PLDT-Digitel Merger : Who Gets To Say It's For the Public Good?

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President Noynoy Aquino according to a news article yesterday by Philippine Daily Inquirer has recently ordered the Department of Science and Technology (DOST) and the National Telecommunications Commission (NTC) to investigate whether the merger between Philippine Long Distance Telephone (PLDT) and Digitel may have any undue disadvantage to other players in the telecom industry.

Earlier this month, we also have Senator Joker Arroyo asking the Senate Committee on Public Services chaired by Sen. Bong Revilla to determine whether the same merger is in accordance with their respective legislative franchises, especially when there's a provision in the legislative franchise of Digitel, Republic Act 9180, which says that Digitel “cannot lease or transfer its assigned franchise to any other commercial or legal entity nor shall the controlling interest of the grantee be transferred without prior approval of the Congress of the Philippines."

While he's at it, Sen. Joker Arroyo has a barb to the government agencies dealing with the merger, saying : “The NTC, SEC, PLDT, and Digitel are talking among themselves about the merger or sale of the controlling interest of Digitel to PLDT as if Congress does not exist,", as reported by Malaya in its online edition dated May 19, 2011.

Meanwhile, in a May 26, 2011 posting at NEWSBYTES Philippines, it was reported that Party-list Congressman Teddy Casino also filed his opposition to the merger before the NTC saying that : “obviously, a 70 percent market share results in tremendous market power for PLDT-Digitel, giving rise to a situation where they can dominate the market, dictate prices and influence the entire industry in their favor. This is precisely what happened in the past, when PLDT monopolized the telecommunications industry”,

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Published In: Antitrust & Trade Regulation Updates, Business Organization Updates, Communications & Media Updates, Mergers & Acquisitions Updates, Consumer Protection Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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