Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
EIGHTEENTH CONGRESS 
Second Regular Session 
HOUSE BILL No. __________ 
Introduced by Hon. Alfredo A. Garbin, Jr. 
AN ACT GRANTING MAYNILAD WATER SERVICES, INC. A FRANCHISE TO 
ESTABLISH, OPERATE, AND MAINTAIN, FOR COMMERCIAL PURPOSES AND IN THE 
PUBLIC INTEREST, A WATER SUPPLY AND DISTRIBUTION SYSTEM AND SEWERAGE 
AND/OR SANITATION SERVICES IN THE SERVICE AREA WEST  
EXPLANATORY NOTE 
This bill seeks to grant MAYNILAD WATER SERVICES, INC. (Maynilad) a franchise to 
establish, operate, and maintain, for commercial purposes and in the public interest, a water 
supply and distribution system and sewerage and/or sanitation services in the Service Area 
West and, subject to applicable laws, other areas. 
In 1995, Congress passed Republic Act No. 8041 (the ―National Water Crisis Act of 
1995‖) to allow the privatization of water services to address the nationwide water crisis which 
adversely affected the health and well-being of the population, food production and 
industrialization process.  
Consequently, on 21 February 1997, Maynilad was granted a 25-year exclusive 
concession by the government to operate, maintain and invest in the water and sewerage 
systems in 17 cities and municipalities that comprise the West Zone of the Metropolitan Manila 
area. Maynilad was then managed and controlled by the consortium of Benpres Holdings 
Corporation (Benpres) and Suez Lyonnaise de Eaux (Suez). 
In 2003, Maynilad went under corporate rehabilitation and in 2005, Benpres and Suez 
ceded management and control of Maynilad to Metropolitan Waterworks and Sewerage System 
(MWSS). The following year, a competitive bidding was done by the Philippine Government to 
re-privatize Maynilad. 
DMCI-MPIC Water Company, Inc. a joint venture between Metro Pacific Investments 
Corporation (MPIC) and DMCI Holdings, Inc. (DMCI), won the competitive bidding and acquired 
83.96 percent of Maynilad’s shares. 
In 2007, the new owners took over Maynilad and launched an aggressive five-year 
investment program to rehabilitate the company and its operations. 
In 2010, the 25-year exclusive concession was extended by additional 15 years, or up to 
May 2037. 
In 2013, Marubeni Corporation of Japan acquired a 21.54 percent stake in DMCI-MPIC 
Water Company, Inc. (renamed Maynilad Water Holding Company, Inc.) and became a 
strategic partner of the Metro Pacific-DMCI consortium. 
In April 2021, in compliance with President Rodrigo R. Duterte’s policy of ensuring the 
protection of the interest of Filipino consumers and the national government, Maynilad and 
MWSS renegotiated the terms and conditions of the exclusive concession.  On 18 May 2021, 
Maynilad and MWSS signed a Revised Concession Agreement (RCA) which contains the 
following features: 
1.
The RCA confirms the continuation of the concession until 31 July 2037. The RCA
largely adopts the provision of the New Clark City – Joint Venture Agreement (NCC-
JVA) for the development of water and wastewater infrastructure in New Clark City.
May 19, 2021
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2.
Consistent with the NCC-JVA, the RCA removes recovery of Corporate Income Taxes
and adjustment for foreign currency differential (FCDA). To mitigate the impact of tariff
increases on customers, the RCA lowers the inflation factor to 2/3 of the Consumer Price
Index adjustment and imposes caps on increases in standard rates for water (1.3x the
previous standard rate) and wastewater (1.5x the previous standard rate). Instead of a
market-driven appropriate discount rate, Maynilad shall now be limited to a 12% fixed
nominal discount rate.
3.
The rate rebasing mechanism under the original CA is retained. Thus, the rates for water
and sewerage services provided by Maynilad shall be set at a level that will permit it to
recover over the term of the concession expenditures efficiently and prudently incurred
and to earn a reasonable rate of return.
4.
To align with the government’s program to assist the disadvantaged sector and to
contribute to the recovery of the economy post-COVID 19, the RCA includes a tariff
freeze until 31 December 2022.
5.
Finally, the Undertaking Letter of the Republic is retained but has been amended to
exclude the non-interference clause. It now applies only to existing loan obligations at
the time of execution of the RCA (including the undrawn amount under the loan
agreement with Japan International Cooperation Agency).
