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SC okays DFA junking of machine-readable passport contract

September 17, 2010 12:05am

The Supreme Court has upheld the government's decision to terminate its contract with a private firm for the production of machine-readable passports and visa (MRPV), putting to rest earlier questions on whether the cancellation was legal.

In a release posted on its website, the Department of Foreign Affairs (DFA) welcomed the court's decision affirming the termination of its contract with the BCA International Corp., a Philippine-Thai firm, for the manufacture of the MRPVs.

The SC decision, released on Tuesday, likewise allowed the DFA to continue with its implementation of the electronic passport (ePassport) project with the Bangko Sentral ng Pilipinas (BSP).

"We hope that the Supreme Court decision will clear all doubts on the legality and transparency of the cancellation of the MRP project. The DFA and the BSP can now continue on providing a world-class, secure and tamper-proof electronic passport to the travelling Filipino without any legal obstacles," Foreign Affairs Secretary Alberto G. Romulo said in the release.

The decision, penned by Justice Teresita Leonardo-De Castro, junked the preliminary injunction issued by the Pasig city Regional Trial Court (RTC) in February 2007, which prohibited the government from proceeding with its current ePassport project.

The High Court also ordered the dismissal of BCA International's case against the DFA and the BSP.

Ending a failed BOT

In 2000, the BCA won the public bidding for the MRPV through a Build-Operate-Transfer Scheme (BOT). Five years after, however, the firm was still unable to implement the project, the DFA said.

After consultations with other national agencies, the DFA decided to “cancel the contract due to the BCA's financial incapacity to carry out the project."

The DFA then entered into the ePassport contract with the BSP, its long-time supplier of passports.

The BCA, however, sought arbitration with a third party, the Philippine Dispute Resolution Center, Inc. (PDRCI).

The Philippine-Thai firm also secured a preliminary injunction order from the Pasig City RTC asking the government to desist from proceeding with the ePassport project, pending resolution of the dispute by the PDRCI.

The SC decision, however, stated that under the Build-Operate-Transfer (BOT) Law, the government "can terminate a BOT agreement, even without fault on the part of the project proponent".

Unresolved issues with ePassport?

The decision also said that the Pasic RTC has no authority to stop the bidding and implementation of the ePassport project, adding that only the High Court has the authority to issue restraining orders and preliminary injunctions against "the government to restrain or prohibit the termination or rescission of any such government project or contract."

It also said that the injunction issued by the RTC was "prejudicial to public interest since government would be indefinitely hampered in its duty to provide vital goods and services."

A paid advertisement published in a newspaper in June alleged that the ePassport production was a “graft-ridden project."

Migrants’ rights group Migrante International likewise said earlier that the ePassport project still has unresolved issues, such as the alleged overpricing of the laminates for the passport by P50.

The group likewise said the ePassport project’s contractor, the French firm Oberthur Technologies, was the same company which produced 80 million of the erroneous P100 “Arrovo" bills, and was also involved in a $34-million passport scandal in Kenya.

The contract with the Kenyan government was later scrapped following questions over the expensive production of passports and failure to conduct bidding in the awarding of the contract.—JV, GMANews.TV
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