Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 1299

Introduced by HONORABLE LUIS RAYMUND F. VILLAFUERTE, JR.

AN ACT PROTECTING THE RIGHTS OF MOBILE PHONE SUBSCRIBERS.
THROUGH ESTABLISHING THE MINIMUM STANDARDS IN THE QUALITY
OF
PHONE SERVICES, REGULATION OF PRICES, TRANSPARENCY IN
BILLING AND
OTHER SERVICE IMPROVEMENTS

Be it enacted by the Senate and the House of Representatives of the Republic of the
Philippines in Congress assembled."

SECTION 1. Short Title. This act shall be known as the "Mobile Subscribers Protection
Act"

SECTION 2. Declaration of Policy. It is hereby declared the policy of the State to protect the
rights and interests of the consumers, promote their general welfare by enforcing strict but
reasonable supervision and regulation of the telecommunications industry Towards this end,
a minimum standard of service quality shall be set and regulation of prices being charged to
subscribers shall be fixed. It Shall require Cellular Mobile Telecommunications (CMTS)
providers to file petitions to the National Telecommunication Commission (NTC) whenever
price adjustments on mobile phone service fees are proposed and Other service
improvements imposed by the State.


SECTION 3. Definition of Terms.

a. NTC refers to the National Telecommunications Commission.

b. Mobile Phone Service Provider, Serco Provider or Telecommunication Company
— refers to any person, firm or partnership or corporation, government or private, granted
a legislative franchise by Congress to provide cellular mobile telephone services to the
general public, and issued certificates of public convenience and necessity (CPCN) by the
NTC .c, Mobile Ce//u/ar Phone, Mobile Phone or Ce//phone — refers to a mobile
telecommurnication device that uses a combination of radio transmission and conventional
telephone switching to permit telephone communication to and from mobile users within a
specified area or cell.

d. Basic Mobile Phone Services — refers to short messaging service (SMS) or text
misgiving end voice call services.

Short Messaging Service (SMS) — refers to a service that allows short, alphanumeric
messages to be sent to cellular phone display panels.

f Supplemental Mobile Phone Services — refers to extended services offered by
service providers to individual consumers, such as, but not limited to, multimedia messaging
services (MMS), data download and subscription services for news, horoscopes, games
recorded messages, logos, pictures, applications, etc.; alert services; browsing services such
as wireless application protocol (WAP) and general packet radio services (GPRS); locator
services, and prepaid subscribér-to-subscriber credit transfer services.

g Global System for Mobile Communications (GSM) — refers to the globally accepted
defector standard for digital cellular communications, which was tasked to formulate
specifications for a Pan European mobile cellular radio system operating at 90CMHz_ Modern
GSM, however, uses frequency ranging from 1850 to 1990MHz and uses narrowband Time
Division Multiple Access (TDMA) method_

hThird Generation Mobile Telephone Technology or 3G — refers to the group of
International Telecommunications Union (ITU) standard access methods and protocols that
provide for wide wireless network at higher bandwidths (higher than 2G) making ease of
access to voice and data transmission. Current standard allows for 3G technology provided
services involving the transmission of text, digitized voice, video and multimedia in cellular
networks to be faster.

iSubscriber Identity Module (SIM) — refers to a pocket-sized card with embedded
integrated circuits, which securely stores the key data identifying a mobile phone service
subscriber, as well as subscription information, subscriber preferences and text messages.


iPrepaid Subscriber — refers to a subscriber who manually loads credits to his/her
mobile cellular phone and is thus, not subjected to a periodical billing for mobile phone
service usage.

k Postpaid Subscriber — refers to subscribers billed for mobile phone services after
the lapse of a set period of time-

i.Network Latency refers to the round-trip time it takes for data to travel from the
source to the ultimate destination end a response jack to the source.

m. Propagation Delay — refers to the time required for data to travel over networks
from the source to the ultimate destination.
n. Noise — refers to undesirable signals, in relation to communications, from

natural to technological sources, which were added in the signals of communication systems.

©. Advertisement — shall refer to the product or service information sent by mail or
disseminated through commerce by print radio, television, outdoor public announcement or
notice, or other media for the purpose of inducing directly or indirectly, the purchase of
consumer products or services.

SECTION 4. Establishment of Standards Regarding the Quality of Commercial
Mobile Service.

A. In General the National Telecommunications Commission (NTC) shall establish
such requirements as the NTC considers appropriate to ensure the Telecommunication
Companies meet the minimum standards regarding the quality and performance of such
service which shalll include, but not lim ited to, standards regarding,

a. Rate of completed/successful calls;
b. The acceptable level of nose during calls;
c. Network latency and propagation delay; d Data drops and unreceived data

packets;
e. Billing practices,

SECTION 5. Price Regulation.