The grant of franchise to Maynilad will secure the continuing obligation of Maynilad to 
provide reliable and adequate supply and distribution of potable water for domestic, commercial 
and other purposes, and to provide necessary sewerage and/or sanitation services in the West 
Zone even after the expiration of the RCA. It will also lay down the preparatory groundwork 
necessary to prepare Maynilad for the change in the regulatory framework for water services 
proposed in the pending bills for the creation of the Department of Water Resources. The grant 
of franchise also gives Congress oversight power over Maynilad and the services that it renders 
in the West Zone. 
As at 31 December 2020, Maynilad’s network consisted of around 7,729 kilometers of 
pipeline.   It also has 35 pumping stations, 32 water reservoirs, and 28 in-line boosters across 
its service area. Its reservoirs have a total holding capacity of over 700 million liters of potable 
water.   
Maynilad’s water distribution system is the longest ISO-certified facility of its kind in the 
Philippines.  It stretches from North Caloocan to Cavite Province and delivers over 2,000 million 
liters of potable water per day to over 1,400,000 million customers. 
Similarly, Maynilad maintains and operates four world-class water treatment plants. The 
La Mesa Treatment Plant 1, the La Mesa Treatment Plant 2, the Putatan Water Treatment Plant 
1, and the Putatan Water Treatment Plant 2 (PWTP2) all produce water that meets the 
Philippine National Standards for Drinking Water (PNSDW) of the Department of Health (DOH). 
On the wastewater front, Maynilad maintains and operates 19 sewage treatment plants, 
two combined sewage and septage treatment plants, and one septage treatment plant that 
process wastewater and sludge collected from customers to prevent pollution of waterways and 
bodies of water. 
20 out of 22 facilities are certified in three standards, namely, the ISO 9001:2015 
(Quality Management System), ISO 140001:2015 (Environment Management System), and 
OHSA 18001:2007 (Health and Safety Management System). Aside from the three ISO 
certifications, the Tondo Sewage Pumping Plant is also certified under ISO 50001:2011 (Energy 
Management System). 
Since the re-privatization of Maynilad in 2007, water coverage has increased by nearly 
one-third, reaching 9.8 million people, while 17 kilometers of new pipes have been laid. Average 
non-revenue water at the district metered area level was at 26% as at December 2020, down 
from 68% 14 years ago, saving one billion liters of water every day. 
In January 2021, PWTP2 was conferred an award of distinction under the ―Water Project 
of the Year‖ category of the Global Water Awards 2020. The Global Water Awards recognize 
the most important achievements in the international water industry. PWTP2, Maynilad’s second 
facility to tap Laguna Lake as raw water source, gained recognition for its crucial role in 
addressing water security in Metro Manila. 


In the coming years, Maynilad is expected to ramp up its spending in capital 
expenditures, not only to open up new sources of water supply to respond to the growing needs 
of the people and businesses in its service area, but to ensure the reliability and robustness of 
its existing facilities to respond to the challenges of climate change. In addition, it will need to 
increase investments in wastewater treatment and other measures to improve the quality and 
sustainability of its surrounding environment and the well-being of the population it serves. 
Given all of the foregoing and considering that Maynilad possesses all the required 
capabilities, it is proper for Congress to grant Maynilad the franchise to establish, operate and 
maintain, for commercial purposes and in the public interest, a water supply and distribution 
system and sewerage and/or sanitation services in the Service Area West, and, subject to 
applicable laws, other areas. 
The support of the Members of Congress for the prompt and timely passage of this 
measure is earnestly requested. 
HON. ALFREDO A. GARBIN, JR. 
Representative 


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
EIGHTEENTH CONGRESS 
Second Regular Session 
HOUSE BILL No. __________ 
Introduced by Hon. Alfredo A. Garbin, Jr. 
