SBMA Chairman and Administrator Jonathan Tan lead the closure and repossession of the Silver Arrow Import Export Services, Inc. on July 16 due to contractual defaults made by the company. (SBMA photos)
By Dolores Mose and Jenny Rose Bitago
The Subic Bay Metropolitan Authority (SBMA) has started clamping down on erring freeport companies by repossessing properties to intensify its campaign to recover idle areas and give them to other investors.
At a press briefing on Wednesday (July 16), SBMA chairman and administrator Jonathan Tan said the agency had seized more than five properties that day.
“We are repossessing leased areas of companies that do not comply with the agreement between them and the SBMA and offering these areas to other investors,” Tan said.
Just two weeks into his job, Tan said he saw the problem of idle properties, also known as “land banking,’ within the freeport and sought the support of President Marcos Jr. to correct the problem.
“I told the President I need his support in repossessing SBMA properties from companies not paying their arrears and violating their development commitment, Tan added.
Among the first properties repossessed by SBMA was that of Silver Arrow Import and Export Services, Inc., located at Lot 1, Boton Area, Argonaut Highway.
The 1,500-square-meter land property of the company was repossessed due to contractual defaults.
(SBMA photos)
According to Tan, the company failed to comply with its investment and development commitment as provided in Section 7, Article II of the lease agreement between the company and the SBMA.
Part of the said default is the failure of the company to develop the area with a funding allocation of at least US$1,000,000.
Tan added that the development commitment on the leased property should have a minimum cost of US$500,000, which includes the construction of a warehouse within two years from the issuance of its building permit.
“Aside from the investment and development commitment, the company’s contractual default also includes non-compliance with the omnibus policy on performance bonds and failure to submit documents for the issuance of a building permit,” he said.
The building permit is for the construction of a warehouse, as stated under the company’s development commitment.
Tan stressed that there had already been an unreasonable length of time since the execution of the lease agreement on July 28, 2015.
The SBMA had already served two notices before executing the repossession, with the final notice of default with demand to pay dated June 19, 2023, that was served on June 26, 2023; and the notice of pre-termination and repossession dated July 28, 2023.
“We are following President Ferdinand Marcos Jr.’s mandate to streamline operations within the Subic Bay Freeport Zone, and fully utilize land areas that are not being developed, but we are leaving space on the table for negotiations with the erring company so that they may continue with their operations efficiently,” Tan said. FREEPORT INSIDER
