The National Telecommunications Commission (NTC), Globe counsel Rodolfo A. Salalima said in an April 26 letter to the agency, "cannot and must not shirk from its legal obligation to... regulate, if not forestall, the deal’s grave implications and impact on free competition and, in the long term, the common good."
An NTC official said the planned purchase -- announced last month and targeted for completion by end-June -- was being reviewed following instructions from Malacañang.
A PLDT executive, meanwhile, called Globe’s appeal "regulatory blackmail."
The questioned P69.2-billion deal involves PLDT’s acquisition of a 51.55% stake in Digitel -- which owns the Sun Cellular brand -- from JG Summit Holdings, which in return will get a 12.8% stake in the dominant telco.
The Globe letter, copies of which were distributed to reporters yesterday during the firm’s demonstration of a planned service, states that the NTC needs to act given its mandate to protect consumers and level the playing field under Republic Act (RA) 7925 or the Public Telecommunications Policy Act.
The law, Globe said, was specifically passed in 1995 to end a monopoly enjoyed by PLDT.
It noted that the PLDT-Digitel deal, if consummated, would give PLDT 70% of the cellular mobile market, leaving Globe with 30%. The frequency ratio of 1:3.5 is also in favor of PLDT, it added.
The firm urged the enactment of antitrust laws and the issuance of NTC policies, among them a circular defining any entity with a minimum 50% share of the market as a "monopoly carrier."
It called for aggressive enforcement of interconnection between telcos and also the implementation of a policy on "IP peering" -- interconnection between two internet service providers -- that would allow for a better Web experience for consumers.
"The present PLDT/Digitel deal...strikes at the very core of free competition and, if not preempted or otherwise regulated, will...bring back this country to the dark ages of the old monopoly pre-RA 7925," Globe said.
Sought for comment, NTC Commissioner Gamaliel A. Cordoba told BusinessWorld, "The deal will need an approval from NTC, and we are studying the deal on how we can prevent it from adversely affecting consumers."
"President [Benigno S. C. Aquino III] has already given us instructions to study the whole deal in cooperation with economic managers and the [Justice department]."
Public hearings, Mr. Cordoba added, will be scheduled once PLDT and Digitel submit details of the deal.
Ray C. Espinosa, head of regulatory affairs and policy at PLDT, said in a statement that "these issues are being raised by Globe with much thunder and lightning in order to gain leverage and exact concessions from PLDT...Globe wants to use the NTC to deliver these concessions on a silver platter."
"The monopoly issue being raised by Globe is a ruse. It is meant to weaken the resolve of the NTC to approve a deal that will bring enormous benefits to the public in terms of better service and accelerated high-speed broadband Internet service throughout the country," he added.
Mr. Espinosa also claimed that Globe was also involved in "institutionalized combinations of restraint of trade," noting exclusive arrangements with property development projects.
Globe shares closed P5 higher at P880 per yesterday, while PLDT’s ended the day P10 up at P2,466 apiece. Shares in Digitel were unchanged from Tuesday at P1.56 per share.
Mediaquest Holdings, Inc., a unit of the Beneficial Trust Fund of PLDT, has a minority stake in BusinessWorld.