AN ACT GRANTING MAYNILAD WATER SERVICES, INC. A FRANCHISE TO 
ESTABLISH, OPERATE, AND MAINTAIN, FOR COMMERCIAL PURPOSES AND IN THE 
PUBLIC INTEREST, A WATER SUPPLY AND DISTRIBUTION SYSTEM AND SEWERAGE 
AND/OR SANITATION SERVICES IN THE SERVICE AREA WEST  
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION 1. Nature and Scope of Franchise. — Subject to the provisions of the Constitution 
and applicable laws, rules and regulations, there is hereby granted to Maynilad Water Services, 
Inc., hereunder referred to as the grantee, its successors or assigns, a franchise to establish, 
operate, and maintain, for commercial purposes and in the public interest, a water supply and 
distribution system and sewerage and/or sanitation services for the purpose of providing water 
and wastewater services to the inhabitants of its franchise area covered by Service Area West, 
and, subject to applicable laws, other areas. 
SECTION 2.  Definition of Terms. —  Whenever used in this Act, the following terms shall 
have the respective meanings hereafter set forth: 
a.
Concession Agreement means the agreement entered into between Maynilad
Water Services, Inc. (formerly Benpres-Lyonnaise Waterworks, Inc.) and MWSS on 21 February 
1997, including its Amendment, dated 5 October 2001, and the Memorandum of Agreement and 
Confirmation entered into between the grantee and MWSS on 22 April 2010, as amended by 
the Revised Concession Agreement dated 18 May 2021. 
b.
CPCN means Certificate of Public Convenience and Necessity.
c.
Franchise Area means the Service Area West as defined and delineated under
the Concession Agreement, and, subject to applicable laws, other areas. 
d.
MWSS means the Metropolitan Waterworks and Sewerage System.
e.
Regulatory Office means: (i) the Regulatory Office established under the
Concession Agreement (the ―MWSS Regulatory Office‖) or its legal successor-in interest, as 
may be created or reorganized by Executive Order or by law, or (ii) the Water Regulatory 
Agency as defined in Section 2(f), as applicable. 
f.
Water Regulatory Agency means the regulatory agency which may be created by
law, which will have primary jurisdiction over waterworks and sewerage systems, including the 
grantee, with power to issue CPCN, permits or licenses over such waterworks and sewerage 
systems, and which will assume the regulatory authority of the MWSS Regulatory Office. 
SECTION 3.  Rights and Privileges. — The grantee, as franchisee, shall have the sole right to 
establish, manage, operate, repair, rehabilitate, expand and improve the waterworks and 
sewerage system in the Franchise Area, including the right to bill and collect fees from end-
users for  water supply and sewerage services provided in the Franchise Area. 
The grantee shall also have the rights and privileges to: 
(a)
develop, finance, construct, install, maintain, and operate, as applicable,
water sources, which include deep wells, dams, aqueducts, tunnels,
treatment plants, reservoirs, pump stations, transmission, conveyance
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and distribution pipes, fire hydrants, machineries and other waterworks 
for the purpose of supplying water to the inhabitants of its Franchise Area, 
for domestic, commercial, industrial, and other purposes; 
(b)
supply, distribute and sell treated and/or grey water, whether in bulk or
retail, to any natural or juridical person, whether public or private concern,
within its Franchise Area for domestic, commercial and/or industrial uses
and to charge and collect a schedule of prices and conventional rates
therefor;
(c)
finance, construct, install, maintain, and operate sewerage systems,
whether separate or combined, as may be necessary for the proper
sanitation and other uses of residential and non-residential customers
within the Franchise Area and to charge and collect a schedule of fees
therefor; provided, that the grantee may only offer services to non-
residential customers for industrial effluents compatible with available
treatment processes;
(d)
purify the sources of the water supply, the reservoirs and the dams
subject to the approval of the Department of Health and/or any other
government agency concerned therewith, and to regulate the control and
use, and prevent the waste of water;
(e)
construct works across, over, through and/or alongside, any stream,
water-course, canal, ditch, flume, street, avenue, highway or railway,
whether public or private, as the location of said works may
require; provided, that such works be constructed in such manner as to
afford security to life and property and so as not to obstruct
traffic; provided, further, that the stream, water-course, canal, ditch,
flume, street, avenue, highway or railway so crossed or intersected be
restored without unnecessary delay to its former state; provided,
furthermore, that any person or entity whose right may be prejudiced by
said works shall not obstruct the same, subject to reasonable notice
before construction and payment of  just compensation;  locate, construct
and maintain such works on, over and/or through any street, avenue, or
highway and land and/or real rights of the Republic of the Philippines or
any of its branches, agencies and political subdivisions upon due notice
to the office or entity concerned, subject solely to the condition that the
street, avenue, or highway in which said works are constructed be
restored without unnecessary delay to its former state unless otherwise
agreed upon by the grantee and the office or entity concerned; and
(f)
disconnect water supply and/or discontinue provision of wastewater
services to a customer if such customer defaults in the payment of fees
due to the grantee for the services provided or for acts of pilferage
pursuant to Sections 8, 9, 10, and 11 of Republic Act No. 8041, 
otherwise known as the Water Crisis Act of 1995. 
