MANILA, Philippines — The Senate approved the franchise renewal of China-backed Dito Telecommunity, the country’s third telecommunications player, on the third and final reading on Wednesday.
Senators approved House Bill No. 7332, which aims to give Dito another 25-year franchise, with 17 affirmative votes, two negative votes, and one abstention.
Dito, which was chosen as the country’s third telco in 2018, has a franchise through Mindanao Islamic Telephone Co. that was granted in 1998 and is scheduled to expire in 2023.
Dito is a joint venture between Davao-based businessman Dennis A. Uy’s Udenna Corp. and China Telecom.
Senators Risa Hontiveros and Francis Pangilinan voted against Dito’s franchise extension, citing national security concerns. Senator Panfilo Lacson did not cast a vote.
Although Hontiveros welcomed greater competition in the country’s telecommunications industry, she emphasized that it should not come at the cost of “vital national security interests, and against a rival claimant in the West Philippine Sea that has [demonstrated] time and again that it will use any leverage it has to its advantage.”
“Against a nation with interests adverse to our own, that has surrounded Julian Felipe reef with more than two hundred vessels of its maritime militia while telling us that the presence of those vessels in the area is a trivial matter,” she said.
“A rival claimant who already controls our power infrastructure and who has blocked attempts to conduct a security audit thereof at any turn,” she added.
Allowing China, whose state-run telco owns 40% of Dito, to “interconnect to our existing networks and use our radio spectrum at [a time] when we are estimated to be some 25 to 30 years behind other countries in cybersecurity and cyber-defense is I would say with great respect, a risk we cannot afford to take,” the senator said.
Pangilinan, for his part, cited two Chinese laws that he claims would lead to Chinese spying and surveillance.
“We understand that a third telco or a fourth or a fifth or a sixth telco, these are vital to improve our telco industry, but we should not close our eyes to the national security issues as well as the threats to our sovereignty surrounding this particular telco,” he said.
The senator cited the Chinese National Intelligence Law (CNIL) of 2017 and the Chinese Counter-Espionage Law of 2014, which he claims have the “power to compel China Telecom to monitor and investigate foreign individuals and institutions and conduct espionage activities on them.”
“This is especially concerning because Dito and the Armed Forces of the Philippines have agreed to put up cell sites in our military bases. Precisely because of these national security concerns and concerns on [the] possible infringement on our sovereignty,” he added.
Dito has previously dismissed concerns about potential Chinese spying, emphasizing that it is operated entirely by Filipinos.
READ: Dito allays fears of Chinese spying: ‘We are a Filipino company’
Dito made its commercial debut on March 8.
Before Dito’s launch, the National Telecommunications Commission (NTC) reported that the telco start-up had met the Philippine government’s initial population coverage and minimum average internet speed commitments.
Aside from Dito, the Senate also approved the telco franchise of Instant Data Inc. on final reading.
The franchise bills of four broadcast stations, namely Highland Broadcasting Network Corp., University of the Philippines System, Davao City Radio Broadcasting Station, and Palawan Broadcasting Corp., were also approved by the Senate.
“While we are welcoming more players in the telecommunications and broadcast industries, we also want to make sure that all applicants are fit to offer their avowed public service,” said Senator Grace Poe, head of the Senate public services panel and sponsor of the franchise bills.