Chapter-1.docx

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CHAPTER 1 INTRODUCTION With

the

essence of

time,

the Information

and

Communication

Technology era, different advancements throughout the world have been made. There has been a growing demand for telecommunications and Internet services. Everyone wants to experience unlimited capacity to cross borders in just a few clicks. Telecommunication

infrastructure

refers

to

the

backbone

of

the

communication system upon which different broadcasting and telecom services are operated. This industry touches many technology-related business sectors as it encompasses not only the traditional areas of local and long-distance telephone service, but also advanced technology-based services including wireless communications, the Internet, fiber optics and satellites. In the Philippines, the telecommunication industry has grown rapidly. The infrastructure component of the industry plays a significant role in the economic progress of the country. In dealing with different business transactions either locally or internationally, it offers convenient and efficient way. In few years, the industry has evolved from an inefficient public utility to a sector with an improved competition, providing consumers lower cost of communicating at home or abroad. Mobile phones have outnumbered landline phones in the Philippines. The Philippines, called the text message capital of the world, is the world leader in Short Messaging Service (SMS) with almost one billion daily messages.

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ZTE Corporation is a leading integrated telecommunications equipment manufacturer in the world market and a provider of global communication and information solutions, with shares listed on the main board of the Shenzhen Stock Exchange and the main board of the Hong Kong Stock Exchange. The Group is dedicated to the design, development, production, distribution and installation of a broad range of advanced ICT-related systems, equipment and terminals, including carriers’ networks, government and corporate business and consumer business. The Group is one of the major telecommunications equipment suppliers in China’s telecommunications market and has also succeeded in gaining access to the international telecommunications market with respect to each of its major product segments. The Group has achieved a leading market position for its various telecommunications products in China with longstanding business ties with China’s major telecommunications service providers, such as China Mobile, China Telecom and China Unicom, and is recognized as a “benchmark enterprise in smart city services.” With respect to the global telecommunications market, the Group has provided innovative technology and product solutions to telecommunications service providers and government and corporate network clients in more than 160 countries and regions, making contributions to facilitate communication services via multiple means, including voice, data, multi-media, wireless broadband and cable broadband, for users all over the world.

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On June 5, 2006, Memorandum of Understanding on the establishment of Philippines-China Economic Partnership executed between the governments of the Philippines and China. NEDA Secretary Romulo L. Neri and DTI Secretary Peter B. Favila represent the Philippines and Commerce Minister Bo Xilai

represents

the

People's

Republic

of

China. Transportation

and

Communications Secretary Leandro Mendoza and ZTE Corporation Vice President Yu Yong enter into a US$ 329.5 million contract on April 2007 for a national

broadband

network

(NBN)

that

will

improve

government

communications capabilities. In August 2007, Nueva Vizcaya Representative Carlos Padilla discloses in a privilege speech that COMELEC Chairman Benjamin Abalos met with ZTE officials in China weeks before April 2007, apparently to broker for the NBN project: "Apparently, Chairman Abalos' unofficial trips to China courtesy of ZTE Corporation and his golf games with the officers of ZTE Corporation can hardly be characterized as just friendly and totally inoffensive. Padilla notes that there were two other private entities which signified their intention to build the NBN for the government. The project cost in these private companies' proposals were cheaper than ZTE's. Sen. Aquilino Pimentel Jr. files resolution calling for a Senate investigation into the circumstances leading to the approval of the broadband contract with ZTE Corporation on September 5, 2007. In an affidavit, Jose De Venecia III claims that he was with Abalos in China when the latter met with ZTE officials. He claimed he heard Abalos demand for money from the ZTE

