Philippines scraps foreign ownership ceiling on prison PPP

The country's Department of Justice has postponed the submission deadline for pre-qualification documents by about three weeks to allow more time for investors to participate.

The Philippines’ Department of Justice (DOJ) is trying to shore up fresh interest in the regional Nueva Ecija prison public-private partnership (PPP) project before a revised May 29 submission date of pre-qualification documents by lifting the 40 percent ownership ceiling usually applied to foreign investors targeting domestic infrastructure assets.

The State officer said foreign companies were encouraged to bid for the project as a way for the government to complement the limited local expertise to carry through the P50 billion (€1 billion; 1.12 billion) project.

“There were several firms that have manifested their interest for the project, but they either find the bid price very high or are still taking time to come up with consortium with other companies because we have very strict requirements for the bidding regarding experience in building prison facilities,” senior State counsel Elena Laborte-Cuevas was reported to have said by local press.

In a public notice issued last Friday, the DOJ said the new deadline would give interested bidders more time to prepare and submit their documents for the project, which is intended to become the country’s most modern prison facility.

The department earlier said that at least three bidders, Megawide, DM Consunji and San Miguel Corporation, had shown initial interest in the big-ticket project.

The deadline for bid submission is August 14, with the target date for the issuance of award notices set for September 3. The DOJ will aim to hold the contract signing ceremony on September 30.

Foreign firms can participate in the bidding on their own, which is allowed under Republic Act 7718 or the Build-Operate-Transfer Law, or enter into consortiums with local firms.

The project started with the release of the invitation to prequalify and bid advertisement on February 27, which was followed by the prequalification conference on April 8 this year.

The project includes the design, financing, construction and maintenance of the prison facilities that will be built inside Fort Magsaysay in Nueva Ecija, 160 kilometres North of Manila. It is designed to accommodate 26,880 inmates.

The DOJ said a number of supporting accommodation and building-related services may be outsourced as part of the PPP agreement to include laundry, waste treatment and disposal, sewage water treatment and power generation.

Once finished, the new facility will replace the New Bilibid Prison in Muntinlupa City in Manila as the main prison facility in the country.