QuestionsQuestions (Republic Act No. 11322)
RA 11322 grants COTELCO-PPALMA (and its successors/assignees) a legislative franchise, subject to the Constitution and applicable laws, to construct, install, establish, operate, and maintain an electric power distribution system for public interest to convey electricity to end users in specified municipalities of Cotabato and its neighboring suburbs.
The grantee must operate and maintain all electric distribution facilities in the best manner at all times, and must modify/improve/change facilities when required by the ERC/DOE/NEA or other concerned government agencies, in accordance with reasonable and proper industry progress.
Yes, whenever practicable and for purposes of maintaining order, safety, and aesthetics along highways/roads/streets/easements, the grantee may allow use by interested parties upon reasonable compensation. The ERC or NEA resolves disputes.
The grantee must secure from the ERC or NEA (or any other jurisdictional agency) the necessary certificate of public convenience and necessity and other appropriate permits and licenses for construction and operation.
The grantee may excavate or lay conduits in public places/roads/streets/bridges of the province/cities/municipalities, subject to prior approval of DPWH or the concerned LGU. Any disturbed/altered public infrastructure must be repaired or replaced at the grantee’s expense according to DPWH/LGU standards. If the grantee fails to act after a 10-day notice, DPWH/LGU may repair at double cost charged to the grantee.
It requires the grantee to provide service at costs that are least costly, and to modify/improve facilities as required by the ERC to achieve efficient and reliable service and reduced electricity costs, consistent with regulatory requirements.
The grantee must provide open and nondiscriminatory access to any end user within the franchise area, consistent with RA 9136 (Electric Power Industry Reform Act of 2001). It must not engage in activities that constitute abuse of market power, including unfair trade practices, monopolistic schemes, or actions that hinder competitiveness.
Retail rates and charges for distribution are regulated and subject to ERC approval (or its successor). The grantee must identify and itemize components of the retail rate on consumers’ bills pursuant to RA 9136, and must make rates public and transparent.
The grantee must establish a consumer desk to handle complaints and ensure protection of consumer interests, and must act with dispatch on all complaints.
The grantee must create employment opportunities and allow on-the-job training. Priority must be accorded to residents where its principal office is located, and it must comply with applicable labor standards. Employment opportunities/jobs created must be reflected in the General Information Sheet (GIS) submitted to the SEC annually.
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 operation of any station/facility for public safety/security/welfare, or authorize temporary use/operation by a government agency, upon due compensation.
The grantee is authorized to exercise eminent domain insofar as reasonably necessary for efficient maintenance and operation, and is authorized to install and maintain poles, wires, and other facilities over/across public property including streets/highways/forest reserves and other government property. It may acquire private property actually necessary, but only through proper condemnation proceedings and payment of just compensation.
The franchise lasts 25 years from the effectivity of the Act 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.
Section 13 (Warranty in Favor of Governments) makes the grantee hold national and local governments free from claims/liabilities/actions arising from accidents causing injury or damage during construction/installation/operation/maintenance. Section 14 (Liability to Damages) makes the grantee liable for injury and damage caused by accidents due to defective construction or neglect to keep poles and wires in safe condition.
The grantee cannot sell/lease/transfer/grant usufruct/assign the franchise or rights, merge, or transfer controlling interest without prior Congress approval. Congress must be informed within 60 days after completion of the transaction. Failure to report renders the franchise ipso facto revoked; the transferee must be subject to the same conditions of the Act.
The grantee must submit an annual report to Congress through the relevant House and Senate committees on compliance and operations on or before April 30 of the succeeding year. If it fails to submit, it is penalized with P500 per working day of noncompliance, collected by the ERC separately from ERC penalties for its own reportorial requirements.
Under Section 21, if any section/provision is held invalid, other unaffected provisions remain valid. Under Section 22, the Act takes effect 15 days after publication in the Official Gazette or in a newspaper of general circulation.