Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
FIFTEENTH CONGRESS

SECOND REGULAR SESSION

COMMITTEE REPORT NO. 589 :

Submitted by the Committee on Legislative Franchises on

5¢
Re: House Bill No SESS prepared by the Committee
Recommending its approval, in substitution of House Bill 5033

Sponsors: Representatives Marcelino “Marcy’ R. Teodoro and Eleandro Jesus F
Madrona

MR. SPEAKER

The Committee on Legislative Franchises to which was referred House Bill
No. 5033, introduced by Rep. Eleandro Jesus F. Madrona, entitled:

“AN ACT GRANTING WI-TRIBE TELECOMS, INC, A FRANCHISE TO
CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND MAINTAIN
TELECOMMUNICATIONS SYSTEMS THROUGHOUT THE PHILIPPINES”

has considered the same and recommends that the attached House Bill No.

BEA. entitled

“AN ACT GRANTING WI-TRIBE TELECOMS, INC., A FRANCHISE TO
CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND MAINTAIN
TELECOMMUNICATIONS SYSTEMS THROUGHOUT THE PHILIPPINES”

be approved in substitution of House Bill No. 5033 with Reps. Eleandro Jesus F.
Madrona as authors thereof.


Respectfully submitted:
RCELINO “MARCY” R. TEODORO

Chairman
Committee on Legislative Franchises

THE HONORABLE THE SPEAKER
HOUSE OF REPRESENTATIVES
QUEZON CITY

Page 2 of 2
Committee Report

Re: House Bill No, 5033, Franchise application of Wi-Tribe Telecommunications, inc.
‘Authored by: Hon. Eleandro Jesus F. Madrona


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
FIFTEENTH CONGRESS

Second Regular Session

House Bill No, 5613

Introduced by Reps. ELEANDRO JESUS F. MADRONA and
MARCELINO “Marcy” M. TEODORO

AN ACT
GRANTING WI-TRIBE TELECOMS, INC., A FRANCHISE TO CONSTRUCT,
INSTALL, ESTABLISH, OPERATE AND MAINTAIN TELECOMMUNICATIONS
SYSTEMS THROUGHOUT THE PHILIPPINES

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

SECTION 1. Nature and Scope of Franchise. - Subject to the provisions of the
Constitution and applicable laws, rules and regulations, there is hereby granted to
Wi-Tribe Telecoms, Inc. (formerly Liberty Broadcasting Network, Inc.) hereunder
referred to as the grantee, its successors or assigns, a franchise to construct, install,
establish, operate and maintain for commercial purposes and in the public interest,
throughout the Philippines and between the Philippines and other countries and
territories, wire and/or wireless telecommunications systems, including but not limited
to mobile, cellular, paging, fiber optics, multi-channel multi-point distribution system
(MMDS), local multi-point distribution system (LMDS), satellite transmit and receive
systems, switches, and their value-added services such as, but not limited to,
transmission of voice, data, facsimile, control signs, audio and video, information
services bureau and all other telecommunications systems 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 in of are convenient

or essential to efficiently carry out the purpose of this franchise

SEC. 2. Manner of Operation of Stations of 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 selected wavelengths or frequencies and the
quality of transmission or reception thereon as should maximize rendition of its
services and/or the availability thereof.

SEC.3. Authority of the National Telecommunications Commission. - The
grantee shall secure from the National Telecommunications Commission (NTC).
hereinafter referred to as the Commission, a Certificate of Public Convenience and
Necessity or the appropriate permits and licenses for the construction, installation
and operation of its telecommunications systems/facilities. In issuing the certificate,
the Commission shali have the power to impose such conditions relative to the
construction, operation, maintenance, or service level of the telecommunications
system. The Commission shall have the authority to regulate the construction and
operation of its telecommunications systems. The grantee shail not use any
frequency in the radio spectrum without having been authorized by the Commission
Such certificate shall state the areas covered and date the grantee shall commence
the service, The Commission, however, shall not unreasonably withhold or delay the
grant of any such authority, permits or licenses.

