Now Tele­com case vs. NTC de­lay­ing se­lec­tion of 3rd telco: DICT

Sun.Star Cagayan de Oro - - Business -

MANILA -- The De­part­ment of In­for­ma­tion and Com­mu­ni­ca­tions Tech­nol­ogy (DICT) has ac­cused third telco as­pi­rant, Now Tele­com, of de­lay­ing the se­lec­tion process for the new ma­jor player in the lo­cal telecom­mu­ni­ca­tions in­dus­try when it filed a case against the Na­tional Telecom­mu­ni­ca­tions Com­mis­sion (NTC).

“The terms and con­di­tions set in the terms of ref­er­ence or me­moran­dum cir­cu­lar for a new ma­jor player are in the in­ter­est of the Filipino peo­ple who de­sire bet­ter tele­com ser­vices in the coun­try. DICT takes ex­cep­tion to NOW Tele­com’s al­le­ga­tions that this ini­tia­tive is a money-mak­ing scheme,” DICT Act­ing Sec­re­tary Eliseo Rio Jr. said in a state­ment Tues­day.

Now Tele­com al­leged that the pro­vi­sions in the Terms of Ref­er­ence were not taken up dur­ing a series of pub­lic con­sul­ta­tions, par­tic­u­larly the PHP700-mil­lion par­tic­i­pa­tion se­cu­rity, the PHP14 to PHP24-bil­lion per­for­mance se­cu­rity, and a PHP 10-mil­lion non-re­fund­able ap­peal fee are bar­ri­ers to en­try and are “mon­ey­mak­ing schemes” im­posed against the third telco.

Rio said the third telco must not only be tech­ni­cally ca­pa­ble but should also have the “fi­nan­cial mus­cle” to com­pete with cur­rent tele­com giants, Globe and Smart.

“The en­try of a third telco is no small mat­ter and to set the bar low for those who ap­par­ently can­not meet the stan­dards is detri­men­tal to the peo­ple who are the tar­get ben­e­fi­cia­ries,” Rio said.

“Is it to fur­ther de­lay the en­try of the third telco?” he added.

The DICT of­fi­cial cited the fol­low­ing jus­ti­fi­ca­tions for the in­clu­sion of the fees in the guide­lines for the se­lec­tion of the third telco player:

The par­tic­i­pa­tion se­cu­rity aims to en­sure par­tic­i­pa­tion of se­ri­ous con­tenders, who have the re­quired fi­nan­cial ca­pa­bil­ity to be a third player that can com­pete with the ex­ist­ing du­op­oly. The par­tic­i­pant is given cer­tain op­tions on what form they wish to put up the se­cu­rity such as cash, bank drafts or let­ters of credit.

Per­for­mance se­cu­rity seeks to as­sure the govern­ment that the third telco will de­liver its com­mit­ments for the 5-year com­mit­ment pe­riod. Re­quire­ments for cash de­posits have been re­moved and the par­tic­i­pant has been given op­tions as to the forms pro­vided in the TOR.

The ap­peal or protest fee is a usual item in the pro­cure­ment pro­cesses, which will dis­cour­age friv­o­lous mo­tions and protests.

Rio noted that the se­cu­ri­ties and fees re­quired are con­sis­tent with the bid­ding and pro­cure­ment pro­cesses and are even lower than those set by Repub­lic Act 9184 or the Govern­ment Pro­cure­ment Re­form Act.

“The TOR was the re­sult of pub­lic con­sul­ta­tions and hear­ings, re­view by the Over­sight Com­mit­tee and lengthy and com­pre­hen­sive stud­ies with in­ter­na­tional con­sul­tants. The pub­lic and stake­hold­ers also had the op­por­tu­nity to sub­mit their po­si­tion pa­pers on the mat­ter,” he said.

Rio said the par­tic­i­pa­tion fee of PHP1-mil­lion paid by Now Tele­com might have cost a sig­nif­i­cant im­pact on its mother com­pany, Now Cor­po­ra­tion’s op­er­at­ing in­come, which only stood at PHP6.3 mil­lion in 2017. PNA

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