MANILA, Philippines — The government is asking the consortium of seven conglomerates for more revisions in the proposed concession agreement for the rehabilitation of the Ninoy Aquino International Airport (NAIA)  before it gets the final approval to proceed with the Swiss challenge.

Transportation Undersecretary for planning Ruben Reinoso said the two major revisions include the coverage of material adverse government action (Maga) and conditions involving government guarantees for subsequent investment.

“The ICC (Investment Coordination Committee) just has some conditions. Number one is that the material adverse government contract should not include local government, judiciary and legislative. So those should be excluded in the Maga,” he said.

Reinoso said the Maga must pertain only to the actions of the executive branch.

“Also, there is a provision in the contract that they will only start phase two after phase one since the project is three phases. After phase one, what they are saying is that they will only start phase two once the passenger service charge is adjusted, which is about P550 now to P750. So that is their condition,” the transportation official said.

Reinoso said implementing the project’s subsequent phase after the approval of a price increase is in effect a guarantee on the part of the government.

“But the ICC said that is not okay. We told them (NAIA Consortium) that their investment commitments will happen whether there is an increase or not. So we are not guaranteeing any increase in fees and charges. You can file, but it’s up to the regulator to approve it and government will not guarantee that the regulator will approve,” he said.

“I can understand where the proponents are coming from because, of course, they will have to borrow money. Of course, their lenders want some assurance that they would be able to pay and the only way they can do that is basically, the fees and charges must be adjusted, but we don’t want to guarantee that. What we told them is you can always file a petition, but we will not guarantee it. Let the regulator decide on it,” Reinoso said.

Should the consortium’s revised submission comply with the conditions, Reinoso said “we will tell ICC that it has already complied and then for NEDA board approval.”

Transportation Secretary Arthur Tugade said they have met with the NAIA consortium twice since the project was approved by the National Economic and Development Authority’s ICC two weeks ago.

Tugade said the consortium has agreed to submit its revised draft of the concession agreement this week.

“Basically there was an agreement on Maga on who should do the price determination, rate determination, and also we agreed on what kind of improvements they will introduce into the proposal,” he said.

“We are thinking of having it approved with finality before the end of the year, including the Swiss challenge,” Tugade said.

With the original proponent status for its P102-billion unsolicited proposal to rehabilitate, upgrade, expand, operate and maintain the NAIA for 15 years, the NAIA consortium will have the right to match better offers once a Swiss challenge is undertaken for the project.

It seeks to expand and interconnect the existing terminals of NAIA, upgrade its airside facilities, develop commercial facilities to increase airline and airport efficiencies, enhance passenger comfort and experience, and elevate the status of the airport as the country’s premier international gateway.

The consortium is composed of Aboitiz InfraCapital, AC Infrastructure Holdings Corp., Alliance Global Group Inc., Asia’s Emerging Dragon Corp., Filinvest Development Corp., JG Summit Holdings Inc., and Metro Pacific Investments Corp.