SEC. 4. Ingress and Egress. — 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 assigns, with the prior approval of the Department of
Public Works and Highways (DPWH) or the local government units concemed, as
May be appropriate, to make excavations or lay conduits in any of the public places,

highways, streets, lanes, alleys, avenues, sidewalks or bridges of said Local



en

s

Government Unit: Provided, however, That a public place, 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 assigns, in accordance with the standards set by DPWH Should the
grantee, its successors or assigns, after the ten -(10) day notice from the said
authority, fail, refuse or neglect to repair or replace any part of public place, road,
highway, street, lane, alley, avenue, sidewalk or bridge altered, changed or disturbed
by the said grantee, its successors or assigns, then the DPWH shall have the right to
have the same repaired and placed in good order and condition at double expense to
be charged against the grantee, its successors or assigns.

SEC. 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 provide basic or enhanced telephone service in any city
and/or municipality in the Philippines where it has an approved Certificate of Public
Convenience and Necessity for the establishment, operation and maintenance of a
local exchange service, without discrimination to any applicant therefor, in the order
of the date of their applications, up to the limit of the capacity of its local telephone
exchange, and should the demand for the telephone service at any time increase
beyond the capacity thereof, the grantee shall increase the same to meet such
demand: Provided, That in case the total demand to be satisfied by the expansion is
less than the smallest viable local exchange available in the market as determined by
the Commission, the grantee shall not be obliged to furnish such service unless the
applicant for telephone service defrays the actual expenses for the installation of the
telecommunications apparatus necessary for such services and in such case, the
Commission may extend the time within which the grant shall furnish such service.

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

x


27

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.

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 non-regulated services, whether flat rates or measured
rates or variation thereof, shall be subject to the approval of the Commission 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 subsidize the unregulated ones.

SEC. 7. Right of Government. — 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 said stations, transmitters, facilities or equipment during
the period when they shall be so operated.

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 anytime after due process.

SEC. 8. Term of Franchise. - This franchise shall be in effect for a period of
twenty-five (25) years unless sooner revoked or cancelled. This franchise shall be
deemed ipso facto revoked in the event the grantee fails to comply with any of the
following conditions:

(a) Commence operations within three (3) years from the approval of its operating
permit or provisional authority by the NTC;

4


1

#

l4
15
16
17
18
19
20

(b) Operate continuously for two (2) years; and
(c) Commence operations within five (5) years from the effectivity of this Act.

SEC. 9. Acceptance and Compliance. — Acceptance of this franchise shall be
given in writing within sixty (60) days from the effectivity of this Act. Upon giving such
acceptance, the grantee shall exercise the privileges granted under this Act. Non-
acceptance shall render the franchise void.

SEC. 10. Bond. - The grantee shall file a bond with the National
Telecommunications Commission (NTC), in the amount that the NTC shall
determine, to guarantee compliance with and fulfillment of the conditions which this
franchise is granted. If, after five (5) years from the date of the approval of its permit
by the Commission, the grantee shall have fulfilled the same, the bond shall be
cancelled by the Commission. Otherwise, the bond shall be forfeited in favor of the
government and the franchise ipso facto revoked.

SEC. 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 Pt
and improved telecommunications services to the public, under such terms and
conditions mutually agreed upon by the parties concerned and the same shall be
‘subject to the review and modification of the Commission.

lippines for the purpose of providing extended

SEC. 12. Gross Receipts. - The grantee, its successors or assigns, shall keep
@ separate account of the gross receipts of the business transacted by it and shall
furnish the Commission on Audit (COA) and the National Treasury a copy of such
account not later than the thirty-first (31st) day of January of each year for the
preceding twelve (12) months.

SEC. 13. Books and Accounts. - The books and accounts of the grantee, its

successor or assigns, shall always be open to the inspection of the Commission on

5


rey

ear aw

Audit and its duly-authorized representatives. It shall be the duty of the grantee to
submit to the COA two (2) copies of the quarterly reports on the gross receipts, the
net profits and the general condition of the business.

SEC. 14. 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, accounts, demands or actions arising out of
accidents or injuries, whether to property or to persons, caused by the construction or
operation of the stations, transmitters, facilities and equipment of the grantee

SEC. 15. Non-Transferability of Franchise - The grantee shall not lease,
transfer, grant the usufruct of, sell nor assign this franchise or the rights and
privileges acquired thereunder to any person, firm, company, corporation or other
commercial or legal 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 parts
and whether simultaneously or contemporaneously, to any such person, firm,
company, corporation or entity without the prior approval of the Congress of the
Philippines. The conditions, terms, restrictions and limitations set by this Act shall be
imposed on any person or entity to which this franchise is sold, transferred or
assigned

SEC. 16. Dispersal of Ownership. - In accordance with the constitutional
provision to encourage public participation in public utilities, the grantee shall offer at
least thirty percentum (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. Non-compliance
therewith shall render the franchise ipso facto revoked.

