MANILA, Philippines – Two power companies in Iloilo City are locked in a legal battle that has reached the Supreme Court (SC).

Panay Electric Company (PECO), which has been Iloilo City’s power distributor for the last 95 years, is fighting for its assets after President Rodrigo Duterte’s grant of a franchise allowed the Enrique Razon-owned MORE Electric Power and Corporation to acquire its facilities.

At the heart of SC petitions are two conflicting local court rulings, which prompted MORE and PECO to elevate the issue to the SC.

The SC Second Division, in two separate resolutions, have asked for the parties’ comments. Both petitions – and their main contentions – remain pending.

Timeline

On February 14, 2019, Duterte signed into law Republic Act 11212 that gave MORE the franchise to distribute power in Iloilo. PECO has complained that it was bypassed for franchise renewal.

The law that granted the franchise – Republic Act 11212 – gave MORE the right to acquire the assets of PECO.

Section 10 of RA 11212 gave MORE the power to “acquire such private property as is actually necessary for the realization of the purposes for which this franchise is granted, including, but not limited to poles, wires, cables, transformers, switching equipment and stations, buildings, infrastructure, machineries and equipment previously, currently or actually used, or intended to be used, or have been abandoned, unused or underutilized, or which obstructs its facilities, for the operation of a distribution system for the conveyance of electric power to end users in its franchise area.”

The facilities being referred to in that provision are PECO assets.

Section 17 of the law allowed PECO to operate its distribution system in the interim “until the establishment or acquisition by the grantee of its own distribution system and its complete transition towards full operations as determined by the Energy and Regulatory Commission, which period shall in no case exceed two (2) years from the grant of this legislative franchise.”

The takeover needed a court go-signal, so MORE went to the Iloilo Regional Trial Court (RTC).

But before the Iloilo RTC could act, on July 1, the Mandaluyong RTC Branch 209 declared as unconstitutional Sections 10 and 17 of RA 11212.

“PECO’s rights to its properties are protected against arbitrary and confiscatory taking under the relevant portions of Section 10 and 17 of R.A No. 11212,” said Mandaluyong Judge Monique Quisumbing-Ignacio.

Judge Ignacio also made permanent the Temporary Restraining Order (TRO) that stops MORE from “enforcing, implementing and exercising any of the rights and obligations set forth under RA 11212.”

On August 14, Iloilo RTC Branch 37 Judge Yvette Marie Go issued the writ of possession to MORE saying that “the Complaint for Expropriation is sufficient in form and substance,”  essentially greenlighting the takeover.

SC petitions

MORE went to the SC to ask for a Temporary Restraining Order (TRO) against the Mandaluyong court ruling; while PECO asked the SC to hold in contempt Iloilo Judge Yvette Marie Go who issued the ruling favorable to MORE.

On August 14, the SC Second Division denied MORE’s request for a TRO, and asked for PECO’s comment.

On September 2, the SC Second Division required Judge Go to respond to PECO’s petition that sought to hold her in contempt. No further actions have been taken by the SC since.

In a press conference on Wednesday, September 25, PECO administrative manager Marcelo Cacho said  MORE has been “vigorously pursuing the expropriation case” which he called “an insidious form of forum-shopping.” – Rappler.com