Lafayette's 100% Foreign Ownership Shocks House Probers, Mine Spill Victims
Militant solon, victims say 2-year-old operations illegal, unconstitutional

Anakpawis party list representative Rafael Mariano and leaders of Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (Pamalakaya), a national alliance of fisherfolk organizations and Lakas ng mga Maliliit na Mangingisda ng Bicol (Lambat-Bicol or alliance of small fisherfolk in Bicol) were stunned by a revelation that Lafayette Philippines Inc. is 100 percent foreign-owned. Mariano said, “This is a violation of the Constitution and the principle of national patrimony.”

By Gerry Albert Corpuz
Bulatlat

Anakpawis party list representative Rafael Mariano and leaders of Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (Pamalakaya), a national alliance of fisherfolk organizations and Lakas ng mga Maliliit na Mangingisda ng Bicol (Lambat-Bicol or alliance of small fisherfolk in Bicol) were stunned by a revelation that Lafayette Philippines Inc. is 100 percent foreign-owned.

"For two years, owners of Lafayette and top government officials kept the truth about the ownership of Lafayette from the general public despite the fact that this is in gross violation of the 1987 Constitution and the fundamental principle of national patrimony," Mariano said in an interview with Bulatlat.

The revelation came from Lafayette Chairman, President and Chief Executive Officer Carlos Dominguez who testified before the House Committee on Natural Resources on Feb. 8 after Sorsogon Representative Francis Escudero, House Minority Leader, questioned him regarding the ownership and the present management structure of Lafayette in the aftermath of the toxic spill and the appointment of new management announced by its mother company in Sydney, Australia last month.

Dominguez, a former agriculture secretary, said the controlling interest in Lafayette belongs to Lafayette Mining Ltd., an Australian company, which holds 74 percent of the mining firm's total stake.  The remaining 24 percent is owned by Philco, a Malaysian firm.

The discovery of the Lafayette ownership prompted Rep. Mariano to call for the immediate closure of Lafayette’s mining operations in Rapu-Rapu, Albay and recommended to the committee the filing of possible criminal and civil charges against government officials and the company’s owners, adding that such act was "a total betrayal of public trust and gross disregard of the 1987 Charter."

"Lafayette, the toxic-emitting giant in Rapu-Rapu has been illegally operating for two years and this unconstitutional and unlawful act is sanctioned by President Gloria Macapagal-Arroyo and the Department of Natural Resources," Lambat-Bicol secretary-general Arieto Radores told Bulatlat in a separate interview.

The Legaspi, Albay-based fisherfolk leader insisted that Lafayette violated the 60-40 capitalization requirement in favor of Filipinos, certain environmental laws and practices and the 1987 Constitution. "Is the Mining Act of 1995 over and above the 1987 Constitution, which prohibits 100 percent foreign ownership?" Radores said. "I don't think so. Lafayette is pushing the issue to the wall to justify its' illegal takeover and corporate plunder at the expense of our national patrimony."

Escudero said Dominguez's group merely entered into a management contract with Lafayette and was not really the owner of Lafayette Philippines, contrary to claims of LPI chair that they were the new owners of the controversial mining firm.

Who is Rod Watt?

Rep. Escudero also questioned the role of Rod Watt, Lafayette's country manager to the Philippines. The opposition lawmaker said Watt, as Lafayette's country manager was acting as the top corporate boss of the mining firm. But Watt failed to attend the hearing for undisclosed reasons, Dominguez said.

"Watt, as Lafayette's country representative is not entitled to sign checks, hire and fire personnel and command the operations of Lafayette Philippines," the Sorsogon lawmaker pointed out.

Escudero said the presence and authority of Watt signified that there was no actual transfer of interest and management and that the Dominguez group was actually hired or elected by Lafayette's board of directors to act as the new management of Lafayette Philippines Inc.

Last month, Dominguez and a group of new investors acquired 10 million shares of Lafayette for AU$1 million or P39.62 million equivalent to 1.6 percent stake. But Escudero wondered how Dominguez’s group was able to get the top management portfolio despite the new group's very minimal shares in the company.

Dominguez insisted that the Lafayette contacted him to head the new Lafayette management and its board of directors elected him as the mining firm's new chairman, president and chief executive officer.

Where's Mike?

Anakpawis Rep. Mariano and leaders of Pamalakaya and Lambat-Bicol inquired why former DENR Secretary Michael Defensor was not invited during the hearing that lasted for more than five hours.  They insisted that Defensor's presence in the hearing was necessary so he could shed light on the controversial issue involving Lafayette, his former office and other government officials.

Mariano said Defensor cannot and should not invoke EO 464, a Palace order directing all government officials to refrain from attending legislative inquiries including budget hearings.

