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Berjaya: PCSO awards deal without bidding

By MST Business | Mar. 19, 2013 at 12:01am
A gaming firm asked the Philippine Charity Sweepstakes Office to explain why Pacific Online Systems Corp., whose exclusive contract to supply lotto equipment in Visayas and Mindanao expires this month, was awarded a contract to supply PCSO in Luzon without a public bidding.

Listed Berjaya Philippines Inc., through wholly-owned subsidiary Philippine Gaming Management Corp., which has been the exclusive supplier of PCSO in Luzon in the past 15 years until 2015, also wants to know why no bidding was called by PCSO days before the lotto equipment supply contract of Pacific Online for Visayas and Mindanao was set to expire.

PGMC legal counsel Jose Bernas said in a letter to PCSO chairman Margarita Juico that Pacific Online’s foray in Luzon was an encroachment into PGMC’s exclusive territory, but what was more alarming about the contract was that it was given on a silver platter.

“Even if we were to concede theoretically that PCSO was not restricted from appointing other service providers in Luzon aside from PGMC, still the award to Pacific Online is indisputably void because it creates a government contract awarded without a prior public bidding,” the letter dated Feb. 28 and addressed to Juico said.

Bernas said the PCSO not only allowed Pacific Online to operate in Luzon but also helped it to roll out terminals rapidly when it reduced the minimum distance between two lotto agents from 100 meters to 50 meters.

He said this had the effect of allowing the Vis-Min operator to install 1,000 outlets in Luzon in one year. In contrast, PGMC installed 3,900 terminals over 15 years.

Bernas said this would eat into PGMC’s revenue, and by doing so, PCSO had effectively “expropriated” PGMC’s business.

The reduction of minimum distance limits and the refusal to bid out the VisMin contract “in our view are unabashed demonstrations of unjustified favoritism,” he said.

Bernas also recounted the efforts of PCSO, under Juico, to force PGMC to reduce its rental rate for its lotto equipment by claiming the reduced rate was ordered by the Senate last year in a report that investigated PCSO.
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