Filipino taxpayers have lost P18 billion in cash, real estate, future cash earnings and shares of stock of Philippine National Construction Corporation (PNCC)Â that runs the country’s toll roads, to a little-known company registered in the British Virgin Islands. By words of the PNCC officials, the BVI firm named Radstock Securities Ltd. has received the amount that could be limited to â€œonly P6.1 billionâ€, through a scheme that, as claimed by critics, undervalues PNCC’s assets.
The amount that PNCC will pay to the BVI company includes half of its cash earnings from toll road operations for the next 27 years. The PNCC-Radstock deal was planned since 2000, and affirmed by the Court of Appeals in January 2007. Currently it is opposed by at least two senators and a civil society advocate who used to chair PNCC. The opponents of the transaction argue that it puts a private firm with an inferior credit standing ahead of the national government, which has outstanding and unpaid claims on PNCC worth at least P36 billion. They also want to know who stands behind the BVI-domiciled Radstock Ltd.
PNCC and Radstock entered into agreement on August 17, 2006, and it was approved by the Court of Appeals on January 25, 2007. The value of the â€œcompromise dealâ€ was put by the Senator Franklin Drilon at P17.6 billion. The Senator became interested in the case when he noticed how other lawmakers were trying to have PNCC’s franchise renewed in December 2006. He considers that this is not a valid contract or an agreement for a project, but just an agreement to cede assets.