Metro Manila water supply

Duterte approves franchises for Maynilad, Manila Water

Pia Ranada
Duterte approves franchises for Maynilad, Manila Water
The two water firms servicing Metro Manila get 25-year franchises more than two years after President Duterte threatened to put them out of business

MANILA, Philippines – Philippine President Rodrigo Duterte signed into law 25-year franchises for Maynilad and Manila Water, two water companies that have long distributed water to Metro Manila.

Republic Act No. 11160 again grants Maynilad Water Services a franchise to serve the West Zone of Metro Manila and Cavite. It was signed by Duterte on December 10, 2021. Republic Act No. 11601, signed by Duterte on the same day, does the same for the Razon-led Manila Water Company but for the East Zone of Metro Manila and Rizal.

The new franchises come months after the two water concessionaires signed revised concession agreements with the government to appease Duterte, who was outraged by “unfair” provisions of the previous deal.

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The President had lashed out against the two companies and the influential tycoons behind them after Manila Water won, in 2019, a legal victory against the government before a court in Singapore, which required the government to pay the firm over P7 billion for company losses, among other things.

After Duterte threatened to confront Ayala family members and Manny V. Pangilinan (who’s Metro Pacific Investments Corporation owns a controlling stake in Maynilad) and vowed to expropriate the two water firms, the two companies said they would waive the billions the government owes them from arbitration cases.

In January 2020, the President put even more pressure on the two firms, telling them to accept the new concession agreements drafted by the Department of Justice or he would send their executives to jail.

The new deals removed provisions that had outraged Duterte, like the guarantee of earnings from investments as well as the non-interference clause.

The non-interference clause had barred the government from interfering in the rate-setting mechanism or determination of water rates and had angered the President the most. – Rappler.com