Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Quezon City
NINETEHNTH CONGRESS
Second  Regular Session
HousEBILLNo.      9981
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Introduced by Representatives MUJIV S. IIATAMAN, PRESLEY C. DE JESUS and
SERGI0 C. DAG00C
EXPLANATORY NOTE
This  bill  seeks  to  grant  a  legislative  franchise  to  the  Basilan  Electric  Cooperative  or
BASELCO,  to  construct,  install,  establish,  operate,  own,  manage  and  maintain  distribution
systems for the conveyance of electric power to the end-users in the entire Province of Basilan,
except the City of Isabela.
BASELCO   currently   serves   the   entire   Province   of   Basilan   composed   of   the
municipalities of Akbar, Al-Barka, Hadji Muhammad Ajul, Hadji Muhtamad, Lantawan, Maluso,
Sumisip, Tabuan Lasa, Tipo-Tipo, Tuburan and Ungkaya Pukan,  and the cities of Lalnitan and
Isabela, through NPC-SPUG.
Needless  to  say,  the  services  provided  by  BASELCO  have  been  instrumental  in  the
continued economic and social improvement of Basilan.
In this bill, however, BASELCO's franchise excludes the City of Isabela. A separate bill
granting franchise to the  Isabela City  Electric Cooperative  (ISABELCO) has been filed due to
the  increasing  power  supply  demand  of the  city,  and  its  non-inclusion  in  the  Bangsanioro


Autonomous Region in Muslim Mindanao (BARMM).
Registered in May 24,1975, the franchise of BASELCO is set to expire in 2028. In order
for BASELCO to continue providing service to the people of Basilan, the passage of this bill is
earnestly sought.
Lone District Of Basilan
LEY C. DE JHS 1.i::     --
Representative
PHILRECA Party-List
SERGIO :i`,.:) GOOC
Representative
APEC Party-List


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
Second  Regular Session
HOUSE BILL NO.
Introduced by Representatives MUJIV S. HATAMAN, PRESLHY C. DE JESUS and
SERGI0 C. DAGOOC
AN ACT GRANTING A FRANCHISE TO THH BASILAN ELHCTRIC COOPERATIVE
q}ASELCO) T0 CONSTRUCT, INSTALL, ESTABLISH, OPERATE, OWN, MANAGH
AND MAINTAIN DISTRIBUTION SYSTEMS FOR THH CONVEYANCE OF
ELECTRIC POWER T0 THE END-USERS IN THE CITY OF LAMITAN, AND THH
MUNICIPALITIES 0F AKBAR, AL-BARKA, HADJI MUHAMMAD AJUL, HADJI
MUHTAMAD, LANTAWAN, MALUSO, SUMISIP, TABUAN LASA, TIPO-TIPO,
TUBURAN, AND UNGKAYA PUKAN IN THH PROVINCE OF BASILAN
Be  it  enacted  by  the  Senate  and  the  House  Of  Representatives  Of the  Republic  Of the  Philippines  in  Congress
assembled:
SHCTI0N  1. IV¢fwre ¢Hd Scapc a/ Fr¢#cfoisc.  -Subject to the provisions of the Constitution
and  applicable  laws,  rules  and  regulations,  there  is  hereby  granted  to  the  Basilan  Electric
Cooperative,  hereunder  referred  to  as  the  grantee,  its  successors  or  assignees,  a  franchise  to
construct,  install,  establish,  operate,  own,  manage,  and  maintain  in  the  public  interest  and
commercial purposes, a distribution system for the conveyance of electric power to the end-users
in the City of Lamitan, and the Municipalities of Akbar, A1-Barka, Hadji Muhammad Ajul, Hadji
Muhtamad, Lantawan, Maluso, Sumisip, Tabuan Lasa, Tipo-Tipo, Tuburan, and Ungkaya Pukan
in the Province of Basilan.


