The Governance Commission for Government Owned or Controlled Corporations (GCG) has “deactivated” state-run First Cavite Industrial Estate Inc. (FCIEI) pending its abolition since it was taking its time to settle unpaid dues to the ecozone regulator.
A memo on Dec. 21 signed by GCG ex-officio members Finance Secretary Carlos Dominguez III and Budget Officer-in-Charge Tina Rose Marie Canda, GCG Chair Samuel Dagpin Jr., and Commissioners Michael Cloribel and Marites Doral, showed FCIEI “deactivated,” which means it should not enter into any contract or transaction while awaiting a formal abolition.
“It is in the best interest of the state to deactivate FCIEI in the interim, pending its formal abolition as recommended by the GCG to the Office of the President,” GCG said.
FCIEI must thus preserve its assets while awaiting final disposition. It also cannot hire more personnel and is no longer entitled to benefits extended to government-owned and -controlled corporations (GOCCs).
It was in 2013 when GCG recommended to then President Benigno Aquino III to abolish FCIEI, which was established in 1990 to acquire, own, lease, hold, subdivide, construct, develop, equip, operate and maintain industrial estates. It was a joint venture of the National Development Co. (NDC), Marubeni Corp. and Japan International Development Organization Inc.
Republic Act No. 10149 or the GOCC Governance Act of 2011 empowers the GCG to rationalize GOCCs. Active firms enjoy subsidy, equity and net lending support from the national government.
President Aquino in 2016 approved in principle the abolition of FCIEI with the condition that it will settle its liabilities with the Philippine Economic Zone Authority (Peza).
Commission on Audit (COA) reports showed, however, that FCIEI “[did] not have enough money,” forcing GCG to make a deal with Peza that allowed FCIEI to pay a partial P3 million to stop incurring interest charges. COA reports had also shown that FCIEI owed Peza a balance of P12.7 million.
The GCG said FCIEI and the NDC boards in 2017 both approved to dissolve the firm, but it was only last year when its audited financial statements were prepared for liquidation purposes. INQ