PRESIDENT Duterte has signed into law a measure granting a 25-year franchise to Ignite Telecommunications Inc.
Under Republic Act 11411 signed by the President on August 22, the scope of the franchise covers the construction, installation, establishment, operation and maintenance for commercial purposes of wire and wireless telecommunications systems including mobile cellular, copper, fiber optics, satellite, transmit and receive systems, switches and their value-added services, among others.
Ignite Telecommunications shall also secure from the National Telecommunications Commission (NTC) a Certificate of Public Convenience and Necessity or the appropriate permits of its telecommunications systems or facilities.
Moreover, the charges and rates for its telecommunications services, except the rates and charges on those that may hereafter be declared or considered as nonregulated services, whether flat rates or measured rates or variation thereof, shall be subject to the approval of the NTC or its legal successor.
The 25-year franchise shall be deemed ipso facto revoked if Ignite Telecommunications fails to comply with the conditions, which include commencing operations within one year from the approval of its operating permit by the NTC, commencing operations within three years from the effectivity of the Act and operating continuously for two years.
The company shall also file a bond with the NTC in the amount that it shall determine to guarantee compliance with and fulfillment of the conditions under which the franchise is granted. The bond shall be canceled by the NTC if the grantee shall have fulfilled the conditions after three years from the date of the approval of its permit by the NTC. Otherwise, the bond shall be forfeited in favor of the government.
Aside from this, Ignite Telecommunications is also 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. However, this is still subject to the terms and conditions mutually agreed upon by the parties concerned and shall also be subject to the review and modification of the NTC.
Without the approval of Congress, the grantee is also prohibited to sell, lease, transfer, grant the usufruct of, nor assign the franchise to any person, firm, company, corporation 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 transfer the controlling interest of the grantee.
Failure to report to Congress such change of ownership shall render the franchise ipso facto revoked.
Since the Constitution encourages public participation in public utilities, the grantee shall also offer to Filipino citizens at least 30 percent or a higher percentage that may be provided by laws of its outstanding capital stock in any securities exchange in the Philippines within five years from the commencement of its operations.
The Act shall take effect 15 days after its publication in the Official Gazette or in a newspaper of general circulation.