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SC dismisses PGMC’s complaint vs PCSO; Makati court chided

The Supreme Court has junked a complaint by the Philippine Gaming Management Corp. that stalled a multi-billion online lottery project of the Philippine Charity Sweepstakes Office even as it also chastised a Makati court for “grave abuse of discretion” in favor of the systems provider.

“Finally, the high tribunal allowed PCSO to proceed with the public bidding for the Nationwide Online Lottery System in Luzon,” PCSO general manager Alexander Balutan said.

Balutan was referring to the P10.9-billion project that was hit by an injunction last year while PCSO was in the middle of a bidding process.

“Premises considered, the petition is granted. The Philippine Charity Sweepstakes may proceed with the bidding process for NOLS for Luzon,” read the 20-page decision penned by Associate Justice Marvic Leonen.

The SC 3rd Division granted the government corporation’s petition to set aside the Aug. 3, 2017 writ of preliminary injunction issued by Makati City Regional Trial Court Branch 143 Judge Maximo de Leon.

“This court finds that the Regional Trial Court committed grave abuse of discretion in granting respondent Philippine Gaming Management Corporation [PGMC] application for injunctive relief. A Writ of Preliminary Injunction is issued to ‘prevent threatened or continuous irremediable injury to some of the parties before their claims can be thoroughly studied and adjucated,” the decision read.

SC ruled that the PGMC, the current private contractor, can not claim that it has alleged exclusive rights to be protected.

The lease agreement was extended only until August 21, 2018 and PGMC failed to provide proof that the Amendments to Equipment Lease Agreement was extended beyond that date.

“This is a welcome development for the agency. Although we have to start all over again with the preparation of terms of reference, technical specifications, and the bidding, which has already been started early this year, kung natapos ‘yun last year, nasa transition period na tayo. Kaya lang na-delay. Nawala completely ang momentum. But with this new development, at least we can now proceed with the bidding process,” said Balutan.

Bidding process usually takes six to eight months; while the transition period from the old to a new system usually takes another eight to 10 months.

Since the start of lotto games more than 20 years ago, it was only in 2017 when PCSO opened for the first time the public bidding for the supply and delivery of its Nationwide Online Lottery System, wherein 17 bidders properly secured bid documents.

However, De Leon granted on Aug. 3, 2017 a temporary restraining order filed by PGMC against the bidding for the five-year lease of the NOLS with an approved budget for the contract (ABC) amounting to P10.906 billion.

In February this year, the International Chamber of Commerce-International Court of Arbitration rendered a ruling favorable to PCSO declaring that PGMC does not have an exclusive contractual right to supply an online lottery system for Luzon.

“The Tribunal thus dismissed PGMC’s P7.6-billion claims for damages against PCSO. The agency was awarded reasonable costs and expenses amounting to P53.5 million. PGMC will also reimburse US$ 200,000 for our share of the advance costs,” said Balutan.

Balutan said that the NOLS has a lower rate compared with the existing lottery system. The system will be implemented nationwide and it will be accessible to the public.

PCSO had two lottery systems. For Luzon, it’s with PGMC, owned by Berjaya, a foreign company from Malaysia allegedly backed by a former president, which ended on Aug. 21, 2018; while for Visayas-Mindanao, it was held by Pacific Online System Corp., which expired on July 31, 2018.

NOLS has only one system and can validate all tickets bought from all over the country. The new ticket system will have added security features. One can easily check if it’s authentic or not to prevent players from counterfeiting or faking winning lotto tickets.

“Meaning, kapag binili mo ‘yung ticket mo sa Visayas o Mindanao, pwede mo i-validate dito sa Luzon. Unlike in the old lottery systems, when one buys in Visayas, the person cannot validate the winning ticket in Luzon because it uses a different system. He has to go to PCSO main office where all validating machines are available to validate his ticket,” explained Balutan.

PCSO is strictly implementing a policy that winners can only claim jackpot prizes at the main office, while consolation prizes of P10,000 and below can be claimed at any Lotto outlets. Meanwhile, prizes amounting to P200,000 or P300,000 can be claimed at its branch offices.

Topics: Supreme Court , Philippine Gaming Management Corp. , Philippine Charity Sweepstakes Office
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