A.B. Won Pat International Airport Authority, Guam

July 19, 2018 – Tamuning, Guam – On July 16, 2018, the Superior Court of Guam granted a stay in its February 2018 order that voided the Guam International Airport's specialty retail concession agreement with Lotte Duty Free, as well as removing a portion of the order that required GIAA to abide by the terms of the voided contract.

GIAA is pleased that its request for a stay in enforcement of the order has been granted so that we can take the case directly to the Guam Supreme Court for final review. We respectfully, but strongly disagree with the Superior Court's earlier order finding that GIAA violated Guam Procurement Law in the RFP process and award of the contract to Lotte Duty Free and look forward to presenting our case on appeal.

The Lotte contract, which has been in place for five years, has so far paid more than $70 million in revenue to GIAA, resulted in over $20 million in airport improvements, and was the linchpin in the $247 million bond issue that is funding the construction of the new Arrivals corridor.

Yesterday's order is also important because it put an end to DFS Guam's attempt to insert itself back into the case and expand the scope of the Superior Court's decision to encompass further litigation of DFS's unfounded claims. The Court's February order made no finding that Airport officials acted unethically or in a biased manner. Rather, the court voided the Lotte contract based on what GIAA believes were untimely protests by DFS that have nothing to do with whether GIAA's contract with Lotte is good for the people of Guam. These protests were based on technical violations raised for the first time almost a year after GIAA issued its request for proposals and cannot justify such a result.

The Superior Court's order voiding the contract is potentially devastating for Guam. It would prevent the Airport from using the procedure used by every other modern international airport to solicit similar contracts. It would directly cost the Airport tens of millions of dollars – costs that will necessarily need to be passed along to travelers for the Airport to remain open. And as we saw when the Moody's Investor Service called the Court's order “credit negative” earlier this year, it has put the financial stability of the Airport and its necessary infrastructure modernization plans at risk.

All of us at GIAA are now looking forward to speedy review of the lower court order by the Guam Supreme Court. The Lotte contract is in the best interests of Guam.

For any questions, please contact Genevieve Rapadas at 646-9355 or [email protected].