Abaya sees completion of MRT 3 buy-out this year

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TRANSPORTATION Secretary Joseph Emilio Abaya is optimistic that the government will get the entire ownership of the Metro Rail Transit 3 (MRT 3) by the end of this year or early next year.

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In an interview after a Senate finance committee hearing on the proposed budget of the Department of Transportation and Communications on Tuesday, Abaya told reporters that the buy-out of Metro Rail Transit Corp. (MRTC) will pave the way for implementation of programs to improve the railway, which recently suffered glitches.

The MRTC entered into a build-lease-transfer contract with the DOTC to build the MRT 3 project in 1997 with a put-up equity of $190 million. The government has since been paying for the project.

Over the years, the MRTC has retained control of the operations and development of the MRT 3, and has been collecting and receiving income from development rights payment (DPR) from commercial rights and development of the 16-hectare depot site, including all concessions to develop air and ground spaces.

In 2010, state banks like the DBP (Development Bank of the Philippines) and the Land Bank acquired a controlling interest in MRT 3 by accumulating equity in the debt paper of the MRTC to realize savings for the government.

Abaya said Executive Order 167 required the DOTC and the Department of Finance (DOF) to implement the Equity Value Buy Out (EVBO) to put an end to the ongoing arbitration case in Singapore between the DOTC and the MRTC.

The DOTC is seeking P53 billion for the EVBO but Congress is yet to approve it.

Senator Francis Escudero, chairman of the Senate finance committee, has been pushing for the settlement of ownership of the train line since 2010 in order to determine the status of the operational control of MRT 3 and allow development plans to move forward.

“The government must already by now have the rightful control of the MRT 3 operations. Unless we resolve this issue, we prolong the agony of the public waiting for an effective and efficient mass transport system,” Escudero said.

Abaya said they are hoping to get the opinion of the Office of the Solicitor General (OSG) on the matter and get a compromise agreement signed by the MRTC before the end of September.

“From there we forward that to the arbitration court, get its blessings and eventually have it executed under Philippine jurisdiction,” he explained.

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