Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Constitution Hills, Quezon City
NINETEENTH CONGRHSS
Second Regular Session
H0dsEB|LLNo.   9029
Introduced by REP.  FAUSTINO `INNO' A. DY V
EXPLANATORY NOTE
In  the  global   stage  where  all  governments  are  prioritizing  digital  transformation,
introducing  new  players  to  the  telecommunications  sector  stands  as  a pivotal  approach  to
enhancing the competitiveness of service providers.
Current records of performance distinctly reveal that the telecommunications industry
in the Philippines  is presently  struggling,  marked by  subpar service delivery hindered by the
dominance  of a  small  number of major players  in  the  field.  The challenging circumstances
have  been  further  exacerbated  by  the  COVID-19  pandemic,  which  unveiled  the  sector's
deficiencies in catering to the populace's requirements for online services to facilitate virtual
education, business endeavors, and personal communication.
[n the recently released Pulse lnternet Resilience  Index (IRI)  tof the  Internet Society,
the  Philippines  ranked  seventh  oiit  of  11   countries  in  Southeast  Asia.  With just  46%,  the
Philippines   scored   behind   Singapore   with   72%;   Vietnam,   52%;   Brunei,   Malaysia  and
Thailand, 51 % each, and Indonesia with 48%, but ahead of Myanmar, 45%; Cambodia, 43%;
Laos, 44°/o, and Timor-Leste with 38%.
The  lnternal  Society  defined  a resilient internet connection  as o77e  /fec/ wcr7.7!fcr7.77s c77?
acceptable level of service in the face Of faults and challenges to normal operation ayd is an
increasing focus for policymakers and activists worldwide as internet infrastructure becomes
essential for a nation's economy and society.
The   need   for  an  efficient  and  reasonably  priced   digital   connectivity   cannot  be
overemphasized.
FICTAP   Telecommunications,   Inc.,   a   newly   established   corporation,   comprises
individuals    with    a    collective    professional    background    of    over    five    decades    in
telecommunications    and    public    service.   The   combined   resources   of   the   company's
]https..//www.phllstar.com/headlines/2023/08/10/2287497/philippines-lags-southeast-asia-internet-ranking


stakeholders,   particularly   their   established   "middle   mile"   and   "last   mile"   connectivity
infrastructure, can be promptly deployed to serve the public's needs.
Affordable and effective telecommunications services continue to be an aspiration for
many  Filipinos.  The  public  has  endured  misleading  advertising  of services  that  ultimately
prove insufficient and expensive. In reality, the quality of telecommunications services in the
Philippines ranks notably below global and regional benchmarks. Thus, addressing this issue
has become imperative.
This  refiled  measure  aims to  grant  FICTAP Telecommunications, Inc. a franchise to
establish,   operate,   and   maintain  telecommunications  services  within  the   Philippines  and
beyond,  with the  objective  of diversifying the  pool  of service  providers  in  the  nation, thus
fostering a more level and competitive playing field for the overall welfare of the public.
This  bill  was  approved  on  third  and  final  reading  by  the  House  of Representatives
during the  18th Congress. However, it did not progress to become law due to time constraints
in the Senate.
For these reasons stated above, the consideration and endorsement of this proposal are
fervently requested.
`.``.,:,`,`--::-:`.,


Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Constitution Hills, Quezon City
NINETEENTH CONGRESS
Second Regular Session
HtousHB|LLNo.9029
Introduced by REP.  FAUSTINO `INNO' A. DY V
AN ACT GRANTING FICTAp TELncoMMUNICATloNs, INc. A
FRANCHISE T0 INSTALL, OPERATH, AND MAINTAIN
TELECOMMUNICATI0N SERVICES IN THE PHILIPPINES
Be  it enacted by the  House  Of Representatives  and the  Senate  of the Republic Of the
Phtlippines in Congress assembled:
SECTJOIV I. Ivfl/wre ¢#d Scape a/Fr¢#cfei.se -Subject to the conditions established in this
Act and the provisions of the Constitution, and the provisions of laws, orders or issuances not
inconsistent  herewith,   there   is  hereby  granted  to  FICTAP  Telecommunications,  Inc.,  its
successors  or  assignees,  a  franchise  to  construct,  establish,  install,  lease,  co-use  purchase,
operate and maintain for commercial purposes and in the public interest, all types of mobile,
wire and/or wireless telecommunications systems, including international and local exchange
carriers,  intemational gateway facilities/services,  intemational and domestic submarine cable
landing  stations,  copper,  fiber  optics,  coaxial  cable,  stations  and  associated  equipment  for
international    satellite    communications,    and   their   value-added    services    such    as   the
transmission  of voice,  data,  facsimile,  control  signs,  audio  and video,  information services,
and  all  other telecommunications systems technologies as are available at present or will be
made   available  through  technological   advances   or   innovations   in  the   future;  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
within the territory of the Philippines and with other countries and territories.
SECTION 2. Manner Of Operation Of Stations or Facilities -The stzriions or fac;tirri\es 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 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 and/or the availability thereof.
