Firm questions Smartmatic contract before SC

By RG Cruz, ABS-CBN News

Posted at Jan 17 2013 03:08 PM | Updated as of Jan 17 2013 11:15 PM

MANILA, Philippines - Disqualified bidder LLDA Marketing is questioning before the Supreme Court the Commission on Election’s (Comelec) award of a contract to Smartmatic for the compact flash (CF) cards that will power the precinct count optical scan (PCOS) machines in the upcoming midterm elections.

In its petition, the firm said: "The instant case is a brazen award of a government contract without passing through a fair and open public bidding, as required by law. With the haste of Respondent Comelec to award the procurement contract…[it] has sadly failed its duty to the Republic to credibly and legally conduct elections through the due enforcement of all laws and regulations regarding the conduct of elections, plebiscite, initiative, and referendum.”

The petition also sought for a halt order on the transaction.

LLDA Marketing said Comelec should be twitted for "running roughshod over the Rule of Law, as it runs counter to the law on public procurement and renders the same an empty formality."

It added that Comelec Resolution No. 9600 dated December 27, 2012, which awarded the contract to Smartmatic, "carries so many badges of fraud that this Honorable Court cannot and must not let it stand."

Smartmatic’s supplier

LLDA said it was disqualified from the first bidding supposedly because its past completed projects were not "notarized". "The said declaration of Comelec came as a surprise, considering that Petitioner previously supplied Respondent Smartmatic with 20,000 Compact Flash ("CF") cards for the May 2010 elections."

LLDA alleged its bid was never opened.

"Had it been otherwise, Petitioner's bid would have been the lowest responsive bid for all items, except for thermal paper. Too, Petitioner would have been the sole bidder for the CF Cards. Moreover, the acceptance of Petitioner's bid would have saved the government over One Hundred Million Pesos.”

LLDA's subsequent MR was denied.

A second bidding was called where LLDA participated again with another bidder. Unison's financial bid for 82,200 CF cards was P44 million, while LLDA’s was P36.5 million.

LLDA was declared to have the Lowest Calculated Bid but still had to be evaluated for post qualification. Its CF cards failed, however.

"Petitioner's CF Cards Worm could not work with Respondent Smartmatic's PCOS machine, only because Respondent Smartmatic refused and up to this time continues to refuse to declare the technical requirements of the CF Worm card of the PCOS, claiming it to be proprietary information to the extreme prejudice of Petitioner and the government."

Specifications were for Smartmatic?

LLDA believes that Comelec conducted a public bidding with specifications that could only be met by Smartmatic.It added Comelec appeared to have laid the ground to ostensibly justify its resort to alternative modes of procurement for the purchase of CF cards, effectively discarding its bid.

Based on rules, Comelec can enter into a negotiated contract after two failed bids.

"On the date of the opening of the bids, petitioner had the lowest bid for the CF Cards-Main, at Thirty Three Million Five Hundred Thousand Pesos (P33,500,000.00). Respondent Smartmatic submitted a bid for Fifty Million Nine Hundred Thousand (P50,900,000.00), or about Four Million Three Hundred Thousand Pesos (P4,300,000.00) above the ABC,” LLDA said.

It also found flimsy Comelec’s decision to reject its CF cards. “Respondent Comelec, acting through the Commission en banc, deemed it proper to disqualify the CF cards that Petitioner provided, on the rather flimsy ground that the Technical Working Group found it difficult to eject Petitioner's CF cards."

SBAC Chair Helen Aguila-Flores maintained that the process was above board. She also said there was nothing wrong with the award to Smartmatic.

Flores recognized LLDA's prerogative to file a legal remedy, but she said they followed all the rules.

She recalled that LLDA failed the technical requirements, leading to their disqualification. She said LLDA’s CF cards were indeed hard to eject, which could lead to problems on election day.

She denied that the bidding processes were rigged to ensure that Smartmatic would still get a majority of the automated election system contracts.

Flores pointed out that eight contracts were bidded out.

Smartmatic got the contract for transmission modems as the sole bidder, while it got the contracts for transmission services and the cf cards through negotiated contracts after failed biddings.

Flores also admitted that despite the problem Smartmatic encountered with its CF cards in 2010, it still got the contract because the sbac focused only on the samples submitted to testing during the procurement process.

"Yung sample na sinubmit ng smartmatic ngayon wasn't the one in 2010. What we considered is sample submitted. We cannot blur minds on incidents of the past."

Two weeks before the May 2010 elections, Smartmatic ordered the pullout and reconfiguration of the CF cards because of a glitch it detected. The glitch was fixed and the cards redeployed in time for the polls.

The Comelec will be starting the configuration for the CF cards soon.

Flores spoke at the opening of bids for ballot packaging for the elections. The SBAC hopes that a contract would be ready in time for the printing of the ballots beginning February 4, 2013.

Flores said the Comelec wants the printed ballots immediately packed.