Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

House Bill No. 6266

Introduced by Representative CARLITO S. MARQUEZ

EXPLANATORY NOTE

This bill seeks to renew the franchise granted to Panay
Telephone Corporation, for another twenty five (25) years.

As enshrined in the Constitution, the State recognizes the vital
role of communication and information in nation-building and the

indispensable role of the private sector.

Panay Telephone Corporation has the distinction of being the
first telephone company in the Aklan and Antique Province to offer
an Automatic Dial System for its subscribers. Its initial franchise
was granted in July 09, 1998.

Thereafter, the service area of Panay Telephone Corporation
expanded all 17 Municipalities of Aklan and 4 Municipalities of
Antique.

With the coming 30 year of operation in 2021 Panay
Telephone Corporation continues to provide latest
telecommunications technology to its subscriber who are literally
based in the countryside. With this, Panay Telephone Corporation
serves by providing global access for people in the countryside
through more telephone and broadband lines...”

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Panay Telephone Corporation as its primary offering provides
its subscribers with both the landline voice connection and the
more in demand data connection. It now focuses its operations to
the more remote communities in the municipalities within its

franchise area.

Advances in the telecommunications technological landscape
had been exponential over the past two decades and will continue
to grow even at a more accelerated pace in the coming decades.
Panay Telephone Corporation is committed to make these services
and products available to the locality it serves. Panay Telephone
Corporation over its almost three decades of service had seen that it
had_ substantially contributed to the modernization and
development in Aklan and Antique.

Hence, the approval of this bill is earnestly sought.

Lae Zoe,

ENGR. CARLITO “Lito” S. MARQUEZ

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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

18™ CONGRESS
First Regular Session

HOUSE BILL Wo, £66

Introduced by Representative CARLITO S. MARQUEZ

AN ACT

RENEWING FOR ANOTHER TWENTY-FIVE (25) YEARS THE
FRANCHISE GRANTED TO PANAY TELEPHONE CORPORATION,
UNDER REPUBLIC ACT NO. 8704, ENTITLED “AN ACT
GRANTING THE PANAY TELEPHONE CORPORATION, INC. A
FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH, OPERATE
AND, MAINTAIN LOCAL EXCHANGE NETWORK IN THE
PROVINCE OF AKLAN AND ANTIQUE.”

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 Constitution and applicable laws, rules and
regulations, the franchise granted to Panay Telephone Corporation,
under Republic Act No. 8704 and hereunder referred to as the
grantee, its successors or assignees, to construct, install, establish,
operate and maintain for commercial purposes and in the public
interest, in the Province of Aklan and Antique, Philippines, wire
and/or wireless telecommunications system, copper, fiber optics,
satellite transmit and receive 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; or construct, acquire, lease, and operate,

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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.

The Panay Telephone Corporation shall operate only in the
Provinces of Aklan and Antique, and now ceases to operate in the

Municipality of Janiuay, Province of Iloilo.

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 or other stations which may be established by law,
without 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 or the availability thereof.

SEC. 3. Authority of the National Telecommunications
Commission. - The grantee shall secure the National
Telecommunications Commission (NTC) a Certificate of Public
Convenience and Necessity (CPCN) and the appropriate permits and
licenses for the construction, installations and operation of its
telecommunications systems or facilities. In issuing the certificate,
the NTC shall have the power to impose such conditions relative to
the construction, operation, maintenance, or service level of the
telecommunications system. The NTC 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 authorization from the NTC. Such certificate
shall state the areas covered and the date the grantee shall

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commence the service. 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 public place, road, highway,
street, lane, alley, avenue, sidewalk, or bridge altered, changed or
disturbed by the said grantee, its successors or assigned, then the
DPWH or the LGU concerned shall have the right to have the same
repaired and placed in good order and condition at double the
amount spent for such repair or replacement, to be charged against

the grantee, its successors or assignees.

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

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

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 rate 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 an order: to
temporarily take over and operate the stations, transmitters,
facilities, or equipment of the grantee; to temporarily suspend the

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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 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 ipso facto revoked in the event the
grantee fails to operate continuously for two (2) years.

SEC. 9. Commitment to Provide and Promote the Creation of
Employment Opportunities. - The grantee shall create employment
opportunities and shall allow on-the-job training in their franchise
operation: Provided, That priority shall be accorded to the residents
in areas where any of its offices 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 annually.

SEC. 10. 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 mutually agreed upon by the

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parties concerned, the right shall be subject to the review and
modification of the NTC.

SEC. 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 and privileges acquired thereunder to any person, firm,
company, corporation or other entity, nor merge with any other
corporation or entity, nor shall transfer the controlling interest of
the grantee, simultaneously or contemporaneously, to any person,
firm, company, corporation, or entity without the prior approval of
the Congress of the Philippines and compliance with legal
requirements stipulated in other statutes. Any person or entity to
which this franchise is validly 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%) or a higher percentage that may hereafter
be provided by law of its common stocks 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

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not applicable, other methods of encouraging public participation
by citizens and corporations operating public utilities must be
implemented. Noncompliance therewith shall render the franchise

ipso facto revoked.

Sec. 14. 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 every year
during the term of its franchise. The compliance certificate issued
by Congress shall be required before an application for any permit,
CPCN, or any equivalent thereof is accepted by the NTC.

SEC. 15. Penalty Clause. - Failure of the grantee to submit the
requisite annual report to Congress shall be penalized with 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. 16. Equality Clause. - Any advantage, favor, privilege
exemption, or immunity granted under other 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,

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That the foregoing shall neither apply to nor affect the provisions of
telecommunications franchises concerning territory, life span, or

type of service authorized by the franchise.

SEC. 17. 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. 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. Repealing Clause. — All other laws, orders, issuances,
rules and regulations or parts thereof inconsistent with this Act are
hereby repealed, amended or modified accordingly.

SEC. 20. Effectivity. - This Act shall take effect fifteen (15)
days after its publication in the Official Gazette or in a newspaper of

general circulation.

Approved,

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