MANILA, Philippines — The Philippine Competition Commission (PCC) has lauded the decision of the Supreme Court (SC) to declare as unconstitutional the nationality requirement in licensing rules for contractors, saying this would level the playing field for local and foreign firms in construction projects.
The SC declared void the nationality requirement in licensing rules set by the Philippine Contractors Accreditation Board (PCAB).
Prior to the SC’s ruling, only domestic firms could get regular licenses for multiple projects per year.
Foreign contractors, meanwhile, were only granted a special license per project.
In its ruling, the SC cited the PCC’s opinion that the nationality restriction prevents the entry of foreign contractors and violates the constitutional policy against unfair competition.
The SC’s ruling stems from the dispute between PCAB and Manila Water Co Inc.
PCC intervened as amicus curiae (friend of the court) and issued an opinion on the case.
Based on the PCC’s study, a foreign contractor would have to spend 12 times more for license applications than a local firm to engage in the same level of activity.
Without that regulatory barrier, the PCC said competition would be based on merit.
In addition, the decision would encourage the entry of more contractors in the market and, in turn, provide more choices in carrying out infrastructure projects.
The move is also expected to benefit the construction sector in terms of new technologies and global best practices.
“This is a game-changing ruling that unlocks the benefits of competition through effective competition advocacy. The country stands to significantly benefit from this development especially amid the government’s Build Build Build program,” PCC chairperson Arsenio Balisacan said.
With fair competition in the construction industry, he said Filipinos benefit in terms of greater value from taxpayers’ money through lower priced and better quality infrastructure projects.