Grant of Radio Paging System Franchise to Multi-Media Telephony Inc.

February 23, 1995

REPUBLIC ACT NO. 7908

AN ACT GRANTING THE MULTI-MEDIA TELEPHONY INCORPORATED, A FRANCHISE TO CONSTRUCT, ESTABLISH, OPERATE AND MAINTAIN RADIO PAGING SYSTEM IN THE PHILIPPINES, AND FOR OTHER PURPOSES

SECTION 1. Nature and Scope of Franchise. — Subject to the provisions of the Constitution and applicable laws, rules and regulations, there is hereby granted to Multi-Media Telephony Incorporated, hereunder referred to as the grantee, its successors or assigns, a franchise to construct, establish, install, operate and maintain for commercial purposes and in the public interest, radio paging and records messaging systems, including data transmission, and other means related to the foregoing now known to science or which in the future may be developed and used exclusively for the foregoing purpose all the apparatus, conduits, appliances, receivers, transmitters, antennas, satellites and equipment necessary for the transmission of messages and signals with the corresponding technological auxiliaries, facilities, distribution or relay stations, throughout the Philippines or territories as public interest may warrant. acd

SECTION 2. Manner of Operation of Stations or Facilities. — The stations or facilities of the grantee shall be constructed and operated in a manner as will at most result only in the minimum interference on the wavelengths or frequencies of the existing stations or other stations which may be established in accordance with law, without in any way diminishing its own rights to use its selected wavelengths or frequencies and the quality of transmission or reception thereon as would maximize rendition of the grantee's services and/or the availability thereof.

SECTION 3. Prior Approval of the National Telecommunications Commission. — The grantee shall secure from the National Telecommunications Commission the appropriate permits and licenses for its stations and shall not use any frequency in the radio spectrum without having been authorized by the Commission. The Commission, however, shall not unreasonably withhold or delay the grant of any such authority.

SECTION 4. Responsibility to the Public. — The grantee shall conform to the ethics of honest enterprise and shall not use its stations for obscene or indecent transmission or for dissemination of deliberately false information or willful misrepresentation, or assist in subversive or treasonable acts.

SECTION 5. Rates for Services. — The charges and rates for services, excluding the sale or lease of equipment or units, that the grantee shall offer to the public shall be subject to the approval of the National Telecommunications Commission or its legal successors.

SECTION 6. Right of Government. — The President of the Philippines, in times of war, rebellion, public peril, calamity, emergency, disaster or disturbance of peace and order, may temporarily take over and operate the stations, transmitter systems, facilities and equipment of the grantee, to temporarily suspend the operation of any station in the interest of public safety, security and public welfare, or to authorize the temporary use and operation thereof by any agency of the government, upon due compensation to the grantee for the use of the said stations, transmitter systems, facilities and equipment during the period when they shall be so operated.

SECTION 7. Term of Franchise. — This franchise shall be for a term of twenty-five (25) years from the date of effectivity of this Act, unless sooner revoked or cancelled. In the event the grantee fails to operate continuously for two (2) years, this franchise shall be deemed ipso facto revoked.

SECTION 8. Acceptance and Compliance. — Acceptance of this franchise shall be given in writing to Congress within sixty (60) days from the effectivity of this Act. Upon giving such acceptance, the grantee shall exercise the privileges granted under this Act. Nonacceptance shall render the franchise void.

SECTION 9. Tax Provision. — The grantee, its successors or assigns, shall be liable to pay the same taxes on their real estate buildings and personal property, exclusive of this franchise, as other persons or corporations are now or hereafter may be required by law to pay. In addition thereto, the grantee, its successors or assigns, shall be levied, assessed and collected a franchise tax equivalent to three percent (3%) on all gross receipts of the business transacted under this franchise by the grantee and the said percentage shall be in lieu of all taxes on this franchise or earnings thereof. The grantee, its successors or assigns, shall continue to be liable for income taxes payable under Title II of the National Internal Revenue Code.

The grantee shall file the return with and pay the tax due thereon to the Commissioner of Internal Revenue or his duly authorized representatives in accordance with the National Internal Revenue Code and the return shall be subject to audit by the Bureau of Internal Revenue.

SECTION 10. Sale, Lease, Transfer, Usufruct, etc. — The grantee shall not lease, transfer, grant the usufruct of, sell nor assign this franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation, or other commercial or legal entity, nor merge with any corporation or entity without the prior approval of the Congress of the Philippines. Neither shall the controlling interest in the grantee be transferred, whether as a whole or in parts and whether simultaneously or contemporaneously, to any such person, firm, company, corporation or entity without the prior approval of the Congress of the Philippines. Any person or entity to which this franchise is sold, transferred or assigned, shall be subject to all the same conditions, terms, restrictions and limitations of this Act.

SECTION 11. Warranty in Favor of National and Local Governments. — The grantee shall hold the national, provincial and municipal governments of the Philippines harmless from all claims, accounts, demands or actions arising out of accidents or injuries, whether to property or to persons, caused by the construction or operation of the stations, facilities and equipment of the grantee.

SECTION 12. Separability Clause. — If any of the sections or provisions of this Act is held invalid, all the other provisions not affected thereby shall remain valid.

SECTION 13. Repealability and Non-exclusivity Clauses. — This franchise shall be subject to amendment, alteration, or repeal by the Congress of the Philippines when the public interest so requires and shall not be interpreted as an exclusive grant of the privileges herein provided for.

SECTION 14. Reportorial Requirement. — The grantee shall submit an annual report to the Congress of the Philippines on its compliance with the terms and conditions of the franchise and on its operations within sixty (60) days from the end of every year. casia

SECTION 15. Effectivity. — This Act shall take effect fifteen (15) days from the date of its publication in at least two (2) newspapers of general circulation.

Approved: February 23, 1995

Published in Malaya and the Manila Times on March 2, 1995. Published in the Official Gazette, Vol. 91 No. 20 page 3031 on May 8, 1995.