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Tuesday, June 07, 2005
John Hay developer prepares for legal showdown vs BCDA
CAMP John Hay Development Corporation (CJHDevCo) is getting ready for a long-drawn legal battle in the event government pursues its plan to bring in a new investor to the former American military facility.
Lawyer Georgina Alvarez, legal and corporate services head of CJHDevCo said, "We are ready to take the Bases Conversion Development Authority to court once it mounts an illegal takeover that will pave the way for a new developer."
"If BCDA thinks it can ease out CJHDevCo just like that, it's wrong. We have infused P4 billion in development investments in John Hay, generated jobs and income not only for our employees, but also for the local tourism industry. We are ready for a legal showdown. And this is not a threat, it is a promise," she said.
Once the Camp John Hay (CJH) project is embroiled in protracted litigation, the developer maintained that no investor in his right mind will dare touch CJH.
"The lease agreement signed with BCDA in 1996 and the succeeding memoranda of agreement are still legally effective. No court has declared the contracts terminated or of no legal effect. Until such thing happens, BCDA could just dream on about bringing in a new developer," Alvarez added.
She also called as a "cheap sales ploy" the BCDA's press releases attracting prospective operators with new incentive packages. "If the government through BCDA cannot make good on its promise to the current developer of a five percent of gross income earned in lieu of all taxes, what more for tax holidays, rewards, and other benefits for newcomers allegedly superior even to the Subic Special Economic Zone?"
Newspaper reports on Friday quoted BCDA as offering Philippine Economic Zone Authority (PEZA) incentives that are reportedly more attractive than current investor come-ons under the Subic Bay Metropolitan Authority package. The incentives include income tax holidays from four to six years, rewards under the Build-Operate-Transfer law, and government support for official development assistance and other sources of financing.
The BCDA claimed a few have shown interest to manage CJH. But a source from the government organization and its subsidiary John Hay Management Corporation (JHMC) admit there are no takers, so far. BCDA is said to have leaked the information of a new investor to the media as a ploy to attract bidders. Some industry observers say the failure of BCDA to rectify the negative impact of the High Tribunal's ruling could affect BCDA's future dealings with investors and create an impression that the government does not stand by its guarantees. (Adam Borja)
(June 7, 2005 issue)
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