Press Release
January 11, 2006


Senate Minority Leader Aquilino Q. Pimentel, Jr. (PDP-Laban) today branded as a backward and illogical step the move of the Presidential Commission on Good Government to revive the negotiation between coconut farmers and businessman Eduardo Danding Cojuangco, Jr. for a compromise agreement on the 18-year old coconut levy case.

Pimentel pointed out that the Sandiganbayan, in a decision issued in May, 2004, held that the 27 percent shareholding in the San Miguel Corporation (SMC), originally acquired through the coconut levy funds, was owned by coconut farmers, held in trust by the government for the benefit of the farmers and the coconut industry.

He said the Sandiganbayan issued the decision after it was ordered by the Supreme Court to resolve the issue. Subsequently, he said there was a motion filed with the anti-graft court to execute the decision.

However, he said the motion to execute has not yet been acted upon by the Sandiganbayan.

There is no need for a compromise agreement on the disputed coconut levy assets. Normally you enter into a compromise agreement before or during the middle of the litigation, but not when a decision has already been rendered by the court, Pimentel said.

He said he could not find any rhyme nor reason behind the stand of the PCGG, as spelled out by Chairman Camilo Sabio, to seek an out-of-court-settlement between the coconut farmers and Cojuangco on the coconut levy case at this stage.

He said the PCGGs action reflects the Arroyo governments lack of direction and resolve in settling the case and its indifference to the plight of about 8 million, small coconut farmers and their families whose economic condition continues to deteriorate due to the governments failure to rehabilitate the ailing coconut industry and rescue it from the brink of collapse.

According to Pimentel, the Sandiganbayan ruling on the ownership of the 27 percent shareholding in the SMC applied to six coconut oil mills and 14 companies.

The minority leader warned that a compromise agreement at this time would only push back the governments prolonged efforts to recover the coconut levy assets. He said this would also render meaningless the hard-earned legal victory of the government and the PCGG during the chairmanship of Haydee Yorac on the issue of ownership and control of the 27 percent SMC shareholding.

The 27 percent is entirely different from the 20 percent shareholding in the SMC which Cojuangco is claiming to have been acquired through his personal funds and which the government is also claiming.

Pimentel said the more the PCGGs move for a compromise settlement becomes ridiculous in the light of Cojuangcos public statement opposing it and maintaining that he would rather see the case resolved by the courts.

Criticizing the Arroyo government for its confusing policy in resolving the coconut levy controversy, Pimentel recalled that it ruled out any out-of-court settlement on the case during the early part of its term and instead followed Yoracs position to rely on the courts to resolve the case.

Moreover, Pimentel recalled that the Arroyo government, upon its inception in 2001, revoked an already-completed compromise agreement between the farmers and Mr. Cojuangco on the coconut levy dispute. The compromise agreement was negotiated by the government of President Joseph Estrada with the help of Catholic bishops and business leaders.

He said that had the November, 2000 compromise agreement not been shelved by the Arroyo government, it would haven unfrozen billions of pesos funds needed for the massive replanting of high-yielding coconut varieties and for alternative livelihood projects for marginalized farmers.

Under the compromise agreement, P50 billion from the proceeds of the sale of the 27 percent of SMC shareholding would be set aside for the establishment of a coconut industry trust fund to be administered by coconut farmers themselves.

In my view, the Arroyo governments decision to revoke that compromise agreement was a colossal mistake because it shut off the release of much-needed funds to alleviate the plight of the long-suffering coconut farmers, Pimentel said.

Pimentel said it is dismaying that five years after invalidating the already-completed compromise agreement on the coconut levy case, the Arroyo government will go through the rigmarole of striking a similar agreement as if to admit that its earlier action was a mistake.

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