AN ACT GRANTING THE PIPOL BROADBAND AND TELECOMMUNICATIONS CORPORATION A FRANCHISE TO CONSTRUCT
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AN ACT GRANTING THE PIPOL BROADBAND AND TELECOMMUNICATIONS CORPORATION A FRANCHISE TO CONSTRUCT
Republic Act No. 10822
May 18, 2016
Case Overview and Summary
Nature and Scope of Franchise (Section 1):- Grants Pipol Broadband and Telecommunications Corporation a franchise to construct, install, establish, operate and maintain telecommunications systems throughout the Philippines and between the Philippines and other countries.
- Covers wire and/or wireless telecommunications systems including mobile cellular, paging, fiber optics, satellite transmit and receive systems, switches, and value-added services such as transmission of voice, data, facsimile, control signs, audio and video, information services, and all other telecommunications systems technologies.
Manner of Operation of Stations or Facilities (Section 2):
- Stations or facilities shall be constructed and operated in a manner that results in minimum interference on the wavelengths or frequencies of existing stations.
Authority of the National Telecommunications Commission (Section 3):
- Grantee shall secure a Certificate of Public Convenience and Necessity or appropriate permits and licenses from the National Telecommunications Commission (NTC) for the construction, installation and operation of its telecommunications systems/facilities.
- NTC has the power to impose conditions relative to the construction, operation, maintenance, or service level of the telecommunications system.
- NTC has the authority to regulate the construction and operation of its telecommunications systems.
- Grantee shall not use any frequency in the radio spectrum without authorization from the NTC.
Excavation and Restoration Works (Section 4):
- Grantee may make excavations or lay conduits in any public places, roads, highways, streets, lanes, alleys, avenues, sidewalks or bridges with prior approval from the Department of Public Works and Highways (DPWH) or the local government unit (LGU) concerned.
- Grantee shall repair and replace in a workmanlike manner any public place, road, highway, street, lane, alley, avenue, sidewalk or bridge disturbed, altered, or changed by its activities, in accordance with the standards set by the DPWH or the LGU.
- If the grantee fails to repair or replace after a 10-day notice, the DPWH or the LGU shall have the right to have the same repaired and placed in good order and condition at double expense to be charged against the grantee.
Responsibility to the Public (Section 5):
- Grantee shall conform to the ethics of honest enterprise and not use its stations or facilities for obscene or indecent transmission, or for dissemination of deliberately false information, or willful misrepresentation, or assist in subversive or treasonable acts.
- Grantee shall provide basic or enhanced telephone service in any city and/or municipality where it has an approved Certificate of Public Convenience and Necessity for the establishment, operation and maintenance of a local exchange service, without discrimination to any applicant, in the order of the date of their applications, up to the limit of the capacity of its local telephone exchange.
- If the demand for telephone service increases beyond the capacity, the grantee shall increase the same to meet such demand, unless the total demand to be satisfied by the expansion is less than the smallest viable local exchange available in the market as determined by the NTC.
- 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 modify, improve, or change such stations, lines, cables, systems, and equipment to keep abreast with the advances in science and technology.
Rates for Services (Section 6):
- The charges and rates for telecommunications services of the grantee, except those that may be declared or considered as non-regulated services, shall be subject to the approval of the NTC.
- 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.
Right of Government (Section 7):
- The President of the Philippines has a special right, in times of war, rebellion, public peril, calamity, emergency, disaster or disturbance of peace and order, to temporarily take over and operate the stations, transmitters, facilities, or equipment of the grantee, or to temporarily suspend the operation of any station, transmitter, facility, or equipment 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.
- 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.
Term of Franchise (Section 8):
- The franchise shall be in effect for a period of twenty-five (25) years from the date of effectivity of this Act, unless sooner cancelled.
- The franchise shall be deemed ipso facto revoked if the grantee fails to:
(a) Commence operations within one (1) year from the approval of its operating permit by the NTC;
(b) Commence operations within three (3) years from the effectivity of this Act; and
(c) Operate continuously for two (2) years.
