AN ACT GRANTING THE ODIONGAN TELEPHONE CORPORATION A FRANCHISE TO CONSTRUCT
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AN ACT GRANTING THE ODIONGAN TELEPHONE CORPORATION A FRANCHISE TO CONSTRUCT
Republic Act No. 8956
September 2, 2000
Case Overview and Summary
Summary of Republic Act No. 8956:Nature and Scope of Franchise (Section 1):
- Grants Odiongan Telephone Corporation (the grantee) a franchise to construct, install, establish, operate and maintain local exchange network, public calling stations, wireless local loop and value-added services in the Province of Romblon.
- Allows the grantee to provide basic telephone service capable of accessing local, national, international and other networks.
Manner of Operation of Stations or Facilities (Section 2):
- The grantee's stations or facilities shall be constructed and operated in a manner that results in minimum interference on existing stations' wavelengths or frequencies.
- The grantee's operations and radiated power shall not exceed what is required to cover its allowed area of operation.
Authority of the National Telecommunications Commission (Section 3):
- The grantee shall secure a Certificate of Public Convenience and Necessity or appropriate permits and licenses from the National Telecommunications Commission (the Commission).
- The Commission has the power to impose conditions on the construction, operation, maintenance or service level of the grantee's telecommunications system.
- The Commission has the authority to regulate the construction and operation of the grantee's telecommunications systems.
- The grantee shall not use any radio frequency without authorization from the Commission.
Responsibility to the Public (Section 4):
- The grantee shall conform to the ethics of honest enterprise and shall not use its stations for obscene, indecent, false or subversive transmissions.
- The grantee shall provide basic or enhanced telephone service without discrimination, up to the capacity of its local telephone exchange.
- The grantee shall operate and maintain its stations, lines, cables, systems and equipment in a satisfactory manner and keep up with advances in science and technology.
Rates for Services (Section 5):
- The charges and rates for the grantee's telecommunications services, except for non-regulated services, shall be subject to the Commission's approval.
- The rates shall be unbundled, separable and distinct among the 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, transmitters, facilities or equipment in 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 for a term of twenty-five (25) years from the date of effectivity of this Act, unless sooner revoked or cancelled.
- The franchise shall be deemed ipso facto revoked if the grantee fails to:
a) Commence operations within three (3) years from the approval of its operating permit or provisional authority by the Commission;
b) Operate continuously for two (2) years; and
c) Commence operations within five (5) years from the effectivity of this Act.
Acceptance and Compliance (Section 8):
- Acceptance of the franchise shall be given in writing within sixty (60) days from the effectivity of this Act.
- Non-acceptance shall render the franchise void.
Bond (Section 9):
- The grantee shall file a bond issued in favor of the Commission, with an amount determined by the Commission, to guarantee compliance with the conditions of the franchise.
- If the grantee fulfills the conditions after five (5) years from the date of approval of its permit, 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.
Right of Interconnection (Section 10):
- The grantee is authorized to connect or demand connection of its telecommunications systems to any other duly authorized telecommunications systems in the Philippines for the purpose of providing extended and improved telecommunications services to the public, under mutually agreed terms and conditions in accordance with law.
Tax Provisions (Section 11):
- The grantee, its successors or assigns, shall be subject to the payment of all taxes, duties, fees or charges and other impositions under the National Internal Revenue Code of 1997, as amended, and other applicable laws.
- All rights, privileges, benefits and exemptions accorded to existing and future local exchange operators franchises shall likewise be extended to the grantee.
- The grantee shall file the return with the city or province where its facility is located and pay the taxes due thereon to the Commissioner of Internal Revenue or his duly authorized representatives.
Gross Receipts (Section 12):
- 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 and the National Treasury a copy of such account not later than the thirty-first (31st) day of January of each year for the preceding twelve (12) months.
Books and Accounts (Section 13):
- The books and accounts of the grantee, its successors or assigns shall always be open to the inspection of the Commissioner on Audit or his authorized representatives.
- The grantee shall submit to the Commission on Audit, two (2) copies of the quarterly reports on the gross receipts, the net profits and the general condition of the business.
Warranty in Favor of National and Local Governments (Section 14):
- The grantee shall hold the national, provincial, city and municipal governments of the Philippines harmless 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 grantee's stations, transmitters, facilities and equipment.
Sale, Lease, Transfer, Usufruct, Etc. (Section 15):
- The grantee shall not lease, transfer, grant the usufruct of, sell nor assign this franchise or the rights and privileges acquired 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.
- 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.
Dispersal of Ownership (Section 16):
- In accordance with the constitutional provision to encourage public participation in the public utilities, the grantee shall offer at least thirty percentum (30%) of its outstanding capital stock or a higher percentage that may hereafter be provided by law in any securities exchange in the Philippines within ten (10) years from the commencement of its operations.
- Noncompliance therewith shall render the franchise ipso facto revoked.
Equality Clause (Section 17):
- Any advantage, favor, privilege, exemption or immunity granted under existing franchises, or may hereafter be granted, shall ipso facto become part of previously granted telecommunications franchises and shall be accorded immediately and unconditionally to the grantees of such franchises.
- However, this shall not apply to provisions concerning territory covered by the franchise, the life span of the franchise, or the type of service authorized by the franchise.
Separability Clause (Section 18):
- If any of the sections or provisions of this Act is held invalid, all the other provisions not affected thereby shall remain valid.
Repealability and Nonexclusivity 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 and shall not be interpreted as an exclusive grant of the privileges herein provided for.
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 sixty (60) days from the end of every year.
Effectivity Clause (Section 21):
- This Act shall take effect fifteen (15) days from the date of its publication, upon the initiative of the grantee, in at least two (2) newspapers of general circulation in the Philippines.
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telecommunications franchise
local exchange network
telephone service
public calling stations
wireless local loop
value-added services
Romblon province
National Telecommunications Commission
Certificate of Public Convenience and Necessity
radio spectrum
rates and charges
tax provisions
gross receipts
books and accounts
warranty
sale or transfer
dispersal of ownership
equality clause
reportorial requirement
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AN ACT GRANTING THE ODIONGAN TELEPHONE CORPORATION A FRANCHISE TO CONSTRUCT
Republic Act No. 8956
•September 2, 2000
Republic Act No. 8956             September 2, 2000
AN ACT GRANTING THE ODIONGAN TELEPHONE CORPORATION A FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND MAINTAIN LOCAL EXCHANGE NETWORK IN THE PROVINCE OF ROMBLON
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 Odiongan Telephone Corporation, 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 Romblon, 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 manner as will, at most, result only in the minimum interference on the wavelengths or frequencies...
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