Price challenge for SCTEx gets PCCI’s backing

MANILA, Philippines–The Philippine Chamber of Commerce and Industry (PCCI) has backed the move of the state-run Bases Conversion and Development Authority (BCDA) to subject the Subic-Clark-Tarlac Expressway to a price challenge, stressing that this will ultimately benefit consumers.

“This is good for us because a price challenge will push parties to become more competitive unlike before, and we can avoid a monopoly,” PCCI president Alfredo M. Yao said.

“Besides, [a price challenge] was really part of the contract [that the BCDA signed with Manila North Tollways Corp.], except that no one challenged that offer before. But a price challenge will be good for the economy, good for country, and good for the consumers, too,” Yao said.

In December 2014, the BCDA board approved and released the guidelines for the SCTEx price challenge, finally allowing the bidding for the long-term contract to operate and maintain the toll road to push through.

Interested parties are required to submit a higher price than the P3.5-billion upfront cash offer—on top of the 50-50 sharing of gross revenues—from the MNTC, a firm led by businessman Manuel V. Pangilinan.

The MNTC then has the right to match the highest bid for the management of the 94-kilometer toll road.

At stake would be the rights, interest and obligations in the management, operation and maintenance of the four-lane divided expressway that passes through the provinces of Bataan, Pampanga and Tarlac, and which is directly linked to the North Luzon Expressway. The contract will be in effect for 28 years until 2043.

The BCDA will meet with interested parties next week and is reportedly looking to award the contract within the first quarter of 2015.

Meanwhile, Yao said PCCI also hoped that a Fair Competition Act of 2014 would be in place before President Aquino steps down in 2016.

“This is a pet project of the PCCI together with Sen. Paolo Benigno Aquino IV. It’s already with the bicameral committee so we’re hoping that it will be signed into law. It’s not against big businesses because initially, the thinking was that it was against these more established enterprises,” Yao explained.

Yao noted that the Fair Competition Act would guard against monopolistic practices, a move that will create a level playing field, foster competition, and thus allow consumers to benefit from more and better choices and lower prices.

The Senate passed on third and final reading Senate Bill (SB) No. 2282, or the Fair Competition Act, which was aimed at eliminating monopolies, cartels and other unfair business practices that lead to high prices of goods and services.