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Mislatel named provisional 3rd telco
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Mislatel named provisional 3rd telco

November 8 ------ The National Telecommunication Commission (NTC)’s Selection Committee tonight declared Mislatel, a consortium of Udenna Corp., Chelsea Holdings, and China Telecom as the provisional New Major Player (NMP) as the consortium will still be subjected to the Document Verification Phase. From a group of 30 telcos, which originally signified to join the NMP bidding, 10 purchased the P1 million per set bid documents, showing their serious intent while four were supposed to submit official bids before two of them joined forces. As a result, three submitted their bids before the government’s 10 a.m. deadline Wednesday.

The other two were Sear Telecom of politician Luis “Chavit” Singson and Philippine Telegraph and Telephone Corporation (PT&T), both of which were disqualified by the NMP Selection Committee. The committee declared Sear Telecom’s documents “incomplete” because they reportedly failed to submit the required P700 million letter of credit. The committee also disqualified PT&T for reportedly failing to submit a certification that it has been in operation on a national scale for the last 10 years.

Sear and PT&T said they will file a motion for reconsideration in three days. In addition, Sear is filing a case against Mislatel which could derail Mislatel’s final selection as the NMP. Mislatel can’t allow its telecom franchise to be used by anyone else without the consent of Digiphil, a member of the Sear consortium, Sear’s Legal Counsel, Raoul Creencia said. Digiphil has a right of first refusal, which Mislatel should have invoked but did not. If the court rules that Mislatel breached its contract with Digiphil, it is not eligible to partner with Udenna of business tycoon Dennis Uy for the NMP. “That’s a fatal flaw,” Sear’s Legal Counsel stressed. On the other hand, a number of consortia, like Teltech, KT Corporation and Converge decided not to join the bidding.

While market and industry outlook are financially viable, the conditions imposed for participation render the venture commercially unviable, they said in a statement. The NMP is required to incur an inordinate amount of funds and carry out commitments at a pace that was not required of the current dominant service providers. Failure to comply is subject to penalties which are not even graduated to consider substantial compliance.

The current telecom duopoly were not subjected to comparative commitments, penalties or forfeiture of licenses. The Terms of Reference (TOR) was reportedly skewed to encourage the NMP to compete in a territory already served by providing services that are costlier to maintain, driving competition at a higher end but smaller range of the consumer market. Dominant players are not required to face such forfeiture of franchises if they don’t meet minimum speed requirement.

Now Telecom is also out of the running although they insist that “the fight is not over yet”. Now Telecoms the other day received an order from the RTC of Manila Branch 42 denying its prayer for an injunction. However, the telco vowed to exhaust all available legal remedies. The third license, which could be awarded by year-end, comes at the behest of President Duterte and aims to boost the country’s notoriously patchy services and end a domestic duopoly long accused of being uncompetitive.

Duterte, who has made strong business ties with China his top foreign policy priority, had repeatedly expressed a preference for a Chinese telecoms firm to enter the Philippines, and even verbally “offered” the license to Chinese Premier Li Keqiang. Uy’s ties to the president are well known having contributed to the Duterte’s 2016 campaign. He also hails from Davao, the city where Duterte was mayor for 22 years.