SEC. 17. Reportorial Requirement. — The grantee shall submit an annual
report to the Congress of the Philippines on its compliance with the terms and
conditions of the franchise and on its operations within sixty (60) days from the end of
every year.


enw aneun

SEC. 18. Equality Clause. — Any advantage, favor, privilege, exemption, or
immunity granted under existing franchise, or which may hereafter be granted, shall
ipso facto become part of this franchise and shall be accorded immediately and
unconditionally to the therein grantee: Provided, however, That the foregoing shall
neither apply to nor affect 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

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. Repealability and Non-exclusivity 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 privileges herein provided for.

SEC. 21. Effectivity Clause. — This Act shall take effect fifteen (15) days from
the date of its publication, upon the initiative of the grantee, in at least two (2) papers

of general circulation in the Philippines.

Approved,


‘Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

FIFTEENTH CONGRESS
Second Regular Session

5033

House Bill No.

Introduced by HON. ELEANDRO JESUS F. MADRONA

EXPLANATORY NOTE

It has been observed that mobile technology in the Philippines is a
resounding success. With the introduction of prepaid cards and text
messaging, Philippine cellular phone service experienced phenomenal success.!
Sadly, however, Internet access has poorly lagged behind, with penetration
rates of a paltry 21.5% as of March 2009.2

‘There is therefore much to be achieved in the sector, especially by way of
competition, coverage and penetration rates. With the continuing trend of
mergers and acquisitions in the telecommunications sector, there is a dearth of
competing firms that can effectively offer alternative choices to consumers and
drive competitive growth.

Wi-Tribe Telecoms, Inc. remains one of the few companies that is at the
forefront of presenting an alternative choice to existing carriers.

The promotion of a healthy competitive telecommunications industry is
an avowed State policy. The reasons therefor are not at ail hard to see:
effective competition is expected to drive innovative product offerings, improve
grades of service, reduce telecommunications charges and promote further
development of the sector.

The continued participation of Wi-Tribe Telecoms, Inc. in the
telecommunications industry will greatly contribute to the attainment of the
aforesaid State policy.

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

ELEANDRO JESUS F. MADRONA

1 Sarmiento and Heceta, Regulation of the Telecommunications/ICT Sector, Vol. 1, p.
202

2 See universalmccann.bitecp.com/waved / Waved pdf

3 See Section 4 (f) of Republic Act No. 7925


Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Quezon City
FIFTEENTH CONGRESS

Second Regular Session

5033

House Bill No.

Introduced by HON. ELEANDRO JESUS F. MADRONA

AN ACT
GRANTING WI-TRIBE TELECOMS, INC., A FRANCHISE TO CONSTRUCT,
INSTALL, ESTABLISH, OPERATE AND MAINTAIN TELECOMMUNICATIONS
SYSTEMS THROUGHOUT THE PHILIPPINES

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

SECTION 1. Nature and Scope of Franchise. - Subject to the provisions of
the Constitution and applicable laws, rules and regulations, there is hereby
granted to WI-TRIBE TELECOMS, INC., hereunder referred to as the grantee,
its successors or assigns, a franchise to construct, install, establish, operate
and maintain for commercial purposes and in the public interest, throughout
the Philippines and between the Philippines and other countries and territories,
wire and/or wireless telecommunications systems, including but not limited to
mobile, cellular, broadband wireless access, paging, fiber optics, multi-channel
distribution system (MMDS), local multi-point distribution system (LMDS),
satellite transmit and receive systems, switches, and their value-added services
such as, but not limited to, transmission of voice, data, facsimile, control signs,
audio and video, information services bureau and all other telecommunications
systems 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 in or are convenient or essential to efficiently carry out the

purpose of this franchise.


SEK

. 2. Manner of Operation of Stations of 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 selected
wavelengths or frequencies and the quality of transmission or reception
thereon as should maximize rendition of the grantees services and/or the

availability thereof.

