Palace: China Telecom covered by 60-40 ownership rule

MANILA � China Telecom has to comply with the Philippine Constitution's provision, which limits foreign companies to 40 percent ownership, MalacaAang has stressed.

They have to partner with Filipino companies with the existing franchise because otherwise, they have to go to Congress for another franchise, Presidential spokesperson Harry Roque said in a press conference Wednesday.

Roque said the Department of Information and Communication Technology (DICT) has already made it clear that a Filipino consortium should own 60 percent of the third major telecommunication firm in the Philippines.

During his bilateral meeting with Chinese Premier Li Keqiang last November in Manila, President Rodrigo Duterte offered to China the chance to operate the third major telecommunications company in the Philippines.

Last month, the Chinese government has announced that it chose China Telecom, the country's largest telecommunication company, to become the Philippines' major third telecom firm.

Roque said the Duterte administration honors the President's offer to China.

If for any reason, this (60-40 foreign ownership rule) is not acceptable to China Telecom, then we'll have to look for other player or country, Roque said.

He clarified that at present, there is no indication that China Telecom would not push through with the project.

The 1987 Philippine Constitution provides that Filipinos must own majority or 60 percent of a company while limiting foreign ownership to 40 percent.

Although he is aware that most Chinese companies are always comfortable with 100-percent ownership, Roque said, I do not know if it applies to China Telecom.

At present, Philippine Long Distance Telephone (PLDT) and Globe Telecom dominate the Philippine mobile industry.

Under Duterte administration, China-Philippines relations have made a complete turnaround, boosting the two countries' cooperation in the fields of trade, agriculture, education, science and technology, and people-to-people exchanges.

Source: Philippine News Agency