Operation of Stations and Interference Management
- Stations must be constructed and operated to minimize interference with existing or future lawful telecommunications stations.
- This must not diminish the grantee's right to use its selected frequencies or the quality of its transmissions.
- The objective is to maximize service rendition and availability.
Regulatory Approvals
- The grantee must obtain appropriate permits, licenses, and certificates from the National Telecommunications Commission (NTC).
- No frequency in the radio spectrum shall be used without prior NTC authorization.
Responsibility to the Public
- The grantee must adhere to principles of honest enterprise.
- Stations must not be used for obscene or indecent transmissions, deliberate misinformation, or to assist subversive or treasonable acts.
Service Rates and Charges
- Subscription charges and rates for services require NTC approval before being offered to the public.
Government Rights During Emergencies
- The President may, during war, rebellion, calamity, or other emergencies, temporarily take over, operate, or suspend the grantee's stations and equipment.
- Temporary use by government agencies is authorized with due compensation to the grantee.
Term and Revocation of Franchise
- The franchise is valid for 25 years from approval unless revoked or cancelled earlier.
- Failure to operate continuously for two years results in automatic revocation of the franchise.
Acceptance and Operation Requirements
- The grantee must accept the franchise in writing within 60 days of approval.
- Operations must commence within 2 years from acceptance; failure to do so voids the franchise.
Taxation
- The grantee is liable to pay regular taxes on real estate, buildings, and personal property.
- Additionally, a franchise tax equal to 3% of gross receipts from business under the franchise is required, in lieu of other franchise-related taxes.
- Income taxes under existing tax laws remain applicable.
- Tax returns and payments are subject to audit by the Bureau of Internal Revenue.
Liability and Indemnification
- The grantee must hold the national and local governments harmless from all claims related to accidents or injuries caused by its operations.
Restrictions on Transfer, Sale, or Assignment
- The franchise or rights thereof cannot be leased, transferred, sold, assigned, or granted as usufruct without prior Congressional approval.
- Controlling interest transfers also require Congressional approval.
- Any valid transferee assumes all conditions and restrictions of the franchise.
Compliance with Future Telecommunications Laws
- The grantee shall comply with provisions of any general telecommunications policy law enacted after this franchise.
Public Offering Requirement
- Within 2 years from effectivity, the grantee must list at least 30% of its authorized capital stock in any Philippine securities exchange.
- This is subject to the Securities and Exchange Commission and stock exchange regulations.
Separability Clause
- Invalidity of any provision does not affect the validity of the remaining provisions.
Amendability and Non-Exclusivity
- The Congress may amend, alter, or repeal the franchise as public interest requires.
- The franchise is non-exclusive and does not grant a monopoly.
Reporting Obligations
- The grantee must submit an annual report to Congress within 60 days after each year’s end, detailing compliance and operations under the franchise.
Effectivity
- The Act takes effect 15 days after its publication in at least two newspapers of general circulation in the Philippines.