SEC. 3. Authority of the National Telecommunications Commission. ~ The
grantee shall secure from the National Telecommunications Commission (NTC),
hereinafter referred to as the Commission, a Certificate of Public Convenience
and Necessity or the appropriate perntits and licenses for the construction,
installation and operation of its telecommunications systems/facilities. In
issuing the certificate, the Commission shall have the power to impose such
conditions relative to the construction, operation, maintenance, or service level
of the telecommunications system. The Commission shall have the authority to
regulate the construction and operation of its telecommunications systems.
‘The grantee shall not use any frequency in the radio spectrum without having
been authorized by the Commission. Such certificate shall state the areas
covered and date the grantee shall commence the service. The Commission,
however, shall not unreasonably withhold or delay the grant of any such
authority, permits or licenses.

SEC. 4. Ingress and Egress. - 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 assigns, with
the prior approval of the Department of Public Works and Highways (DPWH), to
make excavations or lay conduits in any of the public places, highways, streets,
lanes, alleys, avenues, sidewalks or bridges of said province, cities and/or
municipalities: Provided, however, That a public place, 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 assigns, in accordance with the standards set
by DPWH. Should the grantee, its successors assigns, after the ten days notice


from the said authority, fail, refuse or neglect to repair or replace any part of
public place, road, highway, street, lane, alley, avenue, sidewalk or bridge
altered, changed or disturbed by the said grantee, its successors or assigns,
then the DPWH shall have the right to have the same repaired and placed in
good order and condition at double expense to be charged against the grantee,

its successors or assigns.

SEC. 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 shail provide basic ‘vr enhanced telephone service in any
ality in the Philippines where it has an approved Certificate of Public

muni
Convenience and Necessity for the establishment, operation and maintenance

in

of a local exchange service, without discrimination to any applicant therefor,
the order of the date of their applications, up to the limit of the capacity of its
local telephone exchange, and should the demand for the telephone service at
any time increase beyond the capacity thereof, the grantee shall increase the
same to meet such demand: Provided, That in case the total demand to be
satisfied by the expansion is less than the smallest viable local exchange
available in the market as determined by the Commission, the grantee shall not
be obliged to furnish such service unless the applicant for telephone service
defrays the actual expenses for the installation of the telecommunications
apparatus necessary for such services and in such case, the Commission may
extend the time within which the grant shall furnish such service. «

‘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.

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 Commission 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 subsidize the unregulated ones.

SEC. 7. Right of Government. - A special right is hereby granted 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 opération thereof by any agency of the
government, upon due compensation to the grantee for the use of said stations,
transmitters, facilities or equipment during the period when they shall be so
operated.

‘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 withrawn anytime after duc process.

SEC. 8. Term of Franchise. - This franchise shall be for a term of twenty-
five (25) years from the date of effectivity of this Act, unless sooner revoked or
cancelled, This franchise shall be deemed ipso facto revoked in the event the
grantee fails to comply with any of the following conditions:

(a) Commence operation within three (3) years from the approval of its
operating permit by the National Telecommunications Commission;

(b) Operate continuously for two (2) years; and

(c) Commence operations within five (5) years from the effectivity of this
Act.

SEC. 9. Acceptance and Compliance. ~ Acceptance of this franchise shall
be given in writing within sixty (60) days from the effectivity of this Act. Upon
giving such acceptance, the grantee shall exercise the privileges granted under
this Act. Nonacceptance shall render the franchise void.


SEC. 10. Bond. - The grantee shall file a bond issued in favor of the
National Telecommunications Commission, which shall determine the amount,
to guarantee the compliance with and fulfillment of the conditions under which
this franchise is granted. If, after five (5) years from the date of the approval of
its permit by the Commission, the grantee shall have fulfilled the same, the
bond shall be cancelled by the Commission. Otherwise, the bond shall be
forfeited in favor of the government and the franchise ipso facto revoked.

SEC. 11. Right of Interconnection. - The grantee is hereby authorized to
connect or demand connection of its telecommunications systems to any other
telecommunications systems installed, operate 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 such
terms and conditions mutually agreed upon by the parties concerned and the

same shall be subject to the review and modification of the Commission,

SEC. 12. Gross Receipts. - The grantee, its successors or assigns, shall
keep a separate account of the gross receipts of the business transacted by it
and shall furnish the Commission on Audit and the National Treasury a copy of
such account not later than the thirty-first (81st) day of January of each year
for the preceding twelve (12) months.

