Ntc Manual

7/25/2019 Ntc Manual

http://slidepdf.com/reader/full/ntc-manual 1/24

LAWS, RULES & REGULATIONS

NTC MANUALS

NTC Practices and Procedures Manual

1! INTRO"UCTION

Part A #ro$ides an introduction to t%e NTC Practices and Manual, settin out t%e o'(ecti$es and )or*at

o) t%e docu*ent, and t%e aut%orit+ under %ic% it as #roduced

T%e *anual consists o) a nu*'er o) inde#endent #arts, orani-ed so t%at t%e+ *a+ 'e used to assist

t%ose concerned it% s#eci.c t+#es o) #rocess It is intended t%at t%e+ ill 'e 'ound in a si*#le )or*,

and *ade a$aila'le to t%e #u'lic )or a no*inal )ee to #roduction costs T%e *anual ill 'e u#dated

)ro* ti*e to ti*e, as #ractices c%ane and #rocedural a*end*ents are introduced

11 Aut%orit+

T%is *anual is issued #ursuant to t%e aut%orit+ o) t%e Co**ission to #ro*ulate t%e rules and

reulations and *a/e necessar+ rules )or t%e conduct o) its #roceedins 0Sec11, CA 12, as a*ended

and Sec13, EO 324

15 Sco#e

T%e *anual includes 'road in)or*ation on rele$ant constitutional and leislati$e #ro$isions, decrees

and orders relatin to entities6aencies c%ared it% t%e #ri*ar+ #olic+ and

reulator+ )unctions o) t%e o$ern*ent a7ectin teleco**unications and 'roadcastin It also co$ers

t%e rane o) a##lications nor*all+ %andled '+ t%e Co**ission, descri'in in detail , #rocesses and

e8#ected ti*e )ra*es )or t%e *ost co**on t+#es o) a##lications

19 O'(ecti$es

T%e o'(ecti$e o) t%e *anual is to #ro$ide a uide to all #ersons, entities, associations and cor#orations

under t%e Co**ission:s su#er$ision, reulation and control, all users and t%e eneral #u'lic, as ell as

t%e Co**ission itsel), reardin t%e %andlin o) a##lications to t%e Co**ission and #roceedins 'ein

conducted '+ t%e Co**ission T%is s%ould in turn;

a4 Ensure t%at Co**ission #roceedins are o) su<cient de#t% to #er*it =ualit+ decision *a/in>

'4 Assist reulated co*#anies to deal e<cientl+ it% co**ission concerns>

c4 ?acilitate in)or*ed in$ol$e*ent o) interested #arties to #roceedins> and

d4 To eli*inate unnecessar+ dela+ in t%e reulator+ #rocess

5! CONSTITUTIONAL PRO@ISIONS

Certain #ro$isions o) t%e 1B Constitution descri'e t%e State:s concerns reardinteleco**unications and 'roadcastin, %ic% in turn ser$e as t%e 'asis )or t%e o$ern*ent:s

su#er$ision o$er teleco**unications and 'roadcastin ser$ice #ro$iders

Article II, Section o) t%e Constitution states as )ollos;

D T%e State reconi-es t%e $ital role o) co**unication and in)or*ation in nation 'uildinD

Article II states as )ollos;

D Sec 1! T%e Conress s%all U#on reco**endation o) t%e econo*ic and #lannin aenc+, %en t%e

1



national interest dictates, reser$e to citi-ens o) t%e P%ili##ines or to cor#orations or associations at

least si8t+ #er centu* o) %ose ca#ital is oned '+ suc% citi-ens, or %i%er #ercentae as Conress as

#rescri'e, certain areas o) in$est*ents T%e Conress s%all enact *easures t%at ill encourae t%e

)or*ation and o#eration o) enter#rises %ose ca#ital is %oll+ oned '+ ?ili#inosD

D Sec11 No )ranc%ise, certi.cate, or an+ ot%er )or* o) aut%ori-ation )or t%e o#eration o) a #u'lic utilit+s%all 'e ranted e8ce#t to citi-ens o) t%e P%ili##ines or cor#orations or associations orani-ed under

t%e las o) t%e P%ili##ines at least si8t+ #er Centru* o) %ose ca#ital is oned '+ suc% citi-ens, nor

s%all suc% )ranc%ise, certi.cate, or aut%ori-ation 'e e8clusi$e in c%aracter or )or a lon #eriod t%an .)t+

+ears Neit%er s%all an+ suc% )ranc%ise or ri%t 'e ranted e8ce#t under t%e condition t%at it s%all 'e

su'(ect to a*end*ent, alteration, or re#eal '+ t%e Conress %en t%e co**on ood so re=uires T%e

State s%all encourae t%e e=uit+ #artici#ation in #u'lic T%e #artici#ation o) )orein in$estors in t%e

o$ernin 'od+ o) an+ #u'lic utilit+ enter#rise s%all 'e li*ited to t%eir #ro#ortionate s%are in its

ca#ital, and all t%e e8ecuti$e and *anain o<cers o) suc% cor#oration or association *ust 'e citi-ens

o) t%e P%ili##ines

Sec 1 In ti*es o) national e*erenc+, %en t%e #u'lic interest so re=uires, t%e State *a+, durin

t%e e*erenc+ and under reasona'le ter*s #rescri'ed '+ it, te*#oraril+ ta/e o$er or direct t%eo#eration o) an+ #ri$atel+ oned utilit+ or 'usiness a7ected it% #u'lic interest

Sec 1B T%e State *a+ in t%e interest o) national el)are or de)ense, esta'lis% and o#erate $ital

industries and u#on #a+*ent o) (ust co*#ensation, trans)er to #u'lic oners%i# utilities and ot%er

#ri$ate enter#rises to 'e o#erated '+ t%e o$ern*ent

Sec1 T%e State s%all reulate or #ro%i'it *ono#olies %en t%e #u'lic interest so re=uiresD

Wit% reards to *ass *edia, includin 'roadcastin, Article @I 0General Pro$isions4, Sec 11, states;

D T%e oners%i# and *anae*ent o) *ass *edia s%all 'e li*ited to citi-ens o) t%e P%ili##ines, or

cor#orations coo#erati$es, or associations, %oll+Foned and *anaed '+ suc% citi-ens

T%e Conress s%all reulate or #ro%i'it *ono#olies in co**ercial *ass *edia %en t%e #u'lic interest

so re=uires No co*'inations in restraint o) trade or un)air co*#etition s%all 'e alloed

9! RELE@ANT LAWS

Later #arts o) t%is *anual ill #ro$ide additional details, 'ut )or t%e #ur#ose o) t%is #art, t%e

co**ission as created '+ t%e E8ecuti$e Order No 32 Pro*ulated in 1 Its eneral #oers

ere set out in t%e Pu'lic Ser$ice Act 0CA 124, enacted in 192 T%e rele$ant sections o) t%ese

docu*ents ill 'e )ound in t%e A##endi8 to Part C o) t%e *anual

TE "EPARTMENT O? TRANSPORTATION AN" COMMUNICATION 0"OTC4

Ta'le o) Contents

1! Sco#e

5! Introduction

9! "OTC Mandate

! "e#art*ent O'(ecti$es

3! Poers and ?unctions

2! "e#art*ent Structure

5



! Polic+ Pro*ulation

B! Re)erence "ocu*ents

A##endi8

1.0 Scope

T%is #art descri'es t%e in)or*ation o) t%e de#art*ent as it is currentl+ constituted, and includes its#oers and )unctions It also #ro$ides a su**ar+ o) /e+ #u'lic docu*ents issued '+ t%e de#art*ent

in recent +ears

2.0 Introduction

T%e "e#art*ent o) Trans#ortation and Co**unications 0"OTC4, )or*erl+ created as a Ministr+,

#ursuant to E8ecuti$e Order 32, on Hul+ 59, 1, as reconi-ed under EO 153, as a*ended '+

EO 153Fa on A#ril 19, 1B T%e reorani-ation as *ade #ursuant to Article II, Sec 10a4 and Article

III o) t%e ?reedo* Constitution

Its reorani-ation as e7ected to #ro*ote e<cienc+ and e7ecti$eness in t%e deli$er+ o) #u'lic

ser$ices

3.0 DOTC Mandate

Sec o) EO 153 states t%e )olloin;

D T%e Mandate T%e Ministr+ s%all 'e t%e #ri*ar+ #olic+, #lannin, #rora**in, coordinatin,

i*#le*entin, reulatin and ad*inistrati$e entit+ o) t%e E8ecuti$e ranc% o) t%e Go$ern*ent in t%e

#ro*otion, de$elo#*ent and reulations o) de#enda'le and coordinated netor/s o) trans#ortation

and co**unication s+ste*s, as ell as in t%e )ast, sa)e, e<cient and relia'le #ostal trans#ortation and

co**unications ser$icesD

4.0 DOTC Objectives

Pursuant to t%e a'o$e *andate, t%e "e#art*ent as assined t%e )olloin o'(ecti$es;

a4 Pro*ote t%e de$elo#*ent o) de#enda'le and coordinated netor/s o) trans#ortation and

co**unication s+ste*s>

'4 Guide Go$ern*ent and #ri$ate in$est*ents in t%e de$elo#*ent o) t%e countr+:s inter*odal

trans#ortation and co**unications s+ste*s in a *ost #ractical, e8#editions, and orderl+ )as%ion )or

*a8i*u* sa)et+, ser$ice, and cost e7ecti$eness>

c4 I*#ose a##ro#riate *easures so t%at tec%nical, econo*ic and ot%er conditions )or t%e continuin

econo*ic $ia'ilit+ o) t%e trans#ortation and co**unications entities are not (eo#ardi-ed and do not

encourae ine<cienc+ and distortion o) tra<c #atronae>

d4 "e$elo# an interated #lan )or a nationide trans*ission s+ste* in accordance it% national and

international teleco**unications ser$ice re=uire*ents includin, a*on ot%ers, radio and tele$ision

'roadcast rela+in, leased c%annel ser$ices and data trans*ission>

e4 Guide Go$ern*ent and #ri$ate in$est*ents in t%e esta'lis%*ent, o#eration and *aintenance o) an

international sitc%in s+ste* )or inco*in and outoin teleco**unications ser$ices>

9



)4 Encourae t%e de$elo#*ent o) a do*estic teleco**unications industr+ in coordination it% t%e

concerned entities, #articularl+ in t%e *anu)acture o) co**unications6electronics e=ui#*ent and

co*#onents to co*#le*ent and su##ort, as *uc% as #ossi'le, t%e e8#ansion, de$elo#*ent, o#eration

and *aintenance o) t%e nationide teleco**unications netor/>

5.0 Poers and !unctions

To acco*#lis% its *andate, t%e "OTC as i$en t%e )olloin #oers and )unctions related to

teleco**unications;

a4 ?or*ulate and reco**end national and uidelines )or t%e #re#aration o) interated and

co*#re%ensi$e trans#ortation and co**unications s+ste*s at t%e national, reional and local le$els>

'4 Esta'lis% and ad*inister co*#re%ensi$e and interated #rora*s )or t%is #ur#ose, *a+ call on an+

aenc+, cor#oration, or orani-ation, %et%er #u'lic or #ri$ate, %ose de$elo#*ent #rora*s include

trans#ortation and co**unications as an interal #art t%ereo), to #artici#ate and assist in t%e

