Mislatel franchise ‘ipso facto’ revocation has legal effect: IBP

MANILA The "ipso facto" revocation of Mislatel's franchise must be seriously considered with regard to its status as the country's new major player in the telecommunications industry, the national president of the Integrated Bar of the Philippines (IBP) said Wednesday.

During the hearing of the Senate Committee on Public Services, Abdiel Dan Fajardo said the panel's finding that Mislatel violated Section 7 of the company's franchise is of "great importance" and must not be disregarded.

Section 7 provides that the franchise shall be deemed ipso facto (in fact) revoked, in the event the franchisee fails to commence operations within one year from approval.

"These have legal effect. In Black's Law Dictionary, ipso facto means by the very fact. Therefore, we are of the belief, at the present time, that such be considered with respect to the status of the winning bidder," Fajardo said.

"We are of the belief that we should not move forward without considering the impact of such status in this particular endeavor," he added.

The previous hearing bared that Mislatel appeared to have failed to comply with the conditions set by Congress when it handed the firm its franchise, such as the requirement to operate within one year after the acquisition of the franchise and the need to seek Congress approval when it sold majority of its shares in 2015.

Senator Grace Poe, committee chair, asked the IBP president if the Supreme Court should review the franchise of Mislatel, or if it is well within the Congress' power to grant or withdraw a franchise. Mislatel earlier argued only a quo warranto petition can cause a revocation of its franchise.

Fajardo cited a Supreme Court decision that the "the viability of the quo warranto, in this instant case, does not preclude Congress from enforcing its own prerogative by abrogating the legislative franchise of respondents should it be distressed enough by franchisee's violation of the franchise extended to them."

He noted that the language of the franchise itself already represents the act of Congress abrogating the franchise by "virtue of the wording of the franchise itself."

For his part, Mislatel spokesperson, lawyer Adel Tamano, maintained the validity of the company's franchise.

"No quo warranto proceeding has been filed against the franchise of Mislatel. There has been no revocation by the Congress of the franchise of Mislatel. Without going into the legal matters, there has been no positive act that would revoke the existence of the franchise," Tamano said.

He also explained that there was no sale of controlling interest of Mislatel, but rather a subscription and an increase of capital stock.

"In fact, what happened was the initial entry of Nicanor Escalante and the other shareholders into Mislatel was not through a sale of controlling interest, which is basis for an ipso facto revocation, but rather it was through subscription and increase of capital stock," Tamano said.

Poe earlier said holding a re-bidding for the selection of the third telco could be more favorable to the public than allowing a company to operate hounded by questions on the validity of its franchise.

Poe said having a new major player that would later on encounter legal entanglements in the courts could further delay the country's goal to provide the consumers with fast and reliable internet and telecommunications.

The panel is expected to release its committee report next week. (PNA)

Source: Philippines News Agency

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