Experts insist on Smartmatic, Comelec scam Created on January 17, 2013, 3:07 am Posted by nup

Experts reacting to Commission on Elections (Comelec) Chairman Sixto Brillantes Jr.’s response to The Manila Times banner story on Friday, January 11 “Smartmatic and Comelec collusion bared”—insist
that the way the poll body rejected bidders and ended up awarding the contract to Smartmatic was illegal and indicated collusion.

The Comelec on Friday lashed back at those who continue to question the awarding of the compact flash (CF) cards project to Smartmatic International for the May 13 midterm polls.

Brillantes said that they already expected Smartmatic/Comelec critics and those who lost in the bidding to raise doubts on the results of the proceedings.

“We never had a bidding that did not have anyone questioning it. But we must also look at the people questioning it. Who are they? Personally, I believe, these are most probably just the losing bidders,” Brillantes said.

The Times story said that its sources gave documents showing that there was an arrangement to make the first two biddings for the supply of P42-million worth of compact flash cards so that the Comelec could then proceed with negotiations that led to the awarding of the contract to Smartmatic.

Brillantes denied any collusion between the two institutions and that everything in the two biddings and the negotiated granting of the contract to Smartmatic was aboveboard.

He explained that the CF cards—main project was fairly won by Smartmatic through competitive public bidding while the cards —worm was simply awarded to them owing to the “proprietary” claims of the company.

The poll chief also said that it is only logical that the 2010 polls service provider would secure the supply of the CF cards since the technology used by the precinct count optical scan (PCOS) machines is also owned by Smartmatic.

But one of the losing bidders, the documents obtained by The Times, had in fact been the supplier to Smartmatic of 20,000 CF cards used in the 2010 elections.

The Center for People Empowerment in Governance (CenPEG) and Automated Elections System Watch (AES Watch) have both criticized the Comelec for awarding the contract to supply compact flash cards to Smartmatic-TIM despite the glitches that happened in first automated poll in the country in May 2010 and the many protests against the election results that have been unsatisfactorily resolved.

Legal questions
Section 53.1.5. of the Revised Implementing Rules and Regulations (IRR) of Republic Act (RA) 9184 states that “The procuring entity shall select the successful offer on the basis of such best and final offers which should meet the procuring entity’s minimum technical requirement and should not exceed the ABC.” ABC means Amount Budgeted for the Contract.

 Under this provision of the law’s IRR, Smartmatic should have been disqualified as an option in the negotiated procurement taking into consideration that its bid exceeded the ABC.

This was explicitly stated in the Resolution of Comelec (Resolution 9600 dated December 27, 2012).

However, Comelec launched further negotiations with Smartmatic on the alleged reason that only its CF card main simple did not have any negative observation during the sample testing by the Comelec’s Technical Working Group (TWG).

Then Comelec/Smartmatic asking it to lower its price to an amount that no longer exceeded the ABC. And Smartmatic did lower its price to P45.2 million.

Is this legal?

The TWG’s so called negative observation against the CF cards-main offered by LDLA (and that of SPH International Corp.) was that they were difficult to eject from the PCOS machine.

Experts say this is a flimsy reason. For the same kind of Kingston brand CF cards that the TWG said were hard to eject were supplied by LDLA to Smartmatic (20,000 pieces of CF cards) during the May 2012 elections.

In 2010, just before the elections, Smartmatic encountered problems with some of its PCOS machines and CF cards. It was found that Smartmatic’s own CF cards had been erroneously programmed causing it to be out of sync with its PCOS machines.

Election day was fast approaching. For Smartmatic to recall its CF Cards which it had distributed to different provinces would have risked the holding of automated elections in the affected areas.
This prompted Smartmatic to purchase 20,000 CF cards from LDLA, install the correct program on them, and distribute them to the affected areas in time for the automated elections.

This indicates that the Kingston brand CF cards offered by the LDLA in its bid have already been proven to be good and perfect for the purpose they were sought to be procured, notwithstanding the alleged negative observation by the TWG.

In fact, the negative observation that the CF cards main offered by LDLA were difficult to eject, should not have been an issue. The prime consideration should be the best interest of the government.

The issue of being difficult to eject would not deter the fact that the CF cards main offered by LDLA were within the minimum technical requirements set by Comelec. They had in fact passed the test—and their being difficult to eject was a mere observation.

The main purpose of the CF cards is for them to competently store valuable voting information processed by the PCOS machines. Difficulty in ejecting the CF cards should be the least of Comelec’s worries. In fact, this could be more beneficial as it would be difficult for persons with intentions to cheat to switch them with pre-programmed CF cards.

Moreover, while the observation of difficulty to eject was made only during the negotiated procurement, Comelec should not have considered this as a factor as the observation is not included in the bid documents.

The issue raised by Brillantes that the Smartmatic-TIM’s claim that it could not share information with others about the requirements of the PCOS machines because this software is “proprietary” is the biggest indication of a scam.

The PCOS machines to be used in the 2013 Elections use two kinds of CF cards—the CF cards main and the CF cards worm. The CF cards worm can only be used if configured to the technical requirements of all the PCOS machines which Smartmatic itself programmed.

This programming is what Smartmatic claims to be “proprietary.” As to this issue, Smartmatic is wrong to state that the CF cards worm are “proprietary” for the simple reason that the PCOS machines were already purchased by Comelec. The software program installed in the PCOS machines may be considered proprietary but not the use of CF cards worm for the PCOS machines. In other words, it is the duty of Smartmatic to configure CF cards of other suppliers.

How can any bidder ever submit CF card worm that would work if the PCOS program is not shared with the bidder?

And if one accepts for the sake of argument that the CF cards worm are considered “proprietary,” why then did the Comelec go through the process of holding biddings for the CF cards worm when any such card without being configured to the Smartmatic program in the PCOS machines would surely not work?

Also, why did the Comelec agree to this impossible condition—unless it was part of a conspiracy to make Smartmatic the only possible winner?

And if these CF cards worm are considered “proprietary” then Smartmatic has practically monopolized the supply of these CF cards. This is contrary to the governing principles on government procurement as declared in RA 9184’s Sec. 3.

Be that as it may, Smartmatic cannot claim CF cards main to be “proprietary” as the PCOS machines are capable of reading any CF cards in this slot. These CF cards main were the object of the negotiated procurement for which Comelec invited suppliers, including LDLA and Smartmatic, to bid.

But Comelec awarded through negotiated procurement the contract for the supply and delivery of the CF cards main to be used in the May 13, 2013 Elections.

The contract price awarded to Smartmatic amounts to P45.2 million. This is about P12 million higher than the offered price of LDLA. This runs counter to the last paragraph of Section 48 of RA 9184 that states that “In all instances [of resorting to alternative methods of procurements such as negotiated procurement], the Procuring Entity shall ensure that the most advantageous price for the government is obtained.”

Also, one is baffled how a generic China made CF card could be more expensive than a reputably branded Kingston CF card.

Smartmatic also won the bid for the transmission modems and the transmission of results.

Comelec owns the PCOS machines it bought from Smartmatic for P1.8 billion. But Smartmatic controls the machines through its so-called proprietary program.

The situation is that Smartmatic-TIM controls all elements of the PCOS process. This includes the counting of votes and transmission of results in the 2013 elections.

A foreign company now controls the future membership and leadership of the Philippines in the executive and legislative branches of government.


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