#re#aration and i*#le*entation o) suc% #rora*s>

c4 Assess, re$ie and #ro$ide direction to trans#ortation and co**unications researc% andde$elo#*ent #rora*s o) t%e o$ern*ent in coordination it% ot%er institutions concerned>

d4 Ad*inister and en)orce all las, rules and reulations in t%e .eld o) trans#ortation and

co**unications>

e4 Coordinate it% t%e de#art*ent o) Pu'lic Wor/s and i%a+s in t%e desin, location, de$elo#*ent,

re%a'ilitation, i*#ro$e*ent, construction, *aintenance and re#air o) all in)rastructure #ro(ects and

)acilities o) t%e de#art*ent oe$er, o$ern*ent cor#orate entities attac%ed to t%e de#art*ent s%all

'e aut%ori-ed to underta/e s#eciali-ed teleco**unications, #orts, air#orts, and raila+s #ro(ects and

)acilities as directed '+ t%e President o) t%e P%ili##ines or as #ro$ided '+ t%e la>

)4 Esta'lis% and #rescri'e rules and reulations )or t%e esta'lis%*ent, o#eration and *aintenance o)

suc% teleco**unications )acilities in areas not ade=uatel+ ser$ed '+ t%e #ri$ate sector in order to

render suc% do*estic and o$erseas ser$ices t%at are necessar+ it% due consideration )or ad$ances in

tec%nolo+>

".0 D#P$%TM#&T ST%'CT'%#

Sec B o) EO 153FA states t%at t%e Secretar+ o) Trans#ortation and Co**unications is to 'e assisted

'+ )our 04 Undersecretaries a##ointed '+ t%e President u#on t%e reco**endation o) t%e Secretar+

Sec o) EO 153A states t%at t%e Secretar+, t%e Undersecretaries and Assistant Secretaries, t%e

de#art*ent also includes t%e "OTC reional o<ces and t%e attac%ed aencies and cor#orations

re)erred to in Section 1 o) t%e Order T%e o<ce o) t%e Secretar+ %as direct line su#er$ision o$er t%e

reional o<ces

Since t%e #ro*ulation o) EO 153 and 153FA, Conress %as enacted RA 2B 0T%e Munici#al

Tele#%one Act4, %ic% creates it%in t%e de#art*ent, t%e Munici#al Tele#%one Pro(ects O<ce, it% t%e



*andate o) i*#le*entin t%e o'(ecti$es o) t%e Act, #rinci#al a*on %ic% is t%e esta'lis%*ent o)

tele#%one ser$ice in eac% *unici#alit+ in t%e nation T%e director o) t%e MTPO, it% t%e ran/ o)

Undersecretar+, re#orts to t%e Secretar+ T%e )ull te8t o) t%e Act is )ound in A##endi8 I

Ot%er c%anes it%in t%e "e#art*ent *ade in 11, ai*ed at strea*linin t%e o#erations o) t%e

"e#art*ent, are outlined in "e#art*ent Order No 1F393 T%e te8t o) t%is docu*ent is contained inA##endi8 1 to t%is #art

(.0 PO)IC* P%OM')+$TIO&S

1 "e#t Circular No BF1BB

T%is circular, issued in Ma+ 1B, sets out 'road #olicies intended to uide sector de$elo#*ent o$er

t%e )olloin +ears T%e )ourteen #olic+ state*ents ere de$elo#ed '+ a o$ern*ent6industr+

co**ittee, esta'lis%in t%e )ra*eor/ )or an increased le$el o) co*#etition in t%e sector, to

accelerate t%e de$elo#*ent and e8#ansion o) an e<cient and ade=uate in)rastructure as a catal+st o)

socioecono*ic u#li)t*ent and #olitical sta'ilit+

Alt%ou% t%ese #olicies %a$e 'een i*#ro$ed '+ ot%er #olic+ state*ents, s#eciall+ t%ose contained int%e National Teleco**unications "e$elo#*ent Plan issued in 1!, t%e )ull te8t o) t%is land*ar/

#ro*ulation is contained in A##endi8 1 to t%is Part

5 "e#art*ent Circular No !F5B

T%is circular, entitled DPolic+ on Interconnection and Re$enue S%arin '+ Pu'lic Co**unications

CarriersD, sets out t%e o'(ecti$es ter*s and conditions )or #u'lic netor/ interconnection and t%e

s%arin o) toll re$enues 'eteen interconnected co*#anies T%e NTC as directed to #ro*ulate t%e

standards and ot%er rules needed )or t%e i*#le*entation o) t%e #olic+

T%e )ull te8t is contained in A##endi8 1 to t%is #art

9 "e#art*ent Circular No !F535

T%is circular, entitled DPolicies to Pro*ote t%e Ra#id E8#ansion o) Teleco**unications in all Reions;,

sets out t%e o$ern*ent :s #lans reardin #ri$ati-ation, and *andates a''re$iated #rocedures )or t%e

a##ro$al '+ NTC o) $ia'le e8#ansion #ro(ects It also states t%e o$ern*ent:s intent to esta'lis%

arrane*ents )or t%e on lendin o) O<cial "e$elo#*ent Assistance to t%e #ri$ate sector T%e )ull te8t

o) t%e circular is contained to a##endi8 1 to t%is #art

T%e National Teleco**unications "e$elo#*ent Plan 0NT"P4

in 1!, t%e "OTC issued t%e National Teleco**unications "e$elo#*ent Plan 0NT"P4, %ic% set out

t%e de#art*ent:s o$erall #olicies )or t%e sector esta'lis%ed a co*#re%ensi$e set o) ser$iceForiented

tarets t%rou% t%e +ear 5!1! T%e #lan ta/es an aressi$e #ri$ati-ation stance and a<r*s t%e

o$ern*ent:s intention to esta'lis% an en$iron*ent to Dena'le t%e #ri$ate sector con.dentl+ #ursuet%e e8#ansion and i*#ro$e*ent o) 'asic in)rastructure and ser$ices t%at are e<cient and t%at res#ond

to *ar/et needsD

T%e #olic+ )or de$elo#*ent as set out in t%e NT"P is as )ollos;

D T%e i*#ortance o) an e<cient teleco**unications netor/ as a )oundation )or econo*ic reco$er+

and rot% is ell reconi-ed, as is t%e critical need to accelerate t%e de$elo#*ent o)

teleco**unications in)rastructure and )acilities in t%e P%ili##ines T%ere)ore,

3



T%e Go$ern*ent:s #ri*ar+ oal )or t%e teleco**unications sector is rot% to t%e *a8i*u* e8tent

arranted '+ de*and and '+ resource constraints, #articularl+ )orein e8c%ane a$aila'ilit+

T%e )olloin )unda*entals #olicies ill s%a#e and dri$e t%is central #rinci#le o) Dde$elo#*ent .rstD;

a Pri$ate enter#rise Pri$ate enter#rise s%all 'e t%e enine o) rot%, #ro$idin an e<cient $e%icle )or

de$elo#*ent

' Sector sel)Fsu<cienc+ T%e sector s%all 'e .nanciall+ sel)Fsu##ortin it% intraFsectoral cross

su'sidies )uellin de$elo#*ent and e8#ansion toard uni$ersal access oals

c Netor/ interconnection All #u'lic teleco**unications netor/s s%all 'e entitled to interconnection

it% eac% ot%er and interconnection it% #ri$ate e=uita'le re*unerati$e arrane*ents t%at

co*#ensate )or )acilit+ usae and t%at reconi-e t%e necessit+ )or intraFsectoral cross su'sidies

Wit% t%e a'o$e 'road #olic+ o'(ecti$es, "OTC ill 'e res#onsi'le )or settin $arious #olicies to uide

s#eci.c sectoral de$elo#*ents Suc% #olicies ill uide#osts )or Co**ission decision *a/in

T%e National Teleco**unications "e$elo#*ent Plan *a+ 'e seen at t%e "e#art*ent o) Trans#ortation

and Co**unications "i$ision, on t%e 3t% Joor, P%ilco*cen uildin, Pasi, Metro Manila

,.0 %#!#%#&C# DOC'M#&TS

A##endi8 1 o) t%is #art contains t%e "e#art*ent Circulars and certain ot%er docu*ents re)erenced

a'o$e, #lus t%e E8ecuti$e Su**ar+ o) t%e NT"P

RE?ERENCE "OCUMENTS;

INTRO"UCTION

T%is section contains docu*ents %ic% *a+ 'e o) interest to t%ose in$ol$ed or interested in t%e #olic+

o) t%e "OTC In so*e cases, t%e docu*ents %a$e 'een e8cer#ted in order to /ee# t%e te8t to a

*ini*u* W%ere$er #ossi'le, a$aila'le co*#uter .les %a$e 'een t%e source o) t%e te8t, 'ut no

uarantees o) accurac+ can 'e *ade )or t%ese co#ies Parties is%in to 'e certain o) t%e te8t s%ould

a$ail o) t%e )or*al co#+ o) t%e docu*ent )ro* t%e "OTC or source orani-ation

TALE O? CONTENTS

"ocu*ent F Ta'le F Pae

EO 153FA F Reorani-in t%e *inistr+ o) Trans#ortation and Co**unications "e.nin its Poers and

?unctions and )or ot%er Pur#oses F

"C BF1BB F "OTC Polic+ State*ent uidin industr+ de$elo#*ent Reulator+ decisions F

"C !F5B F Polic+ on Interconnection and Re$enue S%arin '+ Pu'lic Co**unications Carriers F

"C !F535 F Policies to Pro*ote t%e Ra#id E8#ansion o) Teleco**unications in all Reions F

NT"P F T%e National Teleco**unications "e$elo#*ent Plan E8ecuti$e Su**ar+ F

2



"O 1F393 F "e#art*ent Order DStrea*in o) t%e "OTC Orani-ationD F

RA 2B F T%e Munici#al Tele#%one Act F

#-C#%PTS !%OM #-#C'TI# O%D#% &O. 125

/$S $M#&D#D * #-#C'TI# O%D#% &O. 125/$

%#O%+$&II&+ T# MI&IST%* O! T%$&SPO%T$TIO& $&D COMM'&IC$TIO&S D#!I&I&+ ITS

PO#%S $&D !'&CTIO&S $&D !O% OT#% P'%POS#S

SECTION 9 "eclaration o) Polic+ T%e State is co**itted to t%e *aintenance and e8#ansion o) $ia'le,

e<cient and de#enda'le trans#ortation and co**unications s+ste*s as e7ecti$e instru*ents )or

national reco$er+ and econo*ic #rocess It s%all not co*#ete as a *atter o) #olic+ it% #ri$ate

enter#rise and s%all o#erate trans#ortation and co**unications )acilities onl+ in t%ose areas %ere

#ri$ate initiati$es are inade=uate ornone8istentt

SECTION Mandate T%e Ministr+ s%all 'e t%e #ri*ar+ #olic+, #lannin, #rora**in, coordinatin,

i*#le*entin, reulatin and ad*inistrati$e entit+ o) t%e E8ecuti$e ranc% o) t%e o$ern*ent in t%e#ro*otion, de$elo#*ent and reulation o) de#enda'le and coordinated netor/s o) trans#ortation and

co**unication s+ste*s, as ell as in t%e )ast, sa)e, e<cient and relia'le #ostal, trans#ortation and

co**unications ser$ices

To acco*#lis% suc% Mandate, t%e Ministr+ s%all %a$e t%e )olloin o'(ecti$es;

a4 Pro*ote t%e de$elo#*ent o) de#enda'le and coordinated netor/s o) trans#ortation and

co**unications s+ste*s>

'4 Guide o$ern*ent and #ri$ate in$est*ents in t%e de$elo#*ent o) t%e countr+:s inter*odal

trans#ortation and co**unications s+ste*s in a *ost #ractical, e8#editious, and orderl+ )as%ion )or

