CA upholds legality of Globe-Bayantel joint use agreement

By Ina Reformina, ABS-CBN News

Posted at Jan 23 2014 01:34 PM | Updated as of Jan 24 2014 05:22 PM

MANILA – The Court of Appeals (CA) upheld the legality of the Joint Use Agreement (JUA) between Globe Telecom, Inc. and Bayantel, which was questioned before the appellate court by Smart Communications, Inc.

In a 12-page decision by its 12th Division dated Jan. 16, penned by Associate Justice Victoria Isabel Paredes, the appellate court junked the petition filed by Smart.

The appellate court ruled that contrary to Smart's claims, the National Telecommunications Commission (NTC) did not commit grave abuse of discretion in granting the agreement.

"[T]he grant of joint use agreement was issued in the exercise of administrative function of the NTC... it (Smart) has failed to show that the grant of the joint use of frequencies is contrary to law or is patent and gross as to amount to grave abuse of discretion," the decision read.

The appellate court also pointed out that Smart failed to exhaust all remedies before the NTC.

Smart argued that under NTC Memorandum Circular No. 3-3-96, an assigned frequency unused for a year from date of issuance of the permits and license may be recalled or withdrawn.

Smart said the band should be opened to bidding to all interested parties.

Since it does not have an active mobile service, Bayantel was unable to use the subject frequencies.

Globe, for its part, argued that Smart should have opposed Bayantel's plea for the NTC to grant an extension of its license to provide Cellular Mobile Telephone Service (CMTS).

Globe stressed that Bayantel's motion was already granted and became final and executory.

Globe and Bayantel sought the commission's approval for the joint use of frequencies 1750-1760 megahertz/1845-1855 assigned to Bayantel in order to address the increasing demand for Globe's voice, SMS and mobile data services.

The agreement will also allow Bayantel to offer mobile telecommunications services nationwide.

Globe and Bayantel are also looking at other forms of collaboration.

Globe, which had acquired over 98 percent of Bayantel's loans, is Bayantel's largest creditor.

The decision was concurred in by Associate Justices Isaias Dicdican and Michael Elbinias.