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Brix Lelis - The Philippine Star
February 25, 2025 | 12:00am
The facade entrance of National Grid Corporation of the Philippines (NGCP) along Quezon Avenue corner BIR Road, Diliman, Quezon City taken on Novenmber 10, 2023.
PNA photo by Ben Briones
MANILA, Philippines — The National Grid Corp. of the Philippines (NGCP) has won its arbitration case against state-run Power Sector Assets and Liabilities Management Corp. (PSALM) and the National Transmission Corp. (TransCo).
Synergy Grid and Development Philippines Inc. (SGP), the listed company behind NGCP, said the Singapore International Arbitration Centre (SIAC)’s Arbitral Tribunal rendered a final award in favor of NGCP on several issues.
On the main issue, the Arbitral Tribunal declared that the transmission operator’s P57.88-billion prepayment made in 2013 was valid.
The tribunal rejected PSALM and TransCo’s claims that NGCP violated the nationality restrictions applicable to public utilities under Philippine laws, including the Anti-Dummy Law.
In 2018, the NGCP filed with SIAC an arbitration case seeking a declaration of the prepayment’s validity and the payment of other monetary claims as the state-run firms claimed that the grid operator was in concessionaire default.
“The Arbitral Tribunal likewise declared that NGCP did not breach its obligations under the concession agreement in relation to permitted indebtedness or insurance,” the SGP said.
As for TransCo’s claim of outstanding obligations totaling around P3.9 billion, the tribunal only requires NGCP to pay P372.77 million at an interest of six percent per year until full payment.
PSALM and TransCo were also ordered to indemnify NGCP by as much as P56.53 million for expenses on right-of-way claims, the SGP said.
“TransCo was likewise obliged to reimburse NGCP for the former’s retained obligations at (around P51.84 million), together with simple interest at the rate of six percent per annum,” it said.
For other non-monetary claims, the SGP said the tribunal ruled that during the concession period, the NGCP has the “exclusive right” to use the transmission assets, including those of a related business.
“During the concession period, TransCo may not interfere with NGCP’s exclusive right by carrying on, or purporting to possess the right to carry on, any such business,” the SGP said.
Under the rules set by the United Nations Commission on International Trade Law, the tribunal’s award is final and binding, with both parties required to carry out the ruling without delay.
PSALM president and CEO Dennis Edward dela Serna said the matter has been referred to the Office of the Government Counsel, which serves as the counsel for PSALM and TransCo.
“We want to assure the public that both PSALM and TransCo are fully committed to protecting the interests of the Filipino people and that we will act in accordance with law,” dela Serna said.
TransCo has yet to comment on the issue.
Sought for insights, Peter Garnace of Unicapital Inc. believes that the tribunal ruling is favorable to NGCP on several aspects, including the technical and financial side.
“The award confirms NGCP’s exclusive rights over transmission assets. Overall, the decision strengthens NGCP’s legal standing as the country’s grid operator,” Garnace told The STAR.
