Alvarez bill to eliminate automatic franchises
SPEAKER Pantaleon D. Alvarez has filed a bill requiring private proponents seeking to build, operate and maintain public utilities to secure a legislative franchise first from Congress to become a qualified bidder.
Mr. Alvarez filed House Bill No. 5270, which seeks to amend Republic Act (RA) No. 6957, as amended by RA 7718, known as “An Act Authorizing the Financing, Construction, Operation and Maintenance of Infrastructure Projects by the Private Sector.”
The speaker noted that under Section 5 of RA 6957 automatically grants the winning bidder a franchise to “operate and maintain the facility, including the collection of tolls, fees, rentals and charges.”
“This arrangement, however, has been suspected of serving private interests instead of that of the general public,” Mr. Alvarez said.
For an additional “safeguard,” Mr. Alvarez’ bill proposes to remove the automatic grant of franchise and requiring the project proponents to first obtain a legislative franchise for public utilities from Congress to become a qualified bidder and in order to operate and maintain such facilities.
Under the bill, the contract for build- operate- and- transfer arrangements will be awarded to the proponent who satisfied the minimum requirements and has submitted the “most advantageous” bid to the government and provided the “most favorable terms for the project.”
It added that a Filipino contractor will be given “preference” over a foreign contractor if both of them submit “an equally advantageous bid, with exactly the same price and technical specifications.”
The measure also mandates all existing operators to secure such a franchise for public utilities from Congress “within one year from the time the proposed law takes effect. Otherwise, the franchises they presently hold shall expire and cease to have any legal effect.”
The legislative franchises for public utilities are likewise subject to amendment, alteration or repeal by Congress, “when the common good requires it.”
The measure limits to the legislative franchises for 25 years only, subject to a renewal. —