By Darwin G. Amojelar | Manila Standard Today | May. 10, 2015

The government is likely to reject unsolicited proposals to expand the Metro Rail Transit Line 3, citing legal issues.

“There are legal issues on all proposals. We are yet to formally convey to the proponents. Informally it has been discussed,” Transportation Secretary Joseph Emilio Abaya said.

Three proposals are pending with the Transport Department, namely the $524-million expansion of MRT 3 offered by Metro Pacific Investments Corp., the P4.7-billion rehabilitation proposal from a joint venture of Schunk Bahn-und Industrietechnik GmbH and HEAG Mobilo GmbH from Germany and local maintenance contractor Comm Builders and Technology Philippines. Corp.; and the P4.4-billion bid of Metro Rail Transit Corp. (MRTC).

Abaya said the government was pursuing the equity value buyout of MRT3 ,even after Congress did not approve the P53.9-billion allocation in the 2015 budget for the government’s takeover of MRT.

President Benigno Aquino III issued Executive Order No. 126 in 2013, directing the Transportation and Finance Departments to buy out MRT 3 from Metro Rail Transit Corp., pursuant to the build-lease-transfer agreement.

MPIC chairman Manuel Pangilinan has said the company might no longer acquire a substantial stake in MRTC, in the wake of the government’s plan to pursue the buyout of the train system.

Pangilinan earlier said the company could exercise the option to acquire a substantial stake in Metro Rail Transit Corp. led by businessman Robert John Sobrepeña, once the government approved the proposal to expand the MRT 3 system.

Metro Pacific signed a cooperation agreement in 2011 with various groups holding rights and interests in MRT 3, including MRTC, Metro Rail Transit Holdings Inc., Metro Rail Transit 2 Inc. and Monumento Rail Transit Corp., giving the unit of Hong Kong-based First Pacific Co. Ltd. an option to acquire 48 percent. Metro Pacific has yet to exercise the option.

State-run Land Bank of the Philippines and Development Bank of the Philippines hold an 80-percent economic interest in MRT 3, creditors of MRTC hold the balance.

MRT 3, which runs along Edsa from North Avenue in Quezon City to Taft Avenue in Pasay City, is serving 500,000 passengers daily, way beyond its rated capacity of 350,000.

The line has a fleet of 73 Czech-made air-conditioned rail cars, in which up to 60 three-car trains operate daily.