BURI questions review of MRT contract in Singapore

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BURI says glitch due to ‘design flaws’ in MRT-3
An MRT car approaches Guadalupe Station. -- BW FILE PHOTO

By Janina S. Lim

MRT-3 maintenance provider Busan Universal Railways, Inc. (BURI) said the government is suggesting to seek arbitration in a court in Singapore to review its contract which it recently terminated, a proposed tack the firm slammed as delaying negotiations toward a resolve.

Maricris B. Pahate, legal counsel of BURI, said the firm received the notice two days ago from the Office of the Solicitor-General (OSG) with the Department of Transportation (DoTr) citing “expertise” and “neutrality” as the main reasons why they opted for a court abroad.

“Hindi pa ba experts sa Philippine law ang arbitration natin? (Aren’t we experts enough on arbitration?) Our contract is governed by Philippine law. Why would you want Singapore to study Philippine law and Philippine contract law. Magaling naman arbitrators natin dito (Our arbitrators here are good),” Ms. Pahate told BusinessWorld on Wednesday in Quezon City.

She said the contract with the DoTr allows parties to seek arbitration from any court but has proposed that the case be elevated to the local arbitration office, the Philippine Dispute Resolution Center.

“Meron na tayong sariling rules of procedure. So di na tayo mahihirapan. Di madedelay yung process,” she added. (We already have our own rules of procedure. So we won’t have a hard time. The process will now be delayed.)

Ms. Pahate said BURI will reply to reject the government’s invitation, adding that having the proceedings in Singapore will be “mahal, malayo and illogical” (expensive, too far, and illogical).

“Either talagang pinapahirapan lang nila o dinedelay (Either they’re making it difficult or they’re delaying),” BURI Legal Counsel Perfecto A. Mercado said in an interview yesterday.

Sought for comment, DoTr Legal and Procurement Service Assistant Secretary Giovanni Z. Lopez said raising the concerns to the Singapore International Arbitration Centre (SIAC) will be “in the advantage of the parties…in view of the greater neutrality as the arbitration will be geographically removed from the Philippines and Korea, where the parties have substantial interests.”

“The technical expertise afforded by this option was also given weight by DoTr and OSG,” Mr. Lopez said in a mobile message yesterday.

Earlier this month, the DoTr terminated the maintenance contract held by BURI for MRT-3.

The Korean service provider has filed a motion for reconsideration and a protection order at a Quezon City Regional Trial Court ruling but said it has yet to receive a reply.

“We hope that we will be given relief immediately,” Ms. Pahate added.

BURI expressed hope that Transportation Secretary Arthur P. Tugade will take more time to mull over the consequences of terminating the contract with a backup transition team that may not be fit to temporarily takeover maintenance of the railway pending interested bidders to replace BURI.

“Tingin kasi namin wala sila din experience ng mga Koreans na na-train samin eh. Tanong niyo sila kung ano experience ng mga nagmemaintain,” Ms. Pahate said. (We think they don’t have the experience of the Koreans who trained us. Ask them what their experience is in maintenance.)

DoTr and BURI entered into a negotiated contract in January 2016, after a failed bid in the absence of interested parties.

Under the contract, BURI was to overhaul 43 light rail vehicles and replace the signaling system.