"They cannot impose EO 464 to this body. This is not an issue governing national security if they so insist. This is a people's issue on national patrimony and people's rights and welfare,”the left-leaning lawmaker added.

But Agusan del Norte Rep. Leovigildo Banaag, chair of the House Committee on Natural Resources said Defensor was originally invited but his committee decided to drop his name in the list of invitees and resource persons after President Arroyo transferred him to Malacañang as chief of the Presidential Management Staff (PMS). But Banaag said his committee will invite Defensor in the next hearing of the committee.

The list of invited guests and resource persons include newly-appointed DENR Secretary Angelo Reyes, Sec. Estrella Alabastro of the Department of Science and Technology (DoST), Malcom Sarmiento, Director of the Bureau of Fisheries and Aquatic Resources (BFAR), Benjamin Philip Romualdez, President of the Chamber of Mines, Sorsogon Gov. Raul Lee, Albay Gov. Fernando Gonzales, Rep. Edcel Lagman (1st district, Albay), Rep. Carlos Imperial (2nd district, Albay), Rep. Joey Salceda (3rd district, Albay), DENR Undersecretaries Armando de Castro and Deinrado Dimalibot, Jeremias Dolino, Director of the Mines and Geosciences Bureau (MGB) and Director Lolibeth Medrano of the Environmental Management Bureau (EMB).

The regional officers of DENR Region V were also invited in last week's hearing together with local government officials of Rapu-Rapu and nearby towns of Sorsogon headed by Rapu-Rapu Mayor Dick Galicia, Mayor Greg Azore of Barcelona, Sorsogon, Mayor Benito Doma (Prieto Diaz, Sorsogon), Mayor Deogracias Ramos Jr. (Gubat, Sorsogon), Mayor Juan Guysayko (Bulusan, Sorsogon) and Sorsogon City Mayor Sally Lee.

Cease and desist

DENR officials who attended the hearing said the cease-and-desist order slapped on Lafayette mining is still in effect until such time the Australian mining firm is able to complete the set of environmental requirements.

For his part Dominguez said the new management under his tenure will abide by the DENR's cease-and-desist order. He said the new management will focus on three main concerns namely: finding out the actual causes and effects of the two mine spills, reaching out to all communities by listening to their views and concerns while at the same time direct benefits of the project to the affected sectors and host communities, and ensuring necessary environmental safeguards so that the project would be allowed to resume operations in the soonest possible time.

But Dominguez's statements raised the eyebrows of local government officials, representatives of church groups and people's organizations who attended the hearing. "We were not born yesterday not to understand this kind of political drama being staged by the Lafayette group and their beneficiaries in Malacañang," said Pamalakaya chairman Fernando Hicap. "These Johnny-come-lately actors are rushing to the scene to save the day for Lafayette and Malacañang's flagship project."

5-point demand

At the hearing, Pamalakaya presented a 5-point demand for the resolution of Lafayette tragedy: permanent closure of Lafayette mining, indemnification of all victims of the two mine spills, nullification of contract between Dominguez group and Lafayette regarding the management contract, the filing of criminal and civil cases against Lafayette and other government officials involved in Lafayette twin spills, the repeal of the Mining Act of 1995.

Pamalakaya, Lambat-Bicol and Pamalakaya-Sorsogon suggested that Lafayette be initially slapped with a P1-billion fine to compensate fisherfolk and residents affected by the Oct.11 and 31, 2005 mine spills.

"Aside from the P10.7 million fine slapped against Lafayette, concerned agencies and local government should also demand an initial P1 billion fee for the damage the twin mine spills had caused to subsistence fisherfolk and affected residents," the groups stated.

"The fisherfolk through their recognized organizations, associations and cooperatives should undertake the management and distribution of the proposed P 1 billion funds for relief and recovery efforts for the livelihood lost during the environmental tragedy," they added.

Pamalakaya also stated that Lafayette should also set aside billions of pesos for the rehabilitation of Albay Gulf, specifically the waters surrounding and encompassing Rapu-Rapu and entire coastal towns of Sorsogon province.

"The indemnification and relief aspects, including the rehabilitation process are just part and parcel of the comprehensive social and economic responsibilities of Lafayette," the group added. "The permanent closure of this Australian mining corporation is the principal demand of the people that should be addressed by the national government and local authorities to make sure this catastrophic event won't happen again."

Radores likewise urged Sorsogon Gov. Raul Lee. Albay Gov. Fernando Gonzales and the local government units in the provinces of Albay and Sorsogon to declare Lafayette Philippines an illegal foreign entity after the Feb. 8 hearing by the House Committee on Natural Resources found out that Lafayette was 100 percent owned by foreign investors. Bulatlat

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