Location and Standards of Poles and Cables
- Poles and conduits to be located as approved by municipal boards.
- Poles must not disfigure public areas, wires laid per standards approved by Public Service Commission (PSC).
- Minimum height for wires: 15 feet above ground.
- Wires must be safely installed to protect public safety.
- Requirement to cable wires in populated areas and place underground if over certain wire volumes upon PSC order.
Excavation and Restoration
- Grantees authorized to excavate public areas for poles and cables.
- Any disturbed public property must be restored to the original or satisfactory condition.
- Removal of all refuse and debris from work areas required.
Adjustment of Facilities for Municipal Works
- Grantees must remove or raise wires/conduits obstructing municipal projects or building removals upon 48-hour municipal notice.
- Cost of replacement shared between grantees and requesting entity.
- Municipal council resolution needed to effect notice; failure to comply permits municipal mayor to order action at grantees' expense.
Equipment Standards and Service Obligations
- All equipment must be modern, first class, and properly maintained.
- Duty to provide efficient and adequate telephone service.
- Obligation to upgrade or improve system upon PSC request to reflect technological advances.
Financial Reporting
- Grantees must keep separate account of gross receipts.
- Annual submission of financial reports to Auditor General and Treasurer by July 31 covering prior 12 months.
Franchise Tax
- Grantees to pay 1% of gross receipts annually to the Treasurer, due within 10 days after account approval.
- This payment is in lieu of all other taxes on the franchise or its earnings.
Certificate of Convenience and Necessity (CCN)
- Grantees must apply for CCN from PSC within 60 days of Act approval.
- Franchise void if application not made in time.
- Construction and operation cannot commence without CCN.
- PSC decides after hearing and may impose reasonable conditions.
- Grantees must accept CCN conditions in writing and make required deposits.
- Failure to commence service under CCN within prescribed time (allowing force majeure) results in forfeiture of deposit and nullification.
Deposit and Commencement of Service
- Upon acceptance, a deposit of ₱5,000 or equivalent government securities to guarantee good faith.
- Deposit held with Treasurer, interest to be paid to grantees on demand.
- Failure to commence service within 12 months of CCN grant (excluding force majeure) forfeits deposit to the government as liquidated damages.
- Successful commencement leads to deposit return following PSC recommendation.
Inspection and Reporting of Accounts
- Books open to provincial auditor or authorized representatives.
- Quarterly reports to Auditor General on gross receipts, net receipts, and business condition required.
Non-Exclusivity and Subsequent Franchises
- Franchise is non-exclusive.
- Granting of other telephone/electrical transmission franchises not impaired.
- Poles and cables of subsequent franchises must not impair existing service.
- PSC may order relocation or removal of poles/cables; costs borne by subsequent franchise grantee.
Hold Harmless Clause
- Grantees to indemnify government against claims from accidents or injuries arising from operation or construction.
Rate Regulation
- Telephone rates (flat and measured) subject to PSC approval.
- Rates for metallic circuit telephones within province also require PSC approval.
Transfer or Assignment of Franchise
- Transfer, sale, or assignment not allowed without prior congressional approval.
Additional Installations
- Grantees may install or lease additional telephone facilities necessary for service.
- Such actions require prior PSC approval.
Use of Poles by Government and Municipalities
- Philippine Government may use one 10-pin crossarm on grantee poles free of charge.
- Additional crossarms subject to negotiated compensation or PSC arbitration.
- Municipalities may use one standard crossarm free for police and fire alarm wires.
- Use must avoid interference with grantee’s service.
- Reciprocal right for grantees to use existing government poles.
Government Right of Takeover
- Government may take over system and equipment at cost less depreciation if it opts to operate the system itself.
Effectivity
- Act takes effect upon approval.