In a disclosure to the Philippine Stock Exchange, Cyber Bay said its management is now studying all options to protect the company’s rights, including claims for reimbursement from the Public Estates Authority (PEA).
The High Court ruled that the joint venture agreement between PEA and Amari Coastal Bay Development Corp. violated the constitutional provision prohibiting private corporations from owning land of public domain without going through a public bidding. Cyber Bay has a 100 percent interest in Amari.
However, the Supreme Court hasd allowed Cyber Bay to recover the estimated costs of around P9.8 billion incurred in developing the property.
Cyber Bay said the nullification of the agreement would cause irreparable losses to its shareholders and foreign partners who have invested their funds in the Amari project, relying in good faith on the review and approvals by the government.
The company added that the nullification puts into question the very sanctity of the contracts entered into by the Philippine government and may lead to the erosion of the overall confidence of the investing public and foreign investors.
The SC ruled that the submerged areas "remain inalienable natural resources of the public domain" and their sale to Amari violated the constitutional injunction on selling the country’s natural resources, like public land, to foreigners. Amari is an Italian-Thai consortium.
With the ruling, PEA has to figure out how to raise money to compensate its joint venture development partners, complete the development of reclaimed lands as well as projects that were halted.
If the ruling were to be applied to all other reclamation projects undertaken up to the Marcos administration, PEA estimated it would cost the government up to P200 billion to compensate developers and investors, who were likewise paid with reclaimed land.
The government stands to lose P1.8 billion in real estate taxes yearly if the lands were taken back, PEA argued.
Government agencies and local governments that paid private contractors, investors and developers with reclaimed land would also be adversely affected by the ruling, PEA added.
In the case of Amari, PEA argued that the reclaimed Manila Bay land, known as Freedom Islands, were not public land because they were reclaimed by and acquired from a state-run company, Construction
and Development Corporation of the Philippines (now Philippine National Construction Corp.) in 1981.
Amari had planned to develop the Manila Bay property into a world-class center of commerce, entertainment, shopping and education integrated with a mix of residential districts.