LTO seeks OSG help vs Dermalog

The Land Transportation Office has asked the Office of the Solicitor General for help in rescinding its P3.14-billion information technology contract with German firm Dermalog over alleged contract violations. 

LTO chief, Assistant Secretary Vigor Mendoza II, said they are coordinating with the Department of Information and Communications Technology to ensure the continuity of their services to the public, including the licensing of drivers and the registration of motor vehicles. 

Mendoza said the LTO will work with the DICT to ensure that all of the agency’s IT-related undertakings proceed smoothly even as it goes through the legal process of booting out Dermalog, which implements the Land Transportation Management System project.

During the continuation of the House Committee on Transportation hearing on the LTMS last 7 March, Antipolo 2nd District Rep. Romeo Acop said Dermalog committed at least two violations of the Government Procurement Manual.

Acop, the panel chair, said those violations caused Dermalog to fail to meet its deliverables on time despite having been granted 13 deadline extensions, which resulted in P1.119 billion in damages to the government. 

The violations merit “the filing of a termination or rescission of the contract,” Acop said, a position shared by the Department of Transportation.

Marcoleta cited the need to give the LTO complete control over the LTMS even as Dermalog has repeatedly refused to turn over the source code to the agency until its contract ends next year.

Dermalog faces complaints on several fronts, including the alleged poor performance of its system, resulting in long online queues and frequent outages. 

Additionally, a local contractor, Verzontal, has alleged they weren’t paid in full for their work on the project and were unfairly terminated.