Keep Laguna de Bay alive

THERE is no stopping the implementation of the Laguna de Bay Rehabilitation Project at the moment.

This has been made clear by Opinion No. 38, Series 2010 signed by Justice Secretary Leila M. de Lima last August 18 but secured by us only the other day.

De Lima has reiterated the position of the Department of Justice (DOJ) that the Belgian company Baggerwerken Decloedt En Zoon (BDC) and the Department of Environment and Natural Resources (DENR) was valid since it was covered by an executive agreement and is considered legally to be supported by official development assistance (ODA).

This is the third time that the DOJ had issued an opinion backing the P18.7-billion project.

Malacanang said earlier the main issue hindering the project is whether it is ODA and that the loan accord covering it partakes of an executive agreement.

The opinion affirmed DoJ Opinions No. 26 issued on June 13 and No. 30 dated June 23, both of which were issued by Acting Secretary Alberto Agra.

Those opinions contended that the loan agreement “is wholly guaranteed by the Belgian government and considered an ODA is an executive agreement.”

They held that the “direct award of the Contract to Baggerwerken Deloedt En Zoon N.V, is supported by law as the procurement of infrastructure projects funded by ODA is excluded from public bidding.”

De Lima said that Section 4 of the Government Procurement Act, also known as Republic Act 9184, held that any treaty of international or executive agreement affecting the subject matter of this Act to which the Philippine government is a signatory shall be observed.

The DENR contract with BDC is covered by this provision, she added, and maintained the loan agreement entered into by the Department of Finance (DoF) was consistent with the power of the President to contract foreign loans.

Moreover, she held that the loan granted to the republic was guaranteed by the Office National du Ducroire-Nationale Delcrederedienst (ONDD), the export credit agency of the Belgian government, and was denominated as “ONDD Buyer Credit Agreement.”

“In the instant case, it appears that the loan agreement was entered into by and between the Philippine Government and a private commercial bank. However, we find that this does not necessarily make the loan agreement a private contract between the parties, since a look into the circumstances surrounding its grant under Belgian law and the nature of the loan itself under Philippine law supports the view that it may be considered as an executive agreement,” she explained.

ONDD is an export credit insurer of the Belgian government and is authorized to represent the state.

The loan for the project had a grant element of at least 25 percent and was approved by Fortis Bank, part of the BNP-Paribas Group, in consideration for the coverage by ONDD.

BNP-Paribas-Fortis Bank also wrote to the DENR on January 25, 2010 to confirm that it is mandated to finance the project, with BDC as the nominated Belgian contractor, and stressed the financing is guarantee by ONDD.


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