DOTr sends notice to terminate contract of MRT-3 maintenance provider BURI

The Department of Transportation (DOTr) has served Metro Rail Transit 3 (MRT-3) maintenance provider Busan Universal Rail, Inc. (BURI) with a Notice to Terminate its MRT-3 contract.

DOTr cited four reasons for the termination – poor performance, failure to put in service the required number of reliable efficient trains, failure to implement a procurement plan for spare parts to repair defective trains, and failure to comply with the contractual requirements of the Computerized Maintenance Management System.

Upon receipt of the notice, BURI has seven days to respond and submit a verified position paper stating why its contract should not be terminated,

if it so decides.

The DOTr, upon receipt of BURI's response, will decide whether or not it will issue an order to terminate the contract.

BURI, in a press statement issued on Friday, maintained it is “positive in being vindicated from the process of DOTr’s contract termination” which it claims is “without factual and legal basis.”

BURI denied DOTr’s allegation of poor performance, saying it has fixed 26 cars to raise the number of running trains from 13 in January, 2016, when it started servicing the system, to about 22 running trains today. This meets train availability requirements, a key performance indicator in its contract, it said.

The company said it is not liable for incidents of train removal, service interruptions, unloading, and derailment in the MRT-3.

“MRT-3’s system design issues should be blamed for these problems, not poor maintenance,” BURI argued.

The decrepit condition of the rails long due for replacement and excessive loading above the rated usage of the modified coaches aggravate the problem which had been there long before BURI assumed its contract.

Even during its first year of operation in 2000, when its coaches and rails were new and passenger usage was well below present figures, MRT-3 suffered 1,492 glitches, averaging 4 glitches per day.

The service contract itself recognized these glitches, exempting BURI from penalty for service interruptions caused by the rail condition and signaling-related concerns until the government replaces these components.

BURI said it should not be made to answer for a big number of MRT-3 stoppages as well as passenger-caused interruptions and those attributed to driver error.

BURI’s responsibility, according to the contract, is to fix or correct glitches when they arise – and not to make them disappear entirely.

“Documentary evidence available from MRT3’s own records showed BURI has significantly reduced the total number of glitches from figures prior to its assumption of service,” the company said.

BURI claims that the DOTr shortchanged it by withholding almost 1350 million in payment, portions of which date back to a year ago.