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officials. De Venecia III is a majority shareholder of Amsterdam Holdings, Inc. AHI submitted an unsolicited proposal to DOTC on the NBN project. On September 11, 2007, the Supreme Court en banc issues temporary restraining order against the implementation of the controversial NBN contract between the Philippines and Chinese firm Zhong Xing Telecommunications (ZTE) Corporation. DOTC Leandro Mendoza attends the hearing, but former NEDA Director General Romulo Neri fails to show up. President Arroyo officially announces the suspension of the NBN and CyberEd projects on September 25, 2007. Neri and Abalos face off at the Senate hearing on September 26, 2007 wherein Neri testifies that Abalos told him, "May 200 ka dito" while playing golf at Wack Wack Golf Club. In a meeting in Shanghai, China, on October 2, 2007 President Arroyo informs Chinese President Hu Jintao of her "difficult decision" to cancel ZTE Corp.'s contract for the NBN project. On October 9, 2007, Akbayan files criminal complaint against Abalos before the Office of the Ombudsman. Neri and Philippine Forest Corporation President Rodolfo Noel Lozada fail to attend the Senate hearing January 30, 2008. Lozada leaves the country, apparently heading for London. Slighted by their non-appearance, the Senate issued warrants for their arrest. Lozada, in a press conference, recounts how, in his attempt to avoid testifying at the Senate, ended up being taken from the airport against his will. On February 8, 2008, Lozada testifies at the Senate. In August 2009, the Office of the Ombudsman clears President Gloria Macapagal Arroyo and husband

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Jose Miguel Arroyo in the graft case related to the failed $329-million NBN deal with

China’s

Zhong

Xing

Telecommunications

(ZTE)

Corporation,

but

recommends the filing of charges against former Commission on Elections chief Benjamin Abalos Sr. and former socio-economic planning secretary Romulo Neri.

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CHAPTER 2 STATEMENT OF THE PROBLEM According to Republic Act 9184, otherwise known as the Government Procurement Reform Act, the procurement of goods, infrastructure projects, and consulting services by the government should be competitive and transparent, and therefore should undergo a process of competitive bidding. The study presented divulges as to why the Philippine Government awarded a construction contract to Zhong Xing Telecommunication Equipment Company, Limited (ZTE) without undergoing competitive bidding that would benefit the public in terms of costs and expenditures. It also presents how the contract came to be overpriced and how corruption by specific government officials affected the pricing of the contract and selection process. The National Broadband Network (NBN) scandal involves allegations of corruption

in

the

awarding

of

US$

telecommunications

company

called

329.5 Zhong

million Xing

to

a

Chinese

Telecommunication

Equipment Company, Limited (ZTE). The deal was for the improvement of the Philippine government communications capabilities by making it more efficient and less expensive. The sequence of events started on September 2006, when ZTE submitted an unsolicited proposal to construct a National Broadband Network to the Philippine Commission on Information and Communications Technology (CICT). The proposal stipulates that the project will be funded by a government-to-government loan and that upon completion; the project will be

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turned over to the Department of Transportation and Communications (DOTC) for its operation and maintenance. The contract was signed on April 21, 2007 by Transportation and Communications Secretary Leandro Mendoza and ZTE Vice President Yu Yong for US$ 329.5 million. It was witnessed by then President Gloria Macapagal-Arroyo. Allegations of corruption in the signing of the deal started to surface on August 29, 2007. Nueva Vizcaya Representative Carlos Padilla filed a criminal complaint against then DOTC secretary Leandro Mendoza and several others who signed the deal with ZTE without public bidding. Padilla claimed that then COMELEC Chairman Benjamin Abalos Sr. has had a hand in the completion of the deal. Padilla also claimed that Abalos was seen playing golf with ZTE officials and that he received a kickback for brokering the deal. Abalos denied Padilla’s accusations the following day. On September 5, 2007, Senator Aquilino Pimentel, Jr. filed a resolution asking the Senate Blue-Ribbon to investigate the NBN-ZTE deal. The first whistleblower of the NBN-ZTE scandal was Jose de Venecia III, the son of House Speaker Jose de Venecia Jr. and the majority shareholder of Amsterdam Holdings, Inc, a losing bidder in the NBN project. He claimed that he was with former COMELEC Chairman Benjamin Abalos Sr. in China where Abalos demanded money from ZTE officials and offered de Venecia US$ 10 million if de Venecia backed out of the NBN project. A Temporary Restraining Order (TRO) on the NBN-ZTE deal was issued by the Philippine Supreme Court on September 11, 2007. Congressman Padilla sued DOTC and ZTE officials for

