PH gov’t told to pay Maynilad over P3B for delayed tariff hike

Chrisee Dela Paz

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PH gov’t told to pay Maynilad over P3B for delayed tariff hike
An arbitral tribunal orders the Republic of the Philippines to reimburse the country's largest water concessionaire of its losses from unenforced tariff adjustments

MANILA, Philippines – The Philippine government will have to pay Maynilad Water Services Incorporated a total of P3.42 billion for losses incurred from delayed tariff adjustments, an arbitral tribunal ordered.

The water concessionaire’s parent firm, Metro Pacific Investments Corporation, reported this to the local bourse on Tuesday, July 26.

It said that the Permanent Court of Arbitration at The Hague has ordered the Republic of the Philippines to reimburse Maynilad P3.42 billion for losses from March 11, 2015 to August 31, 2016, “without prejudice to any rights that Maynilad may have to seek recourse against MWSS (Manila Waterworks and Sewage System) for losses incurred from January 1, 2013 to March 10, 2015.”

“Further, the tribunal ruled that Maynilad is entitled to recover from the republic its losses from September 1, 2016 onwards. In case a disagreement on the amount of such losses arises, Maynilad may revert to the tribunal for further determination,” the disclosure read.  (READ: Pangilinan-led MPIC to Duterte admin: Let’s start with a clean slate)

Maynilad is the largest private water concessionaire in the Philippines in terms of customer base.

It is the agent and contractor of the Metropolitan Waterworks and Sewerage System (MWSS) for the West Zone of the Greater Manila Area.

In 2014, Maynilad won an arbitration case over unenforced hike implementation from 2013 to 2017, but the MWSS did not act on it.


In a decision dated July 24, the 3-man arbitral tribunal unanimously upheld the validity of Maynilad’s claim against the government – through the Department of Finance – to compensate the water concessionaire for the delayed tariff adjustments from 2013 to 2017.

The decision provides that the Philippine government will repay Maynilad for any loss from a delay in implementing increase in rates, after the date of the start of its concession agreement (CA) on February 21, 1997.

MWSS, the agency that approves water rate adjustments in the country, has not given its statement on the issue as of publication time.

For Maynilad president and chief executive officer Ramoncito Fernandez, the firm will continue to honor its commitments under the CA.

“[We] will pursue the capital expenditure projects that will improve further the quality of service to our customers,” Fernandez said in a statement.

Maynilad investing about P13.2 billion this year to improve as well as expand water and wastewater services for its customers.

The Manuel Pangilinan-led firm had said it is allocating more than half of its 2017 capital spending budget, or around P8.2 billion, for its water infrastructure projects. While the remaining has been earmarked for water sources and operations support programs.

The water company expects to generate around 40,549 jobs from its capital spending budget program this year. –

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