Building infrastructure, such as roads and bridges, is no small feat, considering the huge amount of investments required.

While the Duterte administration plans to spend an unparalleled $180 billion over a six-year period for infrastructure, including airports, mass transport and digital communications, this may still not be enough.

To support the effort by government, and to give much-deserved relief to motorists who have long suffered from traffic congestion, the Metro Pacific Investments Corp. (MPIC) group continues to invest in infrastructure despite continued refusal by the Toll Regulatory Board (TRB) to grant its petition for toll adjustments.

MPIC’s upcoming projects include an elevated toll road on the Circumferential Road 5 (C-5), the connector road linking the North Luzon Expressway (NLEX) with the South Luzon Expressway (SLEX),

The P2-billion upgrade of the Subic-Clark-Tarlac Expressway (SCTEX) over the next three years, and the completion of the P10.5 billion NLEX Harbor Link from Valenzuela City to Circumferential Road 3 (C-3).

MPIC started in March the construction of segments 2 and 3 of the 2.6 billion NLEX Road Widening Project, which will expand the existing two-lane portion of NLEX between Sta. Rita and San Fernando to three lanes on both the northbound and southbound sides. The current one-lane stretch between Dau and Sta. Ines will also be expanded to two lanes in both directions.

MPIC unit Manila North Tollways Corp. (MNTC) has also secured a conditional notice to proceed with the construction of the C5 Link Expressway, which forms parts of the existing Cavite Expressway (CAVITEX). This is a 10-billion project spanning 7.6 kilometers to link C-5 Road in Taguig City to the R-1 Expressway (Coastal Road).

Its plan for the construction of the P34.5 billion Cavite-Laguna Expressway (CALAX) is expected to begin in early 2017 once the Department of Public Works and Highways (DPWH) obtains the right-of-way (ROW) for the project.

The Metro Pacific Tollways Corp., (MPTC), another MPIC unit, also signed a joint venture agreement with the city government of Cebu to build the 8.25-kilometer Cebu-Cordova bridge, at a cost of P27.9 billion, to link Cebu to Mactan Island.

MPIC likewise invested P287 million for the construction of eight new toll lanes at NLEX, expanding the Bocaue exit from 26 to 34 lanes.

All these, despite pending arbitration cases it had filed against the government before the United Nations Commission on International Trade Law (UNCITRAL) in Geneva, Switzerland, and another one in New York in a bid to compel the previous Aquino administration to compensate it for roughly P5 billion in foregone revenues as a result of the state’s inaction on its long-due petitions for toll increases for the 84-kilometer NLEX and the 14-kilometer CAVITEX.

The arbitration case, filed by the MNTC in Geneva, involve claims for almost P4 billion in losses from long-pending toll fee adjustments in NLEX covering the period of January 2013 to December 2015. This amount does not include yet an additional P111.8 million for every month of delay in compensation starting in January 2016.

A separate case was also filed by MNTC through its subsidiary, the Cavitex Infrastructure Corp. (CIC), in New York to seek compensation for losses totaling P877 million, this time for its claim of 20 percent toll fee adjustments in Cavitex.

The TRB has yet to act on the new toll rate petitions of MNTC and CIC even though such periodic adjustments are provided for in their operations and management (O&M) concession deals with the government.

MNTC president and chief executive Rodrigo Franco has said he is open to an out-of-court settlement.

MPIC and its subsidiaries continue to spend billions of pesos to upgrade and expand NLEX, SCTEX and CAVITEX despite losses that continue to pile up from uncollected toll adjustments.

The MNTC and CIC are entitled to these long overdue toll fee adjustments because these periodic rate adjustments are provided for in their O&M contracts. TRB’s failure to consider such adjustments is unfair to these O&M contractors, and underscores the kind of policy inconsistency and regulatory risk that have spooked prospective investors in the past Aquino administration and discouraged most of them from putting their money in big-ticket infrastructure projects in the Philippines.

These operators have a legal leg to stand on because no less than the Supreme Court, in one of its rulings, has backed a “reasonable” rate of return for operators via periodic adjustments. It said that “while the interests of the public are ideally to be accorded primacy in considering government contracts, the reality on the ground is that the tollway projects may not at all be possible or would be difficult to realize without the involvement of the investing private sector which expects its usual share of profit.”

The TRB should finally act on this issue to help the Duterte administration show to prospective investors that the new government means business. President Duterte has previously directed his Cabinet secretaries and heads of government agencies “to refrain from changing and bending the rules of government contracts, transactions and projects already approved and awaiting implementation.”

Acting on these unpaid toll adjustment claims now would also save billions of pesos for the government because they earn interest each day that the TRB delays its decision on the issue, not to mention the fact that it has to shell out thousands of dollars in legal fees to represent the state in the arbitration cases.

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