Maynilad files arbitration notice

October 04, 2013

West Zone concessionaire Maynilad Water Services, Inc. (Maynilad) has filed a notice of dispute with the Secretariat of the International Chamber of Commerce (ICC) International Court of Arbitration to resolve its rebasing dispute with the Metropolitan Waterworks and Sewerage System (MWSS). This is pending the ICC Chairman’s appointment of a presiding arbitrator to the Appeals Panel of Maynilad.

In its September 12 resolution, MWSS denied Maynilad’s petition for an upward adjustment of 28.35% of its average basic charge (or ₱8.58 per cu.m.), and instead approved a negative adjustment of 4.82% (or ₱1.46 per cu.m.) to be implemented in five equal tranches of negative 0.964% (or ₱0.29 per cu.m.) per charging year.

Under the Concession Agreement signed by Maynilad and the MWSS, and guaranteed by the Philippine Government, any disagreement, dispute, controversy or claim arising out of, or relating to, the agreement, which cannot be resolved through consultation or negotiation between the parties must be resolved through a process called arbitration.

A three-member panel called the Appeals Panel will conduct the arbitration proceedings in accordance with the arbitration rules of the United Nations Commission on International Trade Law.

In case of a major dispute, as in the case of a rebasing dispute, the panel will be composed of three members: one member appointed by Maynilad, one member appointed by MWSS, and the third member, the Appeals Chairman or Presiding Arbitrator, appointed by the ICC Chairman.

The issuance of a notice of dispute officially commences the arbitration process. Unless otherwise ordered by the Appeals Panel, the current water rates will continue to apply pending the final decision of the panel.

Maynilad is the largest private water concessionaire in the Philippines in terms of customer base.  It is the concessionaire of the Metropolitan Waterworks and Sewerage System (MWSS) for the West Zone of the Greater Manila Area, which is composed of the cities of Manila (all but portions of San Andres & Sta.Ana), Quezon City (west of San Juan River, West Avenue, EDSA, Congressional, Mindanao Avenue, the northern part starting from the Districts of the Holy Spirit & Batasan Hills), Makati (west of South Super Highway), Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas and Malabonall in Metro Manila; the cities of Cavite, Bacoor, and Imus, the towns of Kawit, Noveleta, and Rosario, all in Cavite Province.