SECTION 4. Manner of Operation of Facilities. — All water supply and sewerage systems for 
water services owned, maintained, operated, or managed by the grantee, its successors or 
assignees shall be operated and maintained at all times in accordance with industry standards 
and as specified in the Concession Agreement or CPCN, license, or permit which may be 
issued to the grantee. It shall be the duty of the grantee, its successors or assignees, whenever 
required to do so by the Regulatory Office, to modify, improve, and change such system or 
facilities in such manner and to such extent as the progress in science and improvements in 
water supply and sewerage systems may reasonably require.  
SECTION 5. Certificate of Public Convenience and Necessity, License or Permit – For 
purposes of this Act and in the interest of ensuring reliable services to the consumers within the 
Franchise Area, the Concession Agreement shall serve as the CPCN, license or permit for the 
continued operation of water supply and sewerage services by the grantee until a CPCN, 
license or permit is issued to the grantee by the Regulatory Office or the Water Regulatory 
Agency, as applicable, which CPCN, license or permit shall be issued not later than the 
expiration of the term of the Concession Agreement, and which shall not be inconsistent with 
the terms of this Act. All orders and issuances of the Regulatory Office made pursuant to the 
Concession Agreement, insofar as they may be relevant or applicable and not inconsistent with 
the provisions of this Act, shall continue to be operative, unless subsequently amended, revised 
or revoked in accordance with law.  


Upon the establishment of a Water Regulatory Agency, the grantee may apply with such Water 
Regulatory Agency for a CPCN or appropriate license or permit. The CPCN shall supersede the 
Concession Agreement and the operation and maintenance of the water supply and sewerage 
system by the grantee shall, after the issuance of such CPCN, be governed by the terms and 
conditions thereof. 
The regulatory structure under the Concession Agreement shall continue during the term of the 
Concession Agreement until a CPCN or the appropriate license or permit is issued to the 
grantee by the Regulatory Office or the Water Regulatory Agency, as the case may be, 
provided, that the Water Regulatory Agency, in the exercise of its regulatory authority under the 
law and to promote efficiency and better service, may modify or amend the regulatory structure 
and require an amendment of the Concession Agreement, provided, further, that the expiration 
of the Concession Agreement shall not terminate the right of the grantee to operate in the 
Service Area West under a CPCN or license or permit from the Regulatory Office or the Water 
Regulatory Agency, as the case may be. 
SECTION 6. Excavation and Restoration Works. — For the purpose of constructing and 
maintaining a water supply and sewerage system, which includes, but not limited to, a piped 
distribution network, and any system or network of pipelines, ditches, channels or conduits 
including pumping stations, lift stations and force mains, service connections and other 
constructions, devices or appliances appurtenant thereto, the grantee (and its successors or 
assignees) is authorized to make excavations or lay conduits in any of the public places, roads, 
highways, streets, lanes, alleys, avenues, sidewalks, or bridges of said province, cities and/or 
municipalities, subject to prior approval of the Department of Public Works and Highways 
(―DPWH‖), Metropolitan Manila Development Authority (―MMDA‖), or the local government units 
(―LGU‖) concerned, provided, however, that any public place, road, highway, street, lane, alley, 
avenue, sidewalk, or bridge disturbed, altered, or changed by reason of constructing pipelines 
or other supports, shall be repaired or replaced in workmanlike manner at the expense of the 
grantee, its successors or assignees, in accordance with the standards set by the DPWH, 
MMDA or the LGU concerned; provided, further, that costs arising from any installation or re-
alignment of pipelines and/or other supports and/or construction of other facilities by reason of 
any project of the national government or LGU shall be for the account of the national 
government or LGU concerned. Should the grantee, its successors or assignees, having been 
required by the relevant authority to repair any part of a public place, road, highway, street, lane, 
alley, avenue, sidewalk, or bridge that has been disturbed, altered, or changed by the said 
grantee, its successors or assignees, fails to commence the repair within a period of twenty (20) 
days from notice from the DPWH, MMDA or the LGU concerned, then the DPWH, MMDA or the 
LGU concerned shall have the right to have the same repaired or replaced in good order and 
condition and charge the grantee, its successors or assignees the amount of the costs and 
expenses for such repair or replacement. 
