AN ACT GRANTING THE L.M. UNITED TELEPHONE COMPANY
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AN ACT GRANTING THE L.M. UNITED TELEPHONE COMPANY
Republic Act No. 8961
September 7, 2000
Case Overview and Summary
Summary of Republic Act No. 8961Nature and Scope of Franchise (Section 1):
- Grants L.M. United Telephone Company, Inc. (the grantee) a franchise to construct, install, establish, operate and maintain a local exchange network in the Province of Camarines Sur and all cities therein.
- Allows the grantee to provide basic telephone service capable of accessing local, national, international and other networks.
Manner of Operation (Section 2):
- The grantee's stations or facilities shall be constructed and operated in a manner that results in minimum interference with existing stations.
- The grantee's operations shall not exceed the required power to cover its allowed area of operation.
Authority of the National Telecommunications Commission (Section 3):
- The grantee must secure a Certificate of Public Convenience and Necessity or appropriate permits and licenses from the National Telecommunications Commission (NTC).
- The NTC has the power to impose conditions on the construction, operation, maintenance, or service level of the telecommunications system.
- The NTC has the authority to regulate the construction and operation of the grantee's telecommunications systems.
- The grantee cannot use any radio frequency without authorization from the NTC.
Responsibility to the Public (Section 4):
- The grantee shall conform to ethical business practices and not engage in obscene, indecent, false, or subversive transmissions.
- The grantee shall provide basic or enhanced telephone service without discrimination, up to the capacity of its local exchange.
- The grantee shall operate and maintain its stations, lines, cables, systems and equipment in a satisfactory manner and keep up with technological advances.
Rates for Services (Section 5):
- The charges and rates for regulated telecommunications services shall be subject to the approval of the NTC.
- Rates shall be unbundled and separable among services offered, and regulated services shall not subsidize unregulated ones.
Right of Government (Section 6):
- The President has the right to temporarily take over and operate the grantee's stations, facilities or equipment during times of war, rebellion, public peril, calamity, emergency, disaster or disturbance of peace and order.
- The radio spectrum is part of the national patrimony and the use thereof is a privilege that may be withdrawn anytime, after due process.
Term of Franchise (Section 7):
- The franchise is valid for 25 years from the date of effectivity of this Act, unless sooner revoked or cancelled.
- The franchise shall be deemed revoked if the grantee fails to:
- Commence operations within 3 years from the approval of its operating permit by the NTC.
- Operate continuously for 2 years.
- Commence operations within 5 years from the effectivity of this Act.
Acceptance and Compliance (Section 8):
- The grantee must accept the franchise in writing within 60 days from the effectivity of this Act.
- Non-acceptance shall render the franchise void.
Bond (Section 9):
- The grantee shall file a bond, determined by the NTC, to guarantee compliance with the conditions of the franchise.
- If the grantee fulfills the conditions after 5 years from the approval of its permit, the bond shall be cancelled. Otherwise, the bond shall be forfeited and the franchise revoked.
Right of Interconnection (Section 10):
- The grantee is authorized to connect or demand connection of its telecommunications systems to any other duly authorized system in the Philippines for the purpose of providing extended and improved services.
Tax Provisions (Section 11):
- The grantee shall be subject to the payment of all taxes, duties, fees or charges under the National Internal Revenue Code of 1997 and other applicable laws.
- The grantee shall file tax returns and pay taxes to the Commissioner of Internal Revenue or authorized representatives.
Gross Receipts (Section 12):
- The grantee shall keep a separate account of gross receipts and furnish the Commission on Audit and National Treasury a copy of such account annually by January 31st.
Books and Accounts (Section 13):
- The grantee's books and accounts shall be open to inspection by the Commission on Audit or authorized representatives.
- The grantee shall submit quarterly reports on gross receipts, net profits and general condition of the business to the Commission on Audit.
Warranty in Favor of National and Local Governments (Section 14):
- The grantee shall hold the national, provincial, city and municipal governments harmless from all claims, accounts, demands or actions arising out of accidents or injuries caused by the construction or operation of its stations, facilities and equipment.
Sale, Lease, Transfer, Usufruct, Etc. (Section 15):
- The grantee shall not lease, transfer, grant usufruct, sell or assign this franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation or other entity without the prior approval of the Congress of the Philippines.
Dispersal of Ownership (Section 16):
- The grantee shall offer at least 30% of its outstanding capital stock in any securities exchange in the Philippines within 10 years from the commencement of its operations.
- Non-compliance shall render the franchise ipso facto revoked.
Equality Clause (Section 17):
- Any advantage, favor, privilege, exemption, or immunity granted under existing or future franchises shall become part of previously granted telecommunications franchises.
Separability Clause (Section 18):
- If any section or provision of this Act is held invalid, all other valid provisions shall remain in effect.
Repealability and Non-exclusivity Clause (Section 19):
- This franchise shall be subject to amendment, alteration, or repeal by the Congress of the Philippines when the public interest so requires.
- This franchise shall not be interpreted as an exclusive grant of the privileges provided.
Reportorial Requirement (Section 20):
- The grantee shall submit an annual report to the Congress of the Philippines on its compliance with the terms and conditions of its franchise and on its operations within 60 days from the end of every year.
Effectivity Clause (Section 21):
- This Act shall take effect 15 days from the date of its publication in at least two newspapers of general circulation in the Philippines, upon the initiative of the grantee.
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Tags
Statutes
Republic Acts
telecommunications franchise
local exchange network
Camarines Sur
public calling stations
wireless local loop
value-added services
basic telephone service
national and international networks
radio spectrum
certificate of public convenience and necessity
rates and charges
tax provisions
gross receipts
dispersal of ownership
equality clause
reportorial requirement
Law
AN ACT GRANTING THE L.M. UNITED TELEPHONE COMPANY
Republic Act No. 8961
•September 7, 2000
Republic Act No. 8961             September 7, 2000*
AN ACT GRANTING THE L.M. UNITED TELEPHONE COMPANY, INC. A FRANCHISE TO CONSTRUCT INSTALL, ESTABLISH, OPERATE AND MAINTAIN LOCAL EXCHANGE NETWORK IN THE PROVINCE OF CAMARINES SUR AND ALL THE CITIES THEREIN
SECTION 1. Nature and Scope of Franchise. — Subject to the provisions of the Constitution and applicable laws, rules and regulations, there is hereby granted to the L.M. United Telephone Company, 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, local exchange network, including public calling stations or pay telephone stations or wireless local loop and their value-added services in the Province of Camarines Sur and all the cities therein, and for such purpose provide basic telephone service capable of accessing local, national, international and other networks.
Section 2. Manner of Operation of Stations or Facilities. — The stations or facilities of the grantee shall be constructed and operated in a...
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