316 Supreme Court Reports Annotated: Republic vs. Express Telecommunication Co., Inc

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316 SUPREME COURT REPORTS ANNOTATED

Republic vs. Express Telecommunication Co., Inc.


*
G.R. No. 147096. January 15, 2002.

REPUBLIC OF THE PHILIPPINES, represented by NATIONAL


TELECOMMUNICATIONS COMMISSION, petitioner, vs.
EXPRESS TELECOMMUNICATION CO., INC. and BAYAN
TELECOMMUNICATIONS CO., INC., respondents.

G.R. No. 147210. January 15, 2002.

BAYAN TELECOMMUNICATIONS (Bayantel), INC., petitioner,


vs. EXPRESS TELECOMMUNICATION CO., INC. (Extelcom),
respondent.

Administrative Law; Public Utilities; Telecommunications; In the


regulatory telecommunications industry, the National Telecommunications

_______________

12 Ibid.

* FIRST DIVISION.

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Republic vs. Express Telecommunication Co., Inc.

Commission (NTC) has the sole authority to issue Certificates of Public


Convenience and Necessity (CPCN) for the installation, operation, and
maintenance of communications facilities and services, radio
communications systems, telephone and telegraph systems.—The NTC was
created pursuant to Executive Order No. 546, promulgated on July 23, 1979.
It assumed the functions formerly assigned to the Board of Communications
and the Telecommunications Control Bureau, which were both abolished
under the said Executive Order. Previously, the NTC’s functions were
merely those of the defunct Public Service Commission (PSC), created
under Commonwealth Act No. 146, as amended, otherwise known as the
Public Service Act, considering that the Board of Communications was the
successor-in-interest of the PSC. Under Executive Order No. 125-A, issued
in April 1987, the NTC became an attached agency of the Department of
Transportation and Communications. In the regulatory telecommunications
industry, the NTC has the sole authority to issue Certificates of Public
Convenience and Necessity (CPCN) for the installation, operation, and
maintenance of communications facilities and services, radio
communications systems, telephone and telegraph systems. Such power
includes the authority to determine the areas of operations of applicants for
telecommunications services. Specifically, Section 16 of the Public Service
Act authorizes the then PSC, upon notice and hearing, to issue Certificates
of Public Convenience for the operation of public services within the
Philippines “whenever the Commission finds that the operation of the public
service proposed and the authorization to do business will promote the
public interests in a proper and suitable manner.”
Same; Same; Same; Publication of Laws; National Administrative
Register; There is nothing in the Administrative Code of 1987 which implies
that the filing of the rules with the UP Law Center is the operative act that
gives the rules force and effect; The National Administrative Register is
merely a bulletin of codified rules and it is furnished only to the Office of the
President, Congress, all appellate courts, the National Library, other public
offices or agencies as the Congress may select, and to other persons at a
price sufficient to cover publication and mailing or distribution costs.—
Respondent Extelcom, however, contends that the NTC should have applied
the Revised Rules which were filed with the Office of the National
Administrative Register on February 3, 1993. These Revised Rules deleted
the phrase “on its own initiative”; accordingly, a provisional authority may
be issued only upon filing of the proper motion before the Commission. In
answer to this argument, the NTC, through the Secretary of the
Commission, issued a certification to the effect that inasmuch as the 1993
Revised Rules have not been published in a newspaper of general
circulation, the NTC has been applying the 1978 Rules. The absence of

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318 SUPREME COURT REPORTS ANNOTATED

Republic vs. Express Telecommunication Co., Inc.

publication, coupled with the certification by the Commissioner of the NTC


stating that the NTC was still governed by the 1978 Rules, clearly indicate
that the 1993 Revised Rules have not taken effect at the time of the grant of
the provisional authority to Bayantel. The fact that the 1993 Revised Rules
were filed with the UP Law Center on February 3, 1993 is of no moment.
There is nothing in the Administrative Code of 1987 which implies that the
filing of the rules with the UP Law Center is the operative act that gives the
rules force and effect. x x x The National Administrative Register is merely
a bulletin of codified rules and it is furnished only to the Office of the
President, Congress, all appellate courts, the National Library, other public
offices or agencies as the Congress may select, and to other persons at a
price sufficient to cover publication and mailing or distribution costs.
Same; Same; Same; Same; Publication in the Official Gazette or a
newspaper of general circulation is a condition sine qua non before statutes,
rules or regulations can take effect; The Rules of Practice and Procedure of
the NTC, which implements Section 29 of the Public Service Act (C.A. 146,
as amended), fall squarely within the scope of these laws, as explicitly
mentioned in the case of Tañada v. Tuvera, 146 SCRA 446 (1986).—
Publication in the Official Gazette or a newspaper of general circulation is a
condition sine qua non before statutes, rules or regulations can take effect.
This is explicit from Executive Order No. 200, which repealed Article 2 of
the Civil Code, and which states that: Laws shall take effect after fifteen
days following the completion of their publication either in the Official
Gazette or in a newspaper of general circulation in the Philippines, unless it
is otherwise provided. The Rules of Practice and Procedure of the NTC,
which implements Section 29 of the Public Service Act (C.A. 146, as
amended), fall squarely within the scope of these laws, as explicitly
mentioned in the case Tañada v. Tuvera.
Same; Same; Same; Where the records show that the amended
application filed by a telecommunications firm in fact included a motion for
the issuance of a provisional authority, it cannot be said that the NTC
granted the provisional authority motu proprio.—In any event, regardless of
whether the 1978 Rules or the 1993 Revised Rules should apply, the records
show that the amended application filed by Bayantel in fact included a
motion for the issuance of a provisional authority. Hence, it cannot be said
that the NTC granted the provisional authority motu proprio. The Court of
Appeals, therefore, erred when it found that the NTC issued its Order of
May 3, 2000 on its own initiative. This much is acknowledged in the
Decision of the Court of Appeals: As prayer, ICC asked for the immediate
grant of provisional authority to construct, install, maintain and

