Chelsea Logistics Holdings Corp.CLC

Clarification of news article entitled "Eligibility of 3rd telco player questioned"

We write with respect to the news article entitled “Eligibility of 3rd telco player questioned” posted in philSTAR.com on November 9, 2018. The article reported in part that:

“MANILA, Philippines — The consortium granted provisional authority to operate as the country’s third telco player has no franchise and thus should be stripped of its newly won entitlement as challenger to the so-called ‘duopoly’ of local telecommunications giants, an infrastructure think tank said yesterday.

Infrawatch PH, through convenor Terry Ridon, claimed that the congressional franchise granted to Mindanao Islamic Telephone Co. (Mislatel) in 1998 had been automatically revoked for the group’s failure to list in the stock market, a condition set for the granting of franchise. Ridon was a member of the House committee on legislative franchise.

‘Sorry to rain on the parade of the Mislatel consortium, but the public needs to know that the franchise of Mislatel is non-operational,’ he said.

‘In fact, it has been automatically revoked in 2003 for its failure to join the stock market. We have checked the list of companies currently in the PSE (Philippine Stock Exchange); there is no publicly traded entity named Mislacom,’ said the former Kabataan party-list lawmaker.

The Mislatel consortium – comprising Udenna Corp. of Davao-based businessman Dennis Uy, its subsidiary Chelsea Logistics Holdings Corp. and China Telecommunications Corp. – was named provisional new player in the telco industry after two other groups were disqualified for incomplete requirements.

Ridon, also the former chairman of the Presidential Commission for the Urban Poor under the present administration, said the law that granted franchise to Mislacom requires the company to offer at least 30 percent of its outstanding capital stock in the stock exchange within five years from commencement of its operations.

‘We have not monitored the entry and participation of Mislacom in the Philippine Stock Exchange at present, and we highly doubt that Mislacom had ever participated in the PSE in the past,’ he pointed out.

‘This only means that Mislatel lost its franchise automatically in 2003, when it failed to join the stock market. Correspondingly, Mislatel as a telco, and Mislatel consortium, have absolutely no personality to join and participate in the proceedings to become the new third major player,’ he added.

The former lawmaker urged the Department of Information and Communications Technology (DICT) and the National Telecommunications Commission (NTC) to disqualify the consortium for gross misrepresentation.

‘Mislacom had ipso facto lost its franchise in 2003 yet it has represented itself as in possession of a valid and subsisting franchise before our government authorities,’ he said.

. . . .”

We wish to clarify that prior to the selection process for the third telco, the NTC published a list of telecommunications entities with existing legislative franchises. Mindanao Islamic Telephone Company, Inc. (Mislatel) was included in the list. See attached for reference. In addition, the NTC has accepted the validity of the Mislatel franchise when it vetted Mislatel’s documents during the NMP selection process.

See attached for the list of telecommunications entities with existing legislative franchises