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FLEA MARKET OF IDEAS

Make corporate officers liable

There’s an increasing number of companies guilty of wrongdoing that are getting slapped with up to a billion pesos in penalties by our government.

Manila Water and Maynilad, our country’s biggest water distributors, are the latest of these penalized companies. Last week, the Supreme Court announced it is imposing P2 billion in penalties against these two entities because of their gross environmental law violations. Even the Metropolitan Waterworks and Sewerage System (MWSS), the government agency regulating these two water utilities, is held solidarily liable to pay the penalty.

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Prior to this, Rizal Commercial Banking Corp. was fined P1 billion by the Bangko Sentral ng Pilipinas, Philex Mining Corp. was penalized P1 billion by the Department of Environment and Natural Resources, and the now defunct ride-hailing company, Uber, was ordered by the Land Transportation Franchising and Regulatory Board to pay almost half a billion pesos in fines and financial aid to its drivers.

In addition to the P2 billion fines, Manila Water, Maynilad and the MWSS are being made to pay P322,102 in daily penalty until they fully comply with the Clean Water Act (Republic Act No. 9275). The law requires them to connect the sewage lines found in all subdivisions, condominiums, commercial centers, hotels, sports and recreational facilities, hospitals, market places, public buildings, industrial complexes and other similar establishments, including households, to the available sewerage system.

The two water companies were obligated to provide sewage lines in Metro Manila and other cities in their concession areas within a five-year period, which expired in 2009. The P2-billion penalty was for their failure to put up the sewerage system from 2009 up to the present.

The MWSS admits that only an appalling 15 percent of Metro Manila water consumers are connected to sewer networks. What’s even more distressing is that, despite the 2009 deadline set by law, the MWSS defies Congress by proclaiming that it will take its own sweet time by committing to full sewer and sanitation coverage only in 2037.

In its website, Manila Water admits that 85 percent of the households in its concession areas “are not yet covered by a sewer system and instead utilize their own septic tanks. Wastewater that accumulates inside septic tanks… eventually leak out pollution into the groundwater or into municipal drainage systems, eventually finding its way into our rivers and water bodies.” It’s the same fate for wastewater coming from the households serviced by Maynilad, no doubt.

It’s clear that the heavy pollution of our city rivers and Manila Bay is virtually due to the refusal of the two companies to complete the sewerage system. No amount of money and effort spent by the government and civic organizations will ever clean up our city rivers and the bay because of the daily seepage and flow of wastewater.

Manila Water and Maynilad enjoy two enviable advantages. The government has each given them a franchise that amounts to a business monopoly with millions of captive consumers. They are also guaranteed a 12-percent rate of return on their investments, as public utilities. In exchange for these huge privileges, they have been required to put up a sewerage system out of which they will earn additional income in sewage fees anyway.

The P2-billion fine imposed by the government will work to penalize the stockholders of the two companies, many of whom are innocent investors of the publicly-listed companies. Even making the MWSS solidarily liable merely penalizes innocent taxpayers.

If the government wants to exact real accountability and force the quick completion of the sewerage projects, it should criminally prosecute the responsible corporate officers, because the law allows the imposition of P3 million in fines per day and imprisonment of 10 years against them.

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If that doesn’t work, unleash the ultimate weapon of the current government: Allow the President to go berserk on them.

Comments to [email protected]

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TAGS: corporate officers, corporate penalties, Flea Market of Ideas, Joel Ruiz Butuyan, Manila Water, Maynilad, MWSS, Philex, RCBC, Uber
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