'Misinterpretation' of law makes NTC powerless

MANILA, Philippines - The law creating the National Telecommunications Commission (NTC) may have been misinterpreted, thereby rendering the body powerless to regulate fees charged by mobile phone companies. This possibility was raised by Senator Joker P. Arroyo during a joint hearing organized by the Senate committees on trade and commerce and public services. Officials of the NTC may have “misread or misinterpreted" provisions of Republic Act 7925, the law that created the body, he said. Section 17 of the said law indicates that the Commission “shall establish rates and tariffs which are fair and reasonable and which provide for the economic viability of telecommunications entities and a fair return on their investments considering the prevailing cost of capital in the domestic and international markets." Inclusion of the word “shall" in the law means it is mandatory for the NTC to establish rates and tariffs it will impose on telecommunications companies, Arroyo said. “What is stated here is full power for NTC," Arroyo said. The NTC cannot afford to keep its head under the sand by overlooking the law’s provisions to justify their failure to regulate the telecommunications industry, he added. However, the issue lies in the provision’s second paragraph, NTC deputy commissioner Douglas Michael Mallillin said during the hearing. “Under section 17 and 18 of Republic Act 7925, the NTC is only granted residual powers," he said. The provisions state that “the Commission shall exempt any specific telecommunications service from its rate or tariff regulations if the service has sufficient competition to ensure fair and reasonable rates or tariffs. The Commission shall, however, retain its residual powers to regulate rates or tariffs when ruinous competition results or when a monopoly or a cartel or combination in restraint of free competition exists and the rates or tariffs are distorted or unable to function freely and the public is adversely affected. In such cases, the Commission shall either establish a floor or ceiling on the rates or tariffs." Besides admitting that it has no power over companies it should regulate, the NTC can also only hold public consultations, Mallillin said. Earlier, the same official admitted that the NTC has failed to act on cellphone complaints after a court order temporarily prevented it from implementing its rules. [See story here.] - GMANews.TV