Photo from Sen. Grace Poe’s office
MANILA, Philippines — A bill amending the Public Service Act (PSA) to ease foreign equity restrictions on public services will now only need the signature of President Rodrigo Duterte.
In their respective sessions on Wednesday, the Senate and the House of Representatives ratified the bicameral conference committee report, which reconciled the conflicting provisions between Senate Bill No. 2094 and House Bill. No. 78. These bills propose changes to the over 85-year-old PSA.
“The country’s top economic and legal experts have thrown their weight behind this bill. The data will bear us out. Not only will the passage of this measure speed up the country’s economic recovery from the devastating effects of the pandemic, but it will also make our country competitive when it comes to attracting foreign direct investments which we sorely lack and need,” said Sen. Grace Poe, who sponsored the bill in the Senate as chairman of the Senate public services committee.
The reconciled proposed PSA amendments identified public utilities as follows:
- distribution and transmission of electricity
- petroleum and petroleum products pipeline transmission systems
- water pipeline distribution systems and wastewater
- pipeline systems, including sewerage pipeline systems
- seaports
- public utility vehicles
According to the measure, any industry not included in the list will remain as public services and will be liberalized.
Boosting the economy
“By easing the foreign equity restrictions in such industries, we are confident that our economy, which is lagging even behind our ASEAN neighbors, will thrive and grow, and that more jobs will be created for our kababayans,” Poe went on.
The senator, however, assured that liberalizing some industries does not mean foreign countries would be allowed to take advantage of the country’s resources.
“Adequate safeguards and security provisions are in place, including giving authority to the President to suspend or prohibit any proposed merger or acquisition transaction, or any investment in a public service that will grant control to a foreigner or a foreign corporation,” she said.
She pointed to a provision prohibiting foreign state-owned enterprises from owning capital in any public service classified as a public utility or a critical infrastructure.
Foreign nationals are also not allowed to own more than 50 percent of the capital of entities engaged in the operation and management of critical infrastructure, unless their country accords reciprocity to Philippine nationals, according to Poe.
“The ratified measure made its intentions clear and unequivocal by adding a provision that says that ‘nothing in the bill shall be interpreted as a requirement for legislative franchise where the law does not require any’,” she said.
“No person shall be deemed a public utility unless otherwise subsequently provided by law,” according to the measure. The bill has also instituted penal provisions for violations.
READ: Bill revising Public Service Act awaits final Senate nod