Control Bureau and transferring their function to NTC,
6. Radio Communication of the Phils., Inc v. NTC, GR L-
68729, May 29, 1987
RADIO COMMUNICATIONS OF THE PHILIPPINES,
INC., petitioner,
vs.
NATIONAL TELECOMMUNICATIONS COMMISSION and
KAYUMANGGI RADIO NETWORK
INCORPORATED, respondents.
FACTS:
1. Petitioner has been operating a radio communications
system since 1957 under its legislative franchise
granted by Republic Act No. 2036 which was enacted
on June 23, 1957.
2. It has established a radio telegraph service and
installed radio terlophone services in San Jose
Mindoro, Sorsogon and Catamaran Samar.
3. respondent Kayumanggi Radio Network Incorporated
was authorized by the NTC to operate radio
communications systems in Catarman, Samar and in
San Jose, Mindoro.
4. The private respondent filed a complaint with the NTC
alleging that the petitioner was operating in Catarman,
Samar and in San Jose, Mindoro without a certificate of
public covenience and necessity.
5. The petitioner, on the other hand, counter-alleged that
its telephone services in the places subject of the
complaint are covered by the legislative franchise
recognized by both the public respondent and its
predecessor, the Public Service Commission.
6. After conducting a hearing, NTC, in its decision
ordered petitioner RCPI to immediately cease or desist
from the operation of its radio telephone services
stating that under Executive Order No. 546, a
certificate of public convenience and necessity is
mandatory for the operation of communication
utilities and services including radio communications.
ISSUE: whether or not petitioner RCPI, a grantee of a
legislative franchise to operate a radio company, is
required to secure a certificate of public convenience and
necessity before it can validly operate its radio stations
including radio telephone services in Catarman, Northern
Samar; San Jose, Occidental Mindoro; and Sorsogon,
Sorsogon.
RULING:
1. Yes, petitioner RCPI, a grantee of a legislative franchise
to operate a radio company, is required to secure a
certificate of public convenience and necessity before
it can validly operate its radio stations including radio
telephone services in Catarman, Northern Samar; San
Jose, Occidental Mindoro; and Sorsogon, Sorsogon.
2. Under EO 546, implementing PD 1, thus abolishing the
Board of Communications and Telecommunications
from its provisions the exemption enjoyed by radio
companies from the jurisdiction of the Public Service
Commission and the Board of Communications no
longer exists because of the changes effected by the
Reorganization Law and implementing executive
orders.
3. The petitioner's claim that its franchise cannot be
affected by Executive Order No. 546 on the ground
that it has long been in operation since 1957 cannot be
sustained.
4. Accdg to SC, a franchise, being merely a privilege
emanating from the sovereign power of the state and
owing its existence to a grant, is subject to regulation
by the state itself by virtue of its police power through
its administrative agencies.
5. SC ruled in Pangasinan transportation Co., Inc. v. Public
Service Commission (70 Phil. 221) that:
... statutes enacted for the regulation of public utilities,
being a proper exercise by the State of its police
power, are applicable not only to those public utilities
coming into existence after its passage, but likewise to
those already established and in operation ...
6. Executive Order No. 546, being an implementing
measure of P.D. No. I insofar as it amends the Public
Service Law (CA No. 146, as amended) is applicable to
the petitioner who must be bound by its provisions.
7. The petitioner cannot install and operate radio
telephone services on the basis of its legislative
franchise alone.
8. No certificate of public convenience and necessity
appears to have been secured by the petitioner from
the public respondent when such certificate,was
required by the applicable public utility regulations
9. The Constitution mandates that a franchise cannot be
exclusive in nature nor can a franchise be granted
except that it must be subject to amendment,
alteration, or even repeal by the legislature when the
common good so requires. (Art. XII, sec. 11 of the 1986
Constitution).