Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS‘
First Regular Session

House Bill No.__ 8322

Introduced by Rep. Edcel C. Lagman

EXPLANATORY NOTE

This bill seeks to renew the franchise granted to the Bicol Telephone and Telegraph,
Inc. (BTTI) to construct, establish, install, operate, and maintain local exchange network
in the provinces of Albay and Sorsogon by another twenty five (25) years.

The Bicol Telephone and Telegraph, Inc. (BTTI) was granted its initial franchise
under Republic Act No. 6603 in October 23, 1972. Its franchise was then renewed in
August 8, 1997 under Republic Act No. 8342 which is set to expire in 2022.

In its almost five decades of service, BTTI has substantially contributed to the
modernization and development in the province of Albay and some municipalities in
Sorsogon by providing reliable, efficient, and economical telecommunication and internet
service to its local subscribers. However, as the telecommunications technological
landscape continues to develop, BTTI must establish new infrastructures and improve its
operations to meet the communication needs of local subscribers.

This bill therefore seeks to renew the franchise of BTTI in order to afford it to
continue its operation as well as to expand its operations to underserved municipalities
and areas, and to provide the latest telecommunications technology to its subscribers in
the provinces of Albay and Sorsogon.

In view of the foregoing reasons, the approval of this bill is earnestly sought.

EDCEL C. LAGMAN


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

8322

House Bill No.

Introduced by Rep. Edcel C. Lagman

AN ACT RENEWING FOR ANOTHER TWENTY-FIVE (25) YEARS THE
FRANCHISE GRANTED TO BICOL TELEPHONE AND TELEGRAPH, INC. UNDER
REPUBLIC ACT NO. 6603, AS AMENDED BY REPUBLIC ACT NO. 2,
ENTITLED "AN ACT GRANTING THE BICOL TELEPHONE AND TELEGRAPH,
INC. A FRANCHISE TO CONSTRUCT, ESTABLISH, INSTALL, MAINTAIN ‘AND
OPERATE LOCAL EXCHANGE La WORKIN THE PROVINCES OF ALBAY AND

Be it enacted by the House of Representatives and the Senate of the Congress of the
Philippines in session assembled:

SECTION 1. Nature and Scope of Franchise. — Subject to the provisions of
the Constitution and applicable laws, rules and regulations, the franchise granted under
Republic Act No. 6603, as amended by Republic Act No. 8342, to Bicol Telephone and
Telegraph, Inc., hereunder referred to as the grantee, it successors or assignees, to
construct, establish, install, operate and maintain for commercial purposes and in the
public interest, public domestic telecommunications system in the Province of Albay and
the Province of Sorsogon covering local exchange network, including public calling
stations or pay telephone stations or wireless local loop; wire or wireless
telecommunications system including fiber optics, satellite transmit and receive systems,
transoceanic cable landing stations and systems, switches and their value-added services
such as the transmission of voice, data, facsimile, control signs, audio and video,
information services and all other telecommunications system technologies, as are at
present available or will be made available through technological advances or innovations
in the future; and/or construct, acquire, lease, and operate, or manage transmitting and
receiving stations, lines, cables, or systems as are convenient or essential to efficiently
carry out the purpose of this franchise, is hereby renewed for another twenty-five (25
years) from the effectivity of this Act.

SEC. 2. Manner of Operation of Stations or Facilities. — The stations or
facilities of the grantee shall be constructed and operated in a manner as will, at most,
result only in the minimum interference on the wavelengths or frequencies of existing
stations or other stations which may be established by law, without in any way diminishing
its own right to use its assigned wavelengths or frequencies and the quality of
transmission or reception thereon as should maximize rendition of the grantee's services

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or the availability thereof.

SEC. 3. Authority of the National Telecommunications Commission. —
The grantee shall secure from the National Telecommunications Commission (NTC) a
certificate of public convenience and necessity or the appropriate permits and licenses for
the construction, installation and operation of its telecommunications systems or facilities.
In issuing the certificate, the NTC shall have the power to regulate and impose such
conditions relative to the construction, operation, maintenance, or service level of the
telecommunications systems or facilities. Such certificate shall state the areas covered
and the date the grantee shall commence the service. The grantee shall not use any
frequency in the radio spectrum without authorization from the NTC. The NTC, however,
shall not unreasonably withhold or delay the grant of such authority, permit or license.

