DOTr Files Graft Case Against Former DOTr Officials, BURI

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The Department of Transportation (DOTr) today filed a graft case, or a violation of the Anti-Graft and Corrupt Practices Act, against former Department of Transportation and Communications (DOTC) Secretary Joseph Emilio Aguinaldo Abaya, other former DOTC officials, and Busan Universal Rails Incorporated (BURI) officers, for entering into an alleged anomalous contract for the Metro Railway Transit 3 (MRT-3).

In a 29-page complaint filed before the Office of the Ombudsman earlier this morning, DOTr Undersecretary for Legal Affairs and Procurement Atty. Reinier Paul Yebra cited four components of the MRT-3 project (Project) of the case which are: maintenance of the MRT-3 Systems; general overhauling of 43 units of light rail vehicles (LRVs); total replacement of the signaling system; and additional maintenance works.

According to Usec. Yebra, the DOTr finds it anomalous that while the joint venture of Busan (Busan JV) was the one who participated in and won the bidding, the entity doing the actual maintenance works of the MRT-3, and receiving payments therefor is BURI, which is a totally different entity.

"We want to know the truth. We find it anomalous that the project was awarded to Busan JV, but the one receiving payments and doing MRT-3 maintenance works is BURI, a totally different entity," Usec. Yebra said.

Usec. Yebra explained that the Notice of Award was issued to Busan JV on 23 December 2015. However, interestingly and disturbingly, on the same day, former DOTr Assistant Secretary for Procurement and Bids and Awards Committee (BAC) Chairman Camille Alcaraz requested the Securities and Exchange Commission (SEC) to facilitate the registration of a Special Purpose Company consisting of the members of the Busan JV for the Contract Award of the Project. BURI was later on incorporated on 04 January 2016.

"It shows that the respondents conspired and confederated with one another to enter into a contract that is grossly disadvantageous to the government," he said.

"At the end of the day, our concern goes to our commuters. We can hear and feel their pleas. That is why the DOTr, through the leadership of Secretary Tugade, will do everything to serve the public with the truth and justice that they deserve," Usec. Yebra added.

Last 17 October 2017, DOTr served a Notice to Terminate it's contract with BURI due to: Poor performance; Failure to put in service and subsequently ensure the availability of the contractually obligated number of trains, and more importantly, it failed to put in operation reliable and efficient trains; Failure to implement a feasible procurement plan for spare parts, and in fact, failed to procure and store the required volume of spare parts which affected its ability to affect immediate repairs on defective trains and other facilities of the MRT-3 system, and; Failure to comply with the contractual requirements of a complete and up to date Computerized Maintenance Management System.

BURI was given 7 calendar days to respond and submit a verified position paper stating why the contract should not be terminated. After which, the DOTr shall have 10 days, upon receipt of BURI's response, to decide whether or not it will issue an Order to terminate the entire contract.

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