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violating the Anti-Graft and Corrupt Practices Act, Telecommunications Policy Act, Build-Operate-Transfer Act, and the Government Procurement Act at the Office of the Ombudsman. The first Senate Blue-Ribbon Committee hearing on the NBN-ZTE deal was held on September 18, 2007. During the hearing, Jose de Venecia III testified that former First Gentleman Jose Miguel “Mike” Arroyo was involved in pushing for the overpriced NBN project. He claimed that while he was in China, including Abalos, Mike Arroyo taunted him to withdraw from the deal. The project was overpriced by as much as US$ 130 million after Abalos asked for several kickbacks. The NBN-ZTE deal was suspended on September 22, 2007. Transportation Secretary Leandro Mendoza clears First Gentleman Mike Arroyo and COMELEC Chairman Benjamin Abalos Sr. during the second hearing. On the third Senate hearing, Romulo Neri, former socioeconomic planning secretary and director general of the National Economic and Development Authority (NEDA), testified that Abalos offered him US$ 5 million to approve the ZTE contract. In a private executive session at the Senate, Neri invokes executive privilege, therefore declining to answer further questions. Abalos was also present in the same hearing and denied Neri’s accusations. On September 27, 2007, Iloilo Vice Governor Rolex Suplico filed an impeachment complaint against Abalos for culpable violation of the Constitution, betrayal of public trust, graft and corruption, and bribery. Abalos resigned on October 1, 2007.

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Jose de Venecia III submitted a financial analysis by industry experts to the Senate Blue-Ribbon Committee. The analysis showed that the contract was overpriced by almost US$ 197 million. The project would have only cost the government US$ 132 million if it was contracted with leading local telecommunications companies (e.g. PLDT, Smart Communications, and Globe Telecoms). However, the analysis was criticized by DOTC Assistant Secretary Lorenzo Formoso III, claiming that it was partial since it was presented by de Venecia who was part of the company who lost in the bidding. Information Technology (IT) expert and Philippine Forest Corporation President Rodolfo Noel “Jun” Lozada Jr. allegedly knows how the ZTE contract was overpriced, and was invited to testify in the Senate, but flew to Hongkong hours before the hearing. The Senate ordered his and Romulo Neri’s arrest. Jun Lozada arrived at the Ninoy Aquino International Airport on February 5, 2008. He was taken into police custody by the Manila International Airport Authority and by the members of the Police Security and Protection Office (PSPO) Jun Lozada Jr. appeared before the Senate Blue-Ribbon Committee on February 8, 2008 where he detailed his departure for Hong Kong and his disappearance upon his return. He explained that he was initially consulted by Romulo Neri to assess the NBN-ZTE deal and was asked to moderate the kickbacks for President Arroyo’s allies. Upon his return, men whom were unknown to him approached him and hauled him into a vehicle. He was taken to different locations, until he met with a lawyer named Antonio Bautista and

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police officer Paul Mascarinñas. He was told to sign an antedated affidavit by the two fellows. Lozada also claimed that former presidential chief of staff Mike Defensor told him to hold a press conference to deny that he was kidnapped and to state that he was not involved in the issue. On February 11, 2008 during a senate hearing, Lozada stressed that he was taken against his will upon his return from Hong Kong, while NAIA, PNP, and PSPO officials deny his claims. On the same hearing, Lozada returned an envelope containing P50, 000 to former presidential chief of staff Mike Defensor. Defensor denied that he offered money to Lozada to deny that he was abducted; however, he admitted that he did advised Lozada hold a press conference to say that he was not abducted. Senate President Manuel Villar and Senator Allan Peter Cayetano went to NAIA to trace Lozada and his escort’s way out of the airport. Security records showed members of the Presidential Security Group in restricted areas of the airport, the members were also in the vehicle that transported Lozada from the airport. This investigation seemed to confirm that there was indeed an abduction. On February 18, 2008, the Office of the Ombudsman and the Department of Justice started their separate probes of the NBN-ZTE deal. On the same day in a senate hearing, Jun Lozada Jr. shared a conversation between him and former Socioeconomic and Planning Secretary Romulo Neri in which the latter stated that President Arroyo was “evil” and that she was at the center of the NBN-ZTE scandal. Lozada said that Neri considered resigning

