Gatchalian urges passage of telco bills to attract more players

Senate of the Philippines | July 25, 2018

Senator Win Gatchalian on Wednesday urged Congress to prioritize the passage of three bills that would allow for the entry of more players into the Philippine telecommunications sector.

Gatchalian issued the call in response to President Rodrigo Duterte’s comments during his third State of the Nation Address (SONA) calling for the entry of a third telco player in the country.

“The enactment of the Lifetime Cellphone Number Act, Open Access in Data Transmission Act, and amendments to the Public Service Act will help ensure that our country’s telecommunications services will be reliable, inexpensive, and secure, in line with President Duterte’s vision,” Gatchalian said.

Gatchalian’s Mobile Number Portability Act, more commonly known as the Lifetime Cellphone Number Act (Senate Bill 1636), requires telcos to allow subscribers to retain their mobile phone numbers if they choose to switch providers or change from postpaid to prepaid and vice-versa. The bill has already hurdled the Senate and is currently pending in the House of Representatives.

“Gone will be the days of people text-blasting their contacts, ‘please save my new number and delete my old one’ every time they switch providers or change their type of service,” he said.

The senator also said his proposed Open Access in Data Transmission Act (SB 1644), meanwhile, will allow for the entry of additional telco players without requiring a congressional franchise by shifting towards an Open Access Model in data transmission instead of a single, vertically integrated network.

The bill seeks to open up the different segments of the market to other players by breaking down regulatory barriers, lowering the cost of entry, and institutionalizing a technology-neutral policy framework.

“What this proposed law will basically do is to level the playing field among telco service providers, which will hopefully entice more new players to come in,” he said.

“If the market is configured to be more conducive to the entry of new telco players, it will be beneficial for the public. More players means healthier competition. Healthier competition, in turn, will mean more competitive prices offered by service providers. Ibig sabihin nito, mas maganda at mas murang serbisyo para sa lahat,” Gatchalian added.

The bill is currently in the period of interpellations in the Senate while the House version was already passed on third reading.

Meanwhile, SB 1594, which amends Commonwealth Act No. 146 or the Public Service Act (PSA), aligns the provisions of the PSA with the current focus on fostering competition and creating a more conducive investment climate in the operation of public services — “so the general public will have more choices, better services, and enjoy lower prices,” Gatchalian said.

The senator stressed that the confusion in the definition public service and public utility has contributed to the lack of competition in the telco industry.

“The current Public Service Act only provides a list, and not a definition of public services, and no definition of a public utility so both terms are often used interchangeably. The effect is that all basic services with even a semblance of public utilities or public services are automatically subjected to the 60-40 restriction as provided in the 1987 Constitution,” he said.

“These restrictions lead to lack of competition and encourage monopolies, or in the case of our current telco setup, a duopoly,” he added.

Gatchalian’s amendment provides for a definition of what a public utility is and removes foreign ownership restrictions in telecommunications, including landline, mobile, and internet.

Source: http://www.senate.gov.ph/press_release/2018/0725_gatchalian1.asp