Supreme Court justices are currently in Baguio City for its summer session. Joy Patag
Supreme Court orders gov't to answer plea vs Chico River deal
Kristine Joy Patag ( - April 10, 2019 - 1:50pm

BAGUIO, Philippines — The Supreme Court has ordered the government to answer petitions challenging the legality of the multibillion-peso Chico River loan deal.

The STAR reported that the tribunal, in an en banc session in Baguio Wednesday, directed the Office of the Solicitor General to file its comment on the Makabayan bloc’s petition for prohibition with urgent prayer for temporary restraining order.

Petitioners allege that the loan agreement “contains express waiver by the [Government of the Republic of the Philippines] of its sovereign immunity from execution against its patrimonial assets.”

The petitioners also said that a reading of the provision of the loan agreement showed that the Philippine government “has allowed its patrimonial assets to stand as security for unpaid obligations under this Loan Agreement.”

“’Collateralization’ of patrimonial property for unpaid obligations under a foreign loan contract or as an award in an arbitral proceeding is unconstitutional and illegal,” the petition read.

According to the Civil Code, patrimonial assets are properties that are not “intended for some public use, and are intended for some public service or for the development of the national wealth.”

Senior Associate Justice Antonio Carpio earlier raised that a provision of the loan agreement states that the government of China can seize gas from Reed Bank—classified as patrimonial asset, said the senior justice—if the government fails to pay the loan.

The Palace however stressed that that the government would not default on the loan.

The Makabayan bloc representatives were joined by the Kilusang Mabgbubukid ng Pilipinas in their petition.

 They also asked the high court to issue a halt order against the Chico River Pump Irrigation Project and a separate order to direct government agencies to produce certified true copies, upon request, of all loan agreements between the Philippine government and China.

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