Think tank urges gov't review of San Miguel telco assets sale
MANILA, Philippines – Citing its "implications," a think tank on Thursday, June 2, called for a government review of San Miguel Corporation’s (SMC) sale of its telecommunication business to Philippine Long Distance Telephone Company (PLDT) and Globe Telecom, Incorporated.
The Foundation for Economic Freedom, Incorporated (FEF), manned by former economic and finance officials, directed the call to the Philippine Competition Commission (PCC) and the incoming National Telecommunications Commission chief of President-elect Rodrigo Duterte.
"We, the Foundation for Economic Freedom (FEF), strongly urge that the Philippine Competition Commission (PCC) review the deal immediately and expeditiously and take appropriate action as the facts warrant," the FEF said.
It noted that the PCC is mandated by law to "prohibit anti-competitive agreements, abuse of dominant position, and merger or acquisition agreements that substantially prevent, restrict or lessen competition in the market."
PCC on said Monday said it will assert all of its powers as provided for in the law to "move quickly to reach a fair assessment" of the deal. (READ: New Internet speed minimum throwback to '90s?)
PLDT and Globe announced on Monday, May 30, that they agreed to buy all of San Miguel's telecommunication assets for P69.1 billion. (READ: San Miguel's sale of telco business: Will consumers benefit?)
San Miguel was supposed to launch a third major telco player this year. (READ: Ramon Ang: We hope to open 3rd major telco by 2016)
Under terms of the deal, the two telecommunication giants will acquire SMC’s prized 700 megahertz spectrum network – which is said to be important for wider reach and compatibility with 4G network.
PLDT and Globe said they will return certain other radio frequencies to the government, allowing for a new competitor to begin operations. (READ: The future of 700 MHz band remains unclear)
Amend, alter, or repeal
FEF also called on the incoming NTC chief to review the spectrum allocation, saying it is "a public and scarce resource" for better telco services. (READ: Monopolies, duopolies hamper PH inclusive growth)
To ensure competition in the country's duopolistic telecom sector, FEF called fro a congressional probe into the deal.
"We ask Congress to conduct an investigation in aid of legislation and exercise its powers to amend, alter, or repeal the franchises of public utility operators when the common good so requires," FEF said.
Stock analysts had said the deal has strengthened the dominance of PLDT and Globe, with 57% and 43% of the wireless market, respectively. (READ: Telstra-San Miguel a bumpy, costly ride) – Rappler.com