FINANCE Secretary Carlos G. Dominguez III sounded a note of caution over the process of admitting a “third player” into the telecommunications industry, saying that the required investment is large and all requirements must be in place for a new entrant to compete effectively.
“To effectively compete, the investments required of the new major telecommunications player are estimated to be at least P200 billion,” Mr. Dominguez said in a social media post on Thursday.
“The magnitude of the investment requires that all elements, including the necessary access to available telecommunications infrastructure, are in place for the new player. Until such time, the bidding for its entry cannot be rushed,” he added.
Asked for comment on his post, Mr. Dominguez said in a mobile message to reporters that it was “just a reminder to make sure that all issues that may not give the potential aspirants an even chance of competing in the telco industry are adequately addressed.”
The Department of Finance (DoF) can influence the process of selecting a new telecom entrant because the department’s representative serves as vice-chair of the committee overseeing the entry of the third player. The committee is chaired by the Department of Information and Communications Technology (DICT).
The third player is expected to be selected by July, after Malacañang initially set an informal deadline of the first quarter of 2018. Following consultations, the selection criteria have been modified to favor the candidate with the most aggressive rollout timetable. Initially the criteria focused on the size of the new entrant’s investment commitments.
New entrants are expected to have a Congressional franchise, which means domestic telecom firms with existing franchises are expected to tie up with foreign entrants seeking to become the third player.
A second draft of the Terms of Reference for third-player selection are expected to be issued within the month and a final version by mid-May.
The Public Services Act or Commonwealth Act No. 146, limits foreign ownership to a 40% stake in public utilities, which includes the telecommunications industry.
However, legislators are also currently working on amendments to take out the telecommunications industry from the definition of public utilities to allow purely foreign-owned firms to set up shop here.
The DICT aims to select the third player before President Rodrigo R. Duterte’s State of the Nation Address (SONA) in late July. — Elijah Joseph C. Tubayan

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