As  used  in  this  Act,  distribution  system  refers  to  the  system  of wires  and  associated
facilities including sub-transmission lines belonging to a franchised distribution utility extending
between the  delivery  point  on the  national  transmission  system  or  generating  facility  and the
metering point/facility of the end-users.
SEC.  2.  Ma""cr  a/ Operof!.o#s  a/ Fac!./i.fi.es.  -  All  electric  distribution  facilities,  lines  and
systems for electric services installed, owned, maintain, operated, managed or maintained by the
grantee,  its  successors  or  assignees  shall  be  operated  or  maintained  at  all  times  in  a  superior
marmer, and it shall be the duty of the grantee, its successors or assignees, whenever required to
do  so  by the  Energy  Regulatory  Commission,  hereinafter referred to  as the  ERC,  or its  legal
successor, or the Department of Energy, hereinafter referred to as the DOE, or its legal successor,
or any  other  government agency  concerned to  modify,  improve  and  change  such facilities  or
systems  in  such  manner  and  to  such  extent  as  the  progress  in  science  or  technology  and
improvements or innovations in the electric power services may render reasonable and proper.
Whenever practicable, and for puaposes of maintaining order, safety and aesthetics along
the highways, roads, streets, alleys or right-of-way, the grantee may allow the use of free spaces
in its poles, facilities, or right-of-way by interested parties upon reasonable compensation to the
grantee considering the costs incurred to accommodate and administer the use of the grantee's
facilities by  such parties. The ERC shall decide in case of dispute or disagreement between the
parties.
S;HC. 3. Authority  Of the  Energy  Regulatory  Comndssion  (ERC).  - The  grarl:hoe stwall seoue
from the ERC or any government agency having jurisdiction over their operations, the certificate
of public convenience and necessity, and any other license, permit or authority indispensable for
the construction and operation of the electric power distribution system.
SHC. 4. J"gress ¢"d Egrc§s.  - For the puxpose of erecting and maintaining the poles or other
supports   for  said   facilities,   wires   or  other  conductors,   or  for  the  puapose   of  laying  and
maintaining said facilities, wires, cables or other conductors, it shall be lawful for the grantee, its
successors,  or  assignees,  in  coordination with the  Department  of Public  Works  and  Highways
(DPWH) or the local government unit concerned, as may be appropriate, to make excavations or
lay  conduits  in  any  of  the  public  places,  highways,  roads,  streets,  lines,  alleys,  avenues,
sidewalks,  or  bridges  of the  province  and  city:  Provz.cJec7,  that  a public  place,  highway,  road,
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 at the expense of the grantee, its
successors  or  assignees,  in  accordance  with  the  standards  set  by  the  DPWH  or  the  local
government unit concerned. Should the grantee, its successors or assignees, after the ten (10)-day


notice from the grant of authority, fail, refuse or neglect to repair or replace any part of public
place,  highway,  road,   street,  lane,  alley,  avenue,   sidewalk,  or  bridge  altered,  changed,  or
disturbed  by  the   said   grantee,   its   successors   or  assignees,   then  the   DPWH  or  the   local
government unit concerned shall have the right to have the same repaired and replaced in good
order  and  condition  at  double  expense  to  be  charged  against  the  grantee,  its  successors  or
assignees.
SEC. 5. Rcxpousi.bi./i.fy /a ffec Pwb/i.c.  - The grantee shall supply electricity to its captive market
in the least costly manner. In the interest of the public good and as far as feasible, and whenever
required  by  the  ERC,  the  grantee  shall  modify,  improve,  or  change  its  facilities,  poles,  lines,
systems and equipment for the purpose  of providing  efficient and reliable  service and reduced
electricity costs.
The grantee shall charge reasonable and just power rates for its services to all types of
consumers  within  its  franchised  areas  in  order that businesses  and  industries  shall  be  able  to
compete.
The grantee shall have the obligation to provide open and nondiscriminatory access to its
distribution  system  and  services  for  any  end-user  within  its  franchise  area  consistent  with
Republic Act No. 9136, otherwise known as the "Electric Power Industry Reform Act of 2001 ".
The grantee shall not engage in any activity that will constitute an abuse of market power
such  as  unfair  trade  practices,  monopolistic  schemes,  and  other  activities  that  will  hinder
competitiveness of business and in.dustries.
SEC. 6. R¢fes/or Scrvi.ccs. - The retail rates and charges for the distribution of electric power by
the grantee to its end-users shall be regulated by and subject to the approval of the ERC or its
legal successor.
The  grantee  shall  identify  and  segregate  in  its  electricity  bill  to  the  end-users  the
components  of the  retail  rate  pursuant to  Republic Act No.  9136,  unless  otherwise  amended.
Such rates charged by the  grantee to the end-users  shall be made public  and transparent.  The
grantee shall implement lifeline rate to marginalized end-users as mandated under Republic Act
No. 9136.
SHC. 7. Pro"oJI.o# a/ CoHs#mcr J"/Crests. -The herein grantee shall establish a consumer desk
that will handle consumer complaints and ensure adequate promotion of consumer interests. The
grantee shall act with dispatch on all complaints brought before it.


