2. Critical Infrastructure

Critical Infrastructure

Public Service Act (Commonwealth Act No. 146, as amended by RA 11659)¹

Critical Infrastructure [Sec. 2(e), RA 11659]²

Section 2. Definition of Terms. - For the purposes of this Act, the terms below shall be defined as follows:

(a) Administrative Agency or Administrative Agencies, as the case may be, refers to relevant government agencies, to which the powers and duties of the Public Service Commission were transferred pursuant to existing laws. All mention of the word "Commission" in this Act shall now refer to this term;

(b) Certificates refer to any franchise, certificate of public convenience, certificate of public convenience and necessity, concession, or any other appropriate form of authorization for the operation of a public service, including a public utility, as may be applicable;

(c) Concession refers to a contract granting a private concessionaire the privilege to, among others, finance, construct, manage, operate and/or maintain concession assets;

(d) Concessionaire refers to a person, corporation, firm or association awarded a concession;

(e) Critical Infrastructure refers to any public service which owns, uses, or operates systems and assets, whether physical or virtual, so vital to the Republic of the Philippines that the incapacity or destruction of such systems or assets would have a detrimental impact on national security, including telecommunications and other such vital services as may be declared by the President of the Philippines;

(f) Distribution of Electricity refers to the conveyance of electric power by a distribution utility through its distribution system as defined by Section 4(n) of Republic Act No. 9136 ³, otherwise known as the "Electric Power Industry Reform Act of 2001", as amended;

(g) Foreign State-owned Enterprise refers to an entity in which a foreign State:(i) directly or indirectly owns more than fifty-percent (50%) of the capital taking into account both the voting rights and beneficial ownership;

(ii) controls, through ownership interests, the exercise of more than fifty percent (50%) of the voting rights; or

(iii) holds the power to appoint a majority of members of the board of directors or any other equivalent management body;

(h) National Security refers to the requirements and conditions necessary to ensure the territorial integrity of the country and the safety, security, and well-being of Filipino citizens;

(i) Petroleum and petroleum Product Pipeline Transmission Systems refer to the operation and maintenance of pipeline transmission systems to ensure an uninterrupted and adequate supply and transmission of petroleum and petroleum products to the public; and excludes petroleum pipeline systems operated exclusively for private or own use, or incidental to the operations of a distinct business;

(j) Philippine National refers to citizens, partnerships, associations, and corporations defined by Section 3(a) of Republic Act No. 7042 ⁴, otherwise known as the "Foreign Investments Act of 1991", as amended;

(k) Public Utility Vehicles (PUVs) refer to internal combustion engine vehicles that carry passengers and/or domestic cargo for a fee, offering services to the public, namely trucks-for-hire, UV express service, public utility buses (PUBs), public utility jeepneys (PUJs), tricycles, filcabs, and taxis: Provided, That transport vehicles accredited with and operating through transport network corporations shall not be considered as public utility vehicles;

(l) Seaport refers to a place where ships may anchor or tie up for the purpose of shelter, repair, loading or discharge of passengers or cargo, or for other such activities connected with water-borne commerce, and including all the land and water areas and the structures, equipment and facilities related to these functions, as defined by the charters of relevant authorities or agencies, such as the Philippine Ports Authority, Subic Bay Metropolitan Authority, PHIVIDEC Industrial Estate Authority, Cebu Port Authority, local government units, and other similar agencies or government bodies;

(m) Telecommunications refers to any process which enables a telecommunications entity to relay and receive voice, data, electronic messages, written or printed matter, fixed or moving pictures, words, music or visible or audible signals or any control signals of any design and for any purpose by wire, radio or other electromagnetic, spectral, optical or technological means, as defined by Section 3(a) of Republic Act No. 7925 ⁵, otherwise known as the "Public Telecommunications Policy Act of the Philippines", as amended, except passive telecommunications tower infrastructure and components, such as, but not limited to, poles, fiber ducts, dark fiber cables, and passive telecommunications tower infrastructure, as defined by the Department of Information and Communications Technology (DICT), and value-added services, as defined in Section 3(h) of Republic Act No. 7925 ⁶, as amended;

(n) Transmission of Electricity refers to the conveyance of electricity through the high voltage backbone system, as defined by Section 4(cc) of Republic Act No. 9136 ⁷, as amended;

(o) Water Pipeline Distribution Systems and Wastewater Pipeline Systems refer to the operation and maintenance of water pipeline distribution systems to ensure an uninterrupted and adequate supply and distribution of potable water for domestic and other purposes and the operation and maintenance of wastewater pipeline systems, except desludging companies and septic tanks, to ensure public health and safety, as regulated by Republic Act No. 6234, entitled "An Act Creating the Metropolitan Waterworks and Sewerage System and Dissolving the National Waterworks and Sewerage Authority; and for Other Purposes"⁸, as amended, and Presidential Decree No. 198, otherwise known as the "Provincial Water Utilities Act of 1973"⁹, as amended; and

(p) Sewerage Pipeline Systems refers to the operation and maintenance of sewerage pipeline systems to ensure public health and safety, as regulated by Republic Act No. 6234, as amended, and Presidential Decree No. 198, as amended.

G.R. No. 88404, August 23, 1990

Facts of the Case

• The case arose from a dispute between the NTC and PLDT regarding the latter’s refusal to interconnect with other telecommunications companies. PLDT, being the dominant provider of telecommunications services in the Philippines, controlled a substantial portion of the market.
• The NTC issued orders directing PLDT to interconnect with other telecommunications providers. These orders aimed to facilitate competition and ensure that consumers could benefit from improved services and choices.
• PLDT resisted the NTC’s orders, arguing that it had the right to control its network and that mandatory interconnection would compromise its operations and investments.

Issues

• Whether the NTC had the authority to compel PLDT to interconnect with other telecommunications providers.
• Whether the mandatory interconnection ordered by the NTC served the public interest by promoting fair competition and improving service quality.

Ruling

The Supreme Court ruled in favor of the NTC, upholding its authority to mandate interconnection among telecommunications providers. The key points of the ruling include:

• The Court affirmed the NTC’s regulatory authority to enforce interconnection among telecommunications providers. The NTC’s mandate is to ensure that the telecommunications industry operates efficiently and fairly, benefiting consumers and promoting competition.
• The Court emphasized that the mandatory interconnection was in the public interest. It ensured that consumers could communicate across different networks, which is essential for a competitive and efficient telecommunications sector.
• The ruling recognized the potential for market dominance by a single provider to stifle competition. By mandating interconnection, the NTC was addressing the anti-competitive behavior that could arise from such dominance.