A. All Mobile Phone Service providers shall charge a standard rate of fees for mobile
phone services in accordance with the rates established by the N TC which shall be fair and
reasonable and which provide for the economic viability of telecommunication entities and a
fair return of their investments considering the prevailing cost of capital in the domestic and
international markets.


B.Mobile Phone Service Providers are hereby required to file’ petitions with the NTC
every time they intend to implement any changes in the market price ceilings of basic phone
services. Affected and concemed parties may also file petitions with the NTC opposing such
petitions to increase mobile service price ceilings, or asking for cancellation of franchise for
violation of this act.

SECTION 6. Prepaid Credit Expiration.

Almposition of an expiration period on the validity of the unused prepaid call and text
cards or electronic transfer are hereby prohibited.

8 Forfeiture if load credits stored on an active prepaid phone account prepaid call and
text card or electronic transfer is hereby prohibited.

C Mobile Phone Service providers are hereby required to refund the prepaid
subscriber whose load credits were forfeited without valid cause.

D SIM cards shall only expire year after the loaded credit has been fully consumed

SECTION 7. Transparency.

(A) Prepaid Load Credit Bill Breakdown

Service Providers shall be required to furnish the subscribers with a detailed
billing, at no cost to the subscriber, on the usage of their mobile cellular phone load credits,
through a system created to track such usage, by either presenting their consumed prepaid
card or load credit tracking numbers to designated business centers Of the service providers
within Seven (7) working days after the request of the subscriber. Further, in order to fully
track and secure the usage of a prepaid subscribers’ load credit, a monitoring system for
mobile communications for prepaid load subscribers shall therefore be created for this
purpose.

SECTION 8. Protecting the Rights of Mobile Users.

(A)Mobile Device Insurance

a. Mobile Phone Carriers or Mobile Service Providers are
hereby required to inform and offer insurance p and or packages to the


subscriber upon purchase of mobile devices. An insurance policy form shall be
filled Out and duly signed by the subscriber, which the carrier company shall
then process and keep a record of.

b. The insurance will cover the mechanical malfunction, loss and theft (including
robbery, snatching and any other unlawful taking) of all kinds of mobile devices beyond the
manufacturer's warranty coverage, including tablets and any other devices capable of
making end receiving calls and text messages. The coverage shall be effective from the day
the insurance policy is purchased. The coverage shall be sold and offered on a monthly, bi-
annual or yearly basis, depending on the subscriber's choice of mode of payment, with the
first month offered free. The coverage Shall also include cancellation policies that allow the
subscriber to cancel the coverage at any
given time during the subscriber's chosen insurance plan and at the subscriber's discretion,
with no extra cost to the subscriber.

« Mobile Phone Carriers or Mobile Service Providers are given liberty to
devise their insurance scheme, on their own accord or through partnership with an insurance
company, with varying levels of coverage for the mobile device as deemed reasonable and
marketable, and use the said levels as a leverage against other competing carriers, provided
that the said schemes or levels of coverage adhere to the regulations prescribed by the NTC
in coordination with the Insurance Commission

4 Once the insurance claim of the subscriber has been approved and
granted, the carrier company shall offer repair or replacement of the mobile phone
depending on the circumstances per and on the level of coverage the subscriber as availed.

(B)Privacy

@. Service providers are prohibited from disclosing personal
subscriber information and subscription data, such as history of calls and text
messages, without the written and expressed approval of all part ‘es involved or
on the basis of a valid court order.

b. Any person or individual with access to subscriber
information and subscription data are prohibited to release any private
information without the written and expressed approval of all parties involved or
on the of a valid court order, ¢ Service providers are prohibited from using user
information for other purposes, such as promotions and marketing schemes,
without the permission of the subscriber.


¢. any act violating the privacy of a subscriber, including those
mentioned above, are subjected to concurring penalties as provided for under
Section 11 of this Act.

(C) Unsought Services/Promotions
a. Unsolicited commercial advertisement which includes, but
not limited to, the announcement of winners Of prizes, raffles, draws, etc, or
requesting subscriber action such as requiring return calls or text messages, or
requiring other potentially detrimental actions from subscribers sent through
SMS, recorded voice calls, or other supplementary mob e phone services, are
hereby prohibited.

b. Unless the subscriber has indicated willingness to receive
advertisements and promotional messages, the service provider shall not allow
companies or individuals access to the subscribers’ mobile phone number for
the purpose of advertising and promotion,

c. Advertisements and promotional messages, once the
subscriber indicates willingness to receive such shall only be sent or automated
to be sent during business hours Unsolicited messages beyond the hours of
seven (7) in the evening and before eight (d) in the morning are prohibited. This
shall also include automated calls regarding, but not limited to, bill and usage
reminders.
dFurther, this prohibition shall include unsolicited commercial advertisements

from the mobile phone service providers themselves.

