MANILA -- Regulators on Wednesday disqualified 2 of 3 firms bidding for the Philippines' third telco slot for failure to meet requirements.

Sear Telecom, the consortium backed by former Ilocos Sur Governor Luis "Chavit" Singson, was cited for failure to pay a P700 million security fee, said lawyer Ellen Blanca Lopez, head of the National Telecommunications Commission's legal branch.

Philippine Telegraph and Telephone Corp, on the other hand, failed to produce a "certificate of technical capability" from other countries where it operates, said Lopez, who chaired the selection committee during Wednesday's bidding.

Sear and PT&T can appeal the decisions, Lopez said.

This will leave only one bidder, Mislatel, the newly formed consortium of China Telecom and Davao City tycoon Dennis Uy's Udenna Corp and Chelsea Logistics.

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The Singson-backed group earlier questioned the P700 million participation security citing that the rules of the bidding process were changed at the homestretch.

PT&T also questioned the selection process before a Makati City court.