3rd telco suits junked

The two disqualified bidders in the third telco selection process are weighing the filing of fresh appeals, which will require the payment of a nonrefundable P10-million fee, after the government selection committee denied their motions for reconsideration on Monday.

Representatives of Philippine Telegraph & Telephone Corp. (PT&T) and the Sear Consortium, comprised of TierOne Communications and Luis “Chavit” Singson’s LCS Group, said they were evaluating their options after receiving a formal notice of denial late Monday.

Both groups are seeking to overturn their disqualification and dislodge Mislatel Consortium, the venture of businessman Dennis A. Uy’s Udenna Corp. and state-backed China Telecom, which was named the provisional third telco last Nov. 7.

Based on the bid rules of the National Telecommunications Commission (NTC), parties whose MR had been denied may file a verified petition before the NTC En Banc within three calendar days and pay a nonrefundable fee of P10 million. The NTC En Banc would then resolve the petition within three calendar days “strictly based” on the records of the Selection Committee.

Sear Consortium was disqualified last Nov. 7 because it did not have a valid letter of credit covering the P700-million bond. PT&T, which bid without any foreign partner, was disqualified because it failed to secure a certificate from the NTC as having at least 10 years of operating experience on a national scale.

Sear Consortium sent two motions for reconsideration to the third telco selection committee. One was to undo the decision to disqualify it while the second was aimed at unraveling an agreement between Mislatel Consortium and its franchise holder Mindanao Islamic Telephone Co.—which would also disqualify the provisional winner.

In its decision, the third telco Selection Committee denied Sear Consortium’s request to submit documents that would allow it to meet the bid bond requirements, explaining that this amounted to a modification of the selection documents past the deadline. It also denied the request to step into allegations of breach of contract between a member of Sear Consortium and Mindanao Islamic, stating that this was ultimately a dispute among participants and outside its jurisdiction.

“This, however, does not foreclose the movant to seek recourse in the appropriate courts having proper jurisdiction to resolve the contractual disputes,” a portion of the Selection Committee’s decision read.

Sear Consortium, in a statement, slammed the Selection Committee’s decision.

“Instead of purposively controlling the fate of its selection process, the [Selection Committee] opted to passively wait for the courts to rule on a clear violation of their own formulated rules,” Sear Consortium said.

In a stock exchange filing on Wednesday, PT&T said its motion for reconsideration was also denied by the Selection Committee.

According to the NTC’s rules, Misalatel Consortium was still subject to verification and a confirmation order from the NTC en banc before moving forward in the selection process.