NTC justifies award of 3G frequencies

By Mary Ann Ll. Reyes
The Philippine Star

Amid mounting calls from legislators to set aside the award of 3G or third generation mobile technology frequencies, the National Telecommunications Commission (NTC) has maintained that the law itself precludes an immediate resort to bidding in the award of these bandwidths.

The NTC last year awarded four of five available 3G frequencies to Smart Communications, Globe Telecom, Digitel Mobile, and Connectivity Unlimited Resources Enterprises (CURE). Those not awarded frequencies such as Bayan Telecommunications, Next Mobile, AZ Communications Network, Multimedia Telecommunications (MTI), and Pacific Wireless filed separate motions with the commission questioning the award.

The commission has yet to award the last remaining frequency but according to NTC officials, they may have to first convince Congress that the whole award process had legal basis.

In a position paper submitted to the House of Representatives, the NTC emphasized that Republic Act 7925 or the Public Telecommunications Policy Act precludes immediate resort to the traditional public bidding process in the award of 3G radio frequencies.

Responding to claims by some legislators that the non-resort to open tender deprived the government of billions of pesos in potential revenue, especially considering the experiences in other countries, the NTC stressed that the existing law in this jurisdiction is rigidly restrictive as to when open tender can be resorted to, and that is, only after qualification by the commission as regards legal, technical and financial considerations, there emerge more applicants than the frequencies available.

"A complete reading of RA 7925 would show that the public bidding process is not the sole mode by which the commission is authorized by law to allocate spectrum use. Neither is it the primary method nor the first option that in all instances must be considered first by the commission," the NTC said.

It emphasized that the highest bidder is not necessarily the ‘best qualified,’ or the one technologically positioned to use the spectrum ‘efficiently and effectively to meet public demand.

"Simply stated, the yardstick provided by law is not money. Spectrum use must only be granted to the best qualified taking into account the service provider’s proposal to utilize the spectrum efficiently and effectively to meet public demand. And it is the NTC that has been granted by law the sole competence to pass upon this question and has in the past decades accumulated the technical experience and expertise in the evaluation and grading of proposals from service providers," the regulatory body said in its position paper.

The NTC issued a circular providing for a set of criteria against which the legal, financial and technical qualifications of prospective assignees are to be evaluated, for the purpose of determining which among them is the most qualified. Thus, to be considered best qualified, an applicant must comply with the following requirements: no outstanding unpaid fees, undertaking to interconnect, sharing of network and facilities, roaming agreements, and undertaking to abide by the terms and conditions imposed by the NTC. The commission then ranked the qualified applicants on the basis of their track record, roll-out commitments, and rates to be charged from consumers/subscribers/users