SC nullifies P268-M Comelec-Smartmatic deal

By Ina Reformina, ABS-CBN News

Posted at Apr 21 2015 01:45 PM | Updated as of Apr 22 2015 08:18 AM

Petitions vs extended warranty contract granted

TRO issued last March 24 made permanent

MANILA (1st UPDATE) - The P268-million contract between the Commission on Elections (Comelec) and election service provider Smartmatic-TIM has been nullified by the Supreme Court (SC).

Via unanimous vote, the 15 high court magistrates granted the petitions of the Integrated Bar of the Philippines (IBP) and Automated Election Systems (AES) Watch, and struck down the extended warranty deal.

The deal, inked last January 30, 2015 through direct contracting or single source procurement, is for the repair, refurbishment and maintenance of 82,000 Precinct Count Optical Count (PCOS) machines to be used in the 2016 national and local elections.

"The court ruled that the Comelec failed to justify its resort to direct contracting with Smartmatic-TIM; it had not shown that any of the conditions under Section 50 (direct contracting), Article XVI of the [Government Procurement Reform Act] existed; further, its claims of impracticality were not supported by independently verifiable data and its perceived 'warranty extension' is, in reality, a circumvention of the procurement law.

"It is clear that the Comelec committed grave abuse of discretion," the decision, penned by Associate Justice Estela Perlas-Bernabe, read.

The high court also ordered any payments made by Comelec to Smartmatic-TIM returned to the government "being public funds."

Petitioners assailed the deal for violating provisions of Republic Act (RA) No. 9184, also known as the "Government Procurement Reform Act," stressing that competitive bidding in government procurement is "a matter of public policy."

They also argued that the "tight time schedule" invoked by the poll body to justify the deal does not hold water since it is "not a ground to dispense with the conduct of the public bidding under the law."

The decision made permanent the temporary restraining order (TRO) issued by the high court last March 24 to stay the implementation of the contract.

The high court said the decision is immediately executory considering that time is of the essence in this case.