Eighteenth Congress

Second Regular Session

“No, 7848

Introduced by

HON. DATU ROONIE Q. SINSUAT, SR.

EXPLANATORY NOTE

Performance records clearly indicate that the telecommunications
industry in the Philippines today is in a sorry state of poor service delivery
stunted by the monopoly of a few giant operators in the field. The dire
situation has been aggravated by the COVID-19 pandemic exposing its
inadequacies in meeting the needs of the people for on-line services to
facilitate virtual educational and business activities, as well as for their
personal communications. In the context of social distancing and quarantine
Protocols, the need to digitally connect and sustain the connection in an
efficient and reasonably priced manner has been accentuated. Unfortunately,
there is much to be desired in the current capabilities of existing players in
the field to meet the demand.

FICTAP Telecommunications, Inc. is a newly-organized corporation
with its incorporators and managing officials having a combined professional
experience of more than fifty (50) years in the business of
telecommunications and public service. The amalgamated resources of the
corporation’s stockholders, particularly their respective existing ‘middle mile’


and ‘last mile’ infrastructures for connectivity, are well functioning and can
be immediately utilized to serve the public at short notice.

Efficient and affordable telecommunications services remain an elusive
dream to many Filipinos. The general public has long endured the abuses of
being short-changed by false advertisements of services that are actually
wanting and inadequate but are expensively priced. The fact is, the quality
of telecommunications services in the Philippines rank way below global and
regional standards. It is time to address the problem.

This bill seeks to grant FICTAP Telecommunications, Inc. a franchise to
install, operate and maintain telecommunications services in the Philippines
and other international points for the purpose of expanding the pool of
service providers in the country and thereby promote a levelled and more
competitive field for the benefit of the general public.

For the foregoing reasons, the immediate consideration and approval
of this bill is earnestly sought.

HON. DATU ROONIE Q. SINSUAT, SR.

1ST DISTRICT, MAGUINDANAO
AND COTABATO CITY


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Renal of the Phdlippines
House of Representatioes
Ruezon City, Mere Manila

Eighteenth Congress
Second Regular Session

House Bilt No. 7843

Introduced by

HON. DATU ROONIE Q. SINSUAT, SR.

AN ACT
GRANTING FICTAP TELECOMMUNICATIONS, INC. A FRANCHISE TO
INSTALL, OPERATE AND MAINTAIN TELECOMMUNICATION SERVICES
WITHIN THE TERRITORY OF THE REPUBLIC OF THE PHILIPPINES AND
INTERNATIONAL POINTS, AND FOR OTHER PURPOSES

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

SECTION 1. Nature and Scope of Franchise - Subject to the conditions
established in this Act and the provisions of the Constitution, and the provisions of
laws, orders or issuances not inconsistent herewith, there is hereby granted to
FICTAP Telecommunications, Inc., its successors or assignees, a franchise to
construct, establish, install, lease, co-use, purchase, operate and maintain for
commercial purposes and in the public interest, all types of mobile, wire and/or
wireless telecommunications systems, including international and local exchange
carriers, international gateway facilities / services, international and domestic
submarine cable landing stations, copper, fiber optics, coaxial cable, stations and
associated equipment for international satellite communications, and their value-
added services such as the transmission of voice, data, facsimile, control signs,
audio and video, information services, and all other telecommunications systems


technologies as are available at present or will be made available through
technological advances or innovations in the future; 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
within the territory of the Philippines and with other countries and territories.

SECTION 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 privilege to use its assigned wavelengths or frequencies
and the quality of transmission or reception thereon as should maximize rendition
of the grantee’s services and/or the availability thereof.

SECTION 3. 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.

The President of the Philippines, in times of war, rebellion, public peril, calamity,
emergency, disaster or disturbance of peace and order, may temporarily take over
and operate the stations, transmitter systems, facilities and equipment of the
grantee, temporarily suspend the operation of any station 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 said stations, transmitter systems, facilities and equipment during the
period when these shall be operated.

SECTION 4. Powers of the National Telecommunications Commission -
The grantee shall not exercise any right or privilege under this franchise without
first having obtained such Certificate of Public Convenience and Necessity (CPCN)
and such other permits or licenses from the National Telecommunications
Commission (NTC). This franchise shall not take effect nor shall any power be
exercised by the grantee until the NTC shall have allotted to the grantee the
frequencies and wavelengths to be used, determined the stations to and from which
each frequency and wavelength may be used, and issued to the grantee a license
for such use. However, the NTC shall not unreasonably withhold or delay the grant
of any such authority, permits or licenses.

The NTC shall have the authority to supervise and regulate the installation or
operation of such telecommunication systems and impose such conditions relative
thereto.


SECTION 5. Responsibility to the Public - The grantee shall conform to the
ethics of honest enterprise and not use its stations / 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
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 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’.

SECTION 6. Commitment to Provide and Promote the Creation of
Employment Opportunities. - The grantee shall create employment opportunities
and shall allow on-the-job trainings in their franchise operation: Provided, That
priority shall be accorded to the residents in areas where the principal office of the
grantee is located: Provided, further, That the grantee shall follow 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 (SEC) annually.

SECTION 7. Mobile Number Portability. - The grantee shall provide mobile
number portability (MNP). It shall set up a mechanism for the purpose of
implementing MNP. It 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 8. Term - This franchise shall be for a term of twenty-five (25) years
from the effectivity of this Act, unless sooner revoked or cancelled. In any event the
grantee fails to operate continuously for two (2) years, this franchise shall be
deemed ipso facto revoked.

SECTION 9. Rates for Services - The charges and rates of 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. The rates to be charged by the grantee shall be unbundled, separable,
and distinct among the services offered and shall be determined in such a manner
that regulated services do not subsidized the unregulated ones.