SECTION 7. Responsibility to the Public. — The grantee shall supply and distribute water to 
its captive market in the Franchise Area in a prudent and efficient manner. In the interest of the 
public good, as far as feasible and whenever required by the Regulatory Office, the grantee 
shall improve, rehabilitate or change its facilities, pipes, systems, and equipment for the purpose 
of providing efficient and reliable service and reasonable water and sewerage service costs.  
The grantee shall charge reasonable and just fees for its services to all types of consumers and 
water users within its Franchise Area. 
SECTION 8. Setting of Tariffs, Rates, and Other Charges. — The Regulatory Office shall 
establish tariffs, rates and other charges which are fair and reasonable, and ensure economic 
viability and a fair return on investments. Tariffs, rates and charges shall be based on and 
consistent with a rate-setting methodology that is recognized internationally, and which the 
Regulatory Office shall, after due consultation, define and publish, taking into account the 
following, among others: 
1.
reasonable and prudent capital and recurrent costs of providing the service
including a reasonable rate of return on capital;
2.
efficiency of the service;
3.
incentives for enhancement of efficiency;
4.
willingness to pay of the customers/consumers;
5.
equity considerations; and
6.
administrative simplicity.
Tariffs, rates and charges set by the Regulatory Office shall be presumed valid and reasonable 
unless proven otherwise in a proper proceeding. 


During the franchise period, the grantee shall be entitled to recover reasonable and prudent 
capital and recurrent costs of providing water and wastewater services, including any and all 
concession fee payments to the MWSS, with a reasonable rate of return thereon.   
SECTION 9. Protection of Consumer Interests. — The grantee shall act with dispatch on all 
complaints brought before it. 
SECTION 10. Election of Independent Directors. — The Board of Directors of the grantee 
shall have independent directors as may be required by law applicable to the grantee. These 
directors must be elected by a majority of the total number of outstanding shares entitled to 
vote. 
An independent director is a person who, apart from shareholdings and fees received from the 
corporation, is independent of management and free from any business or other relationship 
which could, or could reasonably be perceived to, materially interfere with the exercise of 
independent judgment in carrying out the responsibilities of a director. 
SECTION 11. Right of the Government. — A special right is hereby reserved to the President 
of the Philippines, in times of war, rebellion, public peril, calamity, emergency, disaster or 
disturbance of peace and order, to temporarily take over and operate the water supply and 
sewerage system of the grantee, to temporarily suspend the operation of any facility in the 
interest of public safety, security and public welfare; or to authorize the temporary use and 
operation thereof by any agency of the government, upon due compensation to the grantee for 
the use of said water supply and sewerage system during the period when they shall be so 
operated. 
SECTION 12. Right of Eminent Domain. — Subject to the limitations and procedures 
prescribed by law, the grantee is authorized to exercise the power of eminent domain, insofar as 
it may be reasonably necessary for the efficient establishment, improvement, upgrading, 
rehabilitation, maintenance and operation of its water and wastewater facilities. The grantee is 
authorized to install and maintain its pipes, and other facilities over, under, and across public 
property, including streets, highways, parks, and other similar property of the Government of the 
Philippines, its branches, agencies or any of its instrumentalities.  
The grantee may acquire such private property as is actually necessary for the realization of the 
purposes for which this franchise is granted, including, but not limited to, pipes, buildings, 
infrastructure, machineries and equipment previously, currently or actually used, or intended to 
be used, or have been abandoned, unused or underutilized, or which obstructs its facilities, for 
the operation of a water supply and distribution system and sewerage system in the Franchise 
Area; provided, that proper expropriation proceedings shall have been instituted and just 
compensation paid; provided, further, that upon the filing of the petition for expropriation, or at 
any time thereafter, and after due notice to the owner of the property to be expropriated and the 
deposit in a bank located in the jurisdiction of the full amount of the assessed value of the 
property or properties, the grantee shall be entitled to immediate possession, operation, control, 
use and disposition of the properties sought to be expropriated, including the power of 
demolition, if necessary, notwithstanding the pendency of other issues before the court, 
including the final determination of the amount of just compensation to be paid. The court may 
appoint a representative from the Regulatory Office as a trial commissioner in determining the 
amount of just compensation. The court may consider the tax declarations, current audited 
financial statements, and rate setting applications of the owner or owners of the property or 
properties being expropriated in order to determine their assessed value. 
