Lawyers support nullification of SEC order on PLDT ownership

Late human rights lawyer Wilson Gamboa Sr's son and several other lawyers on Tuesday joined a petition asking the Supreme Court to nullify a Securities and Exchange Commission (SEC) order that allegedly allowed the Philippine Long Distance Telephone Company (PLDT) to skirt constitutional limits on foreign ownership of utilities.

In a 36-page petition-in-intervention, Wilson Gamboa Jr. and five other lawyers said they supported the earlier petition filed by lawyer Jose Roy III which contested Section 2 of the SEC Memorandum Circular No. 8 Series of 2013.

Roy had said that the circular was "tailor-made to accommodate the scheme of PLDT for conforming with the Constitution."

Roy claimed the SEC circular allowed PLDT to amend its articles of incorporation so it may issue preferred voting shares then sell the stocks to a "non-complying entity" called BTF Holdings Inc. This, the petition noted, would address the foreign ownership limits in public utilities as set under Section 11 of Article XII of the Philippine Constitution.

Roy asked the SC to direct the SEC to re-investigate PLDT and determine if the telco giant violated Section 11, Article XII of the Constitution, which sets foreign ownership of the company at a maximum of 40 percent of the capital, according to the petition.

The high court, in June 2011, had already ruled that the term "capital" was defined under the Constitution as limited to foreign ownership of domestic public utilities to 40 percent.

The court said the SEC should then use only common voting shares in assessing the capital stock of the firm to determine the level of foreign ownership in PLDT.

"Kaso nagkaproblema kasi iyong pag-define ng SEC in relation to that decision of the Supreme Court. Hindi ganoon ang ibig sabihin ng Supreme Court," the younger Gamboa told reporters in Manila.

The younger Gamboa had succeeded his father, the main petitioner in the SC case who died in 2011, in pursuing the case.

"Sabi ng Supreme Court is that the 60-40 must be observed in each of any class of shares, be it common shares, be it preferred shares, be it voting shares or not. So kailangan 60-40," he said.

"Ang ginawa ng SEC sa interpretation nila ay parang nilahat na basta 60-40," Gamboa Jr added.

He said they filed the petition-in-intervention to support Roy's arguments.

"We fully agree with the arguments he raised in his petition and we believe in those allegations na tama yung sinasabi ni Atty. Roy and here we are to support Atty. Roy as a fellow laywer and as officers of the court for the protection of our Constitution and for the respect of rulings rendered by the Supreme Court," he said.

As to whether or not they had a legal standing to contest the SEC order, Gamboa claimed he was a PLDT subscriber. "When you are a subscriber, you are also a shareholder, automatic na iyan," he said. — DVM/ELR, GMA News