Wednesday, August 01, 2007
Justice dep't says broadband deal with China is legal (10:02 a.m.)
MANILA -- The Department of Justice (DOJ) has upheld the legality of the controversial US$330 million broadband infrastructure contract between the Philippines and China amid calls by certain groups to have the deal reviewed.
In his response to the query of the Department of Transportation and Communication (DOTC), Justice Secretary Raul Gonzalez Sr. said the proposed National Broadband Network (NBN) project may be considered an executive agreement by virtue of a memorandum of understanding (MOU) signed between the Philippine Government represented by Trade Secretary Peter Favila and Chinese government firm ZTE Corporation.
Gonzalez said the contract is not required to undergo the bidding process as it is covered by an executive agreement as evidenced by the exchange of notes between former Presidential Management Staff (PMS) chief Michael Defensor and Chinese Minister of Commerce Bo Xilai and Chinese Ambassador Li Jijun.
"In sum, it is the opinion of this department that the exchange of correspondence between Defensor and Li may be considered an executive agreement, provided that the loan agreement between the Philippine government and China Exim Bank is subsequently concluded," he said.
Under Section 4 of Republic Act (RA) 9184, or the Government Procurement Reform Act, "any treaty or international or executive agreement affecting procurement to which the Philippine government is a signatory shall be observed," among them infrastructure projects, goods and consulting services, regardless of source of funds, whether local or foreign, by all branches and instrumentalities of government, its departments, offices and agencies, including government-owned and controlled corporations and local government units.
"Clearly, therefore, executive agreements involving infrastructure projects to be funded by a foreign lending institution do not fall within the scope of RA 9184, which mandates that all procurement activities must be made through public bidding," said Gonzalez, adding that the loan agreement is considered an integral part of the executive agreement with China. (ECV) |
