CA junks petition vs NTC 3G rules

MANILA, Philippines - The Court of Appeals has junked a petition filed by a group of public employees questioning the issuance by the National Telecommunications Commission (NTC) in 2010 of a set of rules that will govern the disposition of third generation mobile telecommunications (3G) frequencies.

In its ruling rendered last June 15, the CA said the petitioners, the Government Employees Legal Action Center (GELAC), did not have the legal standing to sue and to question the NTC rules.

The appellate court also ruled that a petition for certiorari and prohibition is not the proper remedy to challenge the 2010 3G rules.

The petitioners asked for the nullification and setting aside of NTC Memorandum Circular 01-03-2010 dated March 12, 2010 which covers the rules on the assignment of the remaining allocated 3G radio frequency band.

The 2010 3G rules was supposed to replace NTC Memorandum Circular 07-09-2005 dated Aug. 23, 2005 under which 3G frequencies were issued to Smart Communications, Globe Telecom, Digital Telecommunications Phils. Inc. (Digitel) and Connectivity Unlimited Resources Enterprise (CURE).

The 3G radio frequency band is a third generation wireless communications technology that supports higher data transmission rates and offers increased capacity. It supports new media services such as TV streaming, multimedia, video conferencing, among others.

In 2005, there were five available 3G radio frequency band slots available but the NTC decided to assign the bands only to the top four qualified applicants, holding in abeyance the assignment of the last 3G band. GELAC claimed that the 2005 3G rules should govern the assignment of the last 3G band to either of the two remaining qualified applicants that participated in the selection process.

The assignment of the remaining 3G frequency band, however, became the subject of judicial review through various cases filed in court by the different parties that participated in the selection process but were denied 3G radio frequencies by the NTC.

NTC also has claimed that the other applicants under the 2005 rules, namely Pacific Wireless Inc. and AZ Communications, failed to pass the first-tier evaluation, while Next Mobile was disqualified for non-payment of certain NTC fees. Meanwhile, Multimedia Telecommunications and Bayan Telecommunications failed to qualify.

However, in 2010, the NTC totally abandoned the 2005 3G rules and instead promulgated a new set of rules to govern the assignment of the country’s last remaining 3G frequency band despite pending appeals. Under the 2010 rules, the last 3G band will be awarded to the highest bidder among the qualified applicants which submitted their applications under the 2010 rules.

CURE was acquired by Smart Communications while Digitel was subsequently bought by the PLDT group. But the NTC in approving the acquisition by PLDT of Digitel (and together with it Digitel Mobile’s 3G frequency band) mandated that PLDT give up CURE’s frequency which will be bid out by the NTC.

GELAC, in its petition, warned that with the 2010 3G rules, Smart, Globe and Digitel, individually or as a consortium, may again obtain the last 3G band, resulting in “frequency hoarding” and creating a virtual cartel in the 3G market.

On June 28, 2010, Express Telecommunications Co. Inc. (Extelcom) joined GELAC’s petition as an intervenor.

In its new ruling, the CA said that GELAC failed to establish direct, personal and substantial interest in the subject matter in litigation, and to show some actual or threatened injury traceable to the challenged action. “Bare allegation that public funds will be unlawfully disbursed in the implementation of the 2010 3G rules is not sufficient to clothe them with the required legal personality to bring the instant petition,” it ruled.