Revision of public utility law seen

The plan to allow China to become the third telco player in the country will be boosted by President Duterte’s order to clarify the definition of public utilities, the country’s chief economist said.

Socioeconomic Planning Secretary Ernesto M. Pernia said they expected Congress, specifically the Senate, to fast-track amendments to the antiquated Public Service Act.

The President on Nov. 21 issued Memorandum Order No. 16, which directed the National Economic and Development Board and its member-agencies to “exert utmost efforts to lift or ease restrictions on certain investment areas or activities with limited foreign participation.”

The same order directed the members of the Neda Board, which is chaired by the President, to earnestly support legislative efforts needed to remove or ease foreign investment caps, “including pending legislation seeking to clarify the definition of public utilities.”

A bill in the House of Representatives would limit the coverage of public utilities to the distribution and transmission of electricity, and to water distribution and sewerage systems.

Passed in early September by a 135-8 vote, House Bill No. 5828 would amend Commonwealth Act No. 146 (the Public Service Act) but does not mention the provision of telecommunication services as a public utility. It was introduced by six lawmakers led by former President and now Pampanga Rep. Gloria Macapagal Arroyo and Albay Rep. Joey Salceda.

Should the measure and its counterpart in the Senate be approved, foreigners can own more than 40 percent of telecom companies.

Sen. Grace Poe, chair of the Senate committee on public services, had said that the entry of foreign players in the telco market would promote “healthy competition” that, in turn, could lead to better services for the consumers. Poe earlier filed SBN 1441, which also sought to amend the antiquated Public Service Act that would confine the definition of “public utility” to natural monopolies, which are the transmission and distribution of electricity, and waterworks and sewerage systems as it should.

Poe said she would push for her measure’s immediate passage in the Senate after it had concluded its deliberations on the tax reform package and budget bills.

Pernia noted that the amendment to the Public Service Act was part of the common legislative agenda approved by the Legislative-Executive Development Advisory Council in August.

Last Monday, presidential spokesperson Harry Roque announced that President Duterte had offered China the “privilege” of operating the third telco player in the country to break up the industry duopoly of PLDT and Globe Telecom.

Roque had said the President made the offer during his meeting with Chinese Premier Li Keqiang in Malacañang last week.