Posted on May
19, 2013 10:36:53 PM [ BusinessWorld Online ]
LEGAL
QUESTIONS could hound the development of the latest commercial center of SM
Prime Holdings, Inc., as a state firm mulls options to address what it claims
is illegal use by the mall operator of its land.
The Bases Conversion and Development
Authority (BCDA) said over the weekend that it will fight a temporary
restraining order (TRO) issued on Thursday last week on its move to block
construction of a road linking SM Aura Premier, which opened in Taguig City
that same day, to McKinley Parkway in the Fort Bonifacio area.
The state
firm also alleged in a statement that use of the land on which SM Aura stands
for commercial purposes is itself illegal.
“SM occupied
the property forcibly after its request to construct was denied by BCDA.
Despite being denied a permit by the proper authorities, they (SM Prime) still
proceeded with utter impunity and disregard of the law,” Arnel Paciano D.
Casanova, BCDA president and chief executive officer, said in a statement
e-mailed to reporters over the weekend.
In its
statement, BCDA said it sent SM Prime a letter, dated April 3, rejecting the
mall developer’s request to build the road, and another letter early this month
asking the same company to “cease and desist” from proceeding with the digging.
RESTRAINING
ORDER
Taguig City
government was able to secure last May 16 -- the day of SM Aura’s opening -- a
TRO from the Regional Trial Court of Taguig that blocked BCDA’s move.
“They did not
succeed when BCDA questioned their (SM Prime) action because of lack of legal
authority, so they went to the court to get that TRO,” Mr. Casanova said in a
text message.
“BCDA, in the
exercise of its duty as steward of that property, filed an opposition to the
TRO but complied nonetheless with the order,” he added.
“[W]e are
fighting the TRO. We are doing this on behalf of the Armed Forces of the
Philippines (AFP), who should be the beneficiary of the commercial use of
Bonifacio Global City,” he continued, citing various legal bases, including
Republic Act (RA) No. 7917 -- which amended RA 7227, or the Bases Conversion
and Development Act of 1992 -- and RA 10349, or the AFP Modernization Act.
‘ILLEGAL’
In arguing
that the planned road is illegal, BCDA particularly cited the part of RA 7917
stating: “Approximately forty hectares of land in Fort Bonifacio, Phase I,
shall be retained as national government and local government centers, sports
facilities and parks…”
Going
further, Mr. Casanova noted in the statement that SM Aura stands on land
donated by BCDA to Taguig City, saying: “Instead of bidding out the land and
remitting the proceeds to the AFP for its modernization, we turned over this
land so it can be put to good civic use.
“Instead,
both the AFP and the people of Taguig are being deprived by the illegal
construction of this commercial complex,” he argued.
DONATION
TERMS
Mr. Casanova
explained further in his text that “[t]he donation is with a condition that it
will be… for institutional use as a government center and parks which Taguig
and SM clearly violated; we simply want that the law be complied with.”
SM Prime won
an auction Taguig City staged in 2007 to develop the land concerned.
Asked if BCDA
wants to take back control of the land on which the new mall stands, Mr.
Casanova replied: “We are exploring all legal remedies available to the
government.”
Sought for
comment, Corazon P. Guidote, senior vice-president for Investor Relations of SM
Prime parent SM Investments Corp., sidestepped the issue, replying via text
that “[t]he dispute is between the City of Taguig and BCDA.”
SM Aura,
which has a gross floor area of 234,892 square meters, is SM Prime’s 47th mall
in the Philippines. It incorporates office towers, a chapel, a convention
center, and mini-coliseum, among other features.
Shares of SM
Prime, which expects to end this year with 48 malls in the Philippines and five
in China, lost 55 centavos or 2.66% to P20.15 apiece on Friday last week from
P20.70 each last Thursday. -- Emilia Narni J. David
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