SECTION 9. System of Complaints.

(B) _ Establishment of a Complaint System

aThe NTC shall establish and administer a system that enables subscribers of a
mobile service provider to register a complaint regarding the quality of performance of their
service.

b, The mobile service provider, likewise, shall establish and administer a
system that enables subscribers to inquire and/or register a complaint regarding the service,
the subscribers account or load credits or anything pertaining to the use Of the mobile service
provided, through all possible means Of communication, such as, but not limited to, toll free
numbers, physical and electronic mail, and social media accounts.

(C) Toll-free number


a. The complaint system to be established shall include a toll-
free number for both landline and mobile phones, applicable to the mobile
service provider, without a minimum load balance credit requirement, for the
purpose of reporting a complaint.

(D) Physical and Electronic Mail

aThe system to be established shell include a mailing address for both physical
and electronic mail applicable to the mobile service provider for the purpose of reporting a
complaint

(E) Social Media Account and Other Forms Of online communication a, The
complaint system to be established shall include social media accounts and/or other
forms of online communication applicable to the mobile service provider for the
purpose of providing a quick method Of report complaint and/or engaging and assisting
the subscriber regarding the complaint.

(F) Submission of Reports

a. The NTC shall maintain a record of each complaint made
under the system established pursuant to this act; b Every six (6) months, the N
TC shall submit a report to the Congress regard «ng complaints received under
the complaint system; c Reports shall indicate the number of complaints
received, during the period for which the report is made, regarding the service of
the Public Telecommunications Entity for which a complaint is made to; and
d. Reports shall indicate the types of complaints received during such period,
including, but not limited to, complaints regarding dead spots, dropped calls, network busy
signals, noise end improper billing practices, end the number of each type
Of com plaint received during such period.

SECTION 10. Information Dissemination.

AThe Philippine Information Agency (PIA) in coordination with the National
Telecommunications Commission (NTC) shall ensure the proper and adequate information
dissemination of the contents and benefits of this Act to the general public, especially to its
intended beneficiaries.

B.The N TC shall likewise, upon submission of the report to the Congress, make
such report public through publication in at least two (2) newspapers of general circulation.


c. The N TC will require each mobile service provider to include, in each
subscriber's detailed bill for such service, a statement informing the subscriber that a
complaint regarding the quality of their service may be registered with the Commission and
provide the toll-free number and an address for mailing

D. The NTC shall take such other actions as may be appropriate to publicize the
availability of the complaint system and other service improvements to the subscribers.

SECTION 11. Penalties.

A. Any person who gives false or misleading data or information or willfully or through gross
negligence, conceals or falsifies a material fact, in any investigation, inqulry, study or other
proceeding held pursuant to this Act, shall be punished with imprisonment of not less than
six months but not more than one year, and with fine of not less than One Hundred
Thousand Pesos (Php100 000.00) but not more than Five Hundred Thousand Pesos
(Php500r000.00); Provided, however, that if the false or misleading data or information
shall have been under oath, the maximum penalty shell be imposed.

B. Any person, member of an organization or corporation of the service provider or private
individual who releases private information including, but not limited to, history of calls and
text messages, of a postpaid or prepaid subscriber without knowledge or permission Of
the subscriber, and for malicious use, pursuant to this Act, shall be punished with
imprisonment Of not less than six months but not more than one year, and with a fine of
not less than One Hundred Thousand Pesos (Php100,000 00) but not more than Five
Hundred Thousand pesos (Php500,000.00); Provided however, that if the false or
misleading data or information shall have been under oath, the maximum penalty shall be
imposed.

C. If the offender is a corporation the penalties may range from the position a fine not less
than One Million Pesos (Php! 900.000.00) but not more than Ten Million Pesos (Phpl
),000,000.00) and/or a suspension or revocation of its Legislative Franchise and other
permits and licenses by NTC. The maximum penalties prescribed in paragraph (A) shall
also be imposed on the members of its board and/or management as applicable.

D. Analien violating this Act Shell, in addition to the penalty herein provided, be deported
after service of sentence and shall not be permitted reentry into the Philippines,


E. All monetary penalties shall directly accrue to the National

F. Treasury

SECTION 12. Separability Clause, if any provision or part hereof is held invalid or
unconstitutional, the remainder of the law or the provision not otherwise affected shall remain
valid and subsisting.

SECTION 13. Repealing Clause. Any aw, presidential decree or issuance, executive order,
letter of instruction, administrative order, rule or regulation contrary to Or inconsistent with the
provisions Of this Act is hereby repealed, modified or amended accordingly.

SECTION 14. Effectivity Clause. This Act shall take effect fifteen (15) days after its publication
in at least two (2) newspaper of general circulation.

Approved,