Maynilad Water Services signed a revised concession agreement with the Philippine government, which no longer has the contentious provisions found in the original deal.
Justice Secretary Menardo Guevarra said on Tuesday, May 18, that the deal is similar to the one recently signed with Manila Water, which removed the guarantee of earnings from investments as well as the non-interference clause.
The non-interference clause, which earlier barred the government from interfering in the rate-setting mechanism or determination of water rates, had angered President Rodrigo Duterte the most.
In a disclosure to the Philippine Stock Exchange on Wednesday, May 19, Maynilad’s parent company Metro Pacific Investments Corporation said the new agreement with the Metropolitan Waterworks and Sewerage System continues the concession period until July 31, 2037.
A tariff freeze was imposed until December 2022.
The new deal also removes the foreign currency differential adjustment in the calculation for water rates and caps the annual inflation factor to two-thirds of the consumer price index.
Guevarra also noted that Maynilad has waived its P3.7-billion arbitral award and terminated all related proceedings.
Maynilad and Manila Water came under scrutiny in 2019, when Metro Manila experienced a water crisis.
It was also around this time that the companies won separate arbitration cases against the government. – Rappler.com