OGCC wins PCSO’s P32 billion arbitration case

MANILA, Philippines — The Office of the Government Corporate Counsel (OGCC) has won in an arbitration case involving the 2009 contractual joint venture agreement (CJVA) between Philippine Charity Sweepstakes Office (PCSO) and Australian-based firm TMA Australia Pty Ltd. and its subsidiary TMA Group Philippines Inc.

The CJVA was made for the purpose of “establishing the first thermal coating plant in the Philippines, and to generally engage in the production and marketing of thermal coated paper, synthetic substance and other related products.”

Government corporate counsel Rogelio Quevedo said that the arbitral tribunal, in its Dec. 30, 2022 jurisdictional award, dismissed the P32-billion claim of TMA against PCSO “for lack of jurisdiction, and held TMA liable for the costs of the arbitration including the tribunal’s fees and administrative cost.”

Quevedo added that the tribunal ruled that “TMA had waived by operation of law their right to submit the dispute to arbitration when they sought final relief in its applications to the Philippines courts.”

The Supreme Court, in a 33-page decision in August 2019, ordered the TMA to return P707.2 million representing the PCSO funds that were illegally garnished to pay for thermal papers and bets slips made by the former for lotto operations in the country. The SC also declared “void and of no force and effect” an earlier decision of the Makati City regional trial court on the case.”

Following the SC decision, the Makati RTC, in its Feb. 5, 2021 order issued a writ of garnishment and levy ordering TMA to immediately return the PCSO funds that TMA had previously garnished.

“TMA did not comply with the RTC order, but instead filed this arbitration, which was dismissed by the tribunal. So far, this is one of the biggest winning arbitration cases for OGCC,” Quevedo said. “With this favorable arbitral ruling, TMA will finally abide with the court’s order to return the P707 million garnished funds to PCSO.”

The OGCC team that represented PCSO in the international arbitration case seated in the Philippines were deputy government corporate counsel Marilyn Estaris, assistant government corporate counsel Aniceto Calubaquib Jr., and government corporate attorneys Fiona de Leon, Aiza Camille España, Abegail Joan Orilla-Orara, Kathrina Maria Reyes and Jenny Libutaque.

TMA Australia and TMA Philippines were represented by the Australian law firm K&L and Gates LLP and Romulo Mabanta Buenaventura Sayoc & De los Angeles in the arbitration proceedings.

The law firms of Divina Law Romeo C. Dela Cruz and Associates and Marasigan and Dagaso Law Offices also represented TMA in the Philippine courts.