G.R. No. 270564, April 16, 2024
SMARTMATIC TIM CORPORATION AND SMARTMATIC PHILIPPINES, INC., PETITIONERS, VS. COMMISSION ON ELECTIONS EN BANC, ELISEO MIJARES RIO, JR., AUGUSTO CADELIÑA LAGMAN, FRANKLIN FAYLOGA YSAAC, AND LEONARDO OLIVERA ODOÑO, RESPONDENTS.

FACTS

Petitioners Smartmatic TIM Corporation and Smartmatic Philippines, Inc. (collectively, Smartmatic) filed a Petition for Certiorari assailing the November 29, 2023 Resolution of the COMELEC En Banc which disqualified Smartmatic from participating in any public bidding process for elections. Smartmatic had been the service provider for the Automated Election System in past national elections and had purchased bidding documents for the 2025 National and Local Elections. Private respondents Rio, Jr. et al. filed petitions before the COMELEC En Banc alleging irregularities in the 2022 elections, including issues with transmission sequencing, cloned machine transmissions, and a meeting between Smartmatic affiliates and a presidential candidate’s representatives during an active service contract. They prayed for a review of Smartmatic’s qualifications and its disqualification from the 2025 procurement. The COMELEC Law Department initially found no legal basis to prohibit Smartmatic. After hearings, the COMELEC En Banc granted the petition and disqualified Smartmatic. The COMELEC En Banc clarified that, at that pre-procurement stage and as head of the procuring entity, it could not review qualifications under the Government Procurement Reform Act (GPRA) and its rules, as the proper procedure for blacklisting under the 2016 Revised Implementing Rules and Regulations was not followed. However, the COMELEC En Banc grounded its disqualification on its broad constitutional mandate to enforce election laws and ensure electoral integrity. It cited an ongoing U.S. Department of Justice investigation and criminal charges against former COMELEC Chairman Andres Bautista for allegedly receiving bribes from Smartmatic in exchange for a contract, which posed an imminent threat to democratic processes and public confidence. The COMELEC En Banc categorically rejected Rio, Jr. et al.’s allegations of specific irregularities in the 2022 elections, stating no irregularities attended that election.

ISSUE

Whether the COMELEC En Banc acted with grave abuse of discretion in disqualifying Smartmatic from participating in any public bidding process for elections.

RULING

Yes, the Supreme Court granted the petition, annulled and set aside the COMELEC En Banc’s Resolution, and made the temporary restraining order permanent. The COMELEC En Banc committed grave abuse of discretion. The Court held that while the COMELEC possesses broad constitutional powers, these powers must be exercised within the bounds of law and with due process. The disqualification of a bidder from government procurement is governed specifically by Republic Act No. 9184 (the GPRA) and its Implementing Rules and Regulations. The COMELEC, as a procuring entity, is bound by this law. The COMELEC En Banc’s act of disqualifying Smartmatic outside the framework and procedures of the GPRA—such as the stages for eligibility screening, bid evaluation, and post-qualification, and the specific process for blacklisting—was arbitrary and capricious. It effectively imposed a blanket disqualification without a finding of guilt from a competent court regarding the U.S. bribery allegations and without affording Smartmatic the procedural safeguards under procurement laws. The COMELEC’s constitutional duty to ensure clean elections does not grant it unbridled authority to disregard statutory procurement rules. Its power must be exercised in accordance with law, and its failure to adhere to the GPRA’s specific mechanisms for disqualification constituted a grave abuse of discretion amounting to lack or excess of jurisdiction.