*a8i*u* sa)et+, ser$ice, and cost e7ecti$eness>

c4 I*#ose a##ro#riate *easures so t%at tec%nical, econo*ic and ot%er conditions )or t%e continuin

econo*ic $ia'ilit+ o) t%e trans#ortation and co**unications entities are not (eo#ardi-ed and do not

encourae ine<cienc+ and distortion o) tra<c #atronae>

d4 "e$elo# an interated #lan )or a nationide trans*ission s+ste* in accordance it% national and

international teleco**unications ser$ice re=uire*ents includin, a*on ot%ers, radio and tele$ision

'roadcast rela+in, leased c%annel ser$ices and data trans*ission>

e4 Guide o$ern*ent and #ri$ate in$est*ents in esta'lis%*ent, o#eration and *aintenance o) an

international sitc%in s+ste* )or inco*in and outoin teleco**unications ser$ices>

)4 Encourae t%e de$elo#*ent o) a do*estic teleco**unications industr+ in coordination it% t%e

concerned entities, #articularl+ in t%e *anu)acture o) co**unications6electronics e=ui#*ent and

co*#onents to co*#le*ent and su##ort, as *uc% as #ossi'le t%e e=ui#*ent de$elo#*ent, o#eration

and *aintenance o) t%e nationide teleco**unications netor/

4 Pro$ide )or a sa)e, relia'le and e<cient #ostal s+ste* )or t%e countr+

SECTION 3 Poers and ?unctions To acco*#lis% its *andate, t%e "e#art*ent s%all %a$e t%e )olloin

)unction;

a4 ?or*ulate and reco**end national #olicies and uidelines )or t%e #re#aration and i*#le*entation



o) interated and co*#re%ensi$e trans#ortation and co**unications s+ste*s at t%e national, reional

and local le$els>

'4 Esta'lis% and ad*inister co*#re%ensi$e and interated #rora*s )or trans#ortation and

co**unications, and )or t%is #ur#ose, *a+ call on an+ aenc+, cor#oration, or orani-ation, %et%er

#u'lic or #ri$ate, %ose de$elo#*ent #rora*s include trans#ortation and co**unications

i*#le*entation o) suc% #rora*s>

c4 Asses, re$ie and #ro$ide direction to trans#ortation and co**unications researc% and

de$elo#*ent #rora*s o) t%e o$ern*ent in coordination it% ot%er institutions concerned

d4 Ad*inister and en)orce all las, rules and reulations in t%e .eld o) trans#ortation and

co**unications>

e4 Coordinate it% "e#art*ent o) Pu'lic Wor/s and i%a+s in t%e desin, location, de$elo#*ent,

re%a'ilitation, i*#ro$e*ent, construction, *aintenance and re#air o) all in)rastructure #ro(ects and

)acilities o) t%e "e#art*ent oe$er, o$ern*ent cor#oration entities attac%ed to t%e "e#art*ent

s%all 'e aut%ori-ed to underta/e s#eciali-ed teleco**unications, #orts, air#orts and raila+s #ro(ects

and )acilities as directed '+ t%e President o) t%e P%ili##ines or as #ro$ided '+ la>

)4 Esta'lis%, o#erate and *aintain a nationide #ostal s+ste* t%at s%all include *al #rocessindeli$er+ ser$ices, and *one+ order ser$ices and #ro*ote t%e art #%ilatel+

4 Issue certi.cates o) #u'lic con$enience )or t%e o#eration o) land rail trans#ortation utilities and

ser$ices>

%4 Accredit )orein aircra)t *anu)acturers and6or international orani-ations )or aircra)t certi.cation

and in accordance it% esta'lis%ed #rocedure standards>

i4 Esta'lis% and #rescri'e rules and reulations )or identi.cation routes, -ones and6or o) o#eration o)

#articular o) #u'lic land ser$ices>

(4 Esta'lis% and #rescri'e rules and reulations )or t%e esta'lis%*ent, o#erations and *aintenance o)

suc% teleco**unications )acilities in areas not ade=uatel+ ser$ed '+ t%e #ri$ate sector in order to

render suc% do*estic and o$erseas ser$ices t%at are necessar+ it% due consideration )or ad$ances intec%nolo+>

/4 Esta'lis% and #rescri'e rules and reulations )or t%e o#eration and *aintenance o) a nationide

#ostal s+ste* t%at s%all include *ail #rocessin, deli$er+ ser$ices, *one+ order ser$ices and

#ro*otion o) #%ilatel+>

l4 Esta'lis% and #rescri'e rules and reulations )or t%e issuance o) certi.cates o) #u'lic con$enience )or

land trans#ortation utilities, suc% as *otor $e%icles, tri*o'iles and raila+s>

*4 Esta'lis% and #rescri'e t%e corres#ondin rules and reulations )or t%e ins#ection and reistration

o) air and land trans#ortation )acilities, suc% as *otor $e%icles, tri*o'iles, raila+s, and aircra)ts>

n4 Esta'lis% and #rescri'e rules and reulations )or t%e issuance o) licenses to =uali.ed *otor $e%icles,dri$ers, conductors, and air*en>

o4 Esta'lis% and #rescri'e t%e corres#ondin rules and reulations )or t%e en)orce*ent o) las

o$ernin land trans#ortation, air trans#ortation and #ostal ser$ices, includin t%e #enalties )or

$iolators t%ereo), and )or t%e de#utation o) a##ro#riate la en)orce*ent aencies in t%e #ursuance

t%ereo)>

#4 "eter*ine, .8 and6or #rescri'e c%ares and6or rates #ertinent to t%e o#eration o) #u'lic air and land

trans#ortation utilit+ )acilities and ser$ices, e8ce#t suc% rates and 6or c%ares as *a+ 'e #rescri'ed '+

B



t%e Ci$il Aeronautics oard under its c%arter, and, in cases %ere c%ares or rates are esta'lis%ed '+

international 'odies or associations o) %ic% t%e P%ili##ines is a #artici#atin *e*'er reconi-ed '+

t%e P%ili##ine o$ern*ent as t%e #ro#er ar'iter o) suc% c%ares or rates>

=4 Esta'lis% and #rescri'e t%e rules, reulations, #rocedures and standards )or t%e accreditation o)

dri$in sc%ools>

r4 Ad*inister and o#erate t%e Ci$il A$iation Trainin Center 0CATC4 and t%e National

Teleco**unications Trainin Institute 0NTTI4 and

s4 Per)or* suc% ot%er #oers and )unctions as *a+ 'e #rescri'ed '+ la, or as *a+ 'e necessar+,

incidental, or #ro#er to its *andate, or as *a+ 'e assined )ro* ti*e to ti*e '+ t%e President o) t%e

Re#u'lic o) t%e P%ili##inesD

"one in t%e Cit+ o) Manila, P%ili##ines, t%is 19t% da+ o) A#ril, in t%e Kear o) our Lord, Nineteen undred

and Ei%t+ Se$en

+ t%e President

0Sined4 Cora-on C A=uino

DOTC Departent Circuar &o. ,(/1,,

Pursuant to t%e #ro$isions o) t%e 1B2 Constitution %ic% )ull+ reconi-es t%e $ital role o)

co**unications in t%e nation 'uildin and in order to ensure t%at t%e countr+ is #ro$ided it%

uni$ersal essential ser$ices at reasona'le rates, to )oster inno$ation, #articularl+ in ad$anced

in)or*ation ser$ices, to encourae t%e #artici#ation o) #ri$ate enter#rise in a reulated, )air and

co*#etiti$e en$iron*ent, and to accelerate t%e de$elo#*ent and e8#ansion o) an e<cient and

ade=uate teleco**unications in)rastructure as a catal+st )or socioecono*ic u#li)t*ent and #olitical

sta'ilit+, under a s+ste* o) )ree enter#rise, t%e )olloin "e#art*ent #olicies %ere'+ enunciated;

1 T%ere s%all 'e a co%erent and orderl+ de$elo#*ent o) t%e nationide co**unications ser$ices

t%at esta'lis%*ent o) suc% ser$ices s%all 'e su'(ect to a co*#etiti$e and reulated entr+ to t%e

*ar/et>

5 T%ere s%all 'e at least one interated and relia'le nationide teleco**unications )acilit+ it%

ade=uate ca#a'ilit+ to #ro$ide $oice, record and data ser$ices interconnectin all *a(or cities and

tons>

9 T%e a##lication o) t%e stateFo)Ft%eFart and costFe7ecti$e tec%nolo+ in tele#%on+, record and data

ser$ices as in t%e use o) t%e diital trans*ission tec%ni=ue, s%all 'e encouraed ?or t%is #ur#ose,

o$ern*ent s%all encourae and su##ort a##lied researc% and de$elo#*ent to *eet tec%noloical

c%allenes and #ro$ide inno$ations )or sel)Freliance>

All teleco**unications e=ui#*ent to 'e installed s%all con)or* it% acce#ted CCIR and 6or CCITT

reco**endations consistent it% t%e o$ern*ents #olicies toards t%e use o) t%e state o) t%e art

tec%nolo+>

3 T%ere s%all 'e an orderl+, e8#editious and rationali-ed *anae*ent o) t%e radio )re=uenc+

s#ectru* )or an e<cient, econo*ic and o#ti*i-ed utili-ation o) li*ited neutral resource>

2 T%ere s%all 'e at least one relia'le nationFide *arine coastal co**unication s+ste* to #ro$ide

s%i#FtoFs%ore co**unications ser$ices )ull+ interconnected to t%e #u'lic netor/s #ursuant to

co*#arati$el+ e<cient interconnection 0CEI4 #ara*eters as de.ned '+ t%e National

Teleco**unications Co**ission 0NTC4



Mo'ile radio co**unications and an+ $alue added netor/ )or #u'lic use interconnected to t%e

#u'lic teleco**unications netor/ s%all 'e aut%ori-ed onl+ to en)ranc%ised carriers>

B T%e de$elo#*ent6installation o) all o$ern*ent trans*ission netor/s s%all 'e rationali-ed to

a$oid )ra*entation and aste li*ited resources>

T%e "e#art*ent s%all continue to o#erate and *aintain its teleco**unication ser$ices in #ri*aril+

unser$ed and inade=uatel+ ser$ed areas It s%all, %oe$er, encourae t%e entr+ o) #ri$ateenter#rise in suc% areas %en econo*ic $ia'ilit+ *a+ 'e #ro$en to e8ist su'(ect to uidelines set

'+ t%e o$ern*ent>1! T%e connection o) custo*er #ro$ided e=ui#*ent 0CPE4 to t%e #u'lic teleco**unications netor/

*a+ 'e alloed su'(ect to uidelines set '+ t%e o$ern*ent in an orderl+ *anner consistent it%

t%e #u'lic interest, netor/, interit+, and sa)et+>

11 T%e de$elo#*ent o) a do*estic teleco**unications *anu)acturin sector s%all 'e encouraed,

#articularl+ in t%e *anu)acture o) electric and co**unications e=ui#*ent and co*#onents to

co*#le*ent and su##ort t%e e8#ansion, de$elo#*ent, o#eration and *aintenance o) an e<cient

nationide #u'lic teleco**unications netor/>

15 All #u'lic co**unications carriers s%all interconnect t%eir )acilities #ursuant to co*#arati$el+

e<cient interconnection 0CEI4 as de.ned '+ NTC in t%e interest o) econo*ic e<cienc+>

