QuestionsQuestions (Republic Act No. 9172)
RA 9172 grants Eastern Telecommunications Philippines, Inc., its successors or assigns, a franchise to construct, install, establish, operate and maintain wire and/or wireless telecommunications systems throughout the Philippines and between the Philippines and other countries, including mobile, cellular, paging, fiber optic, MMDS/LMDS, satellite systems, switches, and their value-added services.
It must be constructed and operated in a manner that results at most in the minimum interference on relevant wavelengths/frequencies of existing or other legally established stations, without diminishing its own right to use selected frequencies and without reducing transmission/reception quality.
The NTC must issue a certificate of public convenience and necessity or the appropriate permits/licenses and can impose conditions related to construction/operation/service level. The NTC regulates construction and operation, and the grantee may not use any radio frequency without NTC authorization.
No. The NTC shall not unreasonably withhold or delay the grant of authority, permits, or licenses.
The grantee must secure prior approval from the Department of Public Works and Highways (DPWH).
After ten (10) days notice and failure to repair/replace in good order, DPWH may repair it and charge the grantee at double expense.
The grantee must provide basic or enhanced telephone service in any municipality where it has an approved certificate for local exchange service without discrimination among applicants, in order of application date, up to exchange capacity; it must expand capacity when demand increases.
Yes. If expansion demand is less than the smallest viable local exchange as determined by the Commission, the grantee is not obliged to furnish the service unless the applicant defrays actual installation expenses for the needed telecommunications apparatus; the Commission may extend the time for furnishing service.
Charges and rates for telecommunications services (except those later declared as nonregulated) require approval of the NTC/its legal successor. Regulated services must not subsidize unregulated services, and rates must be unbundled, separable, and distinct among services.
The President may temporarily take over and operate the grantee’s stations/facilities/equipment, temporarily suspend operations for public safety/security/welfare, or authorize government agencies to temporarily use/operate them, with due compensation to the grantee.
The franchise term is 25 years from effectivity unless earlier revoked/cancelled. It is deemed ipso facto revoked if: (a) it fails to commence operations within 3 years from NTC operating permit/provisional authority approval; (b) it fails to operate continuously for 2 years; and (c) it fails to commence operations within 5 years from the Act’s effectivity.
The grantee must give written acceptance within 60 days from effectivity. Upon acceptance, it may exercise franchise privileges; nonacceptance renders the franchise void.
The grantee must file a bond in favor of the NTC guaranteeing compliance. If after five years from permit approval the grantee has fulfilled the conditions, the bond is cancelled; otherwise, the bond is forfeited to the government and the franchise is ipso facto revoked.
The grantee may connect or demand connection of its systems to other duly authorized telecommunications systems to provide extended/improved services. Terms must be mutually agreed upon and are subject to NTC review or modification.
The grantee must pay all applicable taxes under the NIRC and other laws, without repealing specific existing tax exemptions/incentives. It must file returns with the city/province where facilities are located, pay income tax to the Commissioner of Internal Revenue, and permit BIR audit. It must keep separate gross receipts accounts, submit them to COA and National Treasury by January 31 for the preceding twelve months, and submit quarterly reports to COA.
No sale, lease, transfer, usufruct, grant, or assignment is allowed (nor merger or transfer of controlling interest) without prior approval of Congress. Any transferee/assignee is subject to the same conditions, terms, restrictions, and limitations.
Within five years from commencement of operations, the grantee must offer at least 30% of its outstanding capital stock (or higher if later required by law) in a Philippine securities exchange to encourage public participation. Noncompliance results in ipso facto revocation.
The franchise term under RA 808 is renewed/extended for another 25 years from expiration. It is deemed ipso facto revoked if the grantee fails to operate continuously for two years.