The Philippine Commission on Audit (COA) has questioned the legality of a casino land lease deal between Hong Kong-listed casino investor Landing International Development Ltd. (LIDL) and state-run Nayong Pilipino Foundation (NPF).
Politiko reported that the COA ordered NPF to cancel the contract it entered with LIDL’s subsidiary Landing Resorts Philippines Development Corp. (LRPDC) on grounds that it was detrimental to the government.
Based on its estimates, COA warned that the Philippine government will lose as much as PHP26 billion ($486.2 million) from the deal since LIDL will be underpaying the lease relative to the market value of the land at the nearby Solaire Resort and Casino.
COA pointed out that the monthly lease rate on the NPF land that both parties agreed upon was a PHP150 ($2.81) per square meter or PHP14.36 million ($268,532), way below Solaire lot’s value of PHP600 ($11.22) per square meter.
The commission noted that the NPF approved the agreement “without conducting an independent appraisal and advertisement to the public to solicit offers from other interested parties to ensure that the proposal is the most advantageous to the government.”
It added that the agreement was made without the approval from the Philippine National Economic Development Authority (NEDA) and state regulator Philippine Amusement and Gaming Corporation (PAGCOR).
The issue on the casino land lease stemmed from the complaint of President Rodrigo Duterte’s niece Maria Fema Duterte, who happens to be a member of NPF board. She claimed that the deal was anomalous since the lease contract favored the foreign group.
Reacting on the issue, LIDL contends that the casino land-deal was completely open and above board. The casino investor said they were not informed that the deal was already cancelled as reported by the local media last week.
“Our agreement to lease a parcel of land of approximately 9.5 hectares [23.5 acres] in size located in Parañaque City, Philippines, from Nayong Pilipino Foundation is a legally binding contract,” LIDL said, according to GGRAsia. “We are not informed that the land lease contract is cancelled, and we are not aware of any reason or ground for cancellation of the lease contract.”
Last year, LIDL announced that its plans to develop a family-oriented resort, which consists of a casino, an indoor cultural theme park featuring the Philippines’ rich history, culture and heritage, an indoor themed waterpark, Asia’s first indoor movie-based theme park, a world-class state-of-the-art convention center, luxury hotels, and international retail and dining.
LRPDC is waiting for approvals from other relevant authorities to develop and operate the integrated resort.
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