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Republic vs. Express Telecommunication Co., Inc.

operate the subject service and to charge the proposed rates and after due
notice and hearing, approve the instant application and grant the
corresponding certificate of public convenience and necessity.
Same; Same; Same; Archiving of Cases; Revival of Cases; The
archiving of cases is a widely accepted measure designed to shelve cases in
which no immediate action is expected but where no grounds exist for their
outright dismissal, albeit without prejudice, and there is nothing irregular in
the revival of the application after the condition therefor is fulfilled.—The
Court of Appeals also erred when it declared that the NTC’s Order archiving
Bayantel’s application was null and void. The archiving of cases is a widely
accepted measure designed to shelve cases in which no immediate action is
expected but where no grounds exist for their outright dismissal, albeit
without prejudice. It saves the petitioner or applicant from the added trouble
and expense of re-filing a dismissed case. Under this scheme, an inactive
case is kept alive but held in abeyance until the situation obtains wherein
action thereon can be taken. In the case at bar, the said application was
ordered archived because of lack of available frequencies at the time, and
made subject to reinstatement upon availability of the requisite frequency.
To be sure, there was nothing irregular in the revival of the application after
the condition therefor was fulfilled.
Same; Same; Same; Same; Same; Due Process; Where the order refers
to a simple revival of an archived application, it cannot be said that an
oppositor’s right to procedural due process was prejudiced if it was not
given an opportunity to question the motion for revival; There is no denial
of due process where full-blown adversarial proceedings are conducted
before an administrative body.—The Court of Appeals ruled that there was a
violation of the fundamental right of Extelcom to due process when it was
not afforded the opportunity to question the motion for the revival of the
application. However, it must be noted that said Order referred to a simple
revival of the archived application of Bayantel in NTC Case No. 92-426. At
this stage, it cannot be said that Extelcom’s right to procedural due process
was prejudiced. It will still have the opportunity to be heard during the full-
blown adversarial hearings that will follow. In fact, the records show that
the NTC has scheduled several hearing dates for this purpose, at which all
interested parties shall be allowed to register their opposition. We have ruled
that there is no denial of due process where fullblown adversarial
proceedings are conducted before an administrative body. With Extelcom
having fully participated in the proceedings, and indeed, given the
opportunity to file its opposition to the application, there was clearly no
denial of its right to due process.

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320 SUPREME COURT REPORTS ANNOTATED

Republic vs. Express Telecommunication Co., Inc.

Same; Same; Same; Same; Same; The requirements of notice and


publication of the application are no longer necessary where the application
is a mere revival of an application which has already been published earlier.
—The requirements of notice and publication of the application is no longer
necessary inasmuch as the application is a mere revival of an application
which has already been published earlier. At any rate, the records show that
all of the five (5) CMTS operators in the country were duly notified and
were allowed to raise their respective oppositions to Bayan-tel’s application
through the NTC’s Order dated February 1, 2000.
Same; Same; Same; Public Telecommunications Policy Act of the
Philippines (R.A. No. 7925); Among the declared national polices under
R.A. No. 7925 is the healthy competition among telecommunications
carriers, and clearly the need for a healthy competitive environment in
telecommunications is sufficient impetus for the NTC to consider all those
applicants who are willing to offer competition, develop the market and
provide the environment necessary for greater public service.—It should be
borne in mind that among the declared national policies under Republic Act
No. 7925, otherwise known as the Public Telecommunications Policy Act of
the Philippines, is the healthy competition among telecommunications
carriers, to wit: A healthy competitive environment shall be fostered, one in
which telecommunications carriers are free to make business decisions and
to interact with one another in providing telecommunications services, with
the end in view of encouraging their financial viability while maintaining
affordable rates. The NTC is clothed with sufficient discretion to act on
matters solely within its competence. Clearly, the need for a healthy
competitive environment in telecommunications is sufficient impetus for the
NTC to consider all those applicants who are willing to offer competition,
develop the market and provide the environment necessary for greater
public service. This was the intention that came to light with the issuance of
Memorandum Circular 9-3-2000, allocating new frequency bands for use of
CMTS.
Same: Same; Same; Exhaustion of Administrative Remedies; The rule
is well-entrenched that a party must exhaust all administrative remedies
before resorting to the courts—the premature invocation of the intervention
of the court is fatal to one’s cause of action.—We now come to the issue of
exhaustion of administrative remedies. The rule is well-entrenched that a
party must exhaust all administrative remedies before resorting to the courts.
The premature invocation of the intervention of the court is fatal to one’s
cause of action. This rule would not only give the administrative agency an
opportunity to decide the matter by itself correctly, but would also prevent
the unnecessary and premature resort to

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courts. In the case of Lopez v. City of Manila, we held: As a general rule,
where the law provides for the remedies against the action of an
administrative board, body or officer, relief to courts can be sought only
after exhausting all remedies provided. The reason rests upon the
presumption that the administrative body, if given the chance to correct its
mistake or error, may amend its decision on a given matter and decide it
properly. Therefore, where a remedy is available within the administrative
machinery, this should be resorted to before resort can be made to the
courts, not only to give the administrative agency the opportunity to decide
the matter by itself correctly, but also to prevent unnecessary and premature
resort to courts.
Same; Same; Same; Certiorari; Motions for Reconsideration; It is
well-settled that the filing of a motion for reconsideration is a prerequisite
to the filing of a special civil action for certiorