Osmena sues DOTC, bidder over Cebu airport project

by Willard Cheng, ABS-CBN News

Posted at Apr 05 2014 12:28 AM | Updated as of Apr 05 2014 08:28 AM

MANILA - Senator Serge Osmena made good on his threat to sue Department of Transportation and Communications (DOTC) Secretary Jun Abaya and the consortium of Megawide Construction Corporation and GMR Infrastrcture of India that is bidding for the P17.5 billion Mactan-Cebu International Airport project.

In a petition for certiorari and prohibition filed on April 3, a copy of which was obtained by ABS-CBN, Osmeña asked the Supreme Court to issue a temporary restraining order and/ or writ of preliminary injunction to stop Abaya, the Mactan-Cebu International Airport Authority (MCIAA) and the Pre-qualification Bids and Awards Committee (PBAC) for the MCIA project from acting on the bid of GMR-Megawide Consortium.

Osmeña asked the SC to stop the public respondents from awarding the project to GMR-Megawide Consortium saying that the consortium should be declared as unqualified bidder for the MCIA project.

In his petition, Osmeña said the GMR-Megawide Consortium violated the conflict of interest rule of the DOTC and MCIAA's Instruction to Bidders (ITB) that required each bidder to submit only one proposal.

He pointed out that a director of two subsidiaries part of the GMR-Megawide Consortium "is also the Managing Director of Malaysia Airport Holding Berhad, which also joined the bidding for the MCIA project as part of the First Philippine Airports Consortium."

Osmeña cited Section 5.6(c) of the ITB that disallows a bidder that has an officer or employee "directly involved in any capacity" with another bidder for the project within a period of two years before the publication of the invitation to pre-qualify and bid and one year after the award of the project.

Osmeña also said that GMR has "poor financial health and track record in its international airport operations."

He said that the company had operating losses in the past three years and that "it did not operate an international airport satisfactorily in its recent history."

He cited controversies involving the operation of the Indira Gandhi International Airport by a consortium that included the GMR Group and Fraport AG Frankfurt Services Worldwide, "the same Fraport AG involved in the PIATCO fiasco."

Osmeña said that the PBAC did not exercise due diligence in evaluating the bid of the consortium.

"The Filipino people, especially the Cebuanos, do not deserve another PIATCO. Perhaps, more importantly, they do not need to have to be serviced by an operator with derogatory track record and a recent history of financial operating losses," Osmeña said in his petition.

In an earlier statement, Megawide defended its consortium partner, GMR Infrastructure of India, saying it "has excellent financial standing as borne out by its investment grade credit rating from international credit ratings agencies." It added, "GMR continues to make operational profits and to meet all its financial obligations."

It also said that "the allegation of conflict of interest is completely baseless and without any substance whatsoever."