DITO Telecommunity responds to the accusations

Published August 10, 2022, 9:47 AM

by Robert D. Reyes

A day after DITO Telecommunity (DITO) filed two separate cases against Globe and Smart at the Philippine Competition Commission (PCC) for alleged abuse of dominance, the pioneer telecommunication companies hit back at the new telecoms player accusing DITO of interconnection violations.

Last 8th of August 2022 (Monday), DITO shared that around 70 to 80 out of 100 calls made by their subscribers to the two other telcos were unsuccessful, thus their filing of a formal complaint at the PCC.

“Interconnection is an essential component of the telecommunications industry as it allows interoperability and exchange of calls, SMS, and other information from one network to another. As such, our Competition Enforcement Office (CEO) is now evaluating the merits of DITO’s complaints. The Commission has 10 days within which to decide whether or not to give due course to the complaint. If given due course, our CEO will proceed to investigate the charges and if it subsequently finds sufficient basis, file with the Commission en banc a Statement of Objections against the allegedly erring entities. The PCC shall also consult with the National Telecommunications Commission for related regulatory concerns,” according to Johannes R. Bernabe, OIC Chairperson of the Philippine Competition Commission in a press statement.

DITO’s Chief Administrative Officer, Atty. Adel Tamano said in a statement, “Interestingly, Smart has taken a similar approach as Globe in regard their position on the Philippine Competition Commission complaints that DITO filed.”

Atty. Tamano added that Smart’s usage of the International Simple Resale (ISR) issue is an admission that the latter is making interconnection (as mandated by law) subject to the acceptance of their request for compensation and that it falls into Sec 15 (C) of the Philippine Competition Act that states:

Section 15(c) of the Competition Act deems as an abuse of dominant position when a dominant entity makes “a transaction subject to acceptance by the other parties of other obligations which, by their nature or according to commercial usage, have no connection with the transaction.”

Based on the International Telecommunication Union’s (ITU) definition of ISR, a public telecommunications operator (PTO) or private company can gather traffic to a particular destination from a variety of different customers and then route it via an international leased line.

DITO said these ISR calls are not made by them, but rather by third parties — and they, too are equally a victim of such calls. Additionally, there are also ISR calls from Smart to DITO and there is no truth that DITO has not taken steps to stop ISR calls to Smart. Atty. Tamano said that they have the data and the facts to show the steps undertaken by DITO to minimize these ISR calls.

It may be recalled that PLDT (Smart is a wholly-owned wireless communications and digital services subsidiary of PLDT, Inc.) lost its case at the Supreme Court in 2006 when it tried to float the idea that ISR constitutes “theft” of telephone calls (PLDT’s main line of business). According to the Supreme Court, telephone calls are not the property of the telco, but the callers themselves, leading to the change in the VOIP business landscape locally.

In addition, Atty. Tamano cited Globe’s informing the media about the alleged interconnection penalties as a disclosure of confidential business information, which is a violation of the PCC’s rules of procedure.

“On the issue of forum shopping, there is no forum shopping in this case as the petitions with the NTC are for violations of the Telecom Policy Act and the corresponding NTC Memorandum Circulars. The complaints with the PCC are anchored on violations of the Philippine Competition Act for abuse of dominant position. Two very different causes of action, with different tribunals, which have distinct jurisdictions,” Atty. Tamano added.

Related to the matter of PLDT building a big part of its telco infrastructure, Atty. Tamano stressed, “This was paid for by DITO. It was not done gratis et amore. And the building of that infrastructure was done in compliance with the legal mandate for interconnection and not to help DITO fulfill its commitments to the NTC and Congress.”

DITO Telecommunity reiterated that they are pursuing the case filed with the Philippine Competition Commission to fulfill its mandate of providing true competition in the telecom industry and to ensure that the Filipino people are given world-class telco services that they rightfully deserve.