Acceptance and Compliance (Section 9):
- 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 giving such acceptance, the grantee shall exercise the privileges granted under this Act.
- Nonacceptance shall render the franchise void.
Bond (Section 10):
- 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 the 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.
Right of Interconnection (Section 11):
- The grantee is authorized to connect or demand connection of its telecommunications systems to 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 public, under such terms and conditions mutually agreed upon by the parties concerned and subject to the review and modification of the NTC.
Gross Receipts (Section 12):
- The grantee, its successors or assignees, shall keep a separate account of the gross receipts of the business transacted by it and shall furnish the Commission on Audit (COA) 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 assignees, shall always be open to the inspection of the COA and its duly authorized representatives.
- It shall be the duty of the grantee to submit to the COA 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 the National and Local Governments (Section 14):
- The grantee 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 or operation of the stations, transmitters, facilities or equipment of the grantee.
Sale, Lease, Transfer, Usufruct, or Assignment of Franchise (Section 15):
- The grantee 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 other commercial or legal entity, nor merge with any other corporation or entity, nor 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.
- 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 controlling interest of the grantee, within sixty (60) days after the completion of the said transaction.
- Failure to report to Congress such change of ownership shall render the franchise ipso facto revoked.
- 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 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.
- In cases where public offer of shares is not applicable, establishment of cooperatives and other methods of encouraging public participation by citizens and corporations operating public utilities must be implemented.
- Noncompliance therewith shall render the franchise ipso facto revoked.
Reportorial Requirement (Section 17):
- 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 NTC.
Penalty Clause (Section 18):
- Failure to submit the requisite annual report to Congress shall be penalized with a fine of five hundred pesos (P500.00) per working day of noncompliance.
- The fine shall be collected by the NTC from the delinquent franchise grantee separate from the reportorial penalties imposed by the NTC.
- All proceeds from said fines or penalties shall accrue to the monitoring fund of the NTC in line with its supervisory and regulatory functions.
Equality Clause (Section 19):
- Any advantage, favor, privilege, exemption, or immunity granted under other existing franchise, 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.
- However, the foregoing shall neither apply to nor affect 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.
Separability Clause (Section 20):
- If any of the sections or provisions of this Act is held invalid, all other provisions not affected thereby shall remain valid.
Repeatability and Nonexclusivity Clause (Section 21):
- 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 privilege herein provided for.
Effectivity (Section 22):
- This Act shall take effect fifteen (15) days after its publication in at least two (2) newspapers of general circulation.
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AN ACT GRANTING THE PIPOL BROADBAND AND TELECOMMUNICATIONS CORPORATION A FRANCHISE TO CONSTRUCT
Republic Act No. 10822
•May 18, 2016
Republic of the PhilippinesCONGRESS OF THE PHILIPPINESMetro Manila
Sixteenth CongressThird Regular Session
Begun and held in Metro Manila, on Monday, the twenty-seventh day of July, two thousand fifteen.
REPUBLIC ACT No. 10822
AN ACT GRANTING THE PIPOL BROADBAND AND TELECOMMUNICATIONS CORPORATION A FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND MAINTAIN TELECOMMUNICATIONS SYSTEMS THROUGHOUT THE PHILIPPINES
Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:
SECTION 1. Nature and Scope of Franchise. – Subject to the provisions of the 1987 Philippine Constitution and applicable laws, rules and regulations, there is hereby granted to Pipol Broadband and Telecommunications Corporation, hereunder referred to as the grantee, its successors or assignees, a franchise to construct, install, establish, operate, and maintain for commercial purposes and in the public interest, throughout the Philippines and between the Philippines and other countries and territories, wire and/or wireless telecommunications systems including, but not limited to, mobile cellular, paging, fiber optics, satellite transmit and receive systems, switches, and their value-added services such as, but not limited to, transmission...
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