SEC.  8. R!.gfe/ a/l„c  Govcr7®7iceH/ -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 the stations or
facilities during the period when these shall be so operated.
SHC. 9. RJ.givf a/EmJ.HeJlf Dom¢J." - Subject to the limitations and procedures prescribed by law,
the grantee is authorized to exercise the right of eminent domain insofar as it may be reasonably
necessary for the efficient maintenance and operation of services. The grantee is authorized to
install  and  maintain  its  poles,  wires,  and  other  facilities  over  and  across  public  property,
including streets, highways, forest reserves, and other similar property of the Goverrment of the
Philippines, its branches,  or any of its instrumentalities.  The grantee may acquire such private
property as is actually necessary for the realization of the purposes for which this franchise is
granted:  Prow.cJec7,  that  proper  expropriation  proceedings  shall  have  been  instituted  and just
compensation paid.
SEC.10.  rcrm a/ Fra#cfeisc.  -Unless  sooner canceled, the  franchise  shall  be  in effect for a
period  of twenty-five  (25)  years  from  the  year  of expiration  of its  existing  franchise.  This
franchise   shall   be   deemed   zPso  /c7c/a  revoked   in  the   event  the   grantee   fails  to   operate
continuously for two (2) years.
SEC.11. 4ccepfo"ce ¢i®d CounpJ..a!#cc. -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 such acceptance, the grantee shall exercise the privileges
granted under this Act. Nonacceptance shall render the franchise void,


SE:C. 12. Wlarranty in Favor Of the National and Local Governments - The grari:tee 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, installation, operation, and maintenance of the distribution
system of the grantee.
SEC. 13. £jdrb!./I.fy/or D¢i"ages - The grantee shall be liable for any injury and damage arising
from  or caused  by  accident to  persons  and  property  by  reason  of any  defective  construction
under this franchise or of any neglect or omission to keep its poles and wires in safe condition.
SE:C. 14. Sale, Lease, Tranofer, Usrfruct, or Assignment Of Franchise. -The glaritee shalil ruof
sell,  lease,  transfer,  grant the  usufruct of,  or  assign this  franchise  or the rights  and privileges
acquired thereunder to  any  person,  firm,  company,  coaporation,  or  other  commercial  or  legal
entity, or merge with any other corporation, or entity, or shall transfer the controlling interest of
the grantee, 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 Congress shall be informed of any lease, transfer,
granting the usufruct of,  sale,  or assignment of franchise or the rights  and privileges acquired
thereunder, or of the merger, or sale of the controlling interest within sixty (60) days after the
completion of said transaction: Provided futher, That any such transfer, sale, or assignment is in
accordance with the  constitutional  limitations:  Provided furthermore,  That failure to  report to
Congress  such  change  of ownership  shall  render  the  franchise  ipso  facto  revoked:  Provided
finally, That any person or entity to which this franchise is sold, transferred, or assigned, shall be
subject to the same, conditions, terms, restrictions, and limitations of this Act.
SEC. 15. Rcpor/orj"/ Reqwc.remcHf. - 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 the franchise. The reportorial compliance certificate issued by Congress shall
be required before any application for permit or certificate is accepted by the ERC.
SEIC. 16. Fi.#c. -The failure of the grantee to submit the requisite annual report to Congress shall
be  penalized  by  a  fine  in  the  amount  of five  hundred  pesos  (P500.00)  per  working  day  of


noncompliance.  The fine  shall  be collected by the ERC  from the delinquent franchise grantee
separate  from  the  reportorial  penalties  imposed  by  the  ERC.  All  proceeds  from  the  fines  or
penalties shall be remitted to the National Treasury.
SHC.  17. Eqwa/dy  C/¢usc.- Any  advantage,  favor, privilege,  exemption,  or immunity  granted
under 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, however, That the foregoing shall neither apply
to  nor  affect  provisions  concerning  territory  covered  by  the  franchise,  the  life  span  of the
franchise or the type of service authorized by the franchise: Provided, further, That the foregoing
shall  not  apply  to  the  sale,  lease,  transfer,  grant  of  usufruct,  or  assignment  of  legislative
franchises with prior congressional approval.
SEC. 18. 4pp/I.c¢b!./try CJawsc. - The grantee shall comply with and be subject to the provisions
of Commonwealth Act No.  146, as amended, otherwise known as the "Public Service Act" and
Republic Act No. 9136, otherwise known as the "Electric Power Industry Reform Act of 2001 " .
SEC.   19.  Rcpe#/fl[bi./rty   ¢#d  IVo#-E]ccJusz.vc.fy   CJ¢wsc.-   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. 20. Scp¢r¢b!./rty C/¢usc. - If any of the sections or provisions of this Act is held invalid, all
other provisions not affected thereby shall remain valid.
SEC.  21.  Rcpca!/I.#g  CJ¢i4sc.   -  All   laws,  presidential  decrees,  executive  orders,   letters  of
instruction,  administrative  rules  and  regulations  or  parts  thereof  which  are  contrary  to  or
inconsistent with the provisions of this Act are hereby repealed or modified accordingly.
SEC.  22.  EJcisfl."g Powers.  -  Existing  mandates,  powers,  functions,  and privileges  granted to
Electric Cooperatives under existing laws, including Section 10 of Republic Act No.10531, shall
remain valid and effective, unless expressly repealed by succeeding laws.
SEC. 23. EJLTcctl.vrty C/¢#se. -This Act shall take effect fifteen (15) days after its publication in
at least two (2) newspapers of general circulation.
Approved