SEC. 13. Books and Accounts. ~ The books and accounts of the grantee,
its successor or assigns, shall always be open to the inspection of the
Commissioner on Audit or his authorized representatives and it shall be the
duty of the grantee to submit to the COA two (2) copies of the quarterly reports

on the gross receipts, the net profits and the general condition of the business.

SEC. 14. Warranty in Favor of the National and Local Governments. ~ The
grantee shall hold the national, provincial, city and municipal governments of
the Philippines harmless from all claims, accounts, demands or actions arising
out of accidents or injuries, whether to property or to persons, caused by the
construction or operation of the stations, transmitters, facilities and equipment
of the grantee.

SEC. 15. Sale, Lease, Usufruct, ete. — The grantee shall not lease,
transfer, grant the usufruct of, sell or 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 without the prior
approval of the Congress of the Philippines. Neither shall the controlling
interest in the grantee be transferred, whether as a whole or in parts 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 the foregoing limitations shall not apply to: (a)
Any transfer or issuance of shares of stock in the implementation of the
requirement for the dispersal of the grantee’s ownership pursuant to Section
16 of this Act; (b) any transfer or sale of shares of stock to a foreign investor or
investors; (c) any issuance of shares to any foreign or local investors pursuant
to or in connection with any increase in the grantee's authorized capital stock
which shall result in the dilution of the stockholdings of the grantee's then
existing stockholders; (d) any combination thereof where such transfer, sale or
issuance is effected in order to enable the grantee to raise the necessary capital
or financing for the provision of any of the services authorized by this Act
and/or to carry out any of the purposes for which the grantee has been
incorporated or organized: provided, further, that any such transfer, sale or
issuance is in accordance with any applicable constitutional limitations. 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.

SEC. 16. Dispersal of Ownership. - In accordance with the constitutional
provision to encourage public participation in public utilities, the grantee shall
offer at least thirty percentum (30%) of its outstanding capital stock or a higher
percentage that may hereafter be provided by law in any securities exchange in
the Philippines within five (5) years from the commencement of its operations.

Noncompliance therewith shall render the franchise ipso facto revoked.

SEC. 17. Equality Clause. - Any advantage, favor, privilege, exemption, or
immunity granted under existing franchise, or 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, however, That
the foregoing shall neither apply to nor affect 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.


SEC. 18. Reportorial Requirement. — The grantee shall submit an annual
report to the Congress of the Philippines on its compliance with the terms and
conditions of the franchise and on its operations within sixty (60) days from the
end of every year,

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. 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 privileges herefn provided for.

SEC, 21. Effectivity Clause. - This Act shall take effect fifteen (15) days
from the date of its publication, upon the initiative of the grantee, in at least

two (2) newspapers of general circulation in the Philippines.

Approved,


Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Quezon City

MINUTES OF THE MEETING OF THE COMMITTEE ON LEGISLATIVE FRANCHISES
HELD ON NOVEMBER 29, 2011, 1:30 P.M. AT CONFERENCE ROOM NOS. 9 & 10,
RAMON V. MITRA, JR. BLDG., BATASAN PAMBANSA COMPLEX, QUEZON CITY

|. CALL TO ORDER

The Chair, Rep. Marcelino R. “Marcy” Teodoro, called the meeting to order at 2:03
p.m

|. ROLL CALL OF MEMBERS / DETERMINATION OF QUORUM

Rep. Lapus moved to dispense with the calling of the roll of members. Duly seconded,
and there being no objection, the same was approved

Ill. APPROVAL OF THE MINUTES OF THE COMMITTEE MEETINGS HELD ON
NOVEMBER 16, 2011

Rep. Madrona, moved to approve and dispense with the reading of the minutes of the
Committee meeting held on November 16, 2010, duly seconded. There being no
objection, the same was approved.

