GMR under probe by Philippines authorities on Anti – dummy Laws

A GMR spokesperson denying the allegation as "unfounded", said the infra major is confident that in due course of time, the case will be found to be without any merit.

Hyderabad: Officials of the Mactan-Cebu International Airport Authority in the Philippines and its operator GMR Megawide Cebu Airport Corp (GMCAC) came under that government’s scanner for allegedly flouting that country’s anti-dummy laws.

A statement issued by the National Bureau of Investigation (NBI) of the Philippines after receiving a complaint, said its Anti-Fraud Division filed charges before the Department of Justice against five Filipinos including a high-ranking official of Mactan-Cebu International Airport Authority (MCIAA) and eleven foreign nationals including some from GMR Group for alleged violation of the Anti-Dummy Law.

A GMR spokesperson denying the allegation as “unfounded”, said the infra major is confident that in due course of time, the case will be found to be without any merit.

“The complainant stressed that the subjects conspired, connived, colluded, schemed and acted together to violate the 1987 Constitution and the Anti-Dummy Law. The complainant added that based on the evidence, the MCIA is operated, administered, and managed by non-Filipinos more particularly by an Irish, a Ghanaian and several Indians who have profound control, enjoyment…, the NBA statement issued in the first week of December said.

The Anti-Dummy Law is a law created to penalise those who violate foreign equity restrictions and evade nationalisation laws of the Philippines.

The law prohibits dummy, or using a proxy arrangement to accomplish a transaction not allowed under Philippine law.

In 2014, a consortium of GMR and Megawide Construction Corporation of the Philippines was awarded the airport contract after it emerged as the highest bidder after offering a bid premium of 14.4 billion pesos or around USD 320 million for construction, development, renovation, expansion and operation of theairport for a period of 25 years as provided in the Concession Agreement.

Through some recent media reports, GMCAC came to know about a complaint before the Department of Justice for violation of the Philippines Anti-Dummy Laws.

However, till date, GMCAC has not received any formal intimation in this regard from the Department of Justice, the GMR official said.

“The government of Philippines recently put the General Manager of Mactan Cebu International Authority, a government organisation, under a preventive suspension as per standard government procedures in such matters. All the allegations are baseless and unfounded. We are 100 percent confident that in due course of time, the case will be found to be without any merit,” the GMR spokesperson told P T I in an email reply.

GMR and Megawide consortium won the bid to modernise and operate the airport in 2014 through a transparent bidding process which drew interest from global operators.

The award was challenged in the Supreme Court of the Philippines in 2014 and after scrutinising all the documents, the case was dismissed in 2016.

The apex court in its ruling found GMR-Megawide Cebu Airport Corporation (GMCAC) to be fully compliant with the bid conditions and requirements of applicable laws of the land, the official added.