Home / Points of View & Perspectives / Congress should scrutinize multibillion telco deal

Congress should scrutinize multibillion telco deal

Ed JavierWe are all for improving the quality of internet service in our country considering that it has one of, if not the slowest internet speed service in the world. 

However, it seems government is not serious in solving this problem that affect millions of Filipino consumers.

Case in point, last year, telecommunications giants Philippine Long Distance Telephone Co. (PLDT) and Globe Telecom negotiated a deal to secure the coveted 700 megahertz (MHz) spectrum thus effectively eliminating a third alternative that would have created a more competitive and better communications and internet service.

The National Telecommunications Commission (NTC) headed by three-term commissioner Gamaliel Cordoba, turned it over almost without batting an eye.

Cordoba, was first appointed during the time of former President Gloria Macapagal-Arroyo. He was reappointed by former President Noynoy Aquino and was again reappointed by President Duterte last year. Lucky guy!

Recall that under the deal signed in May 31, 2016, or barely a month before President Duterte assumed the presidency, the two telcos acquired from San Miguel Corporation the coveted 700-megahertz (MHz) spectrum, which is able to penetrate walls and useful for providing in-building coverage.

Well, the two telecommunication giants last week completed the last tranche of payment for its P69.1-billion joint acquisition of SMC’s telecommunication assets despite the pending petition filed by the Philippine Competition Commission (PCC) to the Supreme Court (SC) to review the deal.

You see, after signing the agreement, the PCC wanted to review the deal to safeguard consumer welfare over the long term. Alas, the Court of Appeals (CA), acting on the petition of PLDT issued a restraining order against the PCC so the agency had to file a petition before the SC to lift the CA order.

PCC’s task would have been easier had the NTC done its job in conducting due diligence before it gave its imprimatur on the project.

As mentioned, the deal was concluded in the dying days of the past administration and just days before the PCC released the law’s implementing rules and regulations on June 3, 2016. Midnight sweetheart deal? You’re guess is as good as mine.

We believe that the NTC should have never allowed the deal given the proximity of the ascension to office of a new administration. The NTC must have its own reason for approving the deal.

What happens now? Does the clever legal strategy of the two telcos to proceed with the last payment to SMC render PCC’ s petition moot and academic? Only the High Tribunal knows.

My two cents worth should the High Tribunal care to listen. Despite the apparent conclusion of the deal, We support PCC’s stand that the deal needs to be scrutinized.

We also agree with PCC’s position that the telcos should give due respect to the Supreme Court and wait for it to decide on PCC’s petition that would allow the competition watchdog to review the telco firms’ joint acquisition of SMC’s telco assets.

Sadly, the duopoly chose to ignore PCC’s “suggestion” and proceeded with the final payment which both parties said were part of the agreement.

Quo vadis PCC? What’s the use of having a competition watchdog if business giants choose to just ignore it’s powers?

We also believe, that the SC, despite the apparent final payment made should still proceed and take into consideration PCC’s arguments. If the telcos are not hiding anything, why not allow the PCC to review the deal?

The PCC noted that “as things stand, the courts have yet to decide whether the two telecommunication firms are legally entitled to proceed with their transaction.

According to PCC, the deal is one imbued with substantial public interest, given the public’s clamor for faster, better Internet services at affordable prices.

“This deal is not a simple business transaction that private parties can decide on their own. As we have emphasized in our court submissions, the review and possible imposition of conditions on the telco deal are intended to safeguard the interest of consumers in the long term,” PCC pointed out.

Now, the duopoly can continue to dictate by how much the country’s internet service grows. They already hold all the cards.

Lastly, if members of Congress can spend time investigating the Resorts World incident, why not scrutinize this deal that would affect the lives of millions of Filipinos. Who knows, they might stumble onto something big.



Leave a Reply

Your email address will not be published. Required fields are marked *