The long-delayed digitalization project of the Land Transportation Office, or LTO, faces new roadblocks that are expected to further complicate the timeline for its full implementation.

The project, which started in 2018, has been delayed by more than two years, mostly because of the failures of German contractor Dermalog.

LTO has identified 14 components of the Land Transportation Management System, or LTMS, as being deficient despite the full payment of its P8-billion cost.

The project consists of two components, the first costing around P3.2 billion and the second more than P5 billion. The Department of Information and Communications Technology or DICT has identified the defects that LTO chief Atty. Vigor Mendoza II said are being addressed by a technical working group he formed.

In 2018, the LTO awarded the project to a joint venture led by German technology firm Dermalog.

Since the contract's start, however, Demalog has failed to deliver many of the project's key components. LTO officials termed Dermalog's handling of the vital processes of the automated system a threat to national security.

Lately, members of the consortium led by Dermalog have been embroiled in infighting.

Filipino construction firm Verzontal Builders Inc. said it is "seeking justice" as it mulls filing civil and criminal complaints against Dermalog due to a payment dispute.

Verzontal counsel Ricardo Gao Pronove III said the company is pursuing legal options to ensure Dermalog is "exposed for its corrupt practices," despite the latest Court of Appeals decision that dismissed a petition due to technicalities.

Pronove said Dermalog cut Verzontal from their joint venture agreement abruptly. The lawyer said that without Verzontal, the LTMS contract would be deemed invalid since the net financial contracting capacity requirement for a government project for bidding can't be achieved without it.

"We don't want to partner with them anymore because they are conducting [it] illegally. They are violating the contract," Pronove said.