CA upholds NTC in awarding telco giants 3G frequencies

MANILA, Philippines – The Philippines’ four available third-generation (3G) mobile frequencies rightfully belong to the country’s largest telecommunications firms, the Court of Appeals has ruled.

The CA, in a recent ruling upheld the National Telecommunications Commission’s move awarding 3G frequencies in 2005 to Smart Communications, Globe Telecom and Sun Cellular when they won their 3G licenses. Connectivity Unlimited Resource Enterprise (Cure), which was later acquired by Smart, was also one of the winning bidders.

The 3G licenses are used to offer mobile Internet services, which are now seen as the next growth area for local telecom companies.

In its 23-page decision penned by Associate Justice Mario L. Guariña III, the apellate court junked the appeal by the Multimedia Telephony Inc. (MTI), saying the existence of substantial evidence to support the NTC’s decision “seals the ruling with finality.”

MTI, one of the bidders that lost out to the four companies, earlier asked the court to nullify the NTC’s bidding process citing violations of due process.

“But the courts have afforded great respect to the interpretation by administrative agencies of their own rules and will defer to their dispositions unless there is an error of law or grave abuse of discretion which is not present here,” Guariña said.

This is the second CA ruling in the last 30 days that upheld the NTC’s 3G license awarding process and evaluation.

In a 12-page decision dated May 26, Associate Justice Franchito Diamante said the court refused to overturn two of the NTC’s decisions—the one denying AZ Communication Network’s application for a 3G license and the other on denying its motion for reconsideration.

In his ruling, Guariña took note of the MTI’s argument that the NTC’s imposed threshold requirement of a minimum of 20 out of a maximum of 30 points in the evaluation of 3G applicants violated due process and protection against retroactivity since these rules were implemented without prior notice.

MTI also claimed that it should have been ranked fourth, instead of Cure, under the point system and that Cure should have been disqualified after it was acquired by Smart.

Guariña said “the adoption of the 20-point qualification threshold by the NTC in evaluating the credentials of the applicants is reasonable and made pursuant to its quasi-judicial powers.”

The NTC had adopted a point system to rank 3G applicants based on their track record, roll-out commitments and rates it would charge consumers and users.

Guariña said the NTC did not violate due process in coming out with the 20-point threshold since it was just a means to interpret the qualifications of the applicants and the applicants were informed of the results of the evaluation.