Abaya denies rigging in MRT maintenance deal

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Secretary Joseph Abaya of the Department of Transportation and Communications (DOTC) has refused to resign amid the controversy surrounding the contract granted to PH Trams for the maintenance of the Metro Rail Transit 3 (MRT 3).

Abaya was at the House of Representatives on Thursday to defend the DOTC’s proposed budget for 2015, but the discussions veered toward the controversy hounding the department’s bidding process.

He said that right after he became DOTC chief on October 18, 2012, an emergency bidding was scheduled because the contract of Sumitomo–the company in charge of  MRT 3 maintenance then–was to expire two days later.

Sumitomo, PH Trams and a third company bid for the contract, with PH Trams eventually clinching the deal after offering P517 million. PH Trams is in a joint venture with CB & T Builders.


PH Trams raised an uproar because one of its incorporators, Wilson de Vera, has been accused as the broker in the alleged attempt of MRT General Manager Al Vitangcol to extort $30 million from Czech Ambassador Joseph Rychtar and Czech train carmaker Inekon.

“At that point, we saw that we can justify an emergency situation. Under the government procurement law, there should be preservation of infrastructure of the government. It would be a bigger disaster if I took my time and go on regular bidding. I had to make a decision because otherwise, I will stop the trains,” Abaya told reporters.

“We could have easily negotiated with one company, but the BAC  (Bids and Awards Committee) decided to continue the simplified bidding. And so we had three bidders, with common terms of reference. There is a form of competition and at the end of the day, the cheaper cost was offered by PH Trams,” he said.

Abaya argued that the start-up venture PH Trams cannot be disqualified from bidding because under the procurement law, the financial capacity of the whole joint venture along with its track record, in this case the COM builders, weighed heavily in the bidding process.

“We will be violating the law if we disqualified the entity outside of the law. The government procurement law even encourages SMEs [small and medium enterprises]to go into joint venture for them to grow,” he said.

Abaya expressed confidence that the Office of the Ombudsman would clear him and the rest of DOTC of any liability, and that there would be no need for them to go on leave while the investigation proceeded.

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