SEC. 4. Excavation and Restoration Works. For the purpose of erecting
and maintaining poles or other supports for said wires or other conductors for the purpose
of laying and maintaining underground wires, cables, or other conductors, it shall be
lawful for the grantee, its successors or assignees, with the prior approval of the
Department of Public Works and Highways (DPWH) or the local government unit (LGU)
concerned, as may be appropriate, to make excavations or lay conduits in any of the
public places, roads, highways, streets, lanes, alleys, avenues, sidewalks, or bridges of
the provinces, cities, or municipalities: Provided, however, That a public place, road,
highway, street, lane, alley, avenue, sidewalk or bridge disturbed, altered or changed by
reason of erection of poles or other supports or the underground laying of wires, other
conductors or conduits, shall be repaired and replaced in workmanlike manner by said
grantee, its successors or assignees, in accordance with the standards set by the DPWH
or the LGU concerned. Should the grantee, its successors or assignees, after the ten (10)-
day notice from the said authority, fail, refuse, or neglect to repair or replace any part of
the public place, road, highway, street, lane, alley, avenue, sidewalk, or bridge altered,
changed or disturbed by the said grantee, it successors or assignees, then the DPWH or
the LGU concerned shall have the right to have the same repaired and placed in good
order and condition, and charge the grantee, its successors or assignees, at double the
amount of the costs and expenses for such repair or replacement.

SEC. 5. Responsibility to the Public. —-The grantee shall conform to the ethics
of honest enterprise and not use its stations or facilities for obscene or indecent
transmission, or for dissemination of deliberately false information, or willful
misrepresentation, or assist in subversive or treasonable acts.

The grantee shall operate and maintain all its stations, lines, cables, systems, and
equipment for the transmission and reception of messages, signals, and pulses in a

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satisfactory manner at all times and, as far as economical and practicable, modify,
improve, or change such stations, lines, cables, systems, and equipment to keep abreast
with the advances in science and technology.

The grantee shall improve and extend its services in areas not yet served, and in
hazard- and typhoon-prone areas that shall be determined by the National Disaster Risk
Reduction and Management Council, or its legal successor, in coordination with NTC.

The grantee shall also improve and upgrade its equipment, facilities and services,
in order to ensure effective compliance with the objectives of Republic Act No. 10639, or
"The Free Mobile Disaster Alerts Act".

SEC. 6. Rates for Services. - The charges and rates for telecommunications
services of the grantee, except the rates and charges on those that may hereafter be
declared or considered as nonregulated services, whether flat rates or measured rates or
variation thereof, shall be subject to the approval of the NTC or its legal successor.

SEC. 7. Right of the Government. — The radio spectrum is a finite resource
that is part of the national patrimony and the use thereof is a privilege conferred upon
the grantee by the State and may be withdrawn any time after due process.

A special right is hereby reserved to the President of the Philippines, in times of
war, rebellion, public peril, calamity, emergency, disaster or disturbance of peace and
order: to temporarily take over and operate the stations, transmitters, facilities, or
equipment of the grantee; to temporarily suspend the operation of any station, transmitter,
facility, or equipment in the interest of public safety, security, and public welfare; or to
authorize the temporary use and operation thereof by any agency of the government,
upon due compensation to the grantee, for the use of the said stations, transmitters,
facilities, or equipment during the period when these shall be operated.

SEC. 8. Term of Franchise. - This franchise shall be extended and in effect for
a period of twenty-five (25) years from the date of the effectivity of this Act, unless sooner
revoked or cancelled. This franchise shall be deemed /pso facto revoked in the event the
grantee fails to operate continuously for two (2) years.

SEC. 9. Right of Interconnection. - The grantee is hereby authorized to
connect or demand connection of its telecommunications systems to other
telecommunications systems installed, operated, and maintained by any other duly
authorized person or entity in the Philippines for the purpose of providing extended and
improved telecommunications services to the public, under the terms and conditions

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mutually agreed upon by the parties concerned. This right shall be subject to the review
and modification by the NTC.

SEC. 10. Mobile Number Portability. —- The grantee shall provide mobile
number portability (MNP) and its implementing mechanism, and shall interconnect,
directly or indirectly, with the infrastructure, facilities, systems, or equipment of other
telecommunications franchise grantees. It shall not install network features, functions, or
capabilities that will impede the implementation of a nationwide MNP system. The NTC
shall issue rules and regulations for this purpose, the effectivity of which shall commence
upon applicability with other telecommunications franchise grantees.

Section 11. Warranty in Favor of the National and Local Governments. —
The grantee shall hold the national, provincial, city, and municipal governments of the
Philippines free from all claims, liabilities, accounts, demands, or actions arising out of
accidents, causing injury to persons or damage to properties, during the construction or
operation of the stations, transmitters, facilities, or equipment of the grantee.

