Senate ready for debates on SMC subsidiary franchise to build Bulacan airport

/ 12:09 AM September 30, 2020

MANILA, Philippines — A bill seeking to grant a franchise to San Miguel Aerocity Inc. that will allow it to build and operate a domestic and international airport in Bulacan reached the Senate floor on Tuesday.

Sen. Grace Poe, chair of the Senate public services committee, endorsed for plenary approval the franchise bid of the San Miguel Corp. (SMC) subsidiary.


The franchise bill is contained in Committee Report 128, which was signed by 15 senators.

In sponsoring the bill, Poe cited the “overwhelming” need to build a new airport amid the “full and overloaded” state of the Ninoy Aquino International Airport (NAIA), the country’s main gateway.


“Most countries are building airports for the future, we should do, too. But building a new airport is not just about the future. It is also an obligation past due,” Poe said.

“Like the public transport that crawls on its congested streets, Manila’s airport is now full and overloaded,” she added.

According to Poe, NAIA is five years past its maximum passenger handling capacity of 35 million people annually.

In 2019, she said NAIA handled 47.8 million passengers.

“The passenger volume is forecast to reach 71. 6 million passengers a year by 2030 and 101.5 million by 2040, a period equivalent to three senatorial terms,” she noted.

“This is the snapshot of the problem confronting the 39th busiest airport in the world, in the 11th most populous metropolis in the planet, in the 13th most populated country in the world,” she added.

Under the bill, the franchise applicant has an “obligation to maintain the airport city in a satisfactory manner at all times.”


“But knowing the proponent behind it, it will go above and beyond in terms of servicing the public,” she said.

“The standards for this new airport are at par with, if not greater, than the ones set for all other airports in the country,” she added.

The construction of the airport will begin within a year of the franchise approval, according to the senator.

“We shall have a brand new international hub within 12 years from now at the latest at no cost to the government. After the lifetime of this franchise, which is 50 years, the airport will be turned over to the government, again, at no cost,” Poe said.

The bill would meanwhile exempt the franchisee from all direct and indirect taxes and fees during the airport’s 10-year construction period.

“After the construction period and during the remaining 40 years of its franchise, it shall be exempt only from income and property taxes until it has recouped its investments,” the senator added.

“After which, it will be subjected to all taxes from thereon,” she further said.

Tourism, employment

The construction of the new airport, Poe added, would inevitably spur tourism and employment.

She said SMC had committed to prioritizing the hiring of residents and returning overseas Filipino workers for the construction of the airport.

“The residents of Taliptip, where it will be built, are all set to train under TESDA (Technical Education and Skills Development Authority) for courses and skills specific to the needs of the airport’s construction,” Poe said.

“At a time where we are badly hit by the pandemic, employment and tourism generating projects are definitely most welcome,” she added.

Poe, meanwhile, assured her colleagues in the Senate that her committee had ensured that the franchise applicant has a history of compliance, the most recent certificates of good standing, tax clearances, audited financial statements and even feasibility studies “before they are even scheduled for a hearing.”

“A franchise is indeed a delicate balance of conditions and privileges,” she added.

Other franchises endorsed

Poe also endorsed for plenary approval the franchise bid of the following companies:

Cruz Telephone Company, Inc. — Operates a telecommunications system under Manila East Holding Corporation and J.S. Cruz Construction and Development Inc. Franchise expired on March 29, 2020, seeking renewal of 25-year franchise.

Tandag Electric and Telephone Company, Inc. — Operates a public domestic telecommunications. Franchise to expire on July 16, 2023, seeking renewal of its 25-year franchise.

Bayan Telecommunications, Inc. — Operates domestic telecommunications, radiophones, broadcasting and telecasting under the same company name and Globe Telecom Inc. Franchise to expire on Aug. 9, 2021, seeking renewal of its 25-year franchise.

FBS Radio Network — Operates radio and television broadcasting. Franchise expired on July 9, 2020, seeking renewal of its 25-year franchise.

Century Communications Marketing Center Inc. — Operates radio and television broadcasting. Franchise expired on July 16, 2020, seeking renewal of its 25-year franchise.

Caceres Broadcasting Corp. — Operates radio and television broadcasting. Franchise expired on July 9, 2020, seeking renewal of its 25-year franchise.

Philippine Collective Media Corp. — Expanding to digital television. Franchise to expire on Nov. 14, 2034, seeking renewal of its 25-year franchise.

Negros Broadcasting and Publishing Corp. — Operates radio and television broadcasting. Franchise expired on Sept. 23, 2020, seeking renewal of its 25-year franchise.

Davao Light and Power Company — Operates electric light, heat and power system. Franchise to expire on Sept. 7, 2025, seeking renewal of its 25-year franchise.

Metro Manila Turf Club Inc. — Operates racetrack for horse racing. Franchise expired on April 22, 2020, seeking a 35-year franchise.

“I thank my colleagues for their preliminary support for these measures, for signing the committee report in a very timely manner,” Poe said.

“I hope that we can deliberate these with the public need in mind,” she added.


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TAGS: Bulacan airport, franchise bills, Nation, news, San Miguel Corporation, Senator Grace Poe, SMC
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