Former SC Justice Carpio scores move to amend utilities law

Retired Supreme Court Senior Associate Justice Antonio Carpio warned of a violation of the Constitution and risk to national security should Congress pursue a House measure that would open the telecommunication and transportation sectors to foreign ownership.

Carpio said the Constitution clearly intended, and Philippine jurisprudence consistently maintains, that the country’s telecommunication and transportation sectors to be a public utility reserved for Filipinos or companies wholly or mostly owned by Filipinos.

But the House of Representatives approved on March 10, House Bill No. 78, which would amend Commonwealth Act No. 146, or the Public Service Act, and ease foreign ownership limits in certain sectors reserved by the Constitution for Filipinos.

House Bill No. 78, authored by Albay Rep. Joey Salceda, was passed by the House with 146 affirmative and 43 negative votes plus one abstention.

But Carpio said Congress couldn’t overrule the Constitution and the courts by simply enacting a law that would remove telecommunications from what was considered public utilities.

He said it would be illegal to allow 100 percent foreign ownership of telcos in the country without a constitutional amendment.

“I think it would be unconstitutional,” Carpio said in a webinar hosted by the Philippine Bar Association last Friday.

“If such a law is passed and eventually questioned before the Supreme Court, I think they (Supreme Court justices) will strike it down because this is the power of the Supreme Court that’s being taken away from them,” Carpio said.

“The Supreme Court is supreme because it’s the final interpreter of words and phrases in the Constitution,” he added.

Carpio said telecommunications companies have always been defined to be public utilities under the 1935, 1973 and 1987 Constitutions.

“Even if they can be classified as nonpublic utilities, they must still be at least 60 percent Filipino-owned since telcos utilize radio frequencies, a natural resource whose exportation is reserved under the Constitution,” he explained.

He cited Article 2, Section 12 of the Constitution which provides that the country’s natural resources are owned by the state and the state may enter into co-production or joint venture only with Filipino citizens or corporations at least 60 percent Filipino-owned.

“In short, even if [House Bill 78] becomes a law and is somehow declared constitutional, it is not sufficient to allow foreigners to own more than 40 percent equity in telcos,” Carpio insisted.He also raised the specter of China’s spying through the consortium between Dito Telecommunity and the state-owned China Telecom (ChinaTel) that was granted a franchise by Congress.

The country’s two other major telco companies—PLDT-Smart and Globe Telecom—are majority owned by Filipinos.

Carpio said Chinese law mandated all Chinese companies, as citizens, to disclose to their intelligence services any information required by the intelligence service.