SEC. 12. Sale, Lease, Transfer, Grant of Usufruct, or Assignment of
Franchise.—The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign
this franchise or the rights or privileges acquired thereunder to any person, firm, company,
corporation, or other commercial or legal entity, nor merge with any other corporation or
entity, nor the controlling interest of the grantee be transferred, simultaneously or
contemporaneously, to any person, firm, company, corporation, or entity without the prior
approval of the Congress of the Philippines. Congress shall be informed of any sale, lease,
transfer, grant of usufruct, or assignment of franchise or the rights and privileges acquired
thereunder, or of the merger or transfer of the controlling interest of the grantee, within
sixty (60) days after the completion of the said transaction. Failure to report to Congress
such change of ownership shall render the franchise jpso facto revoked. Any person or
entity to which this franchise is sold, transferred, or assigned shall be subject to the same
conditions, terms, restrictions, and limitations of this Act.

SEC. 13. Dispersal of Ownership. — In accordance with the constitutional
provision to encourage public participation in public utilities, the grantee shall continue to
offer to Filipino citizens at least thirty percent (30%) of its common stocks, or a higher
percentage that may hereafter be provided by law, in any securities exchange in the
Philippines within five (5) years from the renewal of its franchise: Provided, That in cases
where public offer of shares is not applicable, other methods of encouraging public
participation by citizens and corporations operating public utilities must be implemented.

Noncompliance therewith shall render the franchise /pso facto revoked.


SEC. 14. Commitment to Provide and Promote the Creation of
Employment Opportunities. - The grantee shall create employment opportunities as
well as accept on-the-job trainees in their franchise operation: Provided, That priority
shall be accorded to the residents of the place where the principal office of the grantee
is located: Provided, further That the grantee shall comply with the applicable labor
standards and allowance entitlement under existing labor laws, rules and regulations and
similar issuances: Provided, finally, That the employment opportunities or jobs created
shall be reflected in the General Information Sheet (GIS) to be submitted to the Securities
and Exchange Commission annually.

SEC. 15. Reportorial Requirement. — The grantee shall submit an annual
report on its compliance with the terms and conditions of the franchise and on its
operations to the Congress of the Philippines, through the Committee on Legislative
Franchises of the House of Representatives and the Committee on Public Services of the
Senate, on or before April 30 of every year during the term of its franchise.

The annual report shall include an update on the roll-out, development, operation
and/or expansion of business; audited financial statements; latest GIS officially submitted
to the SEC, if applicable; certification of the NTC on the status of its permits and
operations; and an update on the dispersal of ownership undertaking, if applicable.

The reportorial compliance certificate issued by Congress shall be required before
any application for permit or certificate is accepted by the NTC.

SEC. 16. Fine. — Failure of the grantee to submit the requisite annual report to
Congress shall be penalized with a fine in the amount of One million pesos (P1,000,000.00)
per working day of noncompliance, the effectivity of which shall commence upon
applicability with other telecommunications franchise grantees: Provided, That in the
interim, the grantee shall be liable to pay the fine of Five hundred pesos (P500.00) per
working day of noncompliance. The fine shall be collected by the NTC from the delinquent
franchise grantee separate from the reportorial penalties imposed by the NTC, and the
same shall be remitted to the Bureau of Treasury.

SEC. 17. Equality Clause. - Any advantage, favor, privilege, exemption, or
immunity granted under existing franchises, or which may hereafter be granted, upon
prior review and approval of Congress, shall become part of this franchise and shall be
accorded immediately and unconditionally to the herein grantee: Provided, That the
foregoing shall neither apply to nor affect the provisions of telecommunications franchises
concerning territorial coverage, the term, or the type of service authorized by the


franchise.

SEC. 18. Repealability and Nonexclusivity Clause. — This franchise shall be
subject to amendment, alteration, or repeal by the Congress of the Philippines when the
public interest so requires and shall not be interpreted as an exclusive grant of the
privilege herein provided for.

SEC. 19. Separability Clause. —If any of the sections or provisions of this Act
is held invalid, all other provisions not affected thereby shall remain valid.

SEC. 20. Repealing Clause. —A\l laws, decrees, orders, resolutions, instructions,
rules and regulations, and other issuances or parts thereof which are inconsistent with
the provisions of this Act are hereby repealed, amended, or modified accordingly.

SEC. 21. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in a newspaper of general circulation.

Approved,