SEcrJOIV 3. RJ.giv/ a//Ac Got;e/#mc#/ -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.
The   President   of  the   Philippines,   in   times   of  war,   rebellion,      public  peril,   calamity,
emergency, disaster or disturbance of peace and order, may temporarily take over and operate
its stations, transmitter systems, facilities and equipment of the grantee, temporarily suspend
the operation of any station 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, transmitter systems, facilities and
equipment during the period when these shall be operated.
SECTION 4. Powers Of the National Tlelecommunications Commission - The gltmhee shall
not  exercise  any  right  or  privilege  under this  franchise without  first having  obtained  such
Certificate  of Public Convenience and Necessity (CPCN) and such other permits or licenses
from  the  National  Telecommunications  Commission  (NTC).  This  franchise  shall  not  take
effect nor shall any power be exercised by the grantee until the NTC shall have allotted to the
grantee  the  frequencies  and  wavelengths  to  be  used,  determined  the  stations  to  and from
which  each  frequency  and  wavelength  may be  used,  and  issued to the grantee a license for
such use.  However, the NTC shall not unreasonably withhold or delay the grant of any such
authority, permits or licenses.
The NTC  shall  have the  authority  to supervise and regulate the installation or operation of
such telecommunication systems and impose such conditions relative thereto.
SEcrJOIV 5. Rcxpo#sl.d!./rty fo ffec Pwb/j.c -The grantee shall conform to the ethics of honest
enterprise  and  not  use  its  stations  /  facilities  for  obscene  or  indecent  transmission,  or  for
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 also improve and upgrade its equipment, facilities and services, in order to
ensure  effective  compliance  with  the  objectives  of Republic  Act  No.   10639  or  the  'Free
Mobile Disaster Alerts Act'.
SECTION   6.   Commitment   to   Provide   and   Promote   the   Creation   Of  Employment
Oppor/wHz./..es.    -   The   grantee   shall   create   employment   opportunities   and   shall   allow
on-the-job trainings  in their franchise operation:  Provided, That priority shall be accorded to
the  residents  in areas where the principal  office of the grantee 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: Provz-decJ,J}#cr//y, That the
employment opporfunities or jobs created shall be reflected in the General Information Sheet
(GIS) to be submitted to the Securities and Exchange Commission (SEC) annually.
SECT:JOIV  7.  A4lobz./c  IVwmber  Po#abj./rty.  -  The  grantee  shall  provide  mobile  number
portability  (MNP).  It  shall  set  up a mechanism for the purpose of implementing  MNP.  It
shall   interconnect  directly   or   indirectly   with   the   infrastructure,   facilities,  systems,  or
equipment  of  other  telecommunications  franchise  grantees.  It  shall  not  install  network
features, functions or capabilities that will impede the implementation of a nationwide MNP
system. The NTC shall issue rules and regulations for this purpose, the effectivity of which
shall commence upon applicability with other telecommunications franchise grantees.
SEcrJOIV 8.  rcrm - This franchise shall be for a term of twenty-five (25) years from the
effectivity  of this Act, unless sooner revoked or cancelled. In any event the grantee fails to
operate continuously for two (2) years, this franchise shall be deemed 7Pso/z7cto revoked.
SEC7\Ht}IV   9.     R¢/es/or sc".ass -The charges and rates ofte]ecommunications 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 NTC  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.
SECTION   10.  Excavation  and  Restoration  Works  -  For  the  puxpose  Of  erecting  and
maintaining poles or other supports for wires or other conductors for laying and maintaining
underground wires, cables or other conductors, the grantee, its successors or assignees, shall
be  authorized  to  make  excavations  or  lay  conduits  in  any  of the  public  places,  roads,
highways,  streets,  lanes,  alleys, avenues,  sidewalks,  bridges of the provinces, cities and/or
municipalities,  with  the  prior  approval  of the  Department  of Public  Works and  Highways
(DPWH) and the local government unit (LGU) concerned, as may be appropriate: Provided,
however, That any 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 a
workmanlike  manner  by  said  grantee,  its  successors  or  assignees,  in  accordance  with the
standards  set by  the  DPWH  and 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 a public place, road, highway, street, lane, alley, avenue, sidewalk or
bridge  disturbed,  altered  or changed  by  said  grantee,  its successors or assignees, then the
DPWH  or the  LGU concerned  shall  have the  right to have the same repaired and placed in
good  order and  condition  and  charge the  grantee,  its  successors or assignees, at double the
ainount of the costs and expenses for such repair or replacement.
SECTION 11. Right Of lnterconnection.  - The grzmtee .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 terms and conditions mutually agreed upon by the parties concerned,  subject
to the review and modification of the NTC.
SEcr:JOIV J2.  E"j.7Ic#f Domaz.#.  - Subject to the limitations and procedures prescribed by
law,  the  grantee  is  authorized  to  exercise  the  right  of eminent  domain  insofar as may  be
reasonably necessary to further the establishment and efficient maintenance and operation of
its telecommunications systems.
