Alvarez files bill requiring private firms for PPP projects to secure franchise from Congress

By on March 28, 2017


House Speaker Pantaleon Alvarez has filed a bill requiring prospective bidders under the public-private partnership (PPP) scheme to obtain a franchise from Congress to legally build, operate, and maintain public infrastructure facilities.  (Photo: Speaker Pantaleon Alvarez/Facebook)
House Speaker Pantaleon Alvarez has filed a bill requiring prospective bidders under the public-private partnership (PPP) scheme to obtain a franchise from Congress to legally build, operate, and maintain public infrastructure facilities. (Photo: Speaker Pantaleon Alvarez/Facebook)

MANILA—House Speaker Pantaleon Alvarez has filed a bill requiring prospective bidders under the public-private partnership (PPP) scheme to obtain a franchise from Congress to legally build, operate, and maintain public infrastructure facilities.

In a statement on Tuesday, Alvarez filed House Bill No. 5270, which seeks to amend Republic Act No. 6957, as amended by R.A. 7718 (known as the Build-Operate-Transfer (BOT) Law), serving as the legal framework when the government enters into PPP.

Alvarez argued that while the grant of a franchise to winning bidders is deemed automatic under the BOT Law, such arrangement has favored private interests over the public good and could practically tie the hands of the government.

Alvarez proposed in his bill to remove the automatic grant of franchise and instead require project proponents to secure a 25-year legislative franchise from Congress in order to operate and maintain public utilities.

Under the bill, the contract under the BOT arrangement shall be awarded to the private firm who has submitted a bid that “is most advantageous to the government” and provides “the most favorable terms” for the project.

If enacted into law, the measure will likewise require existing operators to secure a legislative franchise from Congress; otherwise, the franchises they presently have shall expire and lose any legal effect.