Globe claims PLDT ‘hiding something’ in Digitel acquisition deal

Globe Telecom Inc. claimed before the National Telecommunications Commission (NTC) that rival Philippine Long Distance Telephone Co. (PLDT) is hiding something by not making public the full details of its sale agreement with Digital Telecommunications Philippines Inc. (Digital). During Monday’s NTC hearing on the P69.2-billion PLDT-Digitel acquisition deal, Globe's counsel Rodolfo Salalima questioned why the contract to sell was not included in the joint application filed by the two telcos with the NTC. PLDT in late March said it bought the third market player, Digitel, in a share-swap deal for a 51.5-percent stake in the telco that owns and operates Sun Cellular — Digital’s mobile telecommunications business. In particular, Salalima questioned why that the joint application invokes Digitel's landline business but mentions the inclusion of Sun Cellular, later on in the agreement. "Why are they hiding the document? Ano nga ba talaga ang binili? The mobile business or the landline? There are issues that they are hiding something from the public [by not including the contract of sale] in their application," Salalima told reporters during a break in the hearing. In its joint application for regulator NTC to approve its Digitel acquisition, PLDT only included in the annex the congressional franchise agreement of Digitel's landline arm, not its cellular mobile business, Salalima said. "The only way to answer that is for [PLDT] to produce the actionable documents. The denial of our request is a denial of our right to due process," he added. No legal standing PLDT, however, said that since Globe is not a party to the transaction, it does not have any legal standing to question its details. "With respect to all these arguments, even the NTC has no jurisdiction over these commercial terms," said PLDT counsel Arnold Corporal. Ray Espinosa, PLDT head of regulatory affairs and policy, said that since they have acquired the parent company of Digitel's landline and mobile arm, they have already bought all its subsidiaries as well. "If the NTC orders us to submit a copy of the contract, then we will do so, but not on the mere desire of Globe to have a copy of the contract," he said. Due process By not including the sale contract in their joint application, there is an "ultimate denial of due process," Salalima said. Consumer group TXTPower likewise decried the absence of the contract, saying that since there are no documents to base their opposition on, they are void of the right to oppose. "Without information, we feel deprived, we find no basis to file any sort of opposition or any other pleading," TXTPower president Anthony Ian Cruz said. "We [request] that these documents be posted on the NTC website. It is unfair to non-lawyers and the public to be deprived of such documents," Cruz added. PLDT's Espinosa, meanwhile, downplayed allegations of disenfranchisement, saying a copy of the joint application is available from the NTC and can be requested by any party any time. "There is no denial of due process. How can we know who are the opposing parties? Hindi puwedeng hulaan 'yan. The notice of hearing only mentions the Securities and Exchange Commission and the Office of Solicitor-General as the opposing parties, so we sent them a copy of the application," he said. "Dine-delay ‘ata ang proceedings, eh," he said. The NTC has since directed PLDT to forward copies of the joint application to the opposing parties, which include Globe, Eastern Communications, TXTPower and consumer group Txtmate, among others. Special privileges In opposing the deal, Globe is merely asking the NTC for "special privileges," PLDT in turn said in a statement. "By raising the false issue of monopoly, Globe wants the government to give it radio frequencies for free — at the expense not only of PLDT but also of other telecom players," Espinosa said. In its motion to intervene, Globe questioned the monopolistic tendencies of the deal, and asked the NTC to re-assign Smart Communications Inc.’s excess 22 MHz for 3G services to them. Smart is the mobile telecommunications unit of PLDT. "By applying simple ratio and proportion alone, if Globe has 10 MHz for its 26 million cellular subscribers, then PLDT needs only 23 MHz for its 60 million subscribers," Globe said in its motion. "Computed another way, if Globe has 10 MHz for its 26 million subscribers, then PLDT's 45 MHz equals 117 million subscribers. How then can PLDT serve 117 million when the Philippine population to date is only about 92 million?" it added. The behavior of Globe shows it is “holding hostage" the digital deal so it can get free frequencies from PLDT and Digitel, said Espinosa. "That is what all this noise is about. Globe's opposition to the Digitel investment is not based on principle or out of concern for consumer interest," he said. Globe had earlier said that all they want is to level the playing field in the telco market. "When a carrier exercises so much clout, you are endangering the welfare of the public," it said. — VS, GMA News