Solon alarmed over changes in Public Service Act

Flag of House of Representatives (Photo by Exec8, Public Domain)

MANILA — A lawmaker in the House of Representatives on Tuesday sounded the alarm over the constitutionality of a measure that seeks to provide a statutory definition of a public utility as it may allow foreigners to own public utilities in the Philippines.

In a press conference, Albay Rep. Edcel Lagman said the House leadership has prioritized the enactment of House Bill No. 5828 without amending the economic provisions of the Constitution either through constituent assembly or a constitutional convention.

“It is actually a subterfuge to allow foreigners to own public utility enterprises without complying with the citizenship requirement imposed by the Constitution,” Lagman said.

HB 5828 is currently pending on second reading at the Lower House.

Lagman explained the Constitution requires that public utilities must be owned by Filipino citizens or by corporations, partnerships or associations where not less than 60 percent of the capital stock is owned by Filipino citizens.

He, however, pointed out that the bill has removed the requisite Filipino ownership requirement of public utilities under the Public Service Act, which is identical with Section 11 of Article XII of the Constitution.

“No less than House Committee on Economic Affairs Chairman Arthur Yap of Bohol has admitted during the deliberations that once House Bill 5828 is enacted into law, foreigners will be allowed to own public utilities,” Lagman said.

Lagman said the bill’s definition of public utility has also dropped the concept of ownership and limited the definition to the operation, management, and control of public utilities.

“There can be no operation, management, or control without an owner,” Lagman added.

The bill also deletes from the enumeration of public utilities traditional public utilities, such as common carriers and telecommunications companies, which are presently operating with controlling Filipino ownership.

“If these companies are not included in the enumeration of public utilities, again they can be owned and operated by foreigners,” the lawmaker said.

Under the bill, public utility refers to a person that operates, manages and controls for public use the distribution of electricity, transmission of electricity, water pipeline distribution system or sewerage pipeline system.

The bill said no other person, business or service shall be deemed a public utility under this act unless otherwise provided by law.

The bill retains the National Economic and Development Authority secretariat with the Philippine Competition Commission as the recommendatory authority to Congress in the classification of a person, business or service as a public utility. (PNA)