Question & AnswerQ&A (Republic Act No. 11600)
Republic Act No. 11600 grants Maynilad Water Services, Inc. a franchise to establish, operate, and maintain a waterworks system and sewerage and sanitation services in the West Zone Service Area of Metro Manila and the Province of Cavite for commercial purposes and in the public interest.
The franchise area includes the West Zone Service Area as defined under the Concession Agreement, covering cities like Manila (except San Andres and Sta. Ana), Pasay, Paranaque, Caloocan, Muntinlupa, Las Pinas, Valenzuela, Navotas, Malabon, parts of Makati and Quezon City, and cities and towns in Cavite such as Bacoor, Imus, Kawit, Noveleta, and Rosario.
The grantee may establish, manage, operate, repair, rehabilitate, expand, and improve waterworks and sewerage systems, develop water sources, recover and reuse treated water, finance and operate sewerage systems, purify water subject to agency approval, construct infrastructure over public areas with restoration duties, and disconnect water service for payment default or pilferage under RA 8041.
The Regulatory Office, established under the Concession Agreement or its legal successor, oversees the standards for the operation and maintenance of waterworks and sewerage systems, approves tariffs and charges, conducts assessments of compliance, and ensures the grantee modifies or improves systems for efficiency and environmental sustainability.
Tariffs, rates, and charges are to be established by the Regulatory Office with approval from the MWSS Board of Trustees, based on a rate-setting methodology considering reasonable costs, efficiency, incentives, consumer willingness to pay, equity, administrative simplicity, and relevant laws. These tariffs are presumed valid unless challenged in proper proceedings.
Failure to submit the annual report results in a fine of One million pesos (₱1,000,000.00) for each working day of noncompliance, which is collected separately from penalties imposed by the Regulatory Office and remitted to the Bureau of the Treasury.
The franchise is granted for a term of twenty-five (25) years from the effectivity of RA 11600, unless sooner cancelled or revoked by Congress for public interest or non-compliance with regulatory standards, and is ipso facto revoked if the grantee fails to operate continuously for two years.
The grantee must create employment opportunities and accept on-the-job trainees giving priority to residents where it operates, and comply with applicable labor standards, with employment reflected in its General Information Sheet submitted annually to the SEC.
The President may temporarily take over operation during times of war, rebellion, public peril, calamity, emergency, disaster, or disturbances of peace and order, or suspend operations in the interest of public safety and welfare, with due compensation to the grantee.
The Concession Agreement between MWSS and the grantee serves as the certificate of public convenience and necessity, license, or permit for operating the waterworks and sewerage system, and remains valid unless terminated or amended as provided by law, with provisions for possible extension of its term.