Samuel Bautista v. NTC and PLDT G.R. No.

L-60987, 31 August 1982 FACTS PLDT filed an application on March 22, 1982 with the NTC to increase the amount they charge customers/clients under the Subscriber Investment Plan. Petitioner Bautista, an applicant under the PLDT business telephone plan, opposed this application of PLDT as granting it would adversely affect him and other PLDT subscribers. Bautista also averred that there is no necessity for the increase as PLDT is financially sound, had an operating income of more than P500 million, and received an investment from Development Bank of the Philippines of P400 million. NTC Commissioner Ceferino Carreon on April 14, 1982 provisionally approved PLDTs application [Subscriber Self-Financing or Subscriber Investment Plan], finding that the proposed plan was just and reasonable and within the limit set by P.D. 217 and public policy. Bautista filed this petition for certiorari with the Supreme Court to set aside the NTC Order of April 14, 1982 provisionally approving the revised subscriber investment plan. Bautista alleged that although the NTC has authority and jurisdiction to hear PLDTs application, he alleges that: (a) (b) (c) (d) PD 217 DID NOT authorize the NTC to grant provisional approval of the plan; PD prohibits telephone companies from charging more that 50 % of the cost of the installed telephone line; Sec. 16(c) of the Public Service Act the NTC can only provisionally approve the rates proposed by public services; Neither the Public Service Law nor PD 217 authorized the NTC to grant provisional approval of applications to increase the amount of subscriber investment plan.

Therefore the alleged NTC order is null and void. The OSG also opposed the application ad the rates are excessive and unreasonable and persons from the low income and middle class will not be able to afford them. ISSUE Whether the NTC erred in approving PLDTs application. HELD YES. The PLDT application did not seek to fix or determine rates, but a proposed revised subscriber investment plan. The NTC should have conducted a hearing before approving the application. The NTCs provisional order is set aside. RATIO: The application filed by the PLDT with the National Telecommunications Commission, under Case No. 82-27, is not a fixing and/or determining of rate which the commission may have approved provisionally and without the necessity of any hearing. It is a request for the approval of its proposed revised subscriber investment plan.

In Presidential Decree No. 217, promulgated on June 16, 1973, the State adopted the basic policies of the telephone industry which, among others, are: (1) the attainment of efficient telephone service for as wide an area as possible as the lowest reasonable cost to the subscriber; (2) the capital requirements of telephone utilities obtained from ownership funds shall be raised from a broad base of investors, involving as large a number of individual investors as may be possible; and (3) in any subscriber self-financing plan, the amount of subscriber self-financing will, in no case, exceed fifty per centum (50%) of the cost of the installed telephone line, as may be determined from time to time by the regulatory bodies of the state. Thus, the Commission should have conducted a hearing, requiring the OSG to comment, before it acted on the application of the PLDT so that the public could air its opposition.@lF The OSG and petitioner should be given the opportunity to substantiate their objection that the rates under the subscriber investment plan are excessive and unreasonable and, as a consequence, the low income and middle class group cannot afford to have telephone connections; and, that there is no need to increase the rate because the applicant is financially sound.