\V ACKNOWLEDGEMENT OF COMMITTEE MEMBERS, RESOURCE PERSONS AND.
GUESTS

The Officer-in-Charge acknowledged the presence of the members of the Committee
to wit: Reps. Madrona, Lapus, Violago, Amaiz, Quimbo, Aggabao, Romualdo and
Lazatin, officers of the franchise applicants from Mt. Asog Broadcasting Network, Inc.
Mr. Ramon Moraleda, Chairman; Mr. Stephen Sadia, Secretary and former Member of
the House of Representatives, Atty. Felix Alferlor, Jr.; from Wi-Tribe Telecoms Ms.
Catherine Laurel-Carpio, Corporate Secretary; Atty. Filmar Callejo, Secretary; Mr. Paul
Bernard Causon, Treasurer and Mr. Edmund Pike, Head of Marketing: from the
Pantabangan Municipal Electric System Mr. Johnson Mangalili, OIC; Atty. Harrison
Viray, Legal Counsel and Engr. Eduardo Santiago and resource person from NTC,
CCAD Director, Engr. Ed Cabarios and Broadcast Div. Director, Engr. Alvin Blanco and
from NEA, Legal Director Vic Alvaro.

V. APPROVAL OF THE COMMITTEE REPORTS ON HB NO. 5336, 5337 and HB 5359
a. Amendment to Pagcor Charter

Rep. Romualdo moved to approve the Pagcor Committee Report minus the proposed
additional provisions on the regulatory functions of Pagcor.

Rep. Amaiz asked the body on who will regulate the existing casino companies
licensed by Pagcor prior to enactment of the measure at hand.

Page 1 of 4 Nov. 29, 2011 CLF Minutes


The Chair stated that in the 2007 amendment of the Pagcor Charter, a provision was
inserted giving the Pagcor the power to issue licenses to Casino operators. However,
the bill under discussion proposes to revert back to Congress the power to issue such
licenses. Thus, the provisions proposing to provide Pagcor with quasi-judicial powers
will defeat the purpose of reverting back to Congress the power to grant such licenses
to casino operators.

The meeting was suspended at 2:30 p.m and resumed at 2:36 p.m

Rep. Romuaido stated that current license holders should be allowed to continue their
operations until licenses expire but said licenses can only be renewed if they secure a
legislative franchise from Congress.

Rep. Lazatin suggested that within three years after the enactment of the measure, the
license holders should secure a legislative franchise. Failure to do so, would
automatically cancel existing licenses.

On the issue of requiring current operators to seek a legislative franchise, the Chair
suggested to insert a transitory provision in the proposed measure to enable the
current operators to comply with the franchise requirement within a specific period.

Rep. Lapus moved for the approval of the Committee Report on the Amendment to
Pagcor Charter and duly seconded the same was approved.

b. Amendments to the Civil Aeronautics Act

The Committee approved the Committee Report on the amendment to the Civil
Aeronautics Act with the understanding that additional amendments maybe further
proposed.

VI DELIBERATION ON HB NO. 1862, “AN ACT GRANTING THE MT. ASOG
BROADCASTING NETWORK, INC. A FRANCHISE TO CONSTRUCT, INSTALL,
ESTABLISH, OPERATE AND MAINTAIN RADIO AND TELEVISION STATIONS
ANYWHERE IN LUZON” by Hon. Eleandro Jesus F. Madrona

Rep. Madrona informed the Committee that the application had been already approved
in the 14” Congress and transmitted to the Senate on December 17, 2009. Due to lack
of material time, Congress failed to enact the said application

Rep. Romualdo expressed that it was a practice of the Committee as a gesture of
courtesy to consider favorably such application that have gone thru the scrutiny of the
previous Congress. He moved for the approval of the bill and duly seconded, the
Committee approved House Bill No. 1862 subject to the standard Committee style and
format on broadcasting franchise.

The Chair directed the Secretariat to prepare the appropriate Committee Report
and submit the same during the next meeting for approval.

Page 2 of 4 Nov. 29, 2011 CLF Minutes


Vil DELIBERATION ON HB NO. 5033, “AN ACT GRANTING WI-TRIBE TELECOMS,
INC. A FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH OPERATE AND
MAINTAIN TELECOMMUNICATIONS SYSTEMS THROUGHOUT THE
PHILIPPINES” authored by Hon. by Hon. Eleandro Jesus F. Madrona

Rep. Madrona informed the Committee that the applicant, Wi-tribe Telecoms, Inc.,
has diligently complied with the documentary requirements of the Committee. He urged
the Committee to favorably consider the said application

Rep. Amaiz reminded the Committee to include the provisions regarding the DPWH
ingress and egress policy, and the consent of the local government units concern
where the applicant will operate and the tax provisions for the local government units.
The Chair agreed and will consider the same to include in the Committee Report

Rep. Aggabao moved for the approval of the bill and seconded by Rep. Lapus, the
Committee approved House Bill No. 5053 subject to the standard Committee style and
format on telecommunications franchise.