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after Arroyo ordered him to endorse the US$ 329.5 million NBN project despite claims of bribery. Lozada turned over an envelope containing P500, 000 hush money from Malacañang Deputy Executive Secretary Manuel Gaite. Jun Lozada Jr. filed a case of kidnapping and attempted murder at Department of Justice against police and government officials behind his alleged abduction. Meanwhile in an interview, then President Arroyo admitted having been warned of irregularities and possible corruption in the NBN-ZTE deal on the eve of signing. This is a breakthrough because it was the first time that the President revealed that she was aware of possible corruption before the contract was signed. Deputy Executive Secretary Manuel Gaite eventually provided a testimony where he said that the P500, 000 that Lozada returned to him in the previous hearing was not a hush money but rather a loan that Lozada personally asked. On February 28, 2008, Dante Madriaga, a former ZTE consultant, said that President Arroyo and her husband were part of the group that demanded several huge kickbacks so that the NBN project would be given to ZTE. Their demands increased the project cost from US$ 130 million to US$ 329.5 million. Madriaga then identified the members of the group which includes the resigned COMELEC Chairman Abalos Sr., his boss Leo San Miguel, bagman Ruben Reyes, retired General Quirino Dela Torre, and President Arroyo together with her husband. On March 5, 2008, President Arroyo revoked Executive Order 464 which prohibits government officials from testifying in congressional inquiries without

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the President's authorization. On March 11, 2008, Cable TV executive Leo San Miguel appeared before the Senate Blue-Ribbon Committee. He was identified before as being a member of the group that demanded kickbacks from the NBN-ZTE deal. However, he claimed that he does not have any "direct knowledge" of the kickbacks included in the deal. He said that his knowledge is only limited to technical matters and that he did not even coordinate with any government agencies. The hearing left the Committee frustrated with Senator Panfilo Lacson accusing the Malacañang Palace of getting to Leo San Miguel through Attorney Marcelino Agana IV of the Presidential Legislative Liaison Office (PLLO). This caused San Miguel to withhold important details according to Lacson. Lacson later revealed that a Senate sergeant-at-arms heard that San Miguel had a conversation with Attorney Agana through the telephone, assuring Agana that he would deny accusations and limit information coming from him when asked by the Committee. On March 25, 2008, a crippling blow to the investigation was dealt when the Supreme Court ruled that the Senate is not allowed to force Romulo Nero to answer questions regarding the President's involvement in the NBN-ZTE deal. This upholds Nero's invocation of Executive Privilege when he appeared in the Senate hearing on September 26, 2007. Two days later, the Senate indefinitely puts on hold its investigation on the NBN-ZTE deal. A new witness surfaced on May 14, 2008. Iloilo Vico Governor Rolex Suplico stated according to the unidentified witness that President Arroyo made an undisclosed trip to China where she met with ZTE officials. The trip

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was five months before the ZTE contract was signed. The witness confirmed that resigned COMELEC Chairman Abalos Sr. and Mike Arroyo were present in the meeting. These were all evidenced with pictures according to the witness. At this point, the NBN-ZTE deal was already cancelled. The Supreme Court upholds Romulo Neri's executive privilege on September 4, 2008. The Supreme Court that the Senate abused its discretion in citing Neri in contempt when he refused to answer questions regarding his conversations with President Arroyo about the NBN-ZTE deal. To many, this ruling was considered the final blow on the Senate Blue-Ribbon Committee's investigation. On March 14, 2012, the Arroyos were indicted for the NBN-ZTE graft. The Sandiganbayan Anti-Graft court ordered the arrest of former President Gloria Macapagal-Arroyo and her husband, Mike Arroyo, as well as two former government officials.

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Chapter 3 DISCUSSION OF THE OBJECTIVES This case study aims to present as objectively as possible what really happened regarding the whole Philippine National Broadband Network Scandal or the ZTE-NBN mess detail by detail using the limited resources the researches have. The researchers worked towards the presentation of a timeline of the events that took place with detailed explanation of the incidents as well. This study also aims to discuss the laws, rules, regulations and ethical norms and standards violated by the different persons involved in the case. Furthermore, the analysis of this case would also like to confer about the controversial corruption allegations regarding the administration that handled the ZTE-NBN case and its current standing and effect on the economy at large especially in the matters affecting privately-owned businesses and potential investors in the country. The review of the case also aims to reflect how certified public accountants working in the public sector can help in eradicating the issue of graft, corruption and bribery and help expose such unethical conduct using their analytical skills, problem-solving abilities and critical thinking. The study also provides recommendations regarding the transparency of the government, policies relating to corruption and bribery in the workplace and rules and procedures for whistleblowing and protection of whistleblowers. Lastly, this study aims to help business students be aware of the corruption that could or is still happening not only in the government but also

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in their future workplace as they are now aspiring to be future professionals. This study also strives to help future accountants be cognizant of the role they will take on as they work for the public sector and hopefully, inspire them to uphold their integrity and values in difficult situations and have courage to take action to bring justice in the limelight.

