Republic of the Philippines
HOUSE OF REPRESENTATIVES |,
Quezon City

SEVENTEENTH CONGRESS:
First Regular Session

House Bill No. 4515

Introduced by: REPRESENTATIVE HENRY S. OAMINAL

EXPLANATORY NOTE

The Constitution has long recognized the importance of information and
communication technology in nation-building. In pursuance of this expressed
mandate, Section of Republic Act No. 8792 otherwise known as the Electronic
Commerce Act of 2000 declares the need to create an information-friendly
environment which supports and ensures availability, diversity and affordability of
ICT products and services.

Considering the current landscape of the technology industry in the
Philippines where certain business interests have kept prices high and quality
low, itis clear that there is a need for a better alternative. In order to address this
issue, it is imperative for the government to welcome and encourage other
groups and companies, whether small or big business, to directly invest in
telecommunications. Indeed, the more quality players in the industry will be more
beneficial to our country and people.

This bill therefore seeks to grant Ignite Telecommunications, Inc. @
franchise to construct, install, establish, operate and maintain telecommunication
system throughout the Philippines and shall include but not limited to paging,
fiber optics, multi-channel multi-point distribution system (MMDS), local multi-
point distribution systems (LMDS), satellite transmit and received systems
switches and their value-added services, such as but not limited to, transmission
of voice, data, facsimile, control signs, audio and video, information service
bureau and all other value-added technologies as are presently available or will
be 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 is or are
convenient or essential to efficiently carry out the purpose of this franchise.


Ignite Telecommunications, Inc. intends to help improve the present state
of our telecommunications industry with its best human and management
resource and by offering the latest technology at competitive rates.

The entry of another worthy investor in the market, like the Ignite
Telecommunications, Inc. will surely improve the services at lesser costs and
enliven the telecommunications industry for the great benefit of our consumers.

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

Representativ!

Second District, Misamis Occidental

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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

4515

House Bill No.

Introduced by: REPRESENTATIVE HENRY S. OAMINAL

AN ACT
GRANTING IGNITE TELECOMMUNICATIONS, INCORPORATED A
FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND
MAINTAIN TELECOMMUNICATIONS SYSTEM THROUGHOUT THE
PHILIPPINES

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

SECTION 1. Nature and Scope of Franchise. - Subject to the provisions
of the Philippine Constitution and applicable laws, rules and regulations, there is
hereby granted Ignite Telecommunications, Incorporated hereunder referred to
as the grantee, its successors or assigns, @ 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 system and
shall include but not limited to paging, fiber optics, multi-channel multi-point
distribution system (MMDS), local multi-point distribution systems (LMDS),
satellite transmit and received systems, switches and their value-added services,
such as but not limited to, transmission of voice, data, facsimile, control signs,
audio and video, information service bureau and all other value-added
technologies as are presently available or will be 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 is or 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 the grantee’s services and/or availability thereof


SEC. 3. Authority of the National Telecommunications Commission
(NTC). - The grantee shall secure from the National Telecommunications
Commission (NTC) hereinafter referred to as the Commission, the appropriate
permits and licenses for the construction, installation and operation of its
telecommunications system and facilities. The grantee shall not use any
frequency in the radioltelevision spectrum without authorization from the
Commission, 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 unlawful for the grantee, without prior approval of the
Department of Public Works and Highways (DPWH), to make excavations or lay
conduits in any public places, highways, streets, lanes, alleys, avenues,
sidewalks or bridges of said province, cities or municipalities: Provided, however,
That a public place, highway, street, lane, alley. avenue. sidewalk or bridge
altered, changed or 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 in accordance with the standard set by the DPWH. Should the grantee
after ten (10) days notice from 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 said grantee, 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.

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

The grantee shall provide basic or enhanced telephone service in any
local government unit in the Philippines where it has an approved certificate of
public convenience and necessity for the establishment, operation and
maintenance of local exchange service, without discrimination to any applicant
therefore, 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 grantee 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 of Services. - The charges and rates for
telecommunications services of the grantee except the rates 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 or facilities of the grantee, to temporarily suspend the
operation of any station or facility 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 or facilities during the period when they shall be so
operated.

The radio spectrum is @ 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 one (1) year from the approval of its
operating permit by the NTC

(b) Operate continuously for two (2) years

(c) Commence operations within three (3) years from the effectivity of this
Act: and

SEC. 9. Acceptance and Compliance. - Acceptance of this franchise
shall be given in writing 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 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 issued in favor of the NTC,
which shall determine the amount, to guarantee the compliance with the
fulfillment of the conditions under which this franchise is granted. If after five (5)
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
telecommunication 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 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 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 (81% ) of January of each year for the preceding twelve
months,

SEC. 13. Books of Accounts. — The books of accounts of the grantee
shall always be open to the inspection of the Commission 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 National and Local Governments. - The
grantee shall hold the national, provincial, city and municipal governments of the
Philippines harmless from alll 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, Transfer, Usufruct, or Assignment of
Franchise. - The grantee shall not lease, transfer, grant the usufruct of, sell nor
assign this franchise or the rights and privilege 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.


SEC. 16. 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 per centum (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. The public offering shall comply with the rules
and regulations of the Securities and Exchange Commission. Non-compliance
therewith shall render the franchise ipso facto revoked

SEC. 17. Equality Clause. — Except for taxes, any advantage. favor.
privilege. exemption, or immunity granted under existing 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, 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 the succeeding year

SEC. 19. Penalty Clause — Any grantee who fails to submit the Annual
Report to Congress will be fined Five Hundred Pesos (P500.00) per working day
of non-compliance. Said fine will be collected by the Commission from said
delinquent franchise grantee separate from the reportorial penalties imposed by
Commission. The collected funds shall accrue to the monitoring fund of the
Commission in line with its supervisory and regulatory functions. The reportorial
compliance certificate issued by Congress shall be required before any
application for permit or certificate is accepted by Commission

SEC. 20. Separability Clause. — If any of the sections or provisions of this
Act is held invalid, all other provisions not affected thereby shalll remain valid

SEC. 21. 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. 22. Publication. This Act shall be published, through the initiative of
the Grantee, fifteen (15) days after this Act is signed by the President of the
Philippines or has lapsed into law.

SEC. 23. Effectivity. — This Act shall take effect fifteen (15) days from its
publication in the Official Gazette or in a newspaper of general circulation in the
Philippines

Approved,