SECTION 10. Excavation and Restoration Works - For the purpose of
erecting and maintaining poles or other supports for wires or other conductors for
laying and maintaining underground wires, cables or other conductors, the grantee,
its successors or assignees, shall be authorized to make excavations or lay conduits
in any of the public places, roads, highways, streets, lanes, alleys, avenues,
sidewalks, bridges of the provinces, cities and/or municipalities, with the prior
approval of the Department of Public Works and Highways (DPWH) and the local
government unit (LGU) concerned, as may be appropriate: Provided, however, That
any public place, highway, road, 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 a workmanlike manner by said grantee, its successors or assignees, in
accordance with the standards set by the DPWH and 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 a public place, road,
highway, street, lane, alley, avenue, sidewalk or bridge disturbed, altered or
changed by said grantee, its 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.

SECTION 11. Right of Interconnection. - The grantee is hereby authorized to
connect or demand connection of its telecommunications systems to any 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 terms and conditions mutually
agreed upon by the parties concerned, subject to the review and modification of the
NTC.

SECTION 12. Eminent Domain. - Subject to the limitations and procedures
prescribed by law, the grantee is authorized to exercise the right of eminent domain
insofar as may be reasonably necessary to further the establishment and efficient
maintenance and operation of its telecommunications systems.

No private property shall be taken for any purpose by the grantee without proper
condemnation proceedings and just compensation paid or tendered therefor, and
any authority to take and occupy land contained herein shall not apply to the
taking, use or occupation of any land except such as is required for the actual and
necessary purposes for which this franchise is granted.


SETION 13. Bond - The grantee shall file a bond with the NTC in the amount
that it shall determine to guarantee compliance with and fulfillment of the
conditions under which this franchise is granted. If, after three (3) years from the
date of approval of its permit by the NTC, the grantee shall have fulfilled the
conditions, the bond shall be cancelled by the NTC. Otherwise, the bond shall be
forfeited in favor of the government and the franchise ipso facto revoked.

SECTION 14. Gross Receipts. - The grantee, its successors or assignees, shall
keep a separate account of the gross receipts of the telecommunications service
business transacted by it and shall furnish the Commission on Audit (COA) and the
National Treasurer a copy of such account not later than January 31 of each year
for the preceding twelve (12) months.

SECTION 15. Books and Accounts. - The books and accounts of the grantee, its
successors or assignees, shall always be open to the inspection of the COA or its
authorized representatives, and it shall be the duty of the grantee to submit to the
COA quarterly reports in duplicate showing the gross receipts and the net receipts
for the past quarter and the general condition of the business.

SECTION 16. 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, 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, and equipment of
the grantee.

SECTION 17. Sale, Lease, Transfer, Usufruct, or Assignment of Franchise -
The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign this
franchise or the rights and privileges acquired thereunder to any person, firm,
company, corporation or entity, nor merge with any other corporation or entity, nor
shall the controlling interest of the grantee be transferred, whether as a whole or in
part, and whether simultaneously or contemporaneously, to any such person, firm,
company, corporation or entity without the prior approval of the Congress of the
Philippines: Provided, That 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 completion of the said transaction : Provided further,
That failure to report to Congress such change of ownership shall render the
franchise ipso facto revoked: Provided finally, That any such transfer, sale or
issuance is in accordance with any applicable constitutional provision. Any person or
entity to which this franchise is validly sold, transferred or assigned shall be subject
to all the same conditions, terms, restrictions and limitations of this Act.


SECTION 18. Contract with Private Entities. - The grantee is authorized to
contract the installation and operation of the telecommunications system which is
the subject of this grant with entities with expertise in the field of
telecommunications under such terms and conditions as may be approved by the
NTC.

SECTION 19. Dispersal of Ownership. - In accordance with the constitutional
provision to encourage public participation in public utilities, the grantee shall offer
to Filipino citizens at least thirty percent (30%) or a higher percentage that may
hereafter be provided by law of its outstanding capital stock in any securities
exchange in the Philippines within five (5) years from the commencement of its
operations: Provided, That in cases where public offer of shares is not applicable,
the grantee shall apply other methods of encouraging public participation by
citizens and corporations operating public utilities as allowed by law. Noncompliance
therewith shall render the franchise ipso facto revoked.

SECTION 20. Reportorial Requirements. - The grantee shall submit an annual
report 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 its compliance with the terms and conditions of the franchise and on
its operations on or before April 30 of every year during the term of its franchise.
The reportorial compliance certificate issued by Congress shall be required before
any application for permit or certificate is accepted by the NTC.

Failure of the grantee to submit the requisite and separate annual report to
Congress shall be penalized with a fine in the amount to be determined by the NTC.
Provided, That in the interim, the grantee shall be liable to pay the fine of Five
thousand pesos (Php 5,000.00) per working day of non-compliance. 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
National Treasury.

SECTION 21. Equality Clause. - Any advantage, favor, privilege, exemption, or
immunity which may hereafter be granted shall ipso facto 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 territory covered by the
franchise, the life span of the franchise, or the type of service authorized by the
franchise.

SECTION 22. Repealability and Non-Exclusivity Clause. - This franchise is
granted with the understanding and upon condition that it 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.

SECTION 23. Separability Clause - If any part, section or provision of this Act
shall be held invalid or unconstitutional, the other provisions not affected thereby
shall remain in full force and effect.

SECTION 24. Repealing Clause - All laws, decrees, executive orders, rules
and regulations or issuances or parts thereof inconsistent with the provisions of this
Act, are hereby modified or repealed accordingly.

SECTION 25. Effectivity Clause - This Act shall take effect fifteen (15) days

after its full publication in the Official Gazette or in at least two (2) newspapers of
general circulation.

Approved.