CA stops PCC probe on P70-B Telco deal

Edu Punay - The Philippine Star

MANILA, Philippines – The Court of Appeals (CA) has stopped the investigation of the Philippine Competition Commission (PCC) on the P70-billion buyout of the telecommunication assets of San Miguel Corp. (SMC) by industry giants PLDT Inc. and Globe Telecom.

In a seven-page resolution released yesterday, the 12th Division of the appellate court granted the temporary relief sought in the petition of PLDT and issued a writ of preliminary investigation against the PCC probe.

The order specifically prohibits the anti-trust body “from conducting further proceedings for the pre-acquisition review and/or investigation of the subject acquisition.”

“After painstaking evaluation of the parties’ arguments, taking into account the pertinent law and jurisprudence, in order to maintain the status quo ante while the case is being judiciously studied and to preserve the rights of the parties during the pendency of the instant petition and not to render ineffectual whatever judgment that may be rendered by this court, it would be more prudent for this court to grant petitioner’s prayer for a preliminary injunction,” read the ruling penned by Associate Justice Ramon Bato Jr.

“We agree with PLDT that due to the ‘deemed approved’ status extended to the subject acquisition by virtue of the transitory rules, at the very least, PLDT has a clear right to be protected from the pre-acquisition review and/or investigation conducted by respondent PCC,” the ruling said.

The CA added issuance of the order is necessary to protect petitioner’s right to be accorded “safe harbor” or protection from challenge under RA 10667 (Philippine Competition Act).

But before the order could take effect, the court required PLDT to post a cash bond of P1 million “to answer for whatever damages the respondent PCC will suffer should this court decide that PLDT is not entitled (to the writ).”

Globe has filed a similar petition, which was raffled to the CA’s 6th Division that denied its prayer for issuance of a temporary restraining order.

Globe’s petition, however, was later on consolidated to that of PLDT before the 12th Division of the appellate court.

In their separate petitions filed before the CA last month, Globe and PLDT questioned PCC’s investigation of their co-purchase of the telco assets of San Miguel.

Petitioners argued the deal has been deemed approved by operation of law since they have fully complied with the terms of the transitory circulars issued by the PCC.

PLDT further argued its wireless subsidiary Smart has been implementing the transaction and using the frequencies as part of its nationwide rollout.

They warned that a reversal of the transaction would result in irreparable and incalculable injury to the public service.

PCC, for its part, argued that the comprehensive review is necessary as it would identify the potential impact of the transaction on public welfare as well as determine its relevant market and whether it will result to substantial changes to the market structure or not.

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