Court favors Panay Electric Company

Panay Electric Company

THE planned ‘confiscation’ of all the assets and properties of the Panay Electric Company (PECO) by its rival thru a “flawed” franchise granted by Congress has been put on hold after the Mandaluyong Regional Trial Court on Tuesday granted its request for a ‘temporary restraining order.’

In a five-page decision dated March 12, 2019, the Hon. Monique Quisumbing-Ignacio, presiding judge of Branch 209, found merit on the petition filed last week by PECO against Monte Oro Resources Energy (MORE), owned by businessman, Enrique Razon.

PECO last week sought the court’s help, primarily questioning two provisions of RA 11212, the franchise granted by Congress to MORE early this year and which went into effect last March 6, less than a year after the latter applied for a congressional franchise.

PECO had argued “there is no substantial due process when private property is taken by the government from one private person and given to another person for the latter’s direct benefit.”

PECO, which has been the sole power supplier in Iloilo City and nearby areas for the last 97 years, had applied for franchise renewal in 2017 but Congress instead set it aside in order to accommodate Razon’s company.

In the main, PECO challenged Section 10 and Section 17 of RA 11212 that authorized MORE to expropriate PECO’s assets via the principle of ‘eminent domain.’

The petition also seeks to stop other government agencies including the Department of Energy (DoE), Energy Regulatory Commission (ERC) and other government agencies from implementing RA 11212 while the validity of the law is being challenged and heard.

The PECO petition notes that the “authority granted to MORE for the taking of PECO’s assets is arbitrary and confiscatory.”

Furthermore, PECO cited, “the Constitution itself provides that ‘private property shall not be taken for public use without just compensation.’”

“The assailed provisions of R.A. 11212 is not so much the grant of the power of eminent domain, but rather the scheme by which the law was used in a not-so-subtle attempt to unduly interfere with PECO’s rights,” the company said.

In favoring PECO, the court also noted that MORE had already filed a separate petition at a court in Iloilo City thru a ‘complaint for expropriation’ that targets all the assets and properties of PECO.

The court also noted that while PECO, even under RA 11212, was allowed a two-year grace period to continue with its business, MORE had also applied for a ‘certificate of public convenience and necessity’ (CPCN) that would authorize it to fully take over PECO’s business this early.

In granting the TRO that is effective for the next 20 days, PECO was also ordered to deposit a P5 million bond while the discussion of the merits of the position of the two parties has been set this coming April 2.