19 An+ and all $alue added ser$ices )or #u'lic use s%all 'e su'(ect to t%e rant #er*its or Certi.cate

o) Pu'lic Con$enience and Necessit+ 0CPCN4 )ro* t%e National Teleco**unications Co**ission>

1 T%e e8istin #olic+ in t%e Dinternational atea+D s%all 'e su'(ect to c%ane ta/in into

consideration t%e #roress and needs o) t%e countr+ to ensure t%at #u'lic interest and national

securit+ s%all 'e ser$ed

In t%is connection, Ministr+ Circular No B5F!2 is su#erseded and an+ ot%er *e*orandu* orders,

#ursuant to t%e said circular or ot%erise in conJict it% t%is "e#art*ent Circular are %ere'+

dee*ed re$o/ed, a*ended or re$ised

T%e National Teleco**unications Co**ission is %ere'+ directed to )or*ulate reco**endations to

i*#le*ent t%ese #olicies in consultation it% t%e teleco**unications sector, users and ot%er

aencies o) t%e o$ern*ent

T%is Circular ta/es e7ect i**ediatel+

Pasi, Metro Manila, P%ili##ines, 55 Ma+ 1B

0Sined4

Renerio O Re+es

Secretar+

DOTC D#P$%TM#&T CI%C')$% &o. 60/24,

Su'(ect ; Polic+ on t%e Interconnection and Re$enue S%arin '+ Pu'lic Co**unications Carriers

WEREAS, it is t%e o'(ect o) o$ern*ent to #ro*ote t%e ra#id e8#ansion o) teleco**unicationsser$ices %ere in t%e P%ili##ines>

WEREAS, t%ere is a need to *a8i*i-e t%e users o) teleco**unications )acilities a$aila'le and

encourae in$est*ent in t%e teleco**unications in)rastructure '+ suita'l+ =uali.ed ser$ice #ro$iders>

WEREAS, in reconition o) t%e $ital role o) co**unications in nation 'uildin, t%ere is a need to

ensure t%at all users o) t%e #u'lic teleco**unications ser$ice %a$e access to all ot%er users o) t%e

ser$ice %ere$er t%e+ *a+ 'e it%in t%e P%ili##ines at an acce#ta'le standard o) ser$ice and at

1!



reasona'le cost

WERE?ORE, In t%e )ul.ll*ent o) t%e a'o$e and #ursuant to t%e #oers $ested u#on t%e "e#art*ent

to esta'lis% and ad*inister co*#re%ensi$e and interated #rora*s )or co**unications> #ro$ide

direction to co**unications de$elo#*ent> and esta'lis% and #rescri'e rules and reulations )or t%e

o#eration and *aintenance o) teleco**unications )acilities, t%e )olloin "e#art*ent #olicies on

interconnection and re$enue s%arin are %ere'+ #ro*ulation;

1 All )acilities o7erin #u'lic teleco**unications ser$ices s%all 'e interconnected into t%e nationide

teleco**unications netor/6s

5 S+ste* interconnection re=uires tec%nical co*#ati'ilit+ and aree*ent on )acilit+ res#onsi'ilities

it% res#ect to trans*ission, sitc%in and sinalin inter)aces> *essae accountin arrane*ents )or

'illin, as ell as ser$ice #er)or*ance> end user access> and installation, *aintenance and re#air

#ractices

9 To ac%ie$e uni)or* ser$ice =ualit+ and e<cient internetor/in, all ser$ice o#erators , %et%er

o$ern*ent or #ri$ate, *ust )ollo national standards a##ro$ed '+ t%e National Teleco**unications

Co**ission 0NTC4 T%ese standards s%all 'e )or*ulated re$ised or *odi.ed t%rou% a trans#arent

#rocess o) consensus in$ol$in all interested #arties includin ser$ice #ro$iders, e=ui#*ent su##liers,

user rou#s, and o$ern*ent T%e NTC s%all %a$e t%e .nal a##ro$al o) t%e standards

T%e interconnection o) netor/s s%all 'e a7ected in a )air and nonFdiscri*inator+ *anner and it%in

t%e s%ortest ti*eF)ra*e #ractica'le

3 T%e #recise #oints o) inter)ace 'eteen ser$ice o#erators s%all 'e as de.ned '+ t%e NTC, and t%e

a##ortion*ent o) costs and di$ision o) re$enues resultin )ro* interconnection o) teleco**unications

netor/s s%all 'e as a##ro$ed and6or #rescri'ed '+ t%e NTC

2 All ot%er *atters 'ein e=ual, tra<c settle*ent aree*ents s%all 'e 'ased u#on a reco$er+ o) tollF

related costs and a )air return on t%e in$est*ent o) 'ot% co*#anies in t%e )acilities e*#lo+ed in

*as/in t%e tool calls e8c%aned 'eteen t%e s+ste*s Unless ot%erise *utuall+ areed, t%e tollcarrier s%all *eet t%e local e8c%ane carrier at t%e *ain distri'ution )ra*e o) t%e e8c%ane desinated

'+ t%e local e8c%ane carrier

"ue reconition *ust 'e i$en '+ o#erators to t%e critical i*#ortance o) con)or*in it% t%e

international standard #ractices to loer cost and s#eed de$elo#*ent o) teleco**unications

in)rastructure B Su'sidies s%all 'e reconi-ed and a##ro$ed on t%e 'asis o) sound #u'lic #olic+

"ue reard s%all 'e i$en to rele$ant reco**endations, suc% as CCITT, #articularl+ on t%e =ualit+

and standards o) ser$ice to 'e o7ered to t%e #u'lic

T%e National Teleco**unications Co**ission 0NTC4 is %ere'+ directed to #ro*ulate t%e Standards,

Rules and Reulations )or t%e e7ecti$e and i**ediate i*#le*entation o) t%is Circular

An+ Me*orandu*, Circular, Order, Rules and reulations %ic% are in t%e conJict it% t%is Circular are

%ere'+ dee*ed su#erseded, a*ended or re#ealed

T%e Circular *a+ 'e re$ised, a*ended or re#ealed as t%e "e#art*ent dee*s .t and s%all ta/e e7ect

it%in 0134 da+s a)ter t%e #u'lication in a nes #a#er o) eneral circulation

11



Pasi, Metro Manila, P%ili##ines, 1 Hune 1!

0Sined4

Oscar M Or'os

Secretar+

1! Auust 1!DOTC Departent Circuar &o. 60/252

Su'(ect; Policies to Pro*ote t%e Ra#id E8#ansion o) Teleco**unications in all Reions


it%in t%e s%ortest ti*e #ractica'le, arranted '+ de*and and '+ resource constraints, #articularl+

)orein e8c%ane a$aila'ilit+

T%e eart%=ua/e disaster %as de*onstrated ane t%e i**ediate need )or t%e ra#id #ro$isions o)

i*#ro$ed teleco**unications ser$ices and )acilities in all areas o) t%e P%ili##ines, o$er and a'o$e t%e

initiati$es t%at are alread+ undera+

In su##ort o) t%is urent need, It is %ere'+ declared t%at;

1 T%e o$ern*ent ill rel+ on t%e #ri$ate sector to 'uild and o#erate teleco**unications )acilities in

all reions, all suc% )acilities to 'e interconnected to )or* #art o) a sinle national netor/ it%

a##ro#riate re$enue s%arin arrane*ents as enunciated in "e#art*ent Circular !F5B and

#ro*ulated in t%e National Teleco**unications Me*orandu* Circular F19F!

5 As soon as suita'l+ =uali.ed #ri$ate o#erators can 'e )ound, t%e o$ern*ent ill #ri$ati-e its

e8istin teleco**unications o#erations, and ill onl+ enter into a ne $entures %en t%ere is no

#ri$ate sector alternati$e and as te*#orar+ arrane*ent

9 T%e National Teleco**unications Co**ission is directed to esta'lis% a''re$iated #rocedures

ensure ra#id a##ro$al o) $ia'le #ro(ects #ro#osed '+ t%e #ri$ate sector %ic% can 'e i*#le*ented on

a ti*el+ 'asis

T%e o$ern*ent ill esta'lis% arrane*ents %ere'+ o<cial de$elo#*ent assistance )undin can

'e *ade a$aila'le to t%e #ri$ate sector to .nance construction o) ne )acilities )urt%er t%e o$ern*ent

o'(ecti$es

Pursuant to t%e #olicies enunciated a'o$e, t%e "e#art*ent o) Trans#ortation and Co**unication

%ere'+ in$ites =uali.ed #ri$ate sector entities to su'*it to t%e National Teleco**unications

Co**ission )or t%eir #ro*#t a##ro$al T%e co**ission s%all i$e #riorit+ consideration to initiati$es

%ic% result in i**ediate e8#ansion o) ser$ice to an ser$ed rural areas

T%is circular ta/es e7ect i**ediatel+

0Sined4

Oscar M Or'osSecretar+

1! Auust 1!

DOTC Departent Circuar &o. 60/252

Su'(ect; Policies to Pro*ote t%e Ra#id E8#ansion o) Teleco**unications in all Reions

15




it%in t%e s%ortest ti*e #ractica'le, arranted '+ de*and and '+ resource constraints, #articularl+

)orein e8c%ane a$aila'ilit+

T%e eart%=ua/e disaster %as de*onstrated ane t%e i**ediate need )or t%e ra#id #ro$isions o)

i*#ro$ed teleco**unications ser$ices and )acilities in all areas o) t%e P%ili##ines, o$er and a'o$e t%e

initiati$es t%at are alread+ undera+

In su##ort o) t%is urent need, It is %ere'+ declared t%at;

1 T%e o$ern*ent ill rel+ on t%e #ri$ate sector to 'uild and o#erate teleco**unications )acilities in

all reions, all suc% )acilities to 'e interconnected to )or* #art o) a sinle national netor/ it%

a##ro#riate re$enue s%arin arrane*ents as enunciated in "e#art*ent Circular !F5B and

#ro*ulated in t%e National Teleco**unications Me*orandu* Circular F19F!