SECTION 13. Term of Franchise. — This franchise shall be for a term of fifty (50) years from 
the date of effectivity of this Act, unless sooner cancelled or revoked.  
SECTION 14. Acceptance and Compliance. — Acceptance of this franchise shall be given in 
writing by the grantee within sixty (60) days after the effectivity of this Act.  
SECTION 15. Renewal, Extension, or Revocation of Franchise. — The grantee shall apply 
for the renewal or extension of its franchise five (5) years before its expiration date (which shall 
be reckoned from the effectivity of this Act, which is fifteen (15) days after the publication of the 
franchise in the Official Gazette or in a newspaper of general circulation, whichever comes 
earlier). 
This franchise may be revoked by Congress when the public interest so requires or when the 
grantee fails to reasonably comply with regulatory standards. 


SECTION 16. Warranty in Favor of the National and Local Governments. — The grantee 
shall hold the national, provincial, city, and municipal governments of the Philippines free from 
all claims, liabilities, demands, or actions arising out of accidents that cause injury to persons 
and damage to properties during the construction, installation, rehabilitation, operation, and 
maintenance of the water supply and distribution and sewerage system of the grantee. 
SECTION 17. Liability for Damages. — The grantee shall be liable for any injury to persons 
and damage to property arising from or caused by any accident arising from any defective 
construction of any infrastructure built pursuant to the operation of its business under this 
franchise or by any neglect or failure to keep its pipeline distribution system in safe condition. 
SECTION 18. Sale, Lease, Transfer, Grant of Usufruct, or Assignment of Franchise. — 
The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign this franchise or the 
rights and privileges acquired thereunder to any person, firm, company, corporation or other 
commercial or legal entity, nor merge with any other corporation or entity, nor transfer the 
controlling interest of the grantee, whether as a whole or in part, and whether simultaneously or 
contemporaneously, to any person, firm, company, corporation, or entity without the prior 
approval of the Congress of the Philippines and compliance with legal requirements stipulated in 
other statutes; provided, that the foregoing limitations shall not apply to any: (1) transfer or 
issuance of shares of stock in the implementation of requirements for the dispersal of the 
grantee’s ownership pursuant to Section 19 of this Act; (2) transfer or sale of shares of stock to 
an investor or investors; (3) issuance of shares of stock to any investor out of the unissued 
authorized capital stock of the grantee or pursuant to or in connection with any increase in the 
grantee’s authorized capital stock which shall result in the dilution of the stockholdings of the 
grantee’s then existing stockholders; (4) combination thereof where such transfer, sale or 
issuance is effected in order to enable the grantee to raise the necessary capital or financing for 
the provision of any of the services authorized by this Act and/or carry out any of the purposes 
for which the grantee has been incorporated or organized; (5) sale, transfer or assignment by 
the stockholders of the grantee in favor of a holding company, the controlling stockholders of 
which are the same controlling stockholders of the grantee; provided, further, that any such 
transfer, sale or issuance is in accordance  with any applicable constitutional limitation; and 
provided, finally, that Congress shall be informed of any sale, lease, transfer, grant of usufruct, 
or assignment of franchise or the rights and privileges acquired thereunder, or of the merger or 
transfer of the controlling interest of the grantee, within sixty (60) days after the completion of 
the said transaction. The failure to report to Congress such change of ownership shall render 
the franchise ipso facto revoked. Any person or entity to which this franchise is sold, transferred, 
or assigned shall be subject to the same conditions, terms, restrictions, and limitations of this 
Act. 
SECTION 19. Dispersal of Ownership. — In accordance with the constitutional provision to 
encourage public participation in public utilities, the grantee shall, within five (5) years from the 
date of this legislative franchise, offer to the public, specifically Filipino citizens, at least twenty 
percent (20%) or such other percentage that may hereafter be required by law of its outstanding 
capital stock. The public offer of shares shall be through any securities exchange in the 
Philippines or by other methods of encouraging public participation as may be allowed by law. 
