Responsibility to the Public
- SMART must adhere to honest enterprise ethics.
- Prohibited from using stations for obscene or indecent transmissions, deliberately false information, misrepresentation, or assisting subversive/treasonable acts.
- Obligated to improve and expand services in underserved and hazard-prone areas as identified by NDRRMC and NTC.
- Required to upgrade equipment and services to comply with the Free Mobile Disaster Alerts Act (RA 10639).
Term and Revocation of Franchise
- Franchise is valid for 25 years from the law's effectivity unless revoked or cancelled earlier.
- Failure to operate continuously for two years results in automatic revocation of the franchise.
Acceptance and Exercise of Franchise Privileges
- SMART must accept the franchise in writing within 60 days, addressed to Congress Committees on Legislative Franchise and Public Services.
- Failure to accept within this period voids the franchise.
Tax Provisions
- SMART and successors pay standard taxes on real estate, buildings, and personal property except radio telecommunications and electronic equipment, machinery, and spare parts which are exempt from customs duties and taxes.
- Subject to value-added tax (VAT) on all gross receipts from franchise business in lieu of other local and national taxes, excluding income taxes.
- Must file returns and pay taxes according to the National Internal Revenue Code; returns are audit subject to the BIR.
Restrictions on Transfer and Assignment
- The franchise or its rights cannot be sold, leased, transferred, assigned, or have controlling interest transferred without prior Congressional approval.
- Entities acquiring franchise must adhere to all conditions and limitations of the law.
Public Listing Requirement
- SMART must list at least 30% of its authorized capital stock on a Philippine securities exchange within two years unless it is wholly owned by a publicly listed company meeting this requirement.
Compliance with Labor Standards
- SMART and successors must comply with applicable labor laws and rules, considering the telecommunications industry's specific nature.
Mobile Number Portability (MNP)
- SMART must provide MNP to subscribers.
- Required to establish mechanisms for MNP and interconnect with other franchisees’ infrastructure.
- Prohibited from installing network features that impede nationwide MNP.
- NTC will promulgate implementing rules.
Equality Clause
- Any advantages or exemptions granted under other franchises shall apply immediately and unconditionally to SMART, except provisions on franchise territory, lifespan, or authorized service type.
Penalty for Non-compliance in Reporting
- Failure to submit annual reports to Congress results in a fine:
- Initially P500 per working day.
- Increases to P1,000,000 per working day upon applicability with other telecommunications franchisees.
- Fines collected by NTC and remitted to the National Treasury.
Applicability and Continuity of Provisions
- All provisions of R.A. 7294 not inconsistent with this law remain effective.
- Pending cases filed before this law continue under R.A. 7294.
- Existing liabilities, fines, penalties, surcharges, and unpaid taxes from March 27, 1992 until this law’s effectivity remain valid and enforceable.
Effectivity
- The law takes effect 15 days after publication in the Official Gazette or a newspaper of general circulation.