The Philippine Competition Commission on Monday proposed the inclusion of several pro-competition provisions in the terms of reference for the selection of a third telecommunications player.
The anti-trust body’s proposals included a redefinition of related party; prohibition on mergers; voluntary return of frequencies; performance evaluation; and exemption from the commission’s review if competition issues are addressed.
The commission sought to redefine a related party as the company’s parent entity; its subsidiaries and affiliates; or any party that the company exerts direct or indirect control over.
It also defined a related party as a company that is under common control by another person, the company’s directors, officers, shareholders and related interests, and their family members within the fourth degree of consanguinity or affinity, as well as corresponding persons in affiliated companies, or juridical entity whose interest may pose a potential conflict with the interest of the company.
A related party also includes entities which have common economic interests and are not otherwise able to decide or act independently of each other.
The PCC also proposed a provision on the prohibition on mergers, combinations or becoming a related party with a dominant telco. It said that if a company or entity acquired a stake from a related party of the dominant player, the commission should be informed as soon as possible.
The commission also injected the provision that requires the voluntary return of frequencies if the third telco player became a related party with a dominant telco.
“The participant or new major player will have to return the assigned radio frequencies without condition, even after the commitment period,” it said.
The PCC said the National Telecommunications Commission should also recall the radio frequencies within a prescribed number of days from the failure of the participant to return such frequencies.
The agency proposed the constant monitoring and performance evaluation through information sharing and the clawback of spectrum in case of non-use and exemption from the commission’s review if competition issues were addressed.
“In the absence of the inputs in the terms of reference, the commission would be constrained to pursue a regular review of the transaction, in accordance with its mandate,” it said.