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Public Service Act amendment to boost PH market competitiveness — NEDA

/ 10:04 PM February 21, 2020

MANILA, Philippines — The proposed amendments to the Public Service Act of 1936 will foster more competition in the Philippine market, the National Economic and Development Authority (NEDA) said Friday.

NEDA said House Bill No. 78, which seeks to amend the Commonwealth Act No. 146, known as the Public Service Act, “will significantly reduce equity restrictions in several service industries and encourage participation of foreign investors.”

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Socioeconomic Planning Secretary Ernesto M. Pernia said the bill is expected to “improve the country’s attractiveness as an investment destination and make the Philippines one of the top choices of both domestic and foreign investors” once it is passed into law.

Pernia said the proposed amendments will remove ambiguity and uncertainty between what constitutes a “public service” and provide clear economic bases for designating certain industries as “public utility.”

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Under the bill, the definition of a public utility is limited to electricity distribution, electricity transmission and water pipeline distribution or sewerage pipeline system.

“NEDA supports the passage of this legislative measure primarily because it complements the Philippine Competition Act that puts the rights of the Filipino consumers on top by promoting a competitive market for them,” Pernia said.

In the bill’s explanatory note, Albay Rep. Joey Salceda, the author of the bill, said that the enactment of the bill once signed into law will be beneficial to consumers.

“This legislative reform will significantly contribute to increasing competition, as well as protecting the public interest. More competition among providers would result in lower prices and improved quality of basic services, creating a more competitive economy towards a better quality of life for all,” Salceda said.

However, several lawmakers have questioned the constitutionality of the bill.

Albay Rep. Edcel Lagman said House Bill 78 is “fatally violative” of the 1987 Constitution since it would allow public utilities such as transportation and telecommunication to be owned by corporations.

Citing the Constitution, Lagman said that ownership, operation, control and management of public utilities to Filipino citizens or to firms must be at least 60 percent owned by Filipinos.

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The bill was recently approved on second reading in the House of Representatives.

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