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Chapter 4 FINDINGS AND DISCUSSIONS This study examines the Philippine National Broadband Network controversy that erupted around 2006-2008 under the Arroyo Administration. This explores the events that took place during that time which illustrated various forms of corruption, non-compliance acts and unethical behavior from government officials. This part of the study reviews the violated laws, rules, regulations, and ethical norms and standards by the various key persons involved. The whole scandal largely involves the current president of the country during that year, her husband and her well-known alliances. This is an example of a weak control environment. The control environment is a component of a strong internal control system which pertains to the attitudes, awareness and actions of management and those charged with governance concerning an entity’s internal control and its importance. It includes the governance and management functions and sets the tone of an organization, influencing the control consciousness of its people. It is the foundation for effective internal control, providing discipline and structure. This is not only limited to private organizations but is applicable to the government as well. If the highest leader in the hierarchy is involved in questionable and unethical acts, it defeats its very purpose of being an example to its constituents. It is very likely that other forms of corruptions are also occurring in the lower levels of the organization and are also being disregarded unless exposed through

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whistleblowing or other forms of debunking. Due to the poor governance of the Arroyo administration during that time, several laws were violated. They are presented below. VIOLATED LAWS AND REGULATIONS A. ELECTION BAN According to the Omnibus Election Code of the Philippines, the election period shall commence ninety (90) days before the day of election and shall end thirty (30) days thereafter. During this period of time, there are certain restrictions imposed by the law such

as

the

prohibition

against

release,

disbursement

or

expenditure of public funds and the prohibition against the construction of public works, delivery of materials for public works and issuance of treasury warrants and similar devices to ensure the fair and objective dealings of the election. These provisions bar government agencies and officials to enter/sign contracts to pursue building of any public utilities or infrastructures. However, on April 2007, the Office of the President announced that President Arroyo stood as a witness in China to the signing of five economic and trade agreements. One of which is the National Broadband Network deal with ZTE. The aforementioned provision was violated because there was an upcoming senatorial and local election to be held on May of the same year. B. ABSENCE OF PUBLIC BIDDING

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Republic

Act

9184

also

known

as

the

“Government

Procurement Reform Act” is a declared policy of the state that aims to promote ideals of good governance to all of its branches, departments,

agencies,

subdivisions

and

instrumentalities

including government-owned and/or -controlled corporations and local government units. This act shall apply to all procurement of the national government of its infrastructure projects, goods and consulting services regardless of the source of funds whether local or foreign. It provides the basic procedures and requirements to be followed for the acquisition process of the government. It promotes competitive bidding to extend equal opportunity to private contracting parties who are eligible and qualified to participate in public bidding and also fosters a system of accountability for public officials who are involved directly or indirectly in the procurement process wherein, when warranted by circumstances, be investigated and held liable for their actions in relation thereto. With the case on hand, a complaint was filed by the then-Nueva Vizcaya representative Carlos Padilla against PTC Secretary Leandro Mendoza that the NBN deal was sealed without public bidding. This was backed up when a financial analysis held on January the following year concluded that the local internet providers can offer the same service at price much lower than that of the ZTE contract. This means that the local private companies

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were not given the chance to pitch in their proposals since the deal was locked without any public bidding. C. TURNAROUND FROM PUBLIC TELECOMMUNICATIONS POLICY ACT OF THE PHILIPPINES Republic

Act

7925

telecommunications

Section

services

4 shall

(e)

states

be

provided

that

“Public

by

private

enterprises. The private sector shall be the engine of rapid and efficient growth in the telecommunications industry.” With the case at par, the ZTE-NBN deal calls for a government-to-government loan to fund the project. According to the ZTE proposal, upon completion of the national broadband network, the project is to be turned

over

to

Communications

the for

Department its

operation

of

Transportation

and

maintenance.

