Republic of the Philippines
House Or Representatives \
Quezon City, Metro Manila

Sixteenth Congress
Second Regular S

on

HOUSE BILL NO. 4964

Introduced by Honorable Sergio A.F. Apostol

EXPLANATORY NOTE

This bill seeks to grant Eyeview Wireless Communication, Inc. a
franchise to construct, install, establish, operate and maintain
telecommunications systems throughout the Philippines.

Section 24, Article II of the 1987 Constitution provides:

“SEC. 24. The State recognizes the vital role of
communication and information in nation-building.”

Telecommunication plays an important role not only in the socio-
economic development of the country but also in the political behavior of
the people. It is a means by which important information can be
disseminated to the people especially to those residing in the remote places,
Telecommunication makes it convenient for people to transact business in
any part of the country.

There is an urgent need to further develop the teleecommunications
systems in the Philippines today. If we are to keep in step with our expected
economic recovery, we must use every means available to improve our
domestic communications systems.

Bill Drafting Service


Eyeview Wireless Communication, Inc. is seeking a legislative
franchise to operate and maintain telecommunications business using multi-
channel multi-point distribution system (MMDS). MMDS is a broadcasting
and communications service that operates in the ultra-high-frequency (UHF)
portion of the radio spectrum between 2.1 and 2.7 GHz or higher. MMDS is
also known as wireless cable and was conceived as a substitute for
conventional cable television (TV), with applications in data
communications or high-speed internet access. Because of recent
deregulation that allows cable TV companies to provide telephone and
internet services, along with the development of digital technologies that
make efficient use of available bandwidth, digital MMDS has a lot to offer
and has considerable next generation technology. An MMDS network can
provide 200 digital TV channels and high-speed internet access together
without the constraints of cable connections.

The telecommunications business is a highly capital intensive
operation and requires not only national effort but also support from the
private sector. The government must implement its avowed policy to
encourage competition to improve the telecommunications capability within
the country. We must speed-up the process of modernizing our
telecommunications systems.

The ability to easily access and share information and stimulate the
creation of new ideas is viewed as essential in maintaining a strong economy
and enhancing the quaiity of life of every citizen.

In view of the foregoing, approval of this bill is highly recommended.

SERGHO A.F, APOSTOL,


NAURwWNHS

©

10

i

12

13

Republic of the Philippines
House Or Representatives
Quezon City, Metro Manila

Sixteenth Congress
Second Regular Session

HOUSE BILL NO. 4964

Introduced by Honorable Sergio A.F. Apostol

AN ACT
GRANTING THE EYEVIEW WIRELESS COMMUNICATION, INC.
A FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH,
OPERATE AND MAINTAIN TELECOMMUNICATIONS SY: 5
THROUGHOUT THE PHILIPPINES

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

SECTION |. Nature and Scope of Franchise. ~ Subject to the
provisions of the 1987 Constitution and applicable laws, rules and
regulations, there is hereby granted to Eyeview Wireless Communication,
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

wireless telecommunications systems including, but not limited to, mobile,

1

Bill Drafting Service


10

i

12

13

14

1S

16

a7

18

19

20

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 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.

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 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 the rendition of its services and the
availability thereof.

SEC. 3. Authority of the National Telecommunications

Commission. -— The grantee shall secure from the National


10

Il

12

13

14

15

16

17

18

19

20

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 and facilities. In issuing the
certificate, the Commission shall have the power to impose such conditions
relative to the construction, operation, and maintenance or service level of

the telecommunications s

‘stem. 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. 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

assigns, with the prior approval of the Department of Public Works and

Highways (DPWH) or the local government units concerned, as may be

appropriate, to make excavations or lay conduits in any of the public places,


10

i

12

13

l4

15

16

Lh

18

19

20

roads, highways, streets, lanes, alleys, avenues, sidewalks or bridges of said
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
assigns, in accordance with the standards set by the DPWH or the local
government units concerned, Should the grantee, its successors or assigns,
after the ten 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 or the local government units
concerned 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 transmi:

ion or for the dissemination of deliberately false
information or willful misrepresentation, or assist in subversive or

treasonable acts



10

i

12

14

ae

16

17

18

19

The grantee shall 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 for the establishment, operation and

maintenance of a local exchange service, without dis« ination 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

grantee shall furnish such servic

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,


10

i

93:

14

15

16

17

18

19

20

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 reserved to
the President of the Philippines, in times of war, rebellion, public peril,

calamity, emergency, dis

er 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 the 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 operated.


17

18

19

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 from 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 comply with any of the following
conditions:

a) Commence operation within one (1) year from the approval of its
operating permit or provisional authority by the NTC;

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

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

SEC. 9. Acceptance and Compliance, — Acceptance of this franchise
shall be given in writing to the Congress of the Philippines 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.


10

i

12

13

14

17

18

19

20

SEC. 10. Bond. ~The grantee shall file a bond with the NTC in the
amount that the NTC shall determine, to guarantee 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, 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, 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 (COA) and the National

Treasury a copy of such account not later than the thirty-first day of January

of each year for the preceding twelve (12) months.


Is

16

17

18

dy

20

SEC. 13. Books and Accounts. — The books and accounts of the
grantee, its successors or assigns, shall always be open to the inspection of
the Commission on Audit or 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 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. Nontransferability of Franchise. — The grantee shall not
lease, transfer, grant the usufruct of, sell nor assign this franchise or the
rights and privileges acquire 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


10

I

12

13

14

15

16

17

19

20

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 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. Noncompliance 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, 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. 18. Penalty Clause. — In case the grantee fails to submit the
annual report to Congress of the Philippines, the grantee shall be fined Five
hundred pesos (P500.00) per working day of non-compliance. Such fine
shall be collected by the NTC from the grantee which shall accrue to the

10


14

15

16

If

18

19

20

monitoring funds of the NTC 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
NTC.

S|

19. Equality Clause. — Any advantage, favor, privilege,
exemption or immunity granted under existing telecommunications
franchise, or may hereafter be granted upon prior review and approval of
Congress, shall become part of previously granted telecommunications
franchises and shall be accorded immediately and unconditionally to the
grantees of such franchises: Provided, however, That the foregoing shall
neither apply to nor affect the provisions of telecommunications franchises
conceming territory covered by the franchise, the life span of the franchise
or the type of service authorized by the franchise.

SEC. 20. Separability Clause. - If any provision or section of this Act,
or any part thereof, is declared invalid or unconstitutional, all other sections or
provisions not affected thereby shall remain in force and effect.

SEC. 21. Repeatability and Nonexclusivity Claus 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.

u


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

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

Approved,