End to ‘yoyo’ bidding sought

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Information and Communications Acting Secretary Eliseo Rio Jr. must have heaved a mighty sigh of relief when the Duterte government formalized the installation of the third major telco player in the Philippines.

“The ball is in their court now,” Rio told media men as he confirmed that the Mislatel consortium, a joint venture comprising the Beijing-owned China Telecoms, Mindanao Islamic Telephone Co. and Chelsea Logistics of Davao businessman Dennis Uy, had clinched the golden opportunity to challenge the Globe-PLDT duopoly, which has gobbled up untold trillions in revenues during some three decades of lording it over the market.

But that wasn’t the case last week. As a matter of fact, pique, annoyance and frustration were features clearly etched on the face of Rio as he sat down for an early morning television interview the other week to discuss the contested results of the recently-concluded bidding for the right to operate as the third telco.

In bagging the contract, Mislatel committed to modernize the Philippine internet like never before, providing speeds of up to 27 megabits per second (mbps) in the first year and 55 mbps in five years, a P257-billion investment over five years with P150 billion in its first year of operations and national coverage of 84 percent after five years.

But, should Mislatel fail to fulfill the post-qualification requirements, most pressing of which is the payment of performance security amounting to P27.5 billion within 15 days, Rio said the deal would be voided and another bidding procedure for the third telco license would be conducted.

Mislatel was the “last man standing” after two other serious bidders, Chavit Singson’s Sear consortium and PT&T, were disqualified for not fulfilling some of the vital requirements. In the case of Sear, it was its failure to cough up the participation security of P700 million; on the other hand, PT&T couldn’t show the certificate of technical capability from the National Telecommunications Commission (NTC). Of the three parties that filed bids, only Mislatel’s documents were deemed complete and compliant by the Department of Information and Communications Technology (DICT)-NTC.

During the interview, Rio, a retired military man, seemed perturbed over the fact that PT&T, which bitched that the bidding process was rigged and unfair, had filed a complaint before the Supreme Court, saying the NTC had acted with grave abuse of discretion in choosing the provisional third telco player. Chavit’s group, meantime, claimed there was a breach of contract by Mislatel over the illegal use of the congressional franchise owned by Sear.

Through it all, however, Rio stood by the decision to choose Mislatel over the rest as it was the only one that submitted the requirements needed to qualify during deadline time of the bidding process. “They were disqualified because of their own actions,” he was quoted in reports as saying.

It also brought to fruition President Duterte’s earlier pronouncements offering to China the privilege of operating the third telco franchise in order to bring the Philippines up to par with other nations in terms of internet maturity.

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Taking note of the World Bank’s annual report tracking various economies’ competitiveness in ease of doing business, wherein the Philippines slipped to 124th from 113th place, Senate President Tito Sotto is mulling legislation to protect the “winning bidder.”

He said the next time such an important procedure is held, such as the one for the third telco player, Sotto said participants should be made to sign a waiver so they don’t protest or complain about the decision should they end up as losers.

“Our institutions are embarrassing, especially when viewed by outsiders. They were pushing and pulling; they were bidding like a yo-yo. In the end, it looks like we have no word of honor and this is not acceptable to foreign investors,” an executive assistant, who asked not to be identified since he didn’t have authority to speak, quoted Sotto as saying.

Shooting the breeze with some reporter-friends, the senator said he was basing his suggestion on personal observations that post-bidding protests are de rigueur in most bidding procedures in the country, which cause the government to lose a lot of money. He said these protests of losing bidders in effect delay the procurement of goods and services, to the detriment of the public.

“If this were so, let us stop this foolishness and no longer conduct biddings, because they will only raise it in court and that’s where they will come up with a settlement,” he said.

He added that this is probably the reason why so many foreign firms, who had originally expressed desire in joining the DICT-NTC bidding, had inexplicably backed out, companies like Mobitel (Sri Lanka), Telenor (Norway) and Korea Telecom, fearful they be made to go through the proverbial wringer.

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