RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., PETITIONER, VS. NATIONAL TELECOMMUNICATIONS COMMISSION AND KAYUMANGGI RADIO NETWORK INCORPORATED, RESPONDENTS.

This petition seeks the reversal of the decision of the National
Telecommunications Commission (NTC) ordered petitioner Radio Communications of
the Philippines,
Incorporated (RCPI) to desist from operating its radio telephone services in Catarman, Northern
Samar; San
Jose,
Occidental Mindoro; and Sorsogon,
Sorsogon.

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.

In 1968, the petitioner established a radio telegraph service in Sorsogon, Sorsogon.  In 1971, another radio telegraph service was
put up in San Jose, Mindoro followed
by another in Catarman, Samar in 1976. 
The installation of radio
telephone services started 1971 in San Jose, Mindoro; then in Sorsogon, Sorsogon and Catarman, Samar in 1983.

In a decision dated June
24, 1980 in NTC Case. No. 80-08, private respondent Kayumanggi Radio Network Incorporated was authorized by the
public respondent to operate radio communications systems in Catarman, Samar
and in San Jose, Mindoro.

On December 14, 1983,
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 convenience
and necessity.  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.  In its supplemental reply,
the petitioner further stated that it has been in operation
in the questioned places long before private respondent Kayumanggi
filed its application to operate in the same places.

After conducting a
hearing, NTC, in its decision dated August 22, 1984 ordered petitioner RCPI to immediately cease or desist
from the operation of its radio
telephone services in Catarman, Northern Samar;
San Jose, Occidental Mindoro; and Sorsogon,
Sorsogon 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.

On September 4, 1984,
the petitioner filed a motion for reconsideration which was denied in an order
dated September 12, 1984.

On October 1, 1984, the present petition was filed raising the
issue of 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.

The petitioner’s main argument states that the abolition of the
Public Service Commission under Pre­sidential Decree No. 1 and the creation of
the National Telecommunications Commission under Executive Order No. 546 to
replace the defunct Public Service Commis­sion did not affect sections 14 and 15 of the Public Service Law
(Commonwealth Act No. 146, as amended).

The provisions of the
Public Service Law pertinent to the petitioner’s allegation are as follows:

“Section 13 (a) The Commission shall have
jurisdiction, supervision, and control over all public services and their
franchises, equipment and other properties, and in the exercise of its
authority, it shall have the necessary powers and the aid of public force: xxx.

“Section 14.  The following are exempted from the provisions
of the preceding section:

xxx                   xxx                   xxx

“(d) Radio
companies except with respect to the fixing of rates;

xxx                   xxx                   xxx

“Section 15.  With the exception of those enumerated in the preceding section,
no public service shall operate in the Philippines without possessing a valid
and subsisting certificate from the Public Service Commission, known as
‘certificate of public convenience, or ‘certificate of convenience and public
necessity,’ as the case may be,
to the effect that the operation of said service and the authorization to do business will promote the public
interests in a proper and suitable manner. 
xxx“

We find no merit in the petitioner’s contention.

Pursuant to Presidential Decree No. 1 dated September 23, 1972, reorganizing the executive
branch of the National Government, the Public Service Commis­sion was abolished and its functions were
transferred to three specialized regulatory boards, as follows:  the Board of Transportation, the Board of
Communications and the Board of Power and Waterworks.  The functions so transferred were still
subject to the limitations provided in sections 14 and 15 of the Public Service
Law, as amended.  With the enactment of
Executive Order No. 546 on July 23, 1979 implementing P.D. No. 1, the Board of
Communications and the Telecommunications Control Bureau were abolished and
their functions were transferred to the National Telecommunications Commission
(Sec. 19(d), Executive Order No. 546).  Section 15 of said Executive Order spells out
the functions of the National Telecom­munications Commission as follows:

“Sec. 15.  Functions of the
Commission.  – The Commission
shall exercise the following functions:

“a.  Issue Certificate of Public Convenience for
the operation of communications utilities and services, radio commu­nications
systems, wire or wireless tele­phone or telegraph system, radio and television
broadcasting system and other similar public utilities;

“b.  Establish, prescribe and regulate areas of operation
of particular operators of public service communications; and deter­mine and
prescribe charges or rates pertinent to the operation of such public utility
facilities and services except in cases
where charges or rates are established by international bodies or associations
of which the Philippines is a participating member or by bodies recog­nized by
the Philippine Government as the proper arbiter of such charges or rates;

“c.  Grant
permits for the use of radio frequencies for wireless telephone and telegraph
systems and radio communication systems including amateur radio stations and
radio and television broadcasting systems;

“d.  Sub-allocate series of frequencies of bands
allocated by the International Telecommunications Union to the specific services;

“e.  Establish and prescribe rules, regulations,
standards, specifications in all cases related to the issued Certi­ficate of
Public Convenience and administer and enforce the same;

“f.   Coordinate and cooperate with government
agencies and other entities concerned with any aspect involving communi­cations
with a view to continuously improve the communications service in the country;

“g.  Promulgate such rules and regu­lations, as
public safety and interest may require, to encourage a larger and more effective
use of communications, radio and television broadcasting facilities, and to
maintain effective competition among private entities in these activities whenever the Commission finds it reasonably
feasible;

“h.  Supervise and inspect the opera­tion of radio
stations and telecom­munications facilities;

“i.    Undertake the
examination and licensing of radio operators;

“j.    Undertake, whenever necessary, the registration of radio transmitters and
transceivers; and

“k.   Perform such other functions as may be prescribed
by law.