The Chair directed the Secretariat to prepare the appropriate Committee Report
and submit the same during the next meeting for approval.

VIIIDELIBERATION ON HB NO. 3828, “AN ACT AMENDING THE FRANCHISE OF
PANTABANGAN MUNICIPAL ELECTRIC SYSTEM BY RENEWING/EXTENDING
THE TERM OF THE FRANCHISE TO TWENTY-FIVE YEARS FROM THE DATE OF
APPROVAL OF THIS ACT” authored by Hon. Joseph Gilbert P. Violago

Rep. Violago informed the Committee that with the enactment of the EPIRA law that
the power to grant franchises to persons engaged in the transmission and distribution
of electricity rests exclusively in the Congress of the Philippines. It is for this reason
that the applicant is seeking a legislative franchise for power distribution in the
municipality of Pantabangan, Nueva Ecija

Rep. Lapus asked the representative of NEA as to their opinion regarding the
application for a legislative franchise for power distribution of Pantabangan Municipal
Electric System

Atty. Vic Alvaro, Legal Director of NEA representing Administrator Edith Bueno, said
that the agency interpose no objection to the application of the said applicant

Rep. Lapuz moved for the approval of the said measure and duly seconded by Rep.
Quimbo, the Committee approved House Bill No. 3828 subject to the standard
Committee style and format on power distribution franchise.

The Chair directed the Secretariat to prepare the appropriate Committee Report
and submit the same during the next meeting for approval.

Page 3 of 4 Nov. 29, 2011 CLF Minutes


IX ADJOURNMENT

The Chair acknowledged the presence of Rep. Mitos Magsayssay, Danilo Suarez and
Rufus Rodriguez.

Rep. Amaiz moved for the adjournment of the meeting, duly seconded by Rep. Lapus

There being no other maiters to discuss, the meeting adjourned at 2:49 p.m.

| hereby certify to the correctness of the foregoing

Prepared by

Are
ANTONIO T. ORTEGA
OICISLSO II

Attested by

MA’ as eh

Service Dirbctor
Approved by
a

MARCELINO R. “MARCY’ TEODORO
Chairman

Page 4 of 4 Nov 29, 2011 CLF Minutes


FACT SHEET
HOUSE BILL NO. 5033
(As approved by the Committee on November 29, 2011)

AN ACT GRANTING WiI-TRIBE TELECOMS, INC., A FRANCHISE TO CONSTRUCT,
INSTALL, ESTABLISH, OPERATE AND MAINTAIN TELECOMMUNICATIONS.
SYSTEMS THROUGHOUT THE PHILIPPINES

Introduced by: HON. ELEANDRO JESUS F. MADRONA

Committee Referral: LEGISLATIVE FRANCHISES

Committee Chairperson: HON. MARCELINO C. TEODORO
OBJECTIVES:

* Grants the Wi-Tribe Telecoms, Inc., a franchise to construct, install, establish and
maintain telecommunications systems throughout the Philippines

« Provides effective competition, coverage and penetration in the Internet services
market.

* Promotes innovative product offerings, improve grades of service, reduce
telecommunications charges and promote further development of the
telecommunications industry.

KEY PROVISIONS:

* Allows the grantee to provide basic or enhanced telephone service in any city or
municipality in the Philippines where it has an approved Certificate of Public
Convenience and Necessity.

* Requires the grantee to secure from the National Telecommunications
Commission (NTC) a Certificate of Public Convenience and Necessity (CPCN)

* Provides the NTC with the power to regulate the operation of the grantee’s
telecommunications system.

+ Requires that charges and rates for the grantee’s telecommunication service
shall be subject to the approval of the NTC.

* Prohibits the grantee from leasing, transferring, selling or assigning the franchise
or the controlling interest thereof without the prior approval of the Congress of the
Philippines.

RELATED LAW: RA 1553 — An Act Granting Eliseo B. Lemi a Temporary Permit to
Construct, Maintain and Operate Radio Broadcasting Stations and Stations for
Television in the Philippines