SC stops P268.8-M Comelec-Smartmatic deal

MANILA, Philippines - The Supreme Court stopped yesterday the P268.8-million contract of the Commission on Elections with technology provider Smartmatic-Total Information Management for the diagnostics and repair of the precinct count optical scan (PCOS) machines to be used for the presidential elections next year.

Voting 12-2, the justices issued a temporary restraining order (TRO) enjoining the implementation of the extended warranty contract under Comelec’s Resolution No. 9922 that provided for the “diagnostics, repair and refurbishment” of the same 80,000 PCOS machines used in the 2010 and 2013 polls.

The high court granted the urgent relief sought in the petitions of poll watchdog Automated Elections System (AES) Watch led by Auxilliary Bishop of Manila Broderick Pabillo and Integrated Bar of the Philippines (IBP).

The TRO is effective immediately and until further orders from the Court.

SC spokesman Theodore Te said 12 justices approved the issuance of the order.

Chief Justice Ma. Lourdes Sereno and Associate Justice Presbitero Velasco Jr., on the other hand, dissented from the ruling, believing there should be oral arguments before the high tribunal could issue the TRO.

In their consolidated petitions, AES and IBP argued that the award of contract to Smartmatic for the diagnostics of the PCOS machines, signed by Chair Sixto Brillantes Jr. before he retired last February, violated Republic Act 9184 (Government Procurement Reform Act).

They stressed that the poll body blatantly violated RA 9184 when Brillantes signed the contract with Smartmatic-TIM for the repair, refurbishment and maintenance of the PCOS machines, which were used during the 2010 and 2013 elections, without conducting public bidding as required under the law.

Petitioners alleged that the refurbishment and repair of PCOS machines fall under the definition of the term “procurement” under RA 9184 and that the direct contracting method chosen by Comelec was not justified.

In opting to approve Smartmatic’s extended warranty proposal instead of conducting a public bidding, the Comelec cited a “tight time schedule” in the preparations for the forthcoming national and local elections.

The poll body also claimed that it would be “too great a risk” to give the refurbishment and repair of the PCOS machines to a third party other than Smartmatic, considering the highly technical nature of the refurbishment and repair.

But petitioners stressed that the supposed time constraints are not a ground to dispense with the conduct of public bidding under the law.

Earlier, election watchdog Citizens for Clean and Credible Elections (C3E) filed similar petitions before the SC assailing the Comelec-Smartmatic contract.

The Comelec yesterday accepted the TRO issued by the SC against its extended contract with Smartmatic.

“The Comelec welcomes the opportunity to explain the contract subject of the TRO more fully to the honorable SC. However, we would like to emphasize that this issuance impacts on the 81,000 PCOS machines that are central to the automation of the 2016 elections. The TRO is a significant event,” said Comelec spokesman James Jimenez.

He noted upon learning of TRO, Comelec acting Chairman Christian Robert Lim immediately called senior poll officials to a meeting to map out strategies that will ensure that preparations for 2016 will not be “too adversely affected.”

“The bigger challenge, on the other hand, is ensuring that this case is resolved and the TRO permanently lifted at the soonest possible time. The Comelec will apply itself to achieving that goal with utmost vigor,” Jimenez added.

For its part, Smartmatic president for Asia Pacific Cesar Flores said the firm respects the ruling of the SC.

“We understand that in issuing the TRO, the court wants to be enlightened on some matters regarding the contract, something we are always more than willing to do,” he added.

C3E had also asked the SC to blacklist Smartmatic from participating in any bidding process for next year’s elections.

The group said Smartmatic should be barred from the procurement for the 2016 elections, or in any government procurement, for a period of at least two years for committing several “misrepresentations” to the poll body and for violating its obligations under the 2010 automated election system project contract.

They alleged that Smartmatic-TIM misrepresented certain information in its qualification statements by submitting its single largest contract in the name of Smartmatic International Holdings, B.V. and/or a subsidiary of the latter, Smartmatic Deployment Corp.

They added that Smartmatic-TIM and Smartmatic committed misrepresentation of certain information in its qualification statements when it claimed that Jarltech International Corp. was its subsidiary.    – With Sheila Crisostomo, Paolo Romero