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TELECOMMUNICATIONS

 

THE TELECOMS ACT

The Public Telecommunications Policy Act of the Philippines (RA 7925 or the Telecoms Act) and its implementing rules regulate the performance of telecommunications services in the Philippines. Telecommunications services are defined as those services involving “any process which enables a telecommunications entity to relay and receive voice, data, electronic messages, written or printed matter, fixed or moving pictures, words, music or visible or audible signals or any control signals of any design and for any purpose by wire, radio or other electromagnetic, spectral, optical or technological means”.   

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THE PUBLIC SERVICE LAW

The Philippines’ Public Service Law (Commonwealth Act No. 146) is the law that applies to industries/entities engaged in “public service” in general. The Public Service law therefore applies to telecommunications services offered to the public.

 

The regulatory body in charge of telecommunications services in the Philippines is the National Telecommunications Commission (NTC). By virtue of the authority granted to it by the Telecoms Act and the Public Service Law, the NTC has regulatory and quasi-judicial powers. The NTC can also enforce compliance of its issuances by initiating complaints (which may result in fines and imprisonment) and/or imposing fees and penalties. 

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PROVISION OF TELECOMMUNICATIONS SERVICES BY A PUBLIC TELECOMMUNICATIONS ENTITY (PTE)

The provision of telecommunications services by a Public Telecommunications Entity (PTE) is heavily regulated. A PTE is a person, firm, partnership or corporation, government or private, engaged in the provision of telecommunications services (a) to the public; (b) for compensation. Generally, a PTE is required to secure a legislative franchise from the Philippine Congress and a CPCN or Provisional Authority (PA) from the NTC. The franchise contains conditions as to its grant, such as restrictions on transfers and annual reporting obligations. 

 

On the other hand, the CPCN issued by the NTC certifies that the telecommunications service to be provided by the enfranchised entity is feasible and necessary. It is usually granted after an entity’s showing of its legal, technical and financial capability to provide the contemplated service. Additionally, a PTE is required to be at least 60% Filipino owned.

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VALUE-ADDED SERVICES

Regulated telecommunications services also include Value-Added Service (VAS). The Telecoms Act provides that a VAS operator is “an entity which, relying on the transmission, switching and local distribution facilities of the local exchange10 and inter-exchange operators11, and overseas carriers, offers enhanced services beyond those ordinarily provided for by such carriers.” The implementing rules of the Telecoms Act define VAS as “a service which adds a feature or value to basic telephone service not ordinarily provided by a public telecommunications entity such as format, media, conversion, encryption, enhanced security features, paging, internet protocol, computer processing and the like.” Under the Telecoms Act, a VAS provider is not considered a PTE, provided that it does not put up its own network.

VAS providers are required to register with the NTC and submit quarterly reports of the operation. Under NTC regulations, only entities which are at least 60% Filipino-owned may register as VAS providers. In practice, however, the NTC differentiates between non-regulated VAS and regulated VAS. The NTC only applies the VAS restriction requirements (i.e. the registration/ nationality restriction requirements) to regulated VAS providers. VAS providers are regulated if they have the following characteristics: (1) the VAS services are provided directly to the Philippine public; and (ii) the VAS services are provided for free. 

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VoIP AS VALUE-ADDED SERVICES

Voice Over Internet Protocol (VoIP) is a form of VAS that is governed by its own set of rules. VoIP services intended to be offered for use by the public for compensation is expressly regulated by the NTC. Service providers which intend to offer such service are required to register with the NTC as VoIP providers. Further, “any person or entity that intends to derive or source VoIP from a duly registered VoIP provider under an agreement to resell the service directly to retail end-user customers” must also register with the NTC as a VoIP Reseller.

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CYBERCRIME PREVENTION ACT

The Philippines’ Cyber Crime Prevention Act of 2012 (RA No. 10175 or the Cyber Crime Act) requires service providers12 to preserve the integrity of “traffic data and subscriber information relating to communication services” for at least six (6) months from the date of the transaction. Content data (defined as communication or content of communication, the meaning or purport of the communication, or the message or information being conveyed by the communication, other than traffic data), shall also be preserved following an order from law enforcement authorities.

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IMPORTATION/DISTRIBUTION OF TELECOMMUNICATIONS EQUIPMENT

Under current NTC regulations, type approval or type acceptance is required for all customer premises equipment (CPE) and radio transmitters and transceivers, i.e. devices capable of emitting radio waves or energy. Type approval refers to the process by which an equipment is evaluated for conformance to established standards, by undergoing laboratory tests and measurements. Type acceptance on the other hand is a process by which an equipment is evaluated for acceptability for use on the basis of type approval tests done by reputable foreign approval or certification agencies. The importer/distributor of CPEs and radio transmitters/transceivers should secure authorization from the NTC in order to supply these equipment.

 

An import permit must be secured from the NTC in order to import equipment that requires type approval or acceptance. The NTC import permit will be required by the Philippine Bureau of Customs as a condition for customs clearance. 

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CONSIDERATIONS FOR MEMBERS OF THE EU

There are no special considerations/requirements under Philippine telecommunication laws for nationals of EU Member States.

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+632 845 1324

info@businessphilippines.eu

19F Philippine AXA Life Center,

Senator Gil Puyat Avenue corner Tindalo Street, Makati City, Philippines

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