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Third telco aspirants must post P700-million security to participate


Companies bidding for the third Telco slot in the Philippines must post a participation security of P700 million, according to a memo on the rules and regulations on selecting the new major player.

The participation security must be in the form of cash, manager’s check, draft, or irrevocable letter of credit issued by a universal or commercial bank in the Philippines, according to the circular which was released by the Department of Information and Communications Technology on Friday.

“Failure to enclose the required Participation Security in the form and amount prescribed herein shall automatically disqualify the concerned, participant,” according to the National Telecommunications Commission’s Memorandum Circular No. 09-09-2018.

“The New Market Player is expected to be identified in December 2018,” the DICT said in a statement.

MC No. 09-09-2018 was signed by NTC Commissioner Gamaliel Cordoba, Deputy Commissioners Edgardo Cabarios and Delilah Deles, and was noted by DICT Acting Secretary Eliseo M. Rio Jr. as the chairman of the Oversight Committee, on Thursday, 20 September.

Determining the new telco player will be based on the highest committed level of service, and the authorities will evaluate a company’s commitment using a point system.

The average broadband speed committed by a player now accounts for 25 percent of the selection criteria, from 20 percent in previous drafts of the circular.

While national population coverage remained at 40 percent, the capital and operational expenditure commitments were lowered to 35 percent from 40 percent.

A telco aspirant, TierOne, said they remain committed to become the third major player in the industry. Its president, Jonathon Bentley Stevens, said they are “still ready to comply with the terms.

Philippine Telegraph and Telephone, another aspirant declined to issue a statement at this point. Pand CEO James Velasquez said the company’s legal team will still have to look into it.

The memo will take effect on Oct. 6, 2018, at which time the telcos can get the bidding documents from the NTC. They have until Nov. 18 to submit their bids.

Apart from PT&T and Tier One, local companies that are keen on bidding for the third market player are Now Corp., Converge ICT, and Transpacific-Broadband.

DICT has identified the foreign companies interested in joining the bidding as China Telecom, KT Corp., LG U+, KDDI Corp., Vietnam Telecom, Telenor, and AT&T. —With a report by Ted Cordero/VDS, GMA News

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