MS. NERILYN A. TENORIO
Editor-in-Chief, Manila Times
Dear Ms. Tenorio:
We write to take strong exception to the twin opinion articles written by Rigoberto D. Tiglao entitled “Smart’s operations could stop by end-March 2017” and by Ben D. Kritz entitled “Let PLDT Fail” which were published by your newspaper on 16th and 17th of December, respectively.
Both make extravagant and unsubstantiated claims that Smart could be out of business by end-March 2017 because its congressional franchise would not be renewed in time due to issues regarding its public ownership.
With respect to the renewal of Smart’s franchise, the plenary body of the House of Representatives approved on second reading last December 13 — shortly before the publication of the two articles — the amended House bill extending the legislative franchise of Smart for another 25 years. Approval on the third and final reading is expected as soon as the House resumes session in January 2017.
Smart will be working to obtain Senate approval as soon as possible after the House has officially transmitted the approved House bill to the Upper Chamber.
On the issue of Smart’s public ownership, this was discussed extensively during the hearings before the House Committee on Franchises, which took place in November. The Committee agreed that Smart need not comply with the public ownership requirement for as long as it is owned by a listed public company like PLDT. The spirit of the public ownership requirement in Smart’s franchise has been fulfilled through the listing of its parent company. Indeed, the revenues and profits of Smart are consolidated at the PLDT level and therefore are derivatively owned by the public shareholders of PLDT.
In line with this, the public ownership provision of the House bill was amended by the House Committee on Franchises during the second public hearing held in November to reflect this exception, and this amended House bill was approved by the plenary body of the House last December 13.
We must point out that as a duly operating public utility with existing public services and with a valid and pending application for the renewal of its legislative franchise, Smart is not required to immediately cease operations as soon as its franchise expires. There is no law or jurisprudence that requires such immediate cessation of public services, particularly since this would be to the prejudice of the public.
Furthermore, in the worst case scenario, Smart can transfer its mobile telecommunication business to Digitel Mobile Philippines, Inc., another duly enfranchised and operating mobile telecommunication operator owned by PLDT.
Clearly, the dark scenario of an “extinction event” highlighted by the two articles has absolutely no factual or legal basis.
Very truly yours,
RAMON R. ISBERTO
Head, PLDT Public Affairs Office