindi pwedeng pakialaman ng national leadership, ng national government ang anumang mapagkakasunduan ng regulatory office at ng water concessionaire regarding water rates,” Guevarra said early this month.(On the government&#x27;s side, there were big changes, the most important of which is the removal of the onerous non-interference clause that prevents the national leadership, national government from interfering in any deals reached by the regulatory office and water concessionaires regarding water rates.)“Nangyari na ito before at tayo ay nademanda by both Manila Water and Maynilad at nagkaroon tayo ng damages.&quot; (This has happened before and we were taken to court by both Manila Water and Maynilad and we had to pay damages). Guevarra said the government was asked to pay damages amounting to almost P11 billion for the two water concessionaires.The Manila Water concession agreement will require several conditions to be met before it takes effect, but not beyond six months since it was signed, according to Guevarra.A copy of the new Manila Water concession agreement has yet to be released to the public.<div>RELATED VIDEO:</div><figure class="op-interactive"><iframe allow="autoplay; fullscreen" frameBorder="0" height="100%" id="ivsplayer01" scrolling="no" src="https://player.ivideosmart.com/ivsplayer/v4/dist/html/iframe-src.html?iframeid=ivsplayer01&amp;key=e8c22c015ca9eafa76f1e3edfa03c603&amp;spid=3001339&amp;vid=1673529" width="100%"></iframe></figure><div class="iwantbar">Watch more in <a href="//www.iwantv.com.ph/">iWantv</a> or <a href="//tfc.tv/">TFC.tv</a></div>

The ball is now in Maynilad’s court, Justice Secretary Menardo Guevarra said Wednesday, when asked for an update regarding a new water concession agreement with the water distributor.

The ball is now in Maynilad’s court, Justice Secretary Menardo Guevarra said Wednesday, when asked for an update regarding a new water concession agreement with the water distributor.

After Manila Water agreement, Maynilad to deliberate new deal with govt

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After Manila Water agreement, Maynilad to deliberate new deal with govt

Mika Navallo,

ABS-CBN News

Published April 28, 2021 05:12 PM PHT

Read More:

Department of Justice

Maynilad

Manila Water

Sec Menardo Guevarra

concession agreement

Singapore arbitration

President Rodrigo Duterte

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