THE Philippine Competition Commission (PCC) approved on Thursday two new joint ventures in property development and energy investment.
In a two-page decision dated February 20 but released only on Thursday, the anti-trust body confirmed Ayala Land, Inc. and Royal Asia Land, Inc.’s joint venture project to develop a 936-hectare township development in Cavite which will feature commercial and residential segments.
Both firms will subscribe to a 50-50 share in a yet-to-be-incorporated company that will hold the establishment and operations of the mixed-use project.
Royal Asia Land will receive a consultation fee of 2 percent of the joint venture firm’s gross revenue for its participation in the planning and development of the property, while Ayala Land—which will serve as the property’s project and development and sales and marketing manager—will receive a development management fee of 12 percent and sales and marketing fee of 5 percent of the company’s gross revenues.
“The transaction does not result in the substantial lessening of competition because it will not have a structural effect on the market,” the PCC decision read.
Meanwhile, the anti-trust body also gave its go-signal to Markham Resources Corp. and Alternergy Philippine Holdings Corp. for their planned joint venture investment in Kiangan Mini Hydro Corp., Ibulao Mini Hydro Corp., and Lamut-Asipulo Mini Hydro Corp.
The two firms shall establish a joint venture company called Markham-Alterenergy JV companies which will operate, develop, and maintain run-of-river mini hydro projects along the stretch of the Asin, Ibulao, Hungduan, Lamut, and Panubtuban Rivers in Ifugao Province.
PCC said there were enough competitive constraints by other players in the relevant market. The antitrust commission also cited that its review found no increased ability or incentive for the new JV to engage in foreclosure in the relevant market after the transaction.
“The transaction also does not appear to create or strengthen the ability or incentive of the merged firm to engage in withholding capacity,” the PCC decision read.
PCC is mandated to review mergers and acquisitions valued P1 billion and above to ensure that business transactions will not result in the lessening of competition.