and Such

provision of the contract is a clear and direct violation of the regulating laws affecting the project because a government agency such as DOTC will now be the party responsible to provide public telecommunication services. According to the financial analysis of the project, leading telecom companies in the Philippines can provide such service for only $132B which is more than half of what the ZTE-NBN deal entails. D. REPUBLIC ACT NO. 3019 The Anti-Graft and Corrupt Practices Act is a policy of the Philippine Government, in line with the principle that a public

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office is a public trust, to repress certain acts of public officers and private persons alike which constitute graft or corrupt practices, or which may lead thereto. According to Sec. 3, the act of persuading, inducing or influencing another public officer to perform acts constituting a violation of rules and regulations duly promulgated by competent authority or an offense in connection with the official duties of the latter or allowing himself to be persuaded, induced or influenced to commit such violation or offense is considered to be one of the corrupt practices of a public official. In the case at hand, it is to be noticed that several instances illustrate such act. For example, when Romulo Neri, the former socioeconomic planning secretary and director general of the National Economic and Development Authority, was offered $5M by COMELEC Chairman Abalos Sr. to approve the ZTE-NBN deal. Another corrupt practice mentioned in RA. 3019 is the act of directly or indirectly receiving or requesting any gift, present, share, percentage or benefit for himself or for any other person, in connection with any contract or transaction between the government and any other part, wherein the public officer in his official capacity has to intervene under the law. Such act also applies to when the public officer, in any manner or capacity, has secured or will secure or obtain, any government permit or license, in consideration for the help given or to be given. Again, with the ZTE-NBN mess, the prohibited acts of

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corruption were performed by certain government officials such as when Benjamin Abalos and the President of the Philippines herself, Gloria Macapagal Arroyo, when they jacked up the price of the contract to receive a huge amount of kickbacks. It is to be noted that the figures to be received by these two public officials was so blatantly increased for their own enrichment alone which portrays a direct violation of the law and also the betrayal of public trust.

ETHICAL ISSUES A. BRIBERY Bribery is defined as the offering, giving, receiving or soliciting any item of value to influence the actions of an official or other person in charge of a public or legal duty. In the case at bar, the project price was increased to the extent that certain key persons who are needed to the approval of the project was grossly enriched or benefited monetarily. It is considered unethical because it impairs the independence and objectivity of a certain individual hence prohibits him/her in making decisions with proper judgment. B. WHISTLEBLOWING

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Whistleblowing is the term used when a worker passes on information

concerning

a

wrongdoing.

The

wrongdoing

will

typically, although not necessarily, be something they have witnessed at work. With ZTE-NBN case, it was revealed to the public because of the persons who spoke about it to the media and the persons who filed complaints regarding the issue. They can be considered as whistleblowers because they are employed by the government. An example of which from the case was Jun Lozada who allegedly knows how the project was overpriced and later on disclosed how the Arroyo alliances kept him quiet regarding the issue. He was abducted by the police force as he arrived in the airport and was asked to sign false documents and statements. Policies regarding the protection of whistleblowers should be updated and appropriately executed to give workers the confidence to speak of the wrongdoings of their employers.

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CHAPTER 5 RECOMMENDATIONS Accepting a bribe means favoring the giver and will do something in return that is against the rules. If we were the one who is bribe in exchange for the approval of the ZTE contact regarding National Broadband Network, we will not accept it since, as we all know, bribing and accepting a bribe is unethical. Accepting a bribe violates the Republic Act 3019, otherwise known as the Anti-Graft and Corrupt Practices Act,

Article XI of the Constitution on the

Accountability of Public Officers and Republic Act 1379, also known as Code of Conduct and Ethical Standards for Public Officials and Employees which makes bribery not just unethical but illegal. Although the mentioned laws that were violated are not effectively executed in the Philippines because corruption is still one of the biggest problems of the country, it will not justify the act of accepting the bribe for the approval of the ZTE contract. Most importantly, as a public officer who took an oath to serve everyone without discrimination on any count, we will reject the bribe without even a need to think since it is our duty to serve the public equally. RECOMMENDATION 

The implemented laws in the Philippines must be properly executed. Public officials are not afraid to violate the laws or commit fraud because they know that only few are punished by doing so. Furthermore, it is difficult to provide evidence that will serve as a

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proof that a certain public official commits fraud especially if he has a high position in the Philippine government because it is easy for him to collude with those officials under him. 