No   private   property   shall   be   taken   for   any   purpose   by  the  grantee   without  proper
condemnation proceedings and just compensation paid or tendered therefor, and any authority
to take and occupy land contained herein shall not apply to the taking, use or occupation of
any  land  except  such  as  is  required  for  the  actual  and  necessary  purposes  for which this
franchise is granted.
SECZTOIV Jj. Bo#d -The grantee shall file a bond with the NTC in the amount that it shall
determine to  guarantee compliance  with  and  fulfillment of the  conditions  under  which this
franchise  is granted.  If,  after three (3) years from the date of approval  of its permit by the
NTC, the grantee shall have fulfilled the conditions, the bond shall be cancelled by the NTC.
Otherwise, the bond shall be forfeited in favor of the government and the franchise ipso facto
revoked.
SEcrJOIV  J4.  Gross  Recej.pta.  -  The  grantee,  its  successors  or  assignees,  shall  keep  a
separate  account of the gross receipts of the telecommunications service business transacted
by it and shall furnish the Commission on Audit (COA) and the National Treasurer a copy of
such account not later than January 31 of each year for the preceding twelve ( 12) months.
£ECZJtAV J5. Bocks ¢#d ,4`cco##ts. -The books and accounts of the grantee, its successors
or   assignees,   shall   always   be   open   to   the   inspection   of  the   COA   or  its   authorized
representatives, and it shall be the duty of the grantee to submit to the COA quarterly reports
in  duplicate  showing  the  gross  receipts  and  the  net  receipts  for the  past  quarter  and the
general condition of the business.
SECTION  16. Warranty  in Favor Of the National and Local Governments. -The grimhee
shall  hold  the  national,  provincial,  city,  and municipal  governments  of the  Philippines  free
from  all  claims,  liabilities,  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, and equipment of the grantee.
SECTION  17. Sale, Lease, Transfer, Usrfruct, or Assigni'rient Of Franchise -The glautee
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 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 part, 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 sale,  lease,
transfer,  grant of usufruct,  or assignment of franchise or the rights and privileges acquired
thereunder, or of the merger, or transfer of the controlling interest of the grantee, within sixty
(60) days after completion of the said transaction : Provided further, That failure to report to
Congress such change of ownership  shall render the franchise z.pro /crc/a revoked: Provz.c7ec/
¢#c}/fy,   That  any   such  transfer,   sale  or  issuance   is  in   accordance  with  any  applicable
constitutional   provision.   Any   person  or  entity   to  which  this  franchise   is  validly   sold,
transferred  or  assigned  shall  be  subject  to  all  the  same  conditions, terms,  restrictions and
limitations of this Act.
SECTION 18.  Contract with  Private Entities. -The gramtee .is a;uthoriized to c,orttract the
installation  and  operation of the telecommunications  system  which  is the  subject of this
grant with entities with expertise in the field of telecommunications under such terms and
conditions as may be approved by the NTC.
SEcrroIV J9.  Dj.spers¢/ a/ Ow#crsfe!P. - In accordance with the constitutional provision
to  encourage  public  participation  in  public  utilities,  the  grantee  shall  offer  to  Filipino
citizens at least thirty percent (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:  Provided,  That in cases where
public   offer  of  shares   is   not   applicable,   the   grantee   shall   apply   other  methods  of
encouraging public  participation by  citizens  and  corporations  operating public  utilities as
allowed by law. Noncompliance therewith shall render the franchise ipso facto revoked.
SECITOIV 20. jHcpor/or[.¢/ Req#i.reme#ts.  - 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 reportorial compliance
certificate   issued  by  Congress  shall  be  required  before  any  application  for  permit  or
certificate is accepted by the NTC.
Failure of the grantee to submit the requisite and separate annual report to Congress shall
be penalized with a fine in the amount to be determined by the NTC. Provided, That in
the  interim,  the  grantee  shall  be  liable  to  pay  the  fine  of Five  thousand  pesos  (Php
5,000.00)  per working day  of non-compliance.  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 National Treasury.
SEcrtt}IV  2J.   Eqwa/i.ty   C/fl!#se.   -  Any   advantage,  favor,   privilege,   exemption,   or
immunity  which  may hereafter be granted  shall  /Pro /crc/a  become part of this franchise


and  shall be accorded  immediately and  unconditionally to the herein  grantee:  Provided,
That the  foregoing  shall neither apply to nor affect the 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.
SECTION 22. Repealability and Non-Exclusivity Clause. -This £Iandise is glanhed w.[th
the  understanding and upon condition that it 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.
SEcrHOIV 23. Scprrobj./;.ty Cyowsc -If any part, section or provision of this Act shall be
held  invalid or unconstitutional, the other provisions not affected thereby shall remain in
full force and effect.
SECT:TOIV  24.   Rcpca!/z.Hg   C/¢w§e   -   All   laws,   decrees,   executive   orders,   rules   and
regulations  or  issuances  or parts thereof inconsistent with  the provisions of this Act, are
hereby modified or repealed accordingly.
£EC7TOIV 25. Ejrecf;.vi.ty CJ¢wse -This Act shall take effect fifteen (15) days after its full
publication in the Official Gazette or in at least two (2) newspapers of general circulation.
Approved,