Third telco selection did not favor Dennis Uy: DICT chief

ABS-CBN News

Posted at Nov 14 2018 09:05 AM | Updated as of Nov 14 2018 09:54 AM

Davao tycoon Dennis Uy speaks at the Philippine Stock Exchange. Uy and China Telecom secured 'provisional' rights to establish a third telco in the Philippines. Ted Aljibe, AFP/File

MANILA -- The consortium of Davao businessman Dennis Uy and China Telecom, which won provisional rights to establish a third telco, were not favored by a government selection committee, one of the officials who oversaw the search said Wednesday.

Mislatel won because its rivals, Philippine Telegraph and Telephone Corp and Sear, which includes former Ilocos Sur Gov. Luis "Chavit" Singson, failed to meet bidding requirements, said Acting Information and Communications Technology Secretary Eliseo Rio.

"It was done not because we favored Dennis Uy," Rio told ANC's Headstart. "The two were disqualified because of their own actions."

Sear failed to pay a P700-million participation bond while PT&T did not have a certification of 10 years experience. Mislatel had both, Rio said.

"We did not look at personalities. We looked at documents. We did not look at whoever are close to the President," Rio said.

Davao City-based Uy is a known supporter of President Rodrigo Duterte. Mislatel is the latest in Uy's ventures, after parlaying his fuel retail business to stakes in shipping firm 2Go, hospitality school Enderun and convenience store chain Family Mart.

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The National Telecommunications Commission late Monday denied the appeals of Sear and PT&T against Mislatel. Rio said the 2 firms could bring the case up to the Supreme Court.

A foreign partner is "very important" for the third player to go up against Globe Telecom and PLDT Inc, Rio said.

Singapore's Singtel has a stake in Globe while Japan's NTT Docomo is a partner in PLDT.

"We should be able to attract foreign (companies). That is the only way a third telco can compete with Globe and Smart," Rio said, referring to PLDT's mobile unit. "It must have the financial and technical clout."

Mislatel needs to post a P24-billion performance bond or 10 percent of its P250 billion capital expenditures before it can secure frequencies to operate, Rio said.

The government can withhold the bond if Mislatel fails to keep its promise of a minimum average broadband speed of 27 megabits per second and a national coverage of 84 percent after 5 years.

"Even if China Telecom is a state-owned telco, China cannot do anything because we are already holding that bond and if they miss a commitment, they will not only lose that bond, we will get back their frequencies," he said.

"The third telco must not only be able to compete, but must be able to really perform and put its money where its mouth is," he added.

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