Romulo warns Aquino against hasty decision on NAIA 3 case

Philippine Star, Manila

Romulo warns Aquino against hasty decision on NAIA 3 case

By Aurea Calica

16 August 16, 2010

MANILA, Philippines - Foreign Affairs Secretary Alberto Romulo advised President Aquino against deciding hastily on the case involving the Ninoy Aquino International Airport Terminal 3 (NAIA-3), warning the government could be at a disadvantage.

Romulo sent a memorandum to Mr. Aquino informing the Chief Executive that the Philippine government had won the case against the German firm Fraport AG and the Philippine International Air Terminals Corp. (PIATCO) before the International Chamber of Commerce-International Court of Arbitration.

Romulo said he advised Mr. Aquino to decide on the case more carefully following the legal victory.

Romulo, who also served as foreign secretary during the administration of former President Gloria Macapagal- Arroyo, was among the officials of the previous administration who disapproved the expropriation of the NAIA-3 and the payment of P3 billion to the consortium that built the airport despite the absence of a report on its structural integrity.

Romulo said these were some of his “heartbreaks” as regards the NAIA-3 case.

Arroyo’s former chief presidential legal counsel and defense secretary Avelino “Nonong” Cruz said an experts’ study on the airport’s structural integrity would come out in about one and a half or two months.

Cruz said the report would serve as a guide for the Aquino administration to determine the value of the facility.

More than anything, Romulo and Cruz stressed the government’s paramount consideration should be the safety of the airport.

Some government lawyers also stressed the legal victory of the Philippine government in the cases against Fraport AG and PIATCO, as well as in the International Centre for Settlement of Investment Disputes (ICSID) by Fraport since the Supreme Court had ruled on the matter.

They pointed out that SC decisions are non-appealable and it was a bad precedent that the high tribunal’s ruling was challenged before global tribunals since it would affect even the country’s integrity before the international community.

The SC had ruled the NAIA-3 contracts were void and unconstitutional. The high court said the contracts were materially changed after the project proponents won the bidding.

Sources said Mr. Aquino had also been advised by his officials to refrain from giving credit to the Arroyo administration for the victory in the NAIA-3 case since the cases involving the project did not move or had been dismissed during its time.

A business tycoon is reportedly lobbying to have an immediate out-of-court settlement for the NAIA-3 because he had bought shares in PIATCO.

Malacañang said its officials, along with Transportation Secretary Jose de Jesus, were being briefed about the issue by lawyers involved in the international and local cases.

The sources could not reveal however, as to who among the officials in the Aquino Cabinet are in favor of PIATCO and an out-of-court settlement for the airport.

One of those who had testified for PIATCO was Presidential Communications Operations Office Secretary Herminio Coloma.

Coloma had served as Transportation undersecretary during the time of former President Fidel Ramos.

But sources could not say whether Coloma is currently participating in the talks about the NAIA-3 case.

The sources revealed the lawyers who are briefing Malacañang on the issue were those who made the government win in the international tribunals, including newly appointed SC Associate Justice Ma. Lourdes Aranal-Sereno.

Those who had been fighting Fraport and PIATCO said criminal cases against those involved must also be pursued because they were blocked during the time of Arroyo.

Fraport went to the Washington-based ICSID for expropriation as it alleged that the Philippine government violated the bilateral investment treaty by not paying it justly.

But ICSID ruled in favor of the Philippine government noting the material changes made in the contracts for NAIA 3 after they were signed. ICSID also took Fraport to task for violation of the anti-dummy law.

PIATCO went to ICC in Singapore and sought to have its original contracts honored and be paid according to its own computation of the project cost.

The sources said the cases involving violation of the anti-dummy law, money laundering and others filed before the Sandiganbayan did not prosper during the Arroyo administration.

They said the NAIA-3 case was one example of how the costs of government projects could be bloated to accommodate fat commissions for the proponents and the officials who would approve it.

Malacañang gave assurance no “wheeling and dealing” would be allowed to take place in the resolution of the NAIA-3 case.