SMC appeals disqualification from P1.7B LRT smart card project bidding

A San Miguel-led consortium has petitioned the government to reconsider its disqualification from the P1.72-billion public-private partnership (PPP) project that seeks to introduce contactless-based smart card technology into the metropolis’ light railway transit (LRT) system.

The San Miguel Transport Solutions consortium (SMTSC) was disqualified from the bidding due to the “absence of any discussion on some material points as well as inadequacy of the discussions on others that were clearly prescribed for QD-13,” but the consortium said it believed this had no basis.

“The document in question (QD-13) is a project management plan. For a plan to be comprehensive and capable of efficient implementation, the client must provide sufficient information necessary to complete the plan,” consortium representative Raoul Eduardo Romulo said in a May 10 letter addressed to Transportation Undersecretary for legal affairs Jose Perpetuo Lotilla.

The Department of Transportation and Communications is the implementing agency for the Automatic Fare Collection System (AFCS) project under the PPP framework. The project aims to facilitate efficient passenger transfer to different LRT lines, reduce inconvenience due to ticket payment delays and increase the fare collection efficiency by reducing leakage and fraud.

The two-page letter was accompanied by a 10-page clarification letter arguing that the grounds for SMTSC’s disqualification were without basis.

While the prequalification, bidding and awards committee (PBAC) had declared that the project management plan inadequately discussed items prescribed by the rules, the consortium submitted a matrix pointing out the exact location in its submitted documents of the missing item of discussion.

In the letter, Romulo said the basic principle in the procurement law that was adopted during the pre-qualification stage was that the prospective bidder was simply required to provide minimum information to establish technical, financial and legal qualification to undertake the project. He also noted a PBAC bid bulletin, which stated that a more detailed project implementation plan would also be a part of the bid proposals that the prequalified bidders would submit later on while the basic qualification data were track record and existing corporate information.

Romulo said the required “discussion and analysis was clearly provided” based on the submitted documents, refuting the alleged inadequacy cited for the disqualification.

San Miguel Corp. president Ramon S. Ang had said that while a stringent prequalification process was needed to weed out “nuisance” bidders, he said SMC was definitely not a nuisance bidder and was instead capable of giving the government the best value for its PPP pipeline.

Given that SMTSC met all the legal, technical and financial qualifications for the bidding and has submitted a “fully responsive project” management plan, the clarification letter implored PBAC to carefully consider its explanation and declare the consortium “qualified.”

Five other bidders were prequalified for the project: AF consortium led by the Ayala and Metro Pacific groups; Comworks Inc. of Berjaya-led Philippine Gaming Management Corp. and Taiwan-based Kaoshung Rapid Transit Corp.; E-Trans Solutions Joint Venture Inc. of Tera Investments and EastWest Banking Corp.; Megawide-Suyen-Eurolink consortium of Megawide Construction Corp., Suyen Corp. and Eurolink International Corp.; and the SM-led consortium of BDO Capital Investments Corp., Advanced Card Systems, Ltd. and Pentacapital Investment Corp.

The project involves the decommissioning of the old magnetic-based ticketing system and replacing it with contactless-based smart card technology on LRT Line 1 and 2 and MRT Line 3, with the introduction of a centralized back office. The private sector will operate and maintain the fare collection system.