G.R. No. 188655 - Next Mobile, Inc. vs. National Telecommunications Commission~~National Telecommunications Commission vs. Bayan Telecommunications, Inc.~~Multi-Media Telephony, Inc. vs. Pacific Wireless, Inc. et al.

Republic Act No. 7925 (Public Telecommunications Policy Act of the Philippines) designates radio frequency spectrum as a "scarce public resource," to be allocated only to service providers who will use it efficiently and effectively. The National Telecommunications Commission (NTC) is the primary administrator of this resource with broad discretion in assessing applicants for frequency bands.
The NTC’s findings in technical matters are entitled to great weight and only reversed upon clear showing of serious violation of law, fraud, personal malice, or wanton oppression.
The NTC’s mandate includes ensuring quality, safety, reliability, inter-operability, and adopting regulations consistent with international standards.
The move toward Third Generation (3G) wireless technology began in 2002, aiming to improve data transmission rates and enable new multimedia services.

Starting in 2004, the NTC engaged in public consultations and issued draft Memorandum Circulars outlining procedures for the allocation of 3G frequencies. Memorandum Circular No. 07-08-2005 was promulgated on August 23, 2005, establishing rules for allocation and assignment of 3G radio frequency bands to no more than five qualified Public Telecommunications Entities (PTEs).
Applicants were classified into three categories:

Existing Cellular Mobile Telecommunications System (CMTS) providers – automatically qualified.
Existing Public Telecommunications Entities without CMTS authorization – required to obtain CMTS authorization first.
New Public Telecommunications Entities – likewise required to obtain CMTS authorization.

Applicants included Smart Communications, Globe Telecom, Digitel, Bayan Telecommunications, Multi-Media Telephony, Inc. (MTI), Pacific Wireless, Connectivity Unlimited Resource Enterprise, Inc. (CURE), Next Mobile, Inc., and AZ Communications, Inc.
Pacific Wireless and AZ were disqualified at initial qualification; Next Mobile was disqualified for unpaid Supervision and Regulation Fees and Spectrum User Fees. Six applicants remained for evaluation.

The NTC adopted a 30-point system: 10 points each for track record, roll-out plan, and service rates, with a 20-point threshold to qualify.
Only Smart, Globe, Digitel, and CURE scored above the threshold and were awarded four of the five 3G frequency slots. The fifth slot was held in abeyance pending further qualification.
MTI, AZ, Next Mobile, Pacific, and Bayantel filed motions for reconsideration, all of which were denied.

Next Mobile contested its disqualification for unpaid fees, arguing that conversion of liabilities into equity stock subscriptions should not be included in fee computations. The Court of Appeals (CA) affirmed the NTC’s assessment.
Next Mobile filed petitions before the CA and the Supreme Court questioning the disqualification and the Consolidated Order, raising due process concerns and appealing what it considered interlocutory decisions. The CA dismissed some petitions on procedural grounds.
Bayantel challenged the 30-point system and its disqualification, with the CA initially upholding the system but later invalidating it due to lack of publication, and awarding Bayantel the fifth 3G frequency.
The NTC and other parties filed petitions before the Supreme Court; the NTC sought a status quo ante order which was granted.

Bayantel underwent corporate rehabilitation and was eventually majority-owned by Globe Telecom. MTI entered into a network sharing agreement with Globe. PLDT acquired CURE, and subscribers were transferred to Smart. PLDT also acquired Digitel, subject to NTC conditions regarding CURE’s 3G frequency.
As of 2017, three 3G frequency assignments remained active and paid for (Smart, Digitel, Globe); two frequencies were vacant and under litigation.
In 2018, the NTC adopted new rules for selecting a New Major Player in the telecommunications market and named Mislatel (later Dito Telecom) as such.

Next Mobile argued wrongful disqualification for unpaid fees, improper inclusion of paid-in capital from debt-equity conversion in fee computation, interlocutory nature of the order, and lack of due process.
MTI challenged the validity and publication of the 20-point threshold, asserted qualification for award, and raised concerns about PLDT's capital structure and monopoly risks.
AZ contested the validity of NTC’s guidelines for failure to publish, and claimed qualification for the last frequency.
Bayantel contended it was wrongly disqualified, disputed the 30-point system and threshold on publication grounds, argued it was entitled to the fifth slot, and opposed awarding the last frequency to PLDT-affiliated entities.
Smart Communications supported the NTC’s exercise of discretion and disqualification of Next Mobile, challenged MTI’s claims on appeal procedures, and defended the 3G awards including that to CURE.
The NTC asserted improper impleading in petitions, justified the 30-point system as an interpretative regulation, argued applicants were informed and afforded due process, and maintained Next Mobile’s disqualification for unpaid fees was proper.
Extelcom underscored the technical nature of evaluation and criticized CA’s interference and incomplete adjudication, advocating deference to the NTC.

Whether the NTC was correctly impleaded as a party in Rule 43 Petitions before the Court of Appeals.
Whether all 3G applicants are indispensable and necessary parties in proceedings before the Supreme Court.
Whether the December 28, 2005 Consolidated Order by the NTC was interlocutory and thus not appealable.

Whether the NTC erred in establishing the 30-point qualification system and the 20-point qualification threshold based on track record, roll-out plan, and service rates.
Whether the 30-point system and 20-point threshold should have been published or deposited with the University of the Philippines Law Center to be valid.
Assuming validity of the 30-point system and threshold:

Whether Next Mobile’s application was correctly denied for failure to pay required fees.
Whether the NTC correctly awarded a 3G frequency to CURE despite its lack of track record or adequate roll-out capacity and its ownership ties to the PLDT group.
Whether AZ’s disqualification had attained finality in light of prior Supreme Court rulings.
Whether the NTC correctly assessed MTI as a non-CMTS provider and rightly disqualified its application.
Whether the Court of Appeals correctly invalidated the award to CURE in favor of Bayantel using the same 30-point system it had invalidated.