There must be additional protection for whistleblowers. Workers

are

often

the

first

in

line

to

witness

any

wrongdoings done in an organization. However, a worker might not be comfortable in disclosing any information because he/she might be afraid of the possible consequences such as fear of reprisals and that no action will be taken if they do “blow the whistle”. Those who

are

charged

with

governance

should

create

a

safe,

transparent, open and supportive culture wherein the workers would feel secure if they ever get in such a situation.

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CHAPTER 6 CURRENT RULING The Sandiganbayan rules that the evidence presented by the prosecution did not sufficiently prove that the former President Gloria Macapagal Arroyo benefitted from the alleged overpriced deal with the ZTE Corporation. The Sandiganbayan’s 4th Division was unanimous in deciding that the prosecution failed to establish that the contract with ZTE Corporation was grossly disadvantageous to the government. They also said that there was not enough proof to claim that Arroyo was motivated by personal gain when she approved the deal. According to anti-graft court, there was also no enough evidence to prove that there was conspiracy to commit fraud. Furthermore, the court said that the charges against the accused are fatally defective because when the charges were filed in 2011, the contract had already been cancelled by Arroyo government owing to allegations of corruption. The court also dismissed the case against the former First Gentleman Jose Miguel Arroyo, and former Commission on Election chair Benjamin Abalos who were charged with graft with former President Arroyo.

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APPENDICES 

https://reswww.zte.com.cn/mediares/zte/Investor/20180326/E1.pdf?fbclid=IwAR3BUIncl 4hUIFKsSe8Bbni_1sNjw3bs8NTc8nJ2V5uPQyl_7LZ0TfFVTks



http://boi.gov.ph/wp-content/uploads/2018/02/TelecommunicationsInfrastructure-January2018.pdf?fbclid=IwAR3xuzXqQbIxbUySIGH2U7iJVNOXMReKg70Ygi2eWTJb_k3 e23_93bYpOQc



https://www.gmanetwork.com/news/news/content/171031/looking-back-thenbn-ztecontroversy/story/?fbclid=IwAR3_JBmqHZRaIGqAa3P4FKhjww8wNgjOCawZde HMuwE-KOvZz18bT91hpL0



https://newsinfo.inquirer.net/959499/what-went-before-nbn-ztedeal?fbclid=IwAR0M7USYrVjPIQAzd4PJntmxZ9oAZFtKDz8hGNi8XyETp4_cKZnjB4qPUI



http://www.chrispforr.net/phils/nbn/nbn.htm?fbclid=IwAR3Okidek7NFRyGaL czdN5Im6zBakvLB61L2-ONmg3phu7JpbBoZbkIfg0Y



http://pcij.org/blog/2007/09/11/the-case-of-the-missing-zte-broadbandcontract?fbclid=IwAR2J9nV2bGG84-Nj790G2NeCDL1Niorq5O96mhjc4njZ3IzzoQo7-yTqO4

February 10, 2019 

file:///C:/Users/Krizianhor%20A.%20Atenta/Downloads/Philippines%20Code %20of%20Conduct%20and%20Ethical%20Standards%20for%20Public%20Offic ials%201989.pdf

27 

http://www.chanrobles.com/electioncodeofthephilippines.htm#.XGhJOuhKjIU



https://www.lawphil.net/statutes/repacts/ra2003/ra_9184_2003.html



https://lawphil.net/statutes/repacts/ra1995/ra_7925_1995.html



https://aer.ph/pdf/papers/NBNSupplyContract_review.pdf



https://www.lawphil.net/statutes/repacts/ra1960/ra_3019_1960.html

February 16, 2019 

https://en.wikipedia.org/wiki/Bribery



https://assets.publishing.service.gov.uk/government/uploads/system/uploads /attachment_data/file/415175/bis-15-200-whistleblowing-guidance-foremployers-and-code-of-practice.pdf