Lawmaker warns Meralco could lose franchise | Inquirer News

Lawmaker warns Meralco could lose franchise

By: - Content Researcher Writer / @inquirerdotnet
/ 02:46 PM December 11, 2023

Lawmaker warns Meralco could lose franchise


MANILA, Philippines—Amid recent accusations piled up against the Manila Electric Co. (Meralco), a lawmaker warned that the power distributor’s franchise may be canceled due to an alleged failure to submit regulatory reports on time.

At a recent public hearing conducted by theHouse Committee on Legislative Franchises, Surigao del Sur Rep. Johnny Pimentel (second district) said Meralco might lose its franchise after it failed to submit annual financial and operation reports for several years.


According to Pimentel, the yearly submission of these records are required under Section 14 of Republic Act (RA) No. 9209 – the law granting Meralco’s franchise to construct, operate, an maintain a distribution network for the transmission of electric energy to consumers residing in cities and municipalities of Metro Manila and nearby provinces.


Pimentel said records showed that Mealco submitted reports only for 2018 until 2022.

“If you did not submit your repertorial requirement for these years, then well, basically, you have already violated Section 14 of Republic Act 9209,” he said.

“It is very clear in the Republic Act 9209 that the submission of reports should be done on a yearly basis. Now, as stated by the ComSec (Committee Secretariat), [Meralco] submitted only for several years,” he added.

He said that a check made in the records showed that Meralco complied with the reporting requirement only seven times since getting its franchise in 2003.

“For the record, you have submitted only seven reports,” the lawmaker noted.

Pimentel pointed out that since Meralco’s franchise is already 20 years old, there should have been a total of 20 reports submitted by the power distributor.


Under Section 9 of the law, Congress may revoke or cancel the franchise of the power distributor had there been any violation of the terms and/or provisions of the franchise agreement.

When asked by Pimentel why Meralco’s franchise should not be canceled amid said violations, representatives of the power distributor present during the hearing said they would try to reconcile the records.

Pimentel stressed this was an admission of uncertainty over whether the records have been submitted in compliance with the law.

Meralco disproves violation claims

In a statement, Meralco First Vice President Jose Ronald Valles denied claims regarding the company’s failure to comply with its reportorial obligations.

“Contrary to claims that Meralco is not compliant [with] the reportorial requirements, the power distributor has clarified that it has religiously submitted its annual and operating reports after it was granted franchise in 2003,” said Valles.

Valles added that Meralco’s annual reports are “easily accessible to the public” since they are public documents.

“In fact, [Meralco] has been submitting the same to the Philippine Stock Exchange and the Securities and Exchange Commission, since the company is a publicly listed entity and is bound by corporate reportorial requirements,” he said.

He reiterated that the power distributor “strictly adheres to the law and operates within the bounds of its franchise and the areas it serves.”


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TAGS: franchise, INQFocus, MERALCO, Rep. Johnny Pimentel

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