5 As soon as suita'l+ =uali.ed #ri$ate o#erators can 'e )ound, t%e o$ern*ent ill #ri$ati-e its

e8istin teleco**unications o#erations, and ill onl+ enter into a ne $entures %en t%ere is no

#ri$ate sector alternati$e and as te*#orar+ arrane*ent

9 T%e National Teleco**unications Co**ission is directed to esta'lis% a''re$iated #rocedures

ensure ra#id a##ro$al o) $ia'le #ro(ects #ro#osed '+ t%e #ri$ate sector %ic% can 'e i*#le*ented on

a ti*el+ 'asis

T%e o$ern*ent ill esta'lis% arrane*ents %ere'+ o<cial de$elo#*ent assistance )undin can

'e *ade a$aila'le to t%e #ri$ate sector to .nance construction o) ne )acilities )urt%er t%e o$ern*ent

o'(ecti$es

Pursuant to t%e #olicies enunciated a'o$e, t%e "e#art*ent o) Trans#ortation and Co**unication

%ere'+ in$ites =uali.ed #ri$ate sector entities to su'*it to t%e National Teleco**unications

Co**ission )or t%eir #ro*#t a##ro$al T%e co**ission s%all i$e #riorit+ consideration to initiati$es

%ic% result in i**ediate e8#ansion o) ser$ice to an ser$ed rural areas

T%is circular ta/es e7ect i**ediatel+0Sined4

Oscar M Or'os

Secretar+

19 T%e Role o) Go$ern*ent

T%e Go$ern*ent %as 'een #la+in a role in t%e sector, .rst as #olic+ *a/er and reulator, t%ou% t%e

"OTC and NTC res#ecti$el+, second as an o#erator o) )acilities t%rou% its o#eratin ar*, TELO?, and

t%ird, as a de$elo#er, t%rou% its access to O"A )undin

a T%e Go$ern*ent as an O#erator

T%e o$ern*ent %as underta/en to #ro$ide ser$ice in Dun#ro.ta'leD areas, loosel+ de.ned as

an+%ere t%e #ri$ate sector %as not entered T%ere %a$e 'een e7orts o$er t%e +ears to esta'lis%

ser$ice t%rou% TELO? %ic% ere li*ited in sco#e due to de#endence on )orein aid arrane*ents,

and o#eratin 'udet li*itations led to deterioration o) )acilities and ser$ice =ualit+ Anot%er *a(or

i*#act is t%at t%e #resence o) t%e Go$ern*ent as an o#erator in Dun#ro.ta'leD areas %as o'$iated t%e

notion o) #lacin an o'liation on t%e do*inant o#erator 0PL"T4 to #ro$ide ser$ice to all areas T%is

%as deterred e8#ansion into unser$ed areas

?inall+, t%ere is t%e 'urden on t%e ta8F#a+in #u'lic to co$er TELO? o#eratin losses E8#erience in

ot%er de$elo#in countries %as s%on t%at teleco**unications ser$ices need not 'e directl+

19



su'sidi-ed '+ t%e Go$ern*ent

' T%e Go$ern*ent as a "e$elo#er

A sur$e+ o) rele$ant aencies and .nancial institutions in 1B is re$ealed t%e a$aila'ilit+ o)

su'stantial ca#ital resources )ro* 'ot% )orein and local sources t%at t%e Go$ern*ent %as not 'een

a'le to c%annel to t%e #ri$ate teleco**unications sector it% dis#atc% and on )a$ora'le ter*s

In Hul+, 1B, t%e o$ern*ent too/ on a *a(or de$elo#*ent res#onsi'ilit+ in t%e )or* o) t%e Munici#al Tele#%one Act 0RA2B4, in %ic% t%e o$ern*ent co**its itsel) )acilitatin t%e esta'lis%*ent o)

#u'lic callin stations in e$er+ Munici#alit+ in t%e P%ili##ines '+ 15 To t%is end, t%e leislation

esta'lis%ed t%e Munici#al Tele#%one Pro(ect O<ce it%in t%e "OTC Under leislation, t%e #ri$ate

sector is call u#on to e8ercise t%e .rst o#tion to #ro$ide t%e ser$ice

c T%e Go$ern*ent as a Polic+ Ma/er

T%e "OTC:s current #olic+ state*ents are contained in "e#art*ent Circular BF1BB F a docu*ent

ritten it% #ri$ate sector in#uts reJectin in t%e lac/ o) consensus #ositions on so*e issues, resultin

in $aue and inco*#lete #olicies W%ile consensus on *atters o) *utual concern is use)ul t%e

o$ern*ent *ust consider its role as a #olic+ *a/er as ser$in t%e #u'lic interest and, not onl+ t%e

interests o) t%e industr+ ?or t%is reason, inde#endent #olic+F*a/in, it% consultation s%ould 'e t%e

%all*ar/ o) t%is as#ect o) t%e "OTC role T%is ill re=uire t%e additional #ro)essional resources T%ere is

an urent need )or *ore #recise and detailed #olicies to 'e de$elo#ed '+ o$ern*ent on t%e issues on

%ic% consensus a*onst industr+ leaders cannot 'e ac%ie$ed, suc% as co*#etition, ser$ice #riorities

and o$erall industr+ structure

d Relations%i# 'eteen t%e Polic+ Ma/er and t%e Reulator

T%ere is no leislation or #u'lic #olic+ to uide t%e "OTC or t%e NTC as to %o #olic+ and reulation

s%ould 'e %ar*oni-ed, and t%is, cou#led it% t%e )act t%at #olic+ )or*ulation %as not /e#t #ace it%

tec%noloical or #olitical de$elo#*ents, is a #ro'le* t%at needs urent attention W%ile #endin

leislation *a+ assist in #ro$idin uidance, it ill 'e necessar+ )or leislators, reulator+ leaders and

#olic+ *a/ers to coo#erate in deter*inin %o to 'est address t%e serious #ro'le*s con)rontin t%e

sector

T%e a'o$e )actors, in su**ar+, suest t%at t%e o$ern*ent *ust clari)+ its role in t%e

teleco**unications sector F t%e *ost #ositi$e c%ane 'ein to act )acilitator, #olic+ leader and

ena'ler, rat%er t%an as a co*#etitor to t%e #ri$ate sector

Section STRATEGIES ?OR "E@ELOPMENT

T%e )oreoin %as descri'ed t%e *a(or constraints %ic% *ust 'e addressed 'e)ore real #roress can

'e *ade toard i*#ro$e*ent o) t%e nation:s teleco**unication in)rastructure T%e *a(or #ro'le* in

su**ar+ are .rst, serious s%ortaes and distri'utional #ro'le*s )or tele#%one ser$ice, inade=uate

returns )or local o#erators )ro* local and settled toll re$enues, and lac/ o) clear direction and #olicies

)ro* o$ern*ent In t%is section t%e de.ciencies are addressed ender t%ree 'oard cateories;

F de$elo#*ent #olic+ F ti*eF'ound sector de$elo#*ent tarets> and F a##roac%es to ac%ie$in sector

oals

T%ese uidelines see/ ra#id and e<cient sector e8#ansion t%rou% t%e creation o) an en$iron*ent t%at

is conducti$e to #ri$ate enter#rise in$est*ent, and t%rou% t%e )or*ation o) a rational )ra*eor/

it%in %ic% .nancial and tec%nical #lannin acti$ities can e7ecti$el+ ta/e #lace

1 A POLICK ?OR "E@ELOPMENT

T%e i*#ortance o) an e<cient teleco**unications netor/ as a )oundation )or econo*ic reco$er+ and

rot% is ell reconi-ed, as ell as is t%e critical need to accelerate t%e de$elo#*ent o)

1



teleco**unications in)rastructure and )acilities in t%e P%ili##ines T%ere)ore,


arranted '+ de*and and '+ resource constraints, #articularl+ )orein e8c%ane a$aila'ilit+

T%e )olloin )unda*ental #olicies ill s%a#e and dri$e t%is central #rinci#le o) Dde$elo#*ent .rstD;

a Pri$ate enter#rise Pri$ate enter#rise s%all 'e t%e enine o) sector rot%, #ro$idin an e<cient$e%icle )or de$elo#*ent

' Sector sel)Fsu<cienc+ T%e sector s%all 'e .nanciall+ sel)Fsu##ortin it% intraFsectoral cross

su'sidies )uellin de$elo#*ent and e8#ansion toard uni$ersal access oals

c Netor/ interconnection All #u'lic teleco**unications netor/s s%all 'e entitled to interconnection

it% eac% ot%er and interconnection it% #ri$ate netor/s ill 'e encouraed Interconnection

aree*ents s%all #ro$ide e=uita'le re*unerati$e arrane*ents t%at co*#ensate )or )acilit+ usae and

t%at reconi-e t%e necessit+ )or intraFsectoral cross su'sidies

As conte*#lated '+ t%e Teleco**unications Polic+ ill no #endin, 0S 19394, t%e "OTC s%all

#ro*ulate 'asic #olic+ in su##ort o) t%e )oreoin )unda*ental #olicies and t%e NTC s%all 'e t%e

instru*ent o) ensurin t%eir e8ecution> t%ere)ore, all #u'lic teleco**unications )acilit+ o#erators and

ser$ice #ro$iders s%all 'e su'(ect to NTC reulation

Wit% t%e o$ern*ent:s )ocus on de$elo#*ent, all sector o#tions, decisions and actions ill 'e ei%ed

)or rele$ance aainst #rece#t

5 UALITK AN" A@AILAILITK O? SER@ICE F "E@ELOPMENT TARGETS

Ti*eF'ound de$elo#*ent o'(ecti$es are su**ari-ed in Ta'le 1 T%ese indicate t%e Go$ern*ent:s

current #erce#tion o) *ini*u* sector re=uire*ents and are not to 'e ta/en as e8%austi$e o) sector

needs E<cient de$elo#*ent 'e+ond t%ese *ini*al, to *eet ne or )asterFroin de*ands, is

encouraed ?uture editions o) t%e NT"P ill e$ol$e t%ese to .t e*erin de*and #atterns and

national #riorities

T%e tarets ere selected to 'alance econo*ic and social o'(ecti$es and ere set usin an interacti$e

#rocess t%at considered )orecasts o) de*and, )orein e8c%ane a$aila'ilit+, sector ca#a'ilit+, and

econo*ic and .nancial )easi'ilit+ e+ond 13, t%e taret )or tele#%one #enetration is tailored to .t

t%e D*ost #ro'a'leD de*and cur$e

T%e annual in$est*ents esti*ated to ac%ie$e t%ese tarets are s%on in ?iure 5 T%ese in$est*ents

total nearl+ 'illion includin 'ot% )orein e8c%ane and local currenc+ co*#onents 0e8#ressed in

1B #rices4 across t%e 5!F+ear #eriod In addition, so*e 3!,!!! or/ers ill 'e needed to o#erate

and *aintain t%e ne )acilities T%e cost o) raisin t%e nationide tele#%one densit+ )ro* 1 in 1B

to 93 '+ t%e +ear 5!1! is esti*ated at B 'illion at 1B #rices T%e attain*ent o) a %i%er

nationide tele#%one densit+ '+ t%e end o) t%e Plan #eriod *a+ 'e arranted '+ accelerated

econo*ic rot% or ot%er de$elo#*ents> %oe$er, t%e cost o) #ro$idin, sa+, 1! tele#%one densit+

'+ t%e +ear 5!1! is esti*ated to 'e 55 'illion, %ic% could not 'e su##orted '+ current or )orecast

le$els o) de*and Wit% res#ect to rural teleco**unications de$elo#*ent, #ursuant to t%e Munici#al

Tele#%one Act0RA 2B4, t%e #ro$ision o) 'asic access to tele#%one ser$ice don to t%e Munici#al

Teleco**unications Pro(ects O<ce 0MTPO4 to )acilitate and coordinate t%e rural ser$ice #rora*

9 ACIE@ING TE GOALS

Ac%ie$in t%e taret set out a'o$e ill re=uire o#erators to #lan and i*#le*ent s#eci.c #ro(ects and

#lans Alt%ou% desin and i*#le*entation ill 'e t%e o#erators: res#onsi'ilit+, t%e Go$ern*ent ill

stri$e to )acilitate t%e #rocess trou% an i*#ro$ed reulator+ rei*e, assistance to s*all o#erators,

13



t%rou% access to ca#ital and o#erational su##ort, and #ro$ision o) .nancial incenti$es %ere

arranted

91 Institutional Re)or*

W%ile #endin leislation #ro$ides so*e uidance reardin t%e res#ecti$e roles o) t%e "OTC and NTC,

it ill not *ateriall+ i*#ro$e t%e e<cac+ o) t%e #olic+6reulator+ #rocess it%out )unda*ental c%ane

in 'ot% aencies

T%e "OTC *ust c%ane )ro* 'ein a ser$ice de$elo#er and #ro$ider, to 'ein a leader o) t%e sector

