QuestionsQuestions (BFAD ADMINISTRATIVE ORDER NO. 23-C, S. 2000)
It is known as the “Public Telecommunications Policy Act of the Philippines.” It aims to promote and govern the development of Philippine telecommunications and the delivery of public telecommunications services, consistent with national policy on universal, fair, reliable, and competitive telecom infrastructure and services.
It applies to all public telecommunications entities in the Philippines.
“Telecommunications” is any process enabling a telecommunications entity to relay and receive voice, data, messages, signals, etc., by wire, radio, or other electromagnetic/spectral/optical/technological means. A “public telecommunications entity” is any person/firm/corporation—government or private—engaged in providing telecommunications services to the public for compensation.
The law declares a fundamental objective to develop and maintain a viable, efficient, reliable and universal telecom infrastructure using the best available and affordable technologies. It gives priority to improving and extending basic services to areas not yet served, promoting fair market conditions and emphasis on affordable accessibility by persons to basic services in unserved and underserved areas.
It must be administered in the public interest, in accordance with international agreements, and allocated to best-qualified service providers who will use it efficiently and effectively. It also provides for periodic review and open tenders when demand exceeds availability.
The Commission must (1) mandate fair and reasonable interconnection with cross-subsidy provisions to promote telephone density and extensive access at affordable rates; (2) foster fair market conduct and protect entities from unfair trade practices; (3) promote consumer welfare and protect consumers from misuse of monopoly/quasi-monopoly powers by investigating complaints and enforcing service standards.
The Department shall not exercise any power that will tend to influence or affect a review or modification of the Commission’s quasi-judicial functions.
A telecommunications entity may operate in one or more categories mentioned in the Act provided each category is covered by its franchise, and the entity must obtain appropriate authorization for the category.
LEO must provide universal basic telephone service to all subscribers who apply within a reasonable period at standards and tariffs ensuring a fair return on investments. It is protected from uncompensated bypass/overlapping operations by other entities needing physical links, except when it is unable to provide interconnection arrangements within a reasonable time and desired standard.
The number allowed to provide inter-exchange national long distance services may be limited, but at least two carriers should be authorized when economically viable. Obligations include interconnecting with other networks/carriers upon application under fair and reasonable charges, and having the right to establish and operate tandem switching facilities for international calls/overseas carriers.
It must provide local exchange services and demonstrably show technical and financial capability to install and operate an international gateway facility. It must produce firm correspondent/interconnection relationships within one year. It must comply with local exchange service obligations in unserved/underserved areas within three years, with an affiliate option. Failure to comply is a cause to cancel its authority/permit.
If it does not set up its own network, a VAS provider need not secure a franchise. However, it must comply with requirements ensuring no cross-subsidization, non-discrimination in rates for other VAS providers, and separate books of accounts; and some VAS offerings require prior Commission approval.
In a local telephone exchange area, more than one duly enfranchised provider of mobile radio services (distinct from the local exchange carrier) may be allowed, but they must secure prior authority from the Commission and comply with conditions related to VAS norms and radio frequency spectrum utilization. They also must comply with unserved/underserved local exchange obligations within three years or face cancellation.
Users are entitled to non-discriminatory, reliable utility service conforming to minimum Commission standards; a right to first single-line/party-line connection within specified timeframes after application (with deposit) or after targeted barangay commencement; regular, timely, accurate billing and courteous service; and thorough and prompt investigation/action on complaints, with the ability to receive complaints via telephone and a record of all complaints.
No public telecommunications entity may operate without a franchise. The Commission may impose conditions via CPCN, but CPCN cannot be shorter than five years and cannot be longer than the life of the franchise. If CPCN expires at the same time as the franchise and the franchise is renewed/extended, the CPCN is deemed renewed for the same term.
The Commission may exempt a specific service if it has sufficient competition to ensure fair and reasonable rates/tariffs. It retains residual power to regulate when ruinous competition results or when monopoly/cartel/restraint of free competition distorts rates and the public is adversely affected, including setting a floor or ceiling.
Access charge/revenue sharing arrangements between interconnecting carriers are negotiated and submitted to the Commission. If parties fail to agree within a reasonable period, the dispute is submitted to the Commission for resolution. The Commission must ensure equity, reciprocity, fairness, and consider facility completion costs and cross-subsidy needs to promote telephone density and fair return.
For regulated telecommunications entities, at least 30% of aggregate common stocks must be made a bona fide public offering through stock exchanges within five years from effectivity or first commercial operations, complying with SEC rules. The Department must within three years privatize government-owned/operated telecommunications facilities for public use (and those planned under bilateral funding), typically through public bidding unless otherwise authorized by law.