The Supreme Court (SC) has shut the door on the bid of NOW Telecom Company Inc. to become the country’s third major telecommunications player as it affirmed the May 2021 ruling of the Court of Appeals (CA) junking the latter’s plea against the National Telecommunications Commission (NTC).
In a 15-page ruling promulgated on January 31, 2024 but only made public on March 7, the SC First Division upheld the CA ruling dismissing NOW Telecom’s petition seeking to nullify a circular issued by the NTC imposing certain qualifications and restrictions with respect to the entry of new major players in the telecoms industry.
The High Court held that the appellate court did not commit any reversible error when it upheld the 2018 Manila Regional Trial Court’s denial of NOW Telecom’s application for the issuance of a writ of preliminary injunction against the NTC’s implementation of Memorandum Circular No. 09-09-2018 entitled, “Rules and Regulations on the Selection Process for a New Major Player in the Philippine Telecommunications Market.”
“First, NOW Telecom failed to establish that it has a clear and unmistakable right to be protected in this case. Before a writ of preliminary injunction maybe issued, the applicant must establish the existence of the right to be protected. This right must be actual, clear, and existing, not mere contingent, abstract or future. NOW Telecom failed to show the existence of such right,” the SC ruling penned by Associate Justice Rodil Zalameda said.
“As correctly held by the CA, the grant of a legislative franchise to operate telecommunication services in NOW Telecom’s favor does not necessarily carry with it a right over a particular radio frequency nor does NOW Telecom’s franchise state that it is entitled to special radio frequency,” the SC added.
It stressed that NOW Telecom’s use of radio frequency is only a privilege, not a right, and is subject to compliance with relevant laws, rules, and regulations.
It added that Republic Act 7925, known as the Public Telecommunications Policy Act of the Philippines, vested the NTC the authority and responsibility to allocate and assign the radio frequencies and facilitate the entry of qualified service providers through administrative processes.
With this, the SC held that NOW Telecom cannot simply claim any right over the subject allocated frequency bands by virtue of its legislative franchise and must still comply with NTC regulations.
“In this case, NOW Telecom has failed to show that it has complied with the provisions of the subject Circular in order for it to be entitled to the allocated frequencies of new major player,” the SC explained.
The SC also pointed out that the CA correctly ruled that NOW Telecom was a mere prospective bidder at the time of its application for the issuance of writ of preliminary injunction against the NTC and that, by its own admission, has yet to form a consortium to qualify under the NTC circular as a participant with a combined or aggregate capital of P10 billion.
Likewise, the SC said there was no showing that NOW Telecom participated in the selection process to prove that it is the best qualified to become a new major player.
“Since it has no vested right over the allocated frequencies for the new major player, and it failed to show a clear, actual and existing right that must be protected from the challenged provisions of the questioned Circular, NOW Telecom could not sustain any legal injury by reason of the implementation of the said Circular which it seeks to enjoin,” the SC said.
The SC also agreed with the CA and the Manila RTC that the assailed NTC circular cannot be subject to injunctive relief by the trial court under Section 3 of Republic Act No. 8975, otherwise known as An Act To Ensure the Expeditious Implementation and Completion of Government Infrastructure Projects By Prohibiting Lower Court From Issuing Temporary Restraining Orders.