Broadband service provider Converge ICT Solutions Inc. must ensure it adheres to its faster internet speed commitment, or run the risk of losing its tax perks, according to interagency Fiscal Incentives Review Board (FIRB).
A resolution issued last month by the FIRB, chaired by then Finance Secretary Carlos Dominguez III and co-chaired by then Trade Secretary Ramon Lopez, pointed out that Converge secured tax and other incentives from the Board of Investments (BOI) partly due to its pledge to maintain a minimum speed of 100 Mbps at “a price not exceeding the prevailing market rate.”
Converge’s BOI-registered project must also prioritize identified unserved areas, the FIRB noted.
Converge is led by CEO Dennis Anthony H. Uy of Pampanga.
The FIRB had tasked a technical team to come up with a monitoring system that would allow it, the BOI and the National Telecommunications Commission (NTC) to check on Converge’s commitments.
The firm, for its part, was ordered to submit a compliance report made by an independent, third-party auditor.
In May, the FIRB approved a package of fiscal perks for Converge, including four years of income tax holiday, followed by five years of enhanced deductions, and 11 years of duty exemption on importations of capital equipment and other accessories.
“The internet speed floor of 100 Mbps shall only apply to the download throughput of all plans and upload throughput for business plans, whereas upload throughput for household plans, jitter, latency, and packet loss should be tied to national/international medians, whichever is higher, up to 100 Mbps,” the FIRB said.
It added Converge should not price its subscription plan higher than the cheapest of an equivalent plan of the top three internet service providers (ISPs).
“Converge must provide projections on when it will achieve 100-percent service coverage of its most basic household internet plan in all regions in the Philippines, based on the municipalities covered in its project,” the FIRB added. —Ben O. de Vera