SC allows PCSO to auction Luzon online lottery system

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THE SUPREME COURT (SC) has allowed the Philippine Charity Sweepstakes Office (PCSO) to proceed with the auction of the Luzon component of the Nationwide On-line Lottery System.

In a 20-page decision dated Aug. 15 and written by Associate Justice Marvic M.V.F. Leonen, the court said proceeding with the bid will not inflict injury on Philippine Gaming and Management Corp, which claims exclusive supplier rights.

“It cannot claim that it has alleged exclusive rights to be protected and that it will suffer irreparable injury if petitioner continued with the Nationwide On-line Lottery System bidding process. This is precisely because the bidding was for the next supplier of the Nationwide On-line Lottery System for a period of five (5) years after August 21, 2018 or commencing on August 22, 2018,” the decision read.

PCSO and Philippine Gaming and Management Corp. entered an Equipment Lease Agreement in 1995 under which PCSO will lease lottery equipment and accessories for its online lottery in Luzon. The agreement commenced in 1999 and ended in 2007.

In 2004, both parties amended the lease agreement and decided to extend the term for another eight years commencing on Aug. 23, 2007 and ending in 2015. On Aug. 13, 2015, they both executed a Supplemental and Status Quo Agreement extending the term for another three years ending on Aug. 21, 2018.

However while the lease agreement was still in effect in 2012, the gaming corporation filed a petition before the Makati City Regional Trial Court seeking a temporary restraining order and/or writ of preliminary injunction against PCSO as it violated its exclusive rights, which was granted by then-acting Presiding Judge Rommel Baybay.

The gaming corporation also brought the issue to International Chamber of Commerce in 2014 for arbitration.

On July 11, 2017 it also sought a temporary restraining order and/or writ of preliminary injunction seeking the cessation of the bidding. This was granted by Presiding Judge Maximo M. de Leon

The SC said the RTC committed grave abuse of discretion for granting Philippine Gaming and Management Corp.’s application for injunctive relief.

“A Writ of Preliminary Injunction is issued ‘to prevent threatened or continuous irremediable injury to some of the parties before their claims can be thoroughly studied and adjudicated,’” the court said.

“Regional Trial Court’s confirmation of the arbitral tribunal’s Final Award, the Writ of Preliminary Injunction is deemed lifted and petitioner may now proceed with the bidding process of the Nationwide Online Lottery System for Luzon,” it added affirming an RTC resolution which upheld an arbitration court decision in favor of PCSO. — Vann Marlo M. Villegas