Philippines Suspends US Firm, Mall Operator After Deadly Fire

The Philippines has suspended an American firm and the operator of a Davao City shopping mall, where a blaze killed 38 people last month, because the companies failed to meet fire-safety standards over several years, a government official said Wednesday.

The Philippine Economic Zone Authority (PEZA) “has suspended the registrations” of SSI Philippines and the New City Commercial Complex (NCCC) mall in southern Davao City, after an investigation found that both “did not comply with certain fire-safety requirements since 2013,” said Charito Plaza, the agency’s director-general.

PEZA did not say whether charges would be filed, although the Justice Department had said earlier that it was also looking into whether both firms were criminally culpable in the fire.

The death toll from the fire, which broke out over the Christmas holiday weekend, included 37 employees of a call center operated in the NCCC mall by Research Now SSI, a Texas-based firm that specializes in digital research data.

The fire tore through the mall on Dec. 23 and raged for nearly two days before firefighters put it out on Christmas Day. The bodies of the 37 SSI employees were later found charred beyond recognition. The body of a 38th victim – a mall employee – was recovered earlier during the holiday weekend.

Both firms had failed to furnish PEZA with their latest preventive maintenance record, including fire extinguishers, emergency lights and alarm systems, Plaza said.

“They also missed the conduct of fire exit drills which should have been done twice a year, where employees are trained to use fire extinguishers and perform evacuation drills,” Plaza said, adding that the firms were not issued “fire inspection certificates” from 2013 through 2017.

But it remained unclear why the firms were able to operate in Davao without those permits.

“They also failed to submit proof of compliance for 2013, 2014, 2015 and 2016 annual inspection reports in the form of an updated action plan,” according to Plaza.

She said the agency had been calling on SSI and NCCC to comply with the requirements “but those pleas fell on deaf ears.” Plaza did not explain why the firms had not been suspended earlier, and were allowed to keep operating.

Both firms were registered with PEZA in 2008, with SSI categorized as an information technology and business process outsourcing firm and the NCCC mall as an “ecozone developer.” A registration with PEZA qualifies a firm certain incentives, such as tax breaks.

The suspension went into effect on Dec. 29 and would be lifted once the Davao City government and the local fire protection bureau cleared the two firms of any culpability, Plaza said.

However, SSI’s other Philippine operation, which works out of the central city of Mactan, has complied with the rules and would not be affected by the suspension order, according to the agency chief.

“We’re trying to obtain clarity on PEZA’s allegations through our team on the ground in Davao, and therefore have no comment at this time,” Barbara Palmer, a spokeswoman for ResearchNow SSI, told BenarNews on Wednesday from the firm’s headquarters in Plano, Texas.

Officials representing the operator of the CCCI mall were not immediately available for comment.

Mayor recuses herself

Shortly after the fire at the mall, Davao City Mayor Sara Duterte, a daughter of President Rodrigo Duterte, virtually cleared the mall operator and the firm of any culpability, saying that both were “fire safety compliant.”

She said that fire safety compliance was necessary for the renewal of a business permit issued yearly by her office. The city’s bureau of fire office had also found no violations by the mall during its yearly inspections.

The mayor, however, later backtracked and inhibited her office from the investigation, after it was revealed that, through an ad, she had effectively endorsed the grocery subsidiary of the mall operator.

She said her “impartiality” had been questioned and that she would leave the investigation to an interagency task force made up of the fire bureau, the justice department and the police.

The deadly blaze was one of the worst fires to hit a commercial establishment in the Philippines in years.

In March 1996, a fire broke out at Ozone Disco north of Manila, killing 162 people while in 2015, 75 were killed in a fire at a plastic and rubber factory in another suburb of the Philippine capital.

BenarNews staff in Washington contributed to this report.