Maynilad Water Services, a utility firm controlled by the Manny Pangilinan-led Metro Pacific Investments Corp. (MPIC), has taken the Philippine government to another arbitration panel in Singapore over its failure to grant the company’s P3.44-billion in financial claims arising from delays in implementing a water rate hike.
In a disclosure to the Philippine Stock Exchange (PSE) on Monday, Maynilad said it served the Philippine government a notice of arbitration and statement of claim on March 27. The notice was coursed through the Department of Finance (DOF).
In bringing the issues to arbitration, Maynilad asked the government to compensate the company for losses amounting to P3.44 billion.
“Maynilad served the Republic the Notice of Arbitration and Statement of Claim following the latter’s failure/refusal to pay the amount indicated in the Demand Letters. Pursuant to the Undertaking, the arbitration proceedings shall be conducted in Singapore before a three-man panel,” Maynilad said.
Because of the refusal of the Metropolitan Waterworks and Sewerage System (MWSS) to implement rate adjustments as earlier ordered by an arbitration panel, Maynilad claims it lost P3.4 billion from January 1, 2013 to February 28, 2015.
The company said that under the sovereign undertaking, the government undertook to compensate Maynilad if its rate adjustments are delayed by the MWSS.
The West Zone concessionaire had earlier won an arbitration case against the government for an average P3.06 per cubic meter rate increase.
In an earlier arbitration proceeding, the International Chamber of Commerce (ICC) awarded Maynilad its proposed three-year implementation of an adjustment in basic charges.
But this was not honored and implemented by the MWSS, which argued that Maynilad’s claims have no legal basis.
MWSS earlier decided not to take further action on proposed water rate adjustments in Metro Manila until the arbitration process for both metro water concessionaires—Maynilad and Ayala-led Manila Water Co. Inc. —have been completed.
The MWSS said it would be more prudent to wait for the conclusion of the arbitration with Manila Water before making any pronouncements about tariff adjustments.