Lawyers ask SC to revoke PLDT-Globe frequency deal

Mike Navallo, ABS-CBN News

Posted at Oct 29 2018 04:28 PM | Updated as of Oct 29 2018 11:03 PM

MANILA - Two lawyers have asked the Supreme Court (SC) to revoke a co-use agreement between PLDT Inc. and Globe Telecom for a telecommunications frequency that they acquired from San Miguel Corp. (SMC). 

Petitioners Joseph Lemuel Baligod Baquiran and Ferdinand Tecson said allowing the 2 firms to use the 700 mHz frequency and 4 other frequencies previously held by Vega Telecom would amount to a duopoly.

The legal challenge against PLDT and Globe came as the government moved to expedite the entry of a third player to challenge their dominance. Information and Communications Technology acting Secretary Eliseo Rio, Jr. earlier said the government will announce the winning bidder by November 7.

San Miguel had hoped to partner with Australia's Telstra to establish a third telco, until PLDT and Globe bought out the conglomerate's telecommunication business on May 30, 2016.

The Philippine Competition Commission sought to review the deal, but was defeated in the Court of Appeals.

Baguiran and Tecson said the agreement allowed PLDT and Globe to control 75 percent of the assigned mobile radio frequencies as of December 2017.

Arguing that the two companies' continued use of these frequencies amounted to a "duopoly," the lawyers asked the SC through a petition to recall these frequencies and make them available to the best qualified telco players.

They also asked the high court to issue a temporary restraining order to stop the 2 telco giants from using the frequencies and the National Telecommunications Commission from bidding out the frequencies supposedly returned by PLDT and Globe as a consequence of their co-use agreement.

It was not immediately clear if these frequencies are part of the frequencies currently being bid out by the government for a third player.

According to the lawyers, this duopoly has led to an anti-competitive environment, as well as slow and expensive internet services which have affected the delivery of legal services to their clients.

“The absence of healthy competition caused escalating costs and yet deteriorating quality of vital telecommunication and broadband services. Indeed, researches confirmed that the Philippines is being ranked as among the countries with slowest internet speed and yet costliest internet services,” they claimed.

“The expensive and yet unreliable telecommunications and painfully slow internet services hobbled us from effectively and efficiently delivering legal services to our clients, community and society considering that, as private practitioners with limited resources, we depend heavily on the internet services for our research of the applicable law, jurisprudence, relevant data and information, sending of emails, electronic filing of certain pleadings and communications with clients and concerned individuals and entities,” they added.

The lawyers also invoked access to the internet as a basic human right, as declared by the United Nations Human Rights Council in June 2016.

In their petition, Baquiran and Tecson questioned the validity of the contract between PLDT and Globe because the frequencies involved in the transaction could not be an “object” of a valid contract.

They claimed the frequencies were obtained illegally by Liberty Broadcasting Network (Liberty, now Tori Spectrum), the original grantee, and were subsequently illegally assigned to Bell Telecommunications (BellTel).

The two lawyers said Liberty was not eligible to operate a broadcasting business and it was granted use of the frequencies in 1995 without going through a quasi-judicial hearing.

Liberty, they claimed, never used the frequencies and at one point had a foreign state-owned company Qatar Telecommunications Company as a substantial shareholder, which should have been reasons enough for the government to recall the frequencies.

They also accused Liberty of hoarding the 700Mhz broadcast frequency even when its franchise no longer allowed it to engage in broadcasting as a result of a restructuring.

Thus, they concluded, Liberty’s assignment of the frequencies to BellTel was “manifestly illegal and invalid.”

BellTel’s parent company, Vega Telecom, was the telecommunications arm of San Miguel.

The petition before the SC also accused the NTC and the Philippine Competition Commission of neglecting to do their duties under the relevant laws.

It is unclear if and how soon the Supreme Court will act on the petition. The SC en banc is currently on recess and won’t convene until the next session on November 6, a day before the November 7 announcement.