The Philippine Competition Commission (PCC) bats for the opening up of more sectors to foreign ownership to encourage investments and competition.
Amabelle Asuncion, PCC commissioner, told reporters on the sidelines of the Manila Forum on Competition in Developing Countries in Manila yesterday the body continues to push to limit to four sectors in public services that should be subject to the 60:40 Filipino-foreign ownership rule.
Asuncion said the PCC also bats for a shorter Foreign Investment Negative List (FINL) — sectors where foreign participation is regulated — as well as a more frequent review of the list to make it more relevant.
Asuncion said the PCC is calling for the revisit of the definition of “public services” that should be limited to 40-percent foreign ownership cap.
The PCC in its position paper on the amendments to the Public Services Act said only four sectors— which have the tendency as natural monopolies — should be subject to the 60:40 rule.
These are: distribution of electricity system; transmission of electricity gas or petroleum pipeline distribution system and water pipeline distribution system or sewerage pipeline system.
Asuncion said competition in these in these sectors is not efficient because they entail huge investments.
The PCC wishes to remove telecommunication from the foreign ownership limitation but Asuncion said this does not mean the sector would no longer be regulated by the relevant regulators.
Opening up the sector would give foreign players to own up to 100 percent in a company that will use up the remaining frequencies for niche telco services.
“As long as the current 60-40 requirement stays for the industries considered as public service, from a competition perspective, (that requirement) limits the number of possible players that can come in. In a globalized economy you want more players. Why would foreign entities invest if their interest is limited to 40 percent… because that (cap) also translates to how much it can control the operations or management of the company. If it invests this much but has little say to where the company is going, what is its assurance that it can get its investments back?” Asuncion said.