It is clear from the aforequoted
provision that 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.  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.

A franchise started out as a “royal privilege or (a) branch
of the King’s prerogative, subsisting in the hands of a subject.” This
definition was given by Finch, adopted by Blackstone, and accepted by every authority since (State v. Twin Village Water
Co., 98 Me 214, 56 A 763 (1903)).  Today,
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.  We ruled in Pangasinan
Transportation Co., Inc. v. Public Service Commission (70 Phil. 221) that:

“xxxstatutes
enacted for the regulation of public utilities, being 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 operationxxx“

Executive Order No. 546, being
an implementing measure of P.D. No. 1 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.  The petitioner cannot install and
operate radio telephone services on the basis of its legislative franchise
alone.

The position of the petitioner that by the mere grant of its
franchise under RA No. 2036 it can operate a radio communications system
anywhere within the Philippines
is erroneous.  Section 1 of said statute reads:

“Section 1.  Subject to the provisions of the
Constitution, and to the provisions, not inconsistent herewith, of Act Numbered
Three thousand eight hundred and forty-six, entitled ‘An Act providing for the
regulation of radio stations and radio communications in the Philippine
Islands, and for other purposes;’ Commonwealth Act Numbered One hundred
forty-six, known as the Public Service Act, and their amendments, and other
applicable laws, there is hereby granted to the Radio Communications of the
Philip­pines, its successors or assigns, the right and privilege of
constructing, installing, establishing and operating in the Philippines, at
such places as the said corporation may select and the Secretary of Public
Works and Communications may approve, radio stations for the reception and
transmission of wireless messages on radiotelegraphy and/or radiotelephony,
including both coastal and marine telecommunications, each station to consist
of two radio apparatus comprising of a receiving and sending radio apparatus.” (Underscoring ours).

Section 4(a) of the same Act further
provides that:

“Sec. 4(a).  This franchise shall not take effect nor
shall any powers thereunder he exercised by the
grantee until the Secretary of Public Works and Communications shall have
allotted to the grantee the fre­quencies and wave lengths to be used, and
issued to the grantee a license for such case.” (Underscoring
ours).

Thus, in the words of R.A. No. 2036 itself, approval of the then
Secretary of Public Works and Communications was a precondition before the
petitioner could put up radio stations
in areas where it desires to operate. 
It has been repeated time and again that where the statutory norm speaks
unequivocally, there is nothing for the courts to do except to apply it.  The law, leaving no doubt as to the scope of
its operation, must be obeyed.  (Gonzaga v. Court of Appeals, 51 SCRA
381).

The records of the case
do not show any grant of authority from the then Secretary of Public Works
and Communications before the petitioner installed the questioned radio
telephone services in San Jose, Mindoro in 1971.  The same is true as regards the radio
telephone services opened in Sorsogon, Sorsogon
and Catarman, Samar
in 1983.  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.  (See Executive Order No. 545, sec. 15, supra.;
Philippine Long Distance Telephone Co. v. City of Davao,
15 SCRA 75; Olongapo Electric Light and Power Corp.
v. National Power Corporation, et al., G.R. No. L-24912, promulgated April 9, 1987.)

It was well within the powers of the public respondent to
authorize the installation by the private respondent network of radio
communications systems in Catarman, Samar and San Jose,
Mindoro.  Under the circumstances of this case, the
mere fact that the petitioner possesses a franchise to put up and operate a
radio communications system in certain areas is not an insuperable obstacle to
the public respondent’s issuing the proper certificate to an applicant desiring
to extend the same services to those areas. 
The Constitution mandates that a franchise cannot be exclusive in nature nor can 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). 
There is an express provision in the petitioner’s franchise which
provides compliance with the above mandate (RA 2036, sec. 15).

In view of the foregoing, we find no reason to disturb the public respondent’s findings of fact,
and conclusions of law insofar as the private respon­dent was authorized to
operate in Catarman, Samar
and San Jose, Mindoro. 
As a rule, the
Commission’s findings of fact, if supported by substantial evidence, are
conclusive upon this Court.  We may
modify or ignore them only when it clearly appears that there is no evidence to
support reasonably such a conclusion.  (Halili v. Daplas, 14 SCRA 14). 
The petitioner has not shown why the private respondent should be denied
the authority to operate its services in Samar
and Mindoro.  It has not overcome the presumption that when
the public respondent disturbed the petitioner’s monopoly in certain areas, it was doing so
pursuant to public interest and the common good.

WHEREFORE, the challenged order of the public respondent dated August 22, 1984 is hereby AFFIRMED.  The petition is dismissed for lack of merit.

SO ORDERED.

Fernan, (Chairman), Paras, Padilla, Bidin, and Cortes, JJ., concur.