In the event the required dispersal of ownership is not implemented within five (5) years, the 
holdings of persons, natural or juridical, including directors, officers, stockholders, and related 
interests in the grantee and its respective holding company, if any, shall not exceed twenty-five 
percent (25%) of the voting shares of stock unless the grantee or the company holding the 
shares of the grantee or its controlling stockholders (direct or indirect) are already listed in the 
Philippine Stock Exchange. Non-compliance therewith shall render the franchise ipso facto 
revoked. 
SECTION 20. Reportorial Requirement. — The grantee shall submit an annual report to the 
Congress of the Philippines, through the Committee on Legislative Franchises of the House of 
Representatives and the Committee on Public Services of the Senate, on its compliance with 
the terms and conditions of the franchise and on its operations on or before April 30 of the 
succeeding year. 
The annual report shall include an update on the development and/or operation of the grantee’s 
business; audited financial statements; latest General Information Sheet officially submitted to 
the Securities and Exchange Commission (SEC) (if applicable); and an update on the dispersal 
of ownership undertaking, if applicable. 
A reportorial compliance certificate issued by Congress shall be required before any application 
for permit or certificate is accepted by the Regulatory Office.  


SECTION 21. Fine. — Failure of the grantee to submit the requisite annual report to Congress 
shall be penalized by a fine of Five Hundred Pesos (P500.00) per working day of 
noncompliance. The fine shall be collected by the Regulatory Office from the grantee separate 
from the reportorial penalties imposed by the Regulatory Office and the same shall be remitted 
to the National Treasury. 
SECTION 22. Equality Clause. — Any advantage, favor, privilege, exemption, or immunity 
granted under existing franchises, or which may hereafter be granted to water supply and 
distribution system and sewerage system franchises, upon prior review and approval of 
Congress, shall become part of this franchise and shall be accorded immediately and 
unconditionally to the herein grantee; provided, that the foregoing shall neither apply to nor 
affect provisions of water supply and sewerage franchises pertaining to the term, the type of 
service, or the territorial coverage of the franchise. 
SECTION 23. Waterworks and Sewerage System Assets. —  To ensure the realization of the 
purposes for which this franchise is granted, the grantee shall have the right to use any of the 
MWSS assets used in the Service Area West (the ―MWSS Assets‖). The termination or 
expiration of the Concession Agreement shall not terminate the right of the grantee to operate in 
the Service Area West under a CPCN or appropriate license or permit issued by the Regulatory 
Office (as may be allowed by law) or the Water Regulatory Agency. Upon such termination or 
expiry of the Concession Agreement, the grantee shall continue to have the right to use the 
MWSS Assets, subject to agreement with MWSS (or its successor-in-interest) on the term and 
compensation for such continued use; provided, however, that if the public service function of 
MWSS is privatized (including through a public bidding of the right to manage or operate the 
MWSS Assets), the grantee shall have a right of first refusal to acquire ownership of the MWSS 
Assets or to undertake the management or operation of such MWSS Assets, as applicable. 
SECTION 24. Common Purpose Facility – In the public interest and to ensure reliable supply 
of water, the grantee shall continue to have the right to operate and maintain the Common 
Purpose Facilities through the existing joint venture, as provided in the Concession Agreement, 
subject to the terms and conditions of the CPCN or appropriate license or permit which may be 
issued to the grantee and of this franchise. 
SECTION 25. Applicability of Existing Laws. — The grantee shall comply with and be subject 
to the provisions of Commonwealth Act No. 146, or the "Public Service Act", as amended, and 
other applicable laws.  
SECTION 26. Repealability Clause. — This franchise shall be subject to amendment, 
alteration, or repeal by the Congress of the Philippines when the public interest so requires. 
SECTION 27. Separability Clause. — If any of the sections or provisions of this Act is held 
invalid, all other provisions not affected thereby shall remain valid. 
SECTION 28. Repealing Clause. — All laws, decrees, orders, resolutions, instructions and 
rules and regulations or parts thereof which are inconsistent with this Act are hereby deemed 
repealed or modified accordingly. 
SECTION 29. Effectivity. — This Act shall take effect fifteen (15) days after its publication in 
the Official Gazette or in a newspaper of general circulation.