PLDT willing to extend deadline on Digitel deal

Telecommunications giant Philippine Long Distance Telephone Co. (PLDT) said it is open to extending the June 30 deadline for closing its P69.2 billion share-swap deal with Digitel Telecommunications Philippines Inc. (Digitel) in light of strong opposition to the transaction. The deal is currently pending with the National Telecommunications Commission (NTC). During NTC’s second hearing Tuesday on transaction, lawyers of PLDT and Digitel presented the financial controllers of each firm as witnesses who showed the commission the requirements for approval of the joint application on the share-swap deal. The requirements include among others the financial statements of both in the last three years, showing their respective financial standing. Meanwhile, PLDT in a motion filed on Tuesday before the NTC claimed that rival Globe Telecom is delaying the proceedings with its "piece-meal filing of no less than three motions" for consideration by the NTC. "A cursory examination of Globe's allegations reveals that they are utterly bereft of merit and are obviously intended to prevent the [NTC] from proceeding to receive the parties' evidence," PLDT said. The company said such "dilatory tactics based on self-interest" cannot be acted upon by the NTC, to the grave detriment of PLDT, Digitel and the general public. Given the slow progression of the hearings, lawyer Ray Espinosa, PLDT's head of regulatory affairs and policy, said they are willing to extend the deadline for consummating the transaction and wait for the NTC approval. "It's not the end of the world by then," Espinosa told reporters on the sidelines of the hearing, when asked what their plans are should the NTC approval come after their deadline. Espinosa said June 30 remains the company's goal, but whether or not the proceedings will be completed in time for the deadline "is something to be determined by the commission." The next NTC hearings on PLDT-Digitel deal are set next June 22 and June 23, when the two companies are expected to present a third witness. Those who oppose the deal will present their witness after the applicants have presented theirs, NTC hearing officer and legal department director Dennis Babaran said. The case will then be elevated to the commission en banc for resolution. Competition authority Meanwhile, Globe welcomed the administration's newly established Office for Competition to be headed by Justice Secretary Leila de Lima. President Benigno Aquino III last week signed Executive Order No. 45 to promote competition and level the playing field in the market. Globe legal counsel Rodolfo Salalima called on the Department of Justice to "act swiftly" to prevent the deal from eventually stifling competition in the industry. “With so much clout, significant market power and influence now consolidated and vested in the PLDT group, free competition is threatened and ultimately the public good is gravely placed at risk," Salalima said in a statement. He lambasted PLDT for delaying full interconnection with its competitors, saying Globe requested for an interconnection with the telco giant five years ago. Interconnection means subscribers of competing telecom firms within the same locality can call each other without having to pay long distance rates. “Customers cannot enjoy local calls when connecting to a PLDT landline within the locality, and vice versa, because PLDT has yet to act on its request for interconnection," Globe said. Forum shopping However, PLDT's Espinosa said Globe's call for the DOJ to investigate the deal is a form of "forum shopping" and a "political cheap shot." By calling on the DOJ to act on the matter, Espinosa said Globe is undermining the clear statutory authority of the NTC, even as Globe is fully aware that the Public Service Law provides that only the NTC has the approving authority for such transactions. "Globe's latest stunt to take undue advantage of EO 45 is intended to throw the ongoing NTC proceedings into confusion," Espinosa claimed. "Globe's legal counsel is fully aware that EO 45 was not intended to divest the NTC of its jurisdiction and statutory powers as the regulator of the telecommunications sector." He said that should there be any monopolistic practices that the Office for Competition should investigate, it is Ayala's exclusive concessions with Globe — of which it is a majority shareholder — barring other telecom firms from serving its malls. "Globe cannot be a guardian of free competition. It is the beneficiary of a combination and arrangement in restraint of trade — it has exclusivity in the Ayala malls," he pointed out. Espinosa also called on the DOJ to investigate the alleged illegal practice "to promote free competition in domestic trade." — VS, GMA News