The National Telecommunications Commission (NTC) said data transmission industry participants (DTIPs) must have assets of at least P100 million to operate core operations under the Konektadong Pinoy law.
In a memorandum circular dated February 2, the NTC also explained the registration requirements for applicants, adding that it will act as the entity that receives their registration.
The NTC also said that eligible applicants must have the technical and financial capacity to deliver reliable and secure services and must establish, operate and maintain data transmission infrastructure.
It said participants who meet all the requirements can apply for one or more parts of the data transmission network.
“In determining the financial suitability, the NTC will assess the financial and economic viability of the applicant’s proposal to operate as a DTIP in its proposed data transmission segment, taking into account the scale and complexity of its proposed activities,” said the NTC in its memorandum circular.
The Department of Information and Communications Technology (DICT) said a Philippine company is seeking to enter the industry under the provisions of the Konektadong Pinoy Act.
All applicants, except mid-range suppliers, will be required to pay a performance bond, the NTC said, noting that the bond will be equal to at least 10% of the applicant’s proposed capital expenditure for the first two years, but not exceeding P5 million.
The memorandum requires that all applicants who want to work in any part of the data transmission network regardless of whether it is an international gateway, a backbone or a backbone, a middle mile, or a last mile provider to provide a minimum amount of property for each application and to maintain the property liability ratio within the prescribed limit.
“The NTC will periodically review the basic asset requirements, valuation ratios and related financial limits every three years or at shorter intervals as may be necessary, after taking into account inflation, industrial conditions and other relevant economic indicators,” it said.
The NTC said the ratio of debts to assets for all applicants in all categories is 70%. The memorandum stated that the minimum assets required for international agency applicants is P1 billion; approximately P100 million for network applicants, P10 million for middle-mile applicants, and P500,000 for last-mile providers.
The Konektadong Pinoy Act, also known as the Open Access to Data Transfer Act, expired in August.
The law streamlines the process of granting new licenses, increasing competition in data transmission.
About seven foreign companies have expressed interest in entering the Philippine telecommunications sector, with each company expected to invest around $1 billion.
President of Globe Telecom, Inc. and CEO Carl Raymond R. Cruz said the company will work closely with the DICT to ensure that DTIPs are subject to rigorous cybersecurity testing and certification.
“We need laws that balance openness and accountability, especially regarding the use of infrastructure, security standards, and spectrum communication,” said Mr. Cruz. – Ashley Erika O. Jose