T%is re=uires t%e addition o) s/ills t%at are not currentl+ resident in t%e de#art*ent, and 'asic c%anes

to t%e orani-ation t%at reconi-e t%e ne #riorities

T%e "e#art*ent ill co**ence i**ediatel+, in consultation it% a##ro#riate central aencies, to

de$elo# a ne structure )or its orani-ation, co$erin t%e )olloin areas;

a Create a national #olic+ unit it% enineerin, socioFecono*ic, and .nancial s/ills

' Create units res#onsi'le )or industr+ structure liaison, international teleco**unications, satellite

co**unications, tec%nolo+ anal+sis, standards #olic+, NTC liaison, and coordinatin t%e

Go$ern*ent:s on use o) teleco**unications )acilities

T%e NTC, %ile %a$in a *ore loical structure and *ore s#eciali-ed tec%nical resources t%an t%e

"OTC, is nonet%eless inade=uatel+ to deal it% t%e co*#le8 issues o) toda+:s teleco**unications

en$iron*ent T%e NTC Reorani-ation ill ill %el#, 'ut aain, it ill ta/e ti*e )or c%ane to occur One

o) t%e *ost i*#ortant as#ects o) t%e ne leislation is t%e introduction o) colleial decision a*on t%e

*e*'ers o) an e8#anded Co**ission Wit% t%e ri%t *i8 o) 'ac/rounds and s/ills, suc% a rou#

could *ore easil+ co#e it% t%e di<cult issues con)rontin t%e Co**ission, es#eciall+ i) #ro)essional

sta7 resources are also increased as conte*#lated '+ t%e ill

95 Pri$ati-ation o) Go$ern*ent O#erations

T%e Go$ern*ent:s #olic+ ill 'e to entrust t%e o#eration o) #u'lic teleco**unications t%rou%out t%e

countr+ to #ri$ate carriers W%ile t%ere %as 'een in t%e #ast, so*e direct o$ern*ent inter$ention into

#ioneerin areas, t%e Go$ern*ent is con$inced t%at t%is *odel is ina##ro#riate )or t%e orderl+ rot%

and de$elo#*ent o) t%e P%ili##ines: teleco**unications sector, and t%us, it %as concluded t%at it *ust

#ri$ati-e s+ste*s no o#erated '+ TELO?, t%e RT"P no o#erated '+ ?il#%one, and t%e NTP as, or

'e)ore it is i*#le*ented

Since eac% o) t%ese s+ste*s is uni=ue, eac% ill re=uire a di7erent s#eci.c #rocess to #ri$ati-e

oe$er, in all cases, t%e Go$ern*ent ill e*#lo+ an o#en, trans#arent #rocess ai*ed at c%oosin

carriers %o are =uali.ed to conduct o#erations, .nance t%eir rot%, and #ro$ide =ualit+ ser$ice on

alon ter* 'asis

99 Mar/et Structure

T%e Go$ern*ent:s eneral #olic+ is to *o$e toard li'erali-ation T%e NTC ill control t%e c%ane

#rocess consistent it% t%e national interest F t%at is *o$e eac% *ar/et se*ent or ser$ice to an

a##ro#riate deree o) co*#etition at t%e a##ro#riate ti*eIt is also noted t%at t%e Teleco**unication Polic+ ill 0S 19394 contains a descri#tion o) a *ar/et

structure t%at call )or increased co*#etition and a Dsectionali-edD a##roac% to cor#orate orani-ation

T%is ill 'e %el#)ul in de.nin a 'road )ra*eor/, 'ut t%e NTC *ust de$elo# t%e rule )or t%e reulator+

s+ste* t%at ill o$ern t%e result

9 Re$enues )or Local O#erators F Encourain In$est*ent

It %as 'een s%on t%at o$erall, t%e sector is $ia'le> %at re*ains is to de$elo# a *et%od o) distri'utin

re$enue so tat in$est*ent in locall e8c%ane ser$ice, es#eciall+ in rural areas 'eco*es a .nanciall+

12



attracti$e #ro#osition

A or/in rou# o) t%e NT"C, c%aired '+ a senior o<cial o) t%e NTC, %as de$elo#ed a re$enue s%arin

)or*ula t%at s%ould encourae t%e esta'lis%*ent and rot% o) s*allerFscale tele#%one o#erators

T%e #ro#osed re$enue s%arin )or*ula #ro$ides )or increase in t%e re$enue s%are to t%e s*aller

co*#anies o) a##ro8i*atel+ 1!! )or international lon distance callin, and 5! )or do*estic calls?inancial *odels de$elo#ed '+ co**ittee su##ort sta7 and endorsed '+ t%e carriers, %a$e s%on t%at

a ne local e8c%ane can 'e .nanciall+ $ia'le under t%is sc%e*e It as also s%on to su##ort a #lan

under %ic% an e8istin s+ste* could 'e u#raded to *odern tec%nolo+

W%en i*#le*ented, t%e re$enue s%arin )or*ula *ust 'e constantl+ *onitored '+ t%e NTC to ensure

t%at it is ade=uate, and t%at local o#erators are #uttin t%e increased re$enues directed to t%e* to

#ro#er use

It is also reconi-ed t%at lonFdistance rate le$el need re$ie and c%ane to *a8i*i-e re$enue and

%ence crossFsu'sid+ #otential )or .nancin local ser$ices de$elo#*ent

A re#ort )ro* t%e tec%nical su'co**ittee o) t%e interconnection and re$enue s%arin or/in rou#

reco**ends an a##roac% to de$elo#in and *aintainin tec%nical standards PETE? %as 'een as/ed

to underta/e t%e re*ainin or/, and to consider t%e esta'lis%*ent o) a #er*anent Standards O<ce

it%in t%e #ri$ate sector T%is ill 'e )olloed u# '+ t%e "OTC I) )undin is a #ro'le* , DseedD *one+

*a+ %a$e to sou%t )ro* a*on t%e donor countries o7erin su##ort to sector de$elo#*ent

Wit% reard to local ser$ice re$enues, t%e structural di<culties it% tari7s )or tele#%one and certain

ot%er #u'lic netor/ ser$ices arrant attention A consistent and #ractica'le #olic+ )or local rate

settin is re=uired, and consideration *ust 'e i$en to t%e introduction o) local *easured ser$ice to

ensure t%at e8istin de*and is satis.ed at rate le$els t%at #roduce re$enues to .nance rot%

?inall+, t%e deter*ination o) t%e rate o) return *ust 'e re$ieed '+ t%e NTC, it% t%e )olloin )actors

in *ind;

a T%e rate o) return alloed s%ould 'e attracti$e to e8istin and #ros#ecti$e in$estors It *a+t%ere)ore 'e related to sta'le in$est*ent instru*ent suc% as lonFter* 'onds or 'lue c%i# e=uit+

in$est*ent

' T%e 'asis )or co*#utation s%ould 'e easil+ su'(ect to an inde#endent audit, s%ould consider )actor

o) e<cienc+ and 'e 'ased on esta'lis%ed tec%nical and .nancial #er)or*ance standards

c Sanctions s%ould 'e i*#osed on o#erators %o e8ceed t%e *a8i*u* alloa'le rate o) return

nor*all+ in t%e )or* o) a re)und o) o$erc%ares to su'scri'ers, #lus o$erall reduction in rates

93 O#erational Assistance to S*all O#erators

"OTC ill de$elo# a *eans o) #ro$idin a o#erational assistance to s*all o#erators T%e )olloin area

ill 'e addressed;

a Manae*ent and tec%nical trainin in t%e o#erations o) a teleco**unications co*#an+>

' Consolidation o) e=ui#*ent ac=uisitions )or international co*#etiti$e 'iddin>

c Consolidation o) t%e #ro$ision o) co**on 'usiness )unctions, suc% as co*#uteri-ation and

accountin and re#ortin>

d Trainin and orientation in t%e i*#le*entation o) a uni)or* s+ste* o) account and a standard

.nancial re#ortin s+ste*>

1



e Identi.cation o) )a$ora'le sources o) .nancin and )acilitatin .nancin arrane*ents> and

) Assistance in conductin )easi'ilit+ studies )or i*#ro$e*ent and e8#ansion #ro(ects>

92 ?inancial incenti$es

In line it% current #olic+ and in res#onse to t%e sector:s re=uire*ents, t%e Go$ern*ent is loo/in at

t%e )olloin to *eans o) #ro$idin .nancial assistance to teleco**unications o#erators; 0i4 accessto lonFter* )orein e8c%ane .nancin )or ca#ital e=ui#*ent and 0ii4 o#eratin incenti$es )or i*#ro$e

li=uidit+ durin t%e )or*ati$e +ears o) a teleco**unications co*#an+

In addition to t%e standard OI incenti$es on ta8F)ree e=ui#*ent ac=uisition, it %as 'een reco**ended

t%at teleco**unications in$estors s%ould 'e ranted t%e ot%er 'ene.ts a$aila'le to reistered #ioneer

enter#rises T%ese include t%e inco*e ta8 %olida+ o) .$e +ears )ro* reistration and t%e la'or e8#ense

deduction t%erea)ter

To alternati$e *eans o) #ro$idin #ri$ate sector access to a$aila'le lonFter* )orein e8c%ane

.nancin %a$e 'een identi.ed ?irst, usin an accredited .nancial institution, suc% as t%e "e$elo#*ent

an/ o) t%e P%ili##ines 0"P4, )unds sourced '+ t%e National Go$ern*ent *a+ 'e lent to o#erators

eit%er in #esos or in )orein currencies Second, in coordination it% t%e "OTC as t%e e8ecutin

aenc+, t%e Asian "e$elo#*ent an/ 0A"4 or t%e World an/ *a+ #ro$ide u*'rella coF.nancin

arrane*ents T%e dra)t #ro#osal )or t%ese .nancial incenti$es ill 'e endorsed '+ t%e "OTC to t%e

Ca'inet Assistance S+ste* 0CAS4 )or a##ro$al CAS a##ro$al s%ould set t%e *ec%anis* )or t%e "OTC in

coordination it% t%e "e#art*ent o) ?inance 0"O?4, t%e National Econo*ic and "e$elo#*ent Aut%orit+

0NE"A4, and "P 0as .nancial conduit4, to dra u# ter*s o) re)erence o) t%e relendin #ac/ae A *ore

detailed )easi'ilit+ stud+ o) t%e relendin #rora* ill 'e underta/en '+ t%e "OTC T%is stud+ s%ould

'e co*#leted durin 1! and, i) )easi'le, i*#le*ented i**ediatel+ T%e initial or/ o) t%e NT"C Tas/

?orce in t%is area s%ould ser$e as a ood ta/eFo7 #oint )or t%is stud+

Section C

TE NATION AS ENE?ICIARK

T%ese are stron incenti$es to ac%ie$e sector re)or* and accelerate de$elo#*ent T%is Section 'rieJ+

%i%li%ts t%e results o) t%e .nancial and econo*ic e$aluation it% res#ect t%e de$elo#*ent taretsset out in NT"P

1 TE USINESS CASE

?inancial #ro(ections enerall+ 'ased on e8istin leal, reulator+, .nancial o#eratin conditions 'ut

reJectin t%e de*and )orecasts, de$elo#*ent tarets, and tari7 ad(ust*ents reco**ended in t%e

Plan indicate t%at t%e teleco**unications #ro(ects e$aluated ill %a$e an o$erall internal rate return

0IRR4 o) 155 T%is e8ceeds t%e interest rate on treasur+ 'onds, currentl+ 2 a)ter ad(ustin )or

inJation, %ic% is used as a %urdle rate

T%e .nancial e$aluation also s%os t%at alt%ou% t%e #ro(ects are .nanciall+ attracti$e %en

considered in t%e areate, under current conditions 0ie, it%out t%e c%anes #ro#osed in t%e Plan4

so*e #ro(ect cateories *a+ 'e .nanciall+ unattracti$e In #articular, t%e rural #ro(ects ill re=uire

c%anes to current intraFsectoral cross su'sidies in order to 'e $ia'le W%en t%e #ro#osals )or tari7

ad(ust*ents, re$ised re$enue s%arin sc%e*es, and interest rates on lon ter* .nancin loer t%an

#re$ailin *ar/et rate contained in t%is Plan are reJected in t%e .nancial *odels, $ia'ilit+ o) t%e

o#erations o) t%ese su'sectors it %as 'een deter*ined t%at an IRR o) 22 )or ICCs can 'e attained '+

014 an increase in local ser$ice rate )ro* ! to ! o) PL"T:s Metro Manila rates> 054 a ! increase

in do*estic toll tari7 )ro* P35! to P9! #er *inute> 094 a #ro#osed a$erae re$enue #er *inute

0ARPM4 ad(ust*ents )or deter*inin ICCs: s%are in do*estic toll re$enues> 04 an increase )ro* to

5! o) t%e ICCs: s%are in international toll re$enues> and 034 reduction o) interest to a'out 15 All o)

1B



t%ese c%anes are considered )easi'le

5 TE ECONOMIC CASE

T%e underde$elo#ed state o) teleco**unications in structure in t%e P%ili##ines is o)ten as a *a(or

deterrent to 0i4 increased )orein in$est*ents, es#eciall+ in co**unicationsFde#endent e8#ort

industries, and 0ii4 in$est*ents in less de$elo#ed areas o) t%e countr+ To *eet unser$ed de*and andsu##ort accelerated and sustained econo*ic rot%, a##ro#riate teleco**unications sector

in$est*ents *ust 'e i$en a le$el o) #riorit+ co**ensurate it% t%eir de$elo#*ent i*#ortance

T%e #otential 'ene.ts o) teleco**unications ser$ice to t%e econo*+ include t%e )olloin;

a Reduced trans#ort costs and ener+ consu*#tion>

' Reduced isolation o) re*ote areas>

c I*#ro$ed res#onse to national and #ersonal e*erencies>

d I*#ro$ed resource usae>

e I*#ro$ed e<cienc+ o) )rei%t trans#ort>

) More e<cient orderin, collection, and distri'ution o) aricultural and .s%in #roducts, #articularl+

#eris%a'le #roducts>

etter .nancial control>

% I*#ro$ed )easi'ilit+ o) orani-ational decentrali-ation>

i Additional )orein e8c%ane earnins )ro* e8#ort 'usinesses aided or *ade #ossi'le '+ i*#ro$edteleco**unications>

( Reduction in t%e need )or #ersonal tra$el>

/ Maintenance o) t%e dail+ ties>

l Pro$ision o) %eat% end education ser$ices to outl+in areas> and

* Reduction o) *iration )ro* rural to ur'an areas>

In e$aluatin ca#ital in$est*ents #ro(ects, t%e National Econo*ic and "e$elo#*ent Aut%orit+ and t%e

interFaenc+ In$est*ents Coordinatin Co**ittee are currentl+ usin 13 as t%e *ini*u* desired

econo*ic internal rate return 0EIRR4 until a stud+ to u#date t%is .ure is co*#leted Preli*inar+ results

o) t%e u#date stud+ indicate t%at a donard re$ision, *a+ 'e a##ro#riate In an+ e$ent, t%e o$erall

EIRR )or t%e #ro(ects considered in t%e .nancial e$aluation is 1 T%us, in o$erall ter*s, t%e #ro#osed

#ro(ects are $ia'le, and deser$in o) in$est*ent ca#ital )or needed rot%

T%e EIRR anal+sis too/ into account =uanti.a'le )actors 'ased on t%e .nancial #ro(ections *odel

discussed in C%a#ter @II 0?INANCIAL E@ALUATIONS4 Man+ o) t%e econo*ic 'ene.ts e8#ected )ro*

teleco**unications #ro(ects cannot 'e =uali.ed relia'l+ T%e inclusion o) *one+ $alues )or suc%

'ene.ts, i) a$aila'le, ould sini.cantl+ i*#ro$e t%e #ro(ects: co*#uted EIRR

19 Auust 11

D#P$%TM#&T O%D#% &O. 61/535

Su'(ect ; STREAMLINING O? TE "OTC ORGANIATION

Pursuant to t%e #ro$isions RA No !B 0CK 11 General A##ro#riations Act4 reducin t%e nu*'er o)Undersecretaries and Assistant Secretaries, a redistri'ution o) t%e )unctions and res#onsi'ilities it%in

is %ere'+ e7ected )or t%e uidance o) all concerned

1 T%e #rinci#al line )unctions o) t%e "e#art*ent s%all 'e distri'uted a*on t%e )olloin;

a4 Trans#ortation Grou# F %ic% ill #er)or* #lannin and o#erations )unctions o) t%e land, ater and

air trans#ort sectors

1



'4 Co**unication Grou# F %ic% ill #er)or* #lannin and o#erations )unctions o) t%e

teleco**unications and #ostal ser$ice sectors

c4 Pro(ect Manae*ent Grou# F %ic% ill underta/e #ro(ect #re#aration, detailed enineerin, contract

ad*inistration, or/s enineerin, #ro(ect e8ecution, and #ro(ect *onitorin

5 T%e Trans#ortation Grou#, %ic% ill 'e %eaded '+ t%e Undersecretar+ )or Trans#ortation, s%all 'eco*#osed o) t%e Land Trans#ortation O<ce 0LTO4, Land Trans#ortation ?ranc%isin and Reulator+

oard 0LT?R4, Tra<c Enineerin Center 0TEC4 and t%e Air Trans#ortation O<ce 0ATO4 T%e

Trans#ortation Plannin Ser$ice s%all #ro$ide tec%nical sta7 su##ort to t%e Grou#

9 T%e Co**unications Grou#, %ic% ill 'e %eaded '+ t%e Undersecretar+ )or Co**unications, s%all

'e co*#osed o) t%e Teleco**unications O<ce 0Telo)4 and t%e Postal Ser$ices O<ce 0PSO4 T%e

Co**unications Plannin Ser$ice s%all #ro$ide tec%nical su##ort to t%e Grou#

T%e Pro(ect Manae*ent Grou# s%all 'e directl+ su#er$ised '+ t%e Pro(ect Manae*ent Co**ittee

to 'e c%aired '+ t%e secretar+ it% t%e undersecretar+ )or Trans#ortation and Undersecretar+ )or

Co**unications as @iceFC%air#ersons )or Trans#ortation and Co**unications, res#ecti$el+ T%e O<ce

o) t%e Assistant Secretar+ )or Pro(ect Manae*ent and Manae*ent In)or*ation Ser$ices s%all #er)or*

coordination and tec%nical secretariat )unctions )or t%e Pro(ect Manae*ent Co**ittee

An Acco*#an+in "e#art*ent Order s%all s#ell out t%e orani-ation o) t%e Pro(ect *anae*ent Grou#

includin t%e )unctions and res#onsi'ilities o) its ele*ents

3 T%e "e#art*ent:s sta7 and ot%er su##ort )unctions s%all 'e di$ided 'eteen t%e O<ce o) t%e

Assistant Secretar+ )or Ad*inistrati$e and Leal A7air, and t%e O<ce o) t%e Assistant Secretar+ )or

Ad*inistrati$e and Leal A7airs, and t%e O<ce o) t%e Assistant Secretar+ )or ?inance and

Co*#trollers%i#, eac% to 'e %eaded '+ an Assistant Secretar+ %o s%all re#ort directl+ to t%e

Secretar+

2 T%e O<ce o) t%e Assistant Secretar+ )or Ad*inistrati$e and Leal A7airs s%all 'e co*#osed o) t%e

i**ediate sta7 o) t%e Assistant Secretar+ and t%e )olloin; 0i4 Ad*inistrati$e Ser$ice> 0ii4 LealSer$ice> 0iii4 Procure*ent, Su##l+ and Pro#ert+ M*t Ser$ice> and 0i$4 t%e ?ranc%isin Re$ie Sta7

T%e O<ce o) t%e Assistant secretar+ )or ?inance and Co*#trollers%i# s%all 'e co*#osed o) t%e

i**ediate sta7 o) t%e Assistant Secretar+ and t%e )olloin Ser$ices; 0i4 ?inance and Manae*ent

Ser$ice> and 0ii4 Co*#trollers%i# Ser$ice

B T%e In$estiation Securit+ and La En)orce*ent Sta7, and "OTC Action Center are %ere'+ *ered

into one o<ce F ISLES6Action Center F t%e %ead o) %ic% s%all re#ort directl+ to t%e Secretar+

Me*'ers%i# in t%e oards o) attac%ed cor#orations s%all not 'e a7ected '+ t%is Order A##oint*ent

to t%ese oards s%all 'e *ade under se#arate orders as and %en necessar+

An+ #re$ious "e#art*ent Order, S#ecial Order or issuance inconsistent %ereit% are dee*ed *odi.ed,su#erseded o) re#ealed accordinl+

?or i**ediate co*#liance

PETE NICOME"E PRA"O

Actin Secretar+

5!



Re#u'lic o) t%e P%ili##ines

CONGRESS O? TE PILIPPINES

Metro Manila

T%ird Reular Session

eun and %eld in Metro Manila on Monda+, t%e tent+F)ourt% da+ o) Hul+, nineteen %undred and ei%t+

nine

REPULIC ACT NO 2BQAN ACT PRO@I"ING ?OR TE INSTALLATION, OPERATION, AN" MAINTENANCE O? PULIC TELEPONES

IN EAC AN" E@ERK MUNICIPALITK IN TE PILIPPINES, APPROPRIATING ?UN"S TERE?OR AN" ?OR

OTER PURPOSES

e it enacted '+ t%e Senate and ouse o) Re#resentati$es o) t%e P%ili##ines in Conress asse*'led;

SECTION 1 Title F T%is act s%all 'e /non as t%e DMunici#al Tele#%one Act o) 1D

SECTION 5 "eclaration o) National "a+ Polic+ F Reconi-in t%at t%e 'ene.ts o) *odern

co**unication tec%nolo+ are as i*#ortant to rural de$elo#*ent as t%e+ are to ur'an areas, t%e State

s%all #ursue and )oster, in an orderl+, #ur#osi$e and $iorous *anner, t%e interconnection o) all

*unici#alities in t%e countr+ t%rou% t%e esta'lis%*ent and earl+ reali-ation o) a nationide netor/

o) #u'lic callin stations

SECTION 9 Pro(ects O<ce F ?or #ur#oses o) ad*inisterin t%e #ro$isions o) t%is Act, t%ere is %ere'+

created a Munici#al Tele#%one Pro(ects O<ce in t%e "e#art*ent o) Trans#ortation and

Co**unications 0"OTC4 it% t%e )olloin )unctions;

0a4 "e$elo#, in coordination it% all ot%er aencies concerned, a #lan )or #ro$idin #u'lic callin

stations it% tec%nolo+ ca#a'le o) $oice and data trans*ission in e$er+ *unici#alit+ and, %en

)easi'le, in suc% 'arana+ not ot%erise ser$ed '+ an e8istin tele#%one e8c%ane usin a##ro#riate

tec%nolo+ and )or t%is #ur#ose )or*ulate or cause to 'e )or*ulated, enineerin studies>

0'4 Underta/e t%e i*#le*entation o) t%e said #lans and #rora*s and toard t%is end, to enter into

contracts su'(ect to e8istin las and reulations )or t%e #rocure*ent o) e=ui#*ent, construction o)

)acilities and t%e installation o) t%e s+ste*>

0c4 Arrane )or )undin )or* an+ source, #ri$ate, o$ern*ent, )orein or do*estic, includin o<cial

de$elo#*ent assistance, 'ilateral and *ultilateral loans su'(ect to a##lica'le las and reulations>0c4 Prescri'e and ensure co*#ati'ilit+ it% *ini*u* standards and reulations to assure acce#ta'le

standards o) construction, *aintenance, o#eration,

0d4 #ersonnel trainin, accountin and .scal #ractices )or t%e *unici#al teleco**unications o#erators

o) #u'lic callin stations>

0e4 ?urnis% tec%nical assistance and #ersonnel trainin #rora*s )or t%e *unici#al teleco**unications

o#erators o) #u'lic callin stations>

0)4 Monitor and e$aluate local teleco**unications and e7ect s+ste* interation and o#erations

%ene$er econo*icall+ and tec%nicall+ )easi'le

Pro$ided, %oe$er, T%at t%e a##ro$al o) t%e #ro$incial o$ern*ent o) t%e #ro$ince %ere an+ or all o)

t%e )unctions a'o$e *entioned are to 'e disc%are is .rst secured

SECTION Manae*ent o) t%e Pro(ects O<ce F A #ro(ects "irector, %o s%all 'e a #erson o) interit+,

co*#etence and e8#erience in tec%nical .elds related to t%e #ur#oses o) t%is Act, s%all 'e a##ointed'+ t%e President o) t%e P%ili##ines u#on t%e reco**endation o) t%e Secretar+ o) Trans#ortation and

Co**unications e s%all %a$e t%e ran/, #osition and e*olu*ents o) an undersecretar+

T%e Pro(ects "irector s%all %a$e t%e )olloin #oers and duties>

0a4 To e8ecute and ad*inister t%e #lans and #ro(ects )or t%e reali-ation o) t%e #olic+ set )ort% in t%is

Act>

0'4 To direct and su#er$ise t%e o#eration and internal ad*inistration o) t%e Pro(ects O<ce and, )or t%is

#ur#ose, to deleate so*e or an+ o) %is #oers and duties to a##ro#riate su'ordinate o<cials>

51



0c4 Su'(ect to t%e uidelines and #olicies esta'lis%ed '+ t%e Secretar+ o) Trans#ortation and

Co**unications, to a##oint and in coordination it% t%e "e#art*ent o) udet and Manae*ent .8

t%e nu*'er and co*#ensation o) o<cials and e*#lo+ees o) t%e Pro(ects O<ce, su'(ect to Ci$il Ser$ice

La>

0d4 To #re#are an annual re#ort on t%e acti$ities o) t%e Pro(ects O<ce on or 'e)ore t%e end o) t%e .rst

=uarter a)ter t%e .scal +ear co*#leted and to su'*it a co#+ t%ereo) to t%e President o) t%e P%ili##ines

and t%e Conress o) t%e P%ili##ines> and0e4 To e8ercise suc% ot%er #oers and duties t%at are #ro#er or necessar+ to carr+ out t%e #ur#oses o)

t%is Act as *a+ 'e $ested in %i* '+ t%e Secretar+ o) Trans#ortation and Co**unications

SECTION 3 Ri%ts o) ?irst O#tion F All do*estic teleco**unications carriers or utilities e8istin at t%e

ti*e o) t%e a7ecti$it+ o) t%is Act, and )ranc%ised to ser$ice a #ro$ince or reion WIC s%all %a$e 'een

certi.ed '+ t%e National Teleco**unications Co**ission 0NTC4 as renderin satis)actor+ and

co*#etent ser$ice in its area o) o#eration, are %ere'+ i$en, under e=ual conditions and

circu*stances, t%e .rst o#tion to #ro$ide, install and o#erate #u'lic callin stations or tele#%ones in

#ro$incial co**unications netor/ %ic% s%all 'e ca#a'le o) $oice and data trans*ission and s%all 'e

interconnected to t%e #u'lic sitc%ed tele#%one netor/ or ot%er national trans*ission )acilities T%e

intention to e8ercise t%e o#tion s%all 'e *ade s#eci.call+ in ritin to t%e Pro(ects O<ce it%in si8 024

*ont%s o) t%e a7ecti$it+ o) t%is s%all indicate t%e #re)erred #ro$ince and t%e ti*e )ra*e o)

de$elo#*ent Pri$ate o#erators or )ranc%isees o) suc% #u'lic callin stations s%all 'e entitled to t%esa*e 'ene.ts and #ri$ilees en(o+ed '+ t%ose installed and o#erated '+ Go$ern*ent in so )ar as ta8

concessions and6or incenti$es are concerned

SECTION 2 ?re=uenc+ Allocation F In order to accelerate t%e i*#le*entation o) t%is #ro(ect, National

Teleco**unication Co**ission 0NTC4 is aut%ori-ed to assin or reassin, %en necessar+, e8istin

radio )re=uenc+ users currentl+ o#eratin

SECTION Rates and Mandator+ S%arin o) Toll Re$enue F T%e NTC, su'(ect to its standard uidelines

and in consultation it% t%e reional de$elo#*ent councils concerned, s%all .8 an e=uita'le,

reasona'le and uni)or* rate o) c%ares )or e$er+ t+#e o) call A rate sc%edule s%all 'e set )or all

*unici#al tele#%one calls under t%e )olloin classi.cations;

0a4 Munici#al to International>0'4 Munici#al to Metro Manila, and ot%er do*estic lon distance calls>

0c4 Munici#al to Pro$incial Ca#ital>

0d4 Munici#al to Munici#al>

014 o) t%e sa*e #ro$ince

054 o) di7erence #ro$inces, ot%er t%an do*estic lon distance

In connection it% t%e rates, t%e National Teleco**unications Co**ission 0NTC4, in consultation it%

t%e toll netor/ o#erators or interc%ane carriers and t%e #ro$incial o$ern*ent concerned, s%all

aut%ori-e and cause t%e i*#le*entation o) an e=uita'le toll re$enue s%arin and collection sc%e*e

T%e s%are o) t%e local e8c%ane o#erators in toll re$enues s%all 'e re*itted '+ t%e interc%ane carries

to t%e* it%in ninet+ da+s 0!4 )or* recei#t

SECTION B Ti*eta'le o) I*#le*entation F T%e Pro(ects O<ce s%all install all #u'lic callin stations )or#ro$inces and *unici#alities not co$ered '+ #ri$ate co**unication utilities under Section 3 %ereo),

suc% t%at eac% one o) t%e *unici#alities in t%e P%ili##ines still unser$ed '+ tele#%one at t%e a7ecti$it+

o) t%is Act, s%all %a$e at least one 014 #u'lic callin station or #u'lic tele#%one '+ t%e t%ird +ear o)

e7ecti$el+ o) t%is Act W%ere resources #er*it, t%e Pro(ects O<ce s%all also e8tend t%e ser$ices

concurrentl+ or su'se=uentl+ to ot%er re*ote 'arana+s o) t%e countr+ T%e #u'lic callin stations

s%all 'e interconnected to t%e #u'lic sitc%ed tele#%one netor/ or ot%er national trans*ission

)acilities, su'(ect to t%e tec%nical interconnection standards #rescri'ed '+ t%e NTC

55



SECTION O#eration '+ Local Go$ern*ents F Pro$inces and *unici#alities are %ere'+ aut%ori-ed to

set u#, o#erate and *aintain t%eir res#ecti$e #u'lic callin stations or to rant )ranc%ise to #ri$ate

entities )or t%e o#eration and *aintenance o) tele#%one s+ste*s and6or #u'lic callin stations;

Pro$ided, T%at t%e NTC certi.es t%at t%e #ro#osed rantee is tec%nicall+ and .nanciall+ ca#a'le o)

co*#l+in it% all t%e re=uire*ents o) #u'lic ser$ices

SECTION 1! A##ro#riation F T%e a*ount o) to %undred *illion #esos 0P5!!,!!!,!!!!!4, or so *uc%t%ereo) as *a+ 'e necessar+ to i*#le*ent t%e #ro$isions o) t%is Act, s%all 'e ta/en )ro* t%e

a##ro#riations #ro$ided under Title 1 F Teleco**unications o) E8ecuti$e Order No 1B5 In addition, t%e

su* o) t%ree %undred *illion #esos 0P9!!,!!!,!!!!!4, or so *uc% t%ereo) in e=ui$alent )orein

currencies as *a+ 'e necessar+, s%all 'e source, in t%eir order o) #re)erence, )ro* )orein rants,

concessional loans, o<cial de$elo#*ent assistance, co**ercial loans, and6or e8#ort credits to *eet

t%e o'(ecti$e o) t%is Act

SECTION 11 O<cial "e$elo#*ent Assistance F T%e #ro$isions o) E8ecuti$e Order No 59! o) 1B2, on

t%e #oer o) t%e NE"A oard, and t%e rules and reulations o$ernin t%e e$aluation and

aut%ori-ation )or t%e a$ail*ent o) O<cial "e$elo#*ent Assistance notit%standin, t%e *unici#al

tele#%one #rora* #ro$ided )or in t%is Act s%all 'e elii'le )or )orein loans and rants it%out )urt%er

e$aluation '+ t%e NE"A oard, su'(ect to Section 51, Article II o) t%e Constitution

TRANSITORK PRO@ISIONS

SECTION 15 Sunset Clause F T%e #ro(ects O<ce s%all not %a$e a li)e e8ceedin ten 01!4 +ears )ro*

t%e d ate o) t%e a##ro$al o) t%is Act and *a+ onl+ 'e e8tended '+ act o) Conress At t%e o#tions o)

t%e #ro$incial o$ern*ent, t%e s+ste*s o#eratin in eac% #ro$ince s%all 'e turned o$er to it, e8ce#t

t%ose o#eratin under Section 3 t%ereo)

SECTION 19 Se#ara'ilit+ o) Pro$isions F An+ #ortion or #ro$isions o) t%is Act t%at *a+ 'e declared

unconstitutional or in$alid s%all not %a$e t%e e7ect o) nulli)+in ot%er #ortions and #ro$isions %ereo) as

lon as suc% re*ainin #ortions or #ro$isions can still su'sist and 'e i$en e7ect in t%eir entiret+

SECTION 1 Re#ealin Clause F All acts or #arts o) acts inconsistent %ereit% are re#ealed or *odi.edaccordinl+

SECTION 13 E7ecti$it+ F T%is act s%all ta/e e7ect .)teen 0134 da+s a)ter its #u'lication in at least to

054 national nes#a#ers o) eneral circulation

APPRO@E",

0SG"4 RAMON @ MITRA

S#ea/er o) t%e ouse o) Re#resentati$es

0Sd4 HO@ITO R SALONGAPresident o) t%e Senate

T%is Act %ic% is a consolidation o) Senate ill No B5 and ouse ill No 935 as .nall+ #assed '+

t%e Senate and t%e ouse o) Re#resentati$es on "ece*'er 5!, 1B and "ece*'er 51, 1B

res#ecti$el+

0Sd4 UIRINO " AA" SANTOS, HR

Secretar+ o) t%e ouse o) Re#resentati$es

59



0Sd4 E"WIN P ACOA

A##ro$ed; ?e'ruar+ B, 1!

Secretar+ o) t%e Senate

0Sd4 CORAON C AUINO

President o) t%e P%ili##ines

5

Documents

Ntc Manual