Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
‘Third Regular Session

6369

HOUSE BILL No.

Introduced by BAYAN MUNA Rep. NERI J. COLMENARES and Rep. CARLOS
ISAGANI ZARATE

AN ACT EXPANDING THE POWERS OF THE NATIONAL,
‘TELECOMMUNICATIONS COMMISSION CLASSIFYING SHORT MESSAGING
SERVICE, AND INTERNET SERVICES AS UTILITIES IMBUED WITH PUBLIC
INTEREST AND PROVIDING PENALTIES THEREOF, AMENDING REPUBLIC
ACT 7925 OTHERWISE KNOWN AS THE “PUBLIC TELECOMMUNICATIONS,

POLICY ACT OF THE PHILIPPINES” FOR ITS PURPOSE

EXPLANATORY NOTE.

Internet and SMS has been part of our daily lives, it now plays a crucial role in many
aspects of society, from media and information, entertainment, education, governance and the
economy. The “bayanihan” spirit has extended online where people send support for those
affected by calamities and disaster, and government agencies use the internet for relevant alerts.
As such the Philippines has been dubbed as the Text Capital, Social Media and even the BPO
Capital of the World which shows a very high demand for the use of such services. United
Nations Special Rapporteur on the Promotion And Protection Of The Right To Freedom OF
Opinion And Expression Frank La Rue submitted a report to the UN Human Rights Council
last May 2011 stating that “...internet access facilitates economic development and the
enjoyment of a range of human rights, marginalized groups and developing States remain
trapped in a disadvantaged situation, thereby perpetuating inequality both within and berween
States.”

However with all the recognition that the Filipinos are SMS and internet savvy, there siill
lies the fact that the country has been lagging behind in terms of average internet speed and total
internet penetration hovers around 35-40% only of the Philippine population, with majority of
the activity coming from urban centers. In this crisis, the problem lies with the country’s lack of
infrastructure to deliver reliable internet connection as it was left to the hands of private
telecommunications companies that would only construct facilites that would be financially-
viable and the current Telecommunications Act, rendered the NTC as toothless when it comes
to regulating internet and text messaging services, which is considered only as a “value-added
service” and therefore is outside the jurisdiction of the Commission, notwithstanding the reality


that it has been very long since the first connection of our country to the Internet in March 1994
which was only used by enthusiasts and educational institutions back then. The lack of spending,
of telecommunications investment by the private sector is evident as it consists only 0.014 % of
the GDP. While the sectors that provide relying internet and other telecommunication services
such as Business process outsourcing (BPO), Information Technology Outsourcing (ITO),
‘Knowledge process outsourcing (KPO) and other outsourcing industries have contributed USD.
11 billion in export revenues, ot an estimated 5.4% to the country’s GDP in 2011,

This bill echoes the call of consumers that the government should lead the creation of a
national telecommunications and internet infrastructure in order to interconnect the different
islands of the country, which is a very monumental task and shall need government resources as
it would cover areas unprofitable for the telecommunication companies to build its facilites.
Moreover, it seeks to rationalize government regulation of the industry by clearly defining the
powers of the National Telecommunications Commission through the formulation of provisions
specific and categorical to the industry and increasing the fines to be imposed which is also
allowed to be adjusted with inflation to ensure maximum compliance on the side of
tclecommunication companies and intemet service providers.

In order to end our plight of experiencing slow internet at the mercy of private
telecommunication networks, swift passage of this bill is sought.

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J. COLMENARES Rep’. CARLOS ISAG. Rast ZARATE
Bayan Mana Party List Bayan Muna Party-List



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
‘Third Regular Session

6363

HOUSE BILL No. __

Introduced by BAYAN MUNA Rep. NERI J. COLMENARES and Rep. CARLOS
ISAGANI ZARATE

AN ACT EXPANDING THE POWERS OF THE NATIONAL
‘TELECOMMUNICATIONS COMMISSION CLASSIFYING SHORT MESSAGING
SERVICE, AND INTERNET SERVICES AS UTILITIES IMBUED WITH PUBLIC
INTEREST AND PROVIDING PENALTIES THEREOF, AMENDING REPUBLIC

ACT 7925 OTHERWISE KNOWN AS THE “PUBLIC TELECOMMUNICATIONS
POLICY ACT OF THE PHILIPPINES” FOR ITS PURPOSE,

Be it enacted by the Senate and the House of Representatives ofthe Philipines in Congress assembled

SECTION 1 - CLASSIFICATION OF SMS AND INTERNET UNDER NTC’S
REGULATION. Section 3 of Republic Act 7925, otherwise known as the “Public
‘Telecommunications Policy Act” is hereby amended to read as follows:

Section 3. Definitions and Interpretations. - For purposes of this Act, the following terms
shall be used:

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(©) Short messaging services ~ is a text messaging component of mobile
communication systems that are transmitted to and from a mobile phone,
fax machine and/or IP address.

(@) Internet — a communication network that allows connection among
computers and devices worldwide via the internet protocol (IP).

(©) Internet service provider ~ an entity that provides internet access
through existing network infrastructure including but not limited co
telephone lines, cell sites, Ethernet, satellite, cable television lines, and
radio frequency; or through new technologies delivering internet services
that may emerge after the passage of this act.

XXX


Furthermore, the NTC is mandated to adopt standardized definitions the
International Telecommunications Union (ITU), the Internet Engineering Task
Force (IETF), the World Wide Web Consortium (WWWC), and the Internet
Corporation for Assigned Numbers and Names (ICANN), and other
international and transnational agencies governing the development, use, and
standardization of information and communications technology and the Internet.

SECTION 2. INTRODUCTION OF PENALTIES. Section 5 of Republic Act 7925,
otherwise known as the “Public ‘Telecommunications Policy Act” is hereby amended to read as
follows:

Section 5. Responsibilities of the National Teleammunications Commission. -’Tae National
‘Telecommunications Commission (Commission) shall be the principal administrator of
this Act and as such shall take the necessary measures to implement the policies and
objectives set forth in this Act. Accordingly, in addition to its existing functions, the
Commission shall be responsible for the following:

XXX

(h) In exercise of its regulatory powers, the Commission shall be
given the power to impose fines against telecommunication service
providers within the scope of its regulation that is found violating or
failing to comply with the terms and conditions of any certificate or any
orders, decisions or regulations of the Commission shall be subject to a
fine amounting to the total actual loss or overcharging as determined by
the Commission for every day during which such default or violation
continues; and the Commission is hereby authorized and empowered to
impose such fine, after due notice and hearing. The erring service
providers are also mandated to refund to consumers the charges they
erroneously imposed to their subscribers.

SECTION 3. Development of a National Telecommunications Network. ~ Section 6 of of
Republic Act 7925, otherwise known as the “Public Telecommunications Policy Act” is hereby
amended to read as follows:

Section 6, Responsibilities of and Limitations to Department Powers. - The Department of
‘Transportation and Communications (Department) shall not exercise any power which
will tend to influence or effect a review or a modification of the Commission's quasi-
judicial functions.

In coordination with the Commission, however, the Department shall, in accordance
with the policies enunciated in this Act, be responsible for:

XXX

a.) In coordination with the Department of Science and Technology and othe:
related agencies, they are given the mandate to develop a National
‘Telecommunications and Internet Infrastructure in order to provide a
nationwide network that would provide interconnection among difierent


government offices and Local Government Units. All internet service
providers shall be required to connect to the said infrastructure.

SECTION 4. Repealing Clause. - All laws, orders, issuances, rules and regulations or pact
thercof inconsistent with the provisions of this Act are hereby repealed, amended or modified
accordingly.

SECTION 5. Effectivity Clause. - "This Act shall take effect within fifteen (15) days after its

publication in the Offaial Gazette or in at least two (2) newspapers of general circulation,
whichever comes eatlier.

Approved,