3rd telco bidder sues NTC for ‘money-making’ requirements

Ralf Rivas
3rd telco bidder sues NTC for ‘money-making’ requirements
NOW Telecom says the National Telecommunications Commission is imposing on bidders multi-billion-peso fees that were not taken up in public hearings

MANILA, Philippines (UPDATED) – NOW Telecom, one of the prospective bidders to be the 3rd telecommunications player in the Philippines, locked horns with the National Telecommunications Commission (NTC) over issues in the terms of reference (TOR) for the selection process.

Aldrich Dy, lawyer for NOW Telecom, an affiliate company of NOW Corporation, confirmed to Rappler that they filed a complaint with the Manila Regional Trial Court on Monday, October 8, the same day they bought bidding documents.

NOW Telecom claimed the TOR issued by the NTC and the Department of Information and Communications Technology (DICT) had insertions that were not taken up during the public hearings. In particular, it complained of the following “barriers of entry” for the 3rd telco player bidders:

  • P700 million participation security
  • P14 to P24 billion performance security
  • P10 million non-refundable appeal fee 

NOW Telecom said these violate laws and “can be declared onerous, confiscatory, and potentially extortionary.”

The company’s legal team asked for a 20-day temporary restraining order and a writ of preliminary injunction on the bidding process. 

“NOW Telecom is suing NTC to protect the interest of its public shareholders and President Rodrigo Duterte from any suspicion that he is complicit to the money making schemes in the TOR for the third telco,” NOW Corporation president and chief executive officer Mel Velarde said in a statement.

Velarde added they prefer that President Duterte receives all the bidding documents on November 7.

“[I]t would be best if the President, not the NTC, would be the one to choose the new major player,” NOW Telecom said.

Dy said his clients still want the bidding to continue and would not want a delay in the selection process.

The government aims to name the new major player by December.

NTC Deputy Commissioner Edgardo Cabarios told Rappler they have received the complaint.

“We will refer the matter to the Office of the Solicitor General. The SolGen is our lawyer. We observe the protocol of referring questions and concerns regarding our cases to the SolGen in observance of the subjudice rules and respect for court processes,” Cabarios said.

DICT Acting Secretary Eliseo Rio Jr. questioned NOW Telecom’s complaint and insisted that the TOR’s standards meet the “interest of the Filipino people.”

“There is also no truth to the allegation that the provisions on performance security and appeal fee are not included in the past drafts as it was published and presented during the Public Hearing last August 23,” Rio said.

NOW Corporation was among the first to purchase bid documents for the 3rd telco slot, along with the Luis Chavit Singson (LCS) group and TierOne consortium, Udenna Corporation, Telenor, and a company which remained anonymous. (READ: UK’s Vodafone may enter PH as 3rd telco)

Philippine Telegraph and Telephone Corporation (PT&T) is also poised to pay P1 million for the bid documents. – Rappler.com

Editor’s Note: An earlier version of this report identified the complainant as NOW Corporation. It has been corrected to reflect NOW Telecom, an affiliate of NOW Corporation, as the complainant. 

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.