Malacañang laud's ICSID decision on Fraport case

Malacañang on Friday lauded the World Bank’s International Centre for Settlement of Investment Dispute’s decision dismissing Fraport AG Frankfurt Services Worldwide’s petition for payment from the Philippine government concerning the construction of the Ninoy Aquino International Airport Terminal 3. "The Philippines has won in the international arbitration case filed by Fraport against our government before the International Centre for Settlement of Investment Dispute. This is a significant milestone in our quest for modernity and progress. Work on NAIA Terminal 3 will continue with more vigor and sharp focus on safety and convenience," President Gloria Macapagal-Arroyo said in a statement. In a statement, Malacanang said that in its decision, the ICSID said it does not have jurisdiction over Fraport’s complaint, which has it seeking $425 million from the Philippine government for allegedly trying to ease out its local partners only to be replaced by parties close to the government. According to Fraport, these actions were a breach of the Bilateral Investment Treaty between the Federal Republic of Germany and the Republic of the Philippines. “The decision has clarified the standards which must be observed by both the RP investors and the German investors in either countries… Philippine laws (should be) complied with because that's the essence of the resolution." Solicitor-General Agnes Devanadera said. If the government lost the case, it would have had to pay Fraport as much as $600 million The government said it challenged the Tribunal’s jurisdiction on the ground that the protection afforded by the BIT does not cover investments made in violation of Philippine laws. The Philippines’ Supreme Court has declared the pre-qualification and award of the project to Fraport as null and void for violating the Constitution. Fraport has stated that it owns 61.44 percent of Philippine International Airport Terminal Co., the firm which was tasked to build NAIA 3, “directly and indirectly through cascade companies." The Philippine Constitution allows only a maximum of 40 percent ownership of local firms. - GMANews.TV