DOTC, Ayala-MPIC ink agreement for MRT-LRT ticket project

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It's all systems go for the modernization of the MRT-LRT ticketing scheme as the government signs the concession agreement for the project

WINNING BIDDER. The government awards the contract to modernize the MRT-LRT ticket system to the consortium owned by Metro Pacific Investments Corporation and Ayala Corporation. Photo obtained from the PPP Center

MANILA, Philippines – The government and the consortium of Ayala Corporation and Metro Pacific Investments Corporation (MPIC) signed on Monday, March 31 the concession agreement for the modernization of the Metro Rail Transit (MRT) and Light Rail Transit (LRT) ticketing system despite an appeal made by the SM group.

Transportation and Communications Secretary Joseph Emilio Abaya, MPIC chairman Manuel Pangilinan and Ayala chairman Jaime Augusto Zobel de Ayala signed the agreement for the P1.72-billion Automatic Fare Collection System (AFCS) at EDSA Shangri-La Hotel Monday.

The AFCS is the first Public-Private Partnership project awarded by government this year. The joint venture of Ayala and MPIC, AF Consortium, bagged the project in a bidding held last December 12.

Abaya said the concession agreement was finally signed after delays due to appeals filed by losing bidders, among them, the SM group.

“We have addressed all the issues,” he noted, stressing that the “project is in good hands.”

The AFCS, patterned after mass rail transport payment systems in developed countries such as Singapore’s EZ Link Card, will upgrade the MRT and LRT ticketing system to substantially speed up payments, reduce queuing time and allow passengers seamless transfers from one rail line to another.

At the agreement signing, Pangilinan gave assurances that the project would be completed within the September 2015 deadline set by the Department of Transportation and Communications. 

“Now that the bid is over and we are about to conclude this agreement, I think the hard work begins this afternoon. We have 18 months to deliver on this promise,” Pangilinan said.

For his part, Zobel said, “We are absolutely delighted to be here with the MPIC group. Hopefully this won’t be the last time that we will work together.”

SM group’s appeal

This developed as the SM group filed its second motion, asking DOTC to reconsider the award of the project.

AF Consortium submitted a negative bid of P1,088,103,900 for the AFCS, edging the negative P1,088,000,000 bid of SM.

SM claimed its bid was better because it offered to pay the government the full amount upfront. It also claimed that AF Consortium’s bid was conditional. “Under the terms of the AF Consortium bid, 72% of the total amount will only be paid to government in 2024 or 2025 and only if the conditional [passenger] volume is met. Otherwise, the government will not be able to collect anything at all,” the company’s president Hans Sy said in an earlier statement.

But DOTC spokesperson Michael Arthur Sagcal said, “The bid provided a schedule of the different options on how the transaction fee will be paid example x amount for 300 million to 350 million passengers, y amount for 350 million to 400 million. I guess SM chose a different structure. In any case, AF’s structure met our requirements.”

AF Consortium is eyeing to expand the use of the AFCS to include other transport modes such as buses. –

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