QuestionsQuestions (Republic Act No. 11322)
RA 11322 grants COTELCO-PPALMA (and its successors/assignees) a legislative franchise to construct, install, establish, operate, and maintain an electric power distribution system for public interest, covering the municipalities of Pikit, Pigcawayan, Aleosan, Libungan, Midsayap, and Alamada, Province of Cotabato, and neighboring suburbs—subject to the Constitution and applicable laws.
The grantee must operate and maintain its facilities, lines, and systems in the best manner at all times, and must modify/improve/change facilities when required by the ERC (or successor), DOE (or successor), NEA (or successor), or any other concerned government agency, in line with scientific progress and industry improvements.
When practicable and to maintain order, safety, and aesthetics along highways/roads/streets or easements, the grantee may allow use upon reasonable compensation. The ERC or NEA resolves disputes or disagreements between parties.
The grantee must secure from the ERC or NEA (or the other agency with jurisdiction) the necessary certificate of public convenience and necessity (CPCN) and other appropriate permits and licenses.
For erecting/maintaining poles and supports and for underground facilities, the grantee may excavate or lay conduits in public places/roads/bridges subject to prior approval of DPWH or the LGU concerned. Any disturbed area must be repaired/replaced at the grantee’s expense according to DPWH/LGU standards. If the grantee fails to repair within 10 days after notice, DPWH/LGU may do the repair and charge the grantee double the cost.
The grantee must supply electricity to its captive market in the least costly manner; modify/improve facilities as required to provide efficient, reliable service and reduced electricity costs; charge reasonable and just power rates; provide open and nondiscriminatory access to its distribution system and services to end users within its franchise area consistent with RA 9136; and avoid abuse of market power and unfair trade practices.
Retail rates/charges for distribution are regulated and subject to ERC (or successor) approval. The grantee must identify and itemize components of the retail rate in the electricity bill pursuant to RA 9136, and must make such rates public and transparent.
The grantee must implement lifeline rates to marginalized end users as mandated under RA 9136.
The grantee must establish a consumer desk to handle complaints and ensure adequate protection of consumer interests, and must act with dispatch on complaints brought before it.
The grantee must create employment opportunities and allow on-the-job trainings. Priority is accorded to residents where its principal office is located. It must follow applicable labor standards and entitlements under existing labor laws, and employment opportunities/jobs created must be reflected in the General Information Sheet (GIS) submitted annually to the SEC.
In times of war, rebellion, public peril, calamity, emergency, disaster, or disturbance of peace and order, the President may temporarily take over and operate the distribution system, temporarily suspend a station/facility for public safety/security/welfare, or authorize temporary use/operation by a government agency, upon due compensation to the grantee.
Subject to legal limits and procedures, the grantee may exercise eminent domain as reasonably necessary for efficient maintenance and operation. It may install and maintain poles/wires/facilities over and across public property (including streets/highways/forest reserves and similar government property). It may acquire private property actually necessary, but proper condemnation proceedings must be instituted and just compensation paid.
The franchise term is 25 years from effectivity unless sooner cancelled. It is deemed ipso facto revoked if the grantee fails to operate continuously for two (2) years.
Acceptance must be in writing to the House Committee on Legislative Franchises and the Senate Committee on Public Services within 60 days after effectivity. Upon acceptance, the grantee may exercise franchise privileges. Nonacceptance renders the franchise void.
The grantee may not sell, lease, transfer, grant usufruct, or assign the franchise/rights/privileges, nor merge with another entity, nor transfer controlling interest, without prior approval of Congress. Congress must be informed within 60 days after completion of such transactions. Failure to report renders the franchise ipso facto revoked. Transferees are subject to the same conditions/terms.
The grantee must submit an annual compliance and operations report to Congress by April 30 of the succeeding year through the House and Senate committees on legislative franchises and public services. Failure to submit the annual report subjects it to a fine of PHP 500 per working day of noncompliance.
Section 18 requires compliance with the Public Service Act (CA 148 as amended), RA 9136, and the NEA Reform Act (RA 10531). Section 21 has a separability clause: invalid provisions do not affect others not held invalid. Section 22 states effectivity 15 days after publication in the Official Gazette or in a newspaper of general circulation.