Location and Standards for Poles and Conduits
- Poles and conduits must be placed where designated by grantee and approved by the municipal board.
- All poles must be aesthetically acceptable and not disfigure streets.
- Wires and cables must meet professional standards approved by the Public Service Commission.
- Wire height must be at least 15 feet above ground for safety.
- Bundling of wires is required: at 25 or more wire pairs, wires must be cabled; at 800 or more pairs, wires must be buried underground if ordered.
Excavation and Restoration of Public Places
- Grantee can excavate public places for pole placement or underground cables.
- Any public property disturbed must be restored and repaired to original condition and cleaned of debris to the satisfaction of the city engineer.
Removal or Raising of Wires for City Projects
- Upon 48 hours notice by municipal board, grantee must raise or remove wires/conduits to allow building removal or city work.
- Half of the cost of such removal or raising is paid by the party requesting it.
- If grantee refuses, the city mayor may order removal at grantee’s expense.
Quality and Maintenance of Telephone System
- All apparatus must be modern, first-class, and telephone lines must be maintained for efficient service.
- Public Service Commission may require upgrades or changes to keep pace with scientific progress.
Accounting and Reporting Requirements
- Grantee must keep separate accounts of all gross receipts.
- Annual submission of accounts to Auditor General and Treasurer by July 31 for the previous fiscal year is required.
Taxes and Franchise Fees
- Grantee pays regular taxes on real estate, buildings, and personal property.
- Additionally, pays 1% of gross receipts from telephone business annually as franchise tax, in lieu of other taxes on franchise or earnings.
Certificate of Convenience and Public Necessity
- Grantee must apply within 60 days for certificate from Public Service Commission.
- Without application, franchise is void.
- Construction cannot commence without this certificate.
- Certificate issued only after hearing, with conditions to protect public interest.
- Grantee must accept certificate’s terms and deposit security before exercising rights.
- Failure to commence service within fixed period may lead to certificate annulment and deposit forfeiture, except for force majeure.
Good Faith Deposit and Penalties
- Upon accepting franchise, grantee deposits ₱1,000 with Treasurer or negotiable bonds.
- Deposit assures readiness to begin service within 6 months after certificate issuance.
- Failure to start service within 12 months leads to forfeiture of deposit as liquidated damages.
- Deposit with interest returned to grantee upon successful installation of telephone service.
Inspection and Auditing
- Books and accounts accessible to city auditor and authorized representatives.
- Quarterly financial reports showing gross and net receipts must be submitted to Auditor General.
Non-Exclusivity and Coexistence with Other Franchises
- Franchise is non-exclusive; others may be granted telephone or electrical transmission franchises.
- New franchises must not impair the grantee’s existing infrastructure and service.
- Public Service Commission can order relocation or removal of poles and wires for coexistence.
- Costs for such relocation borne by subsequent franchise holder.
Indemnity to Government
- Grantee holds national, provincial, city, and municipal governments harmless against all claims from accidents or injuries related to system construction or operation.
Regulation of Service Rates
- Telephone service rates, including flat and measured rates, must be approved by the Public Service Commission.
- Rates for metallic circuit telephones within the city limits also subject to approval.
Transfer and Assignment of Franchise
- Franchise transfer or assignment to others requires prior explicit approval of the Philippine Congress.
Installation and Operation of Additional Facilities
- Grantee may install, operate, or lease additional telephone stations, lines, cables as needed.
- Prior permission of Public Service Commission required for these activities.
Use of Poles by Government Agencies
- Philippine Government may use grantee’s poles to attach one crossarm and telegraph wires without compensation.
- Additional crossarms require negotiated compensation or Public Service Commission-set rates.
- City of Cavite may use poles for police and fire alarm wires without compensation, provided no interference occurs.
Purchase of Existing City Telephone Property
- Grantee shall purchase existing city telephone system property at agreed price.
- If no agreement, Public Service Commission acts as referee for reasonable price determination.
Government’s Right to Take Over
- Philippine Government may operate system itself and require grantee to surrender franchise.
- Grantee must turn over system and equipment at cost less reasonable depreciation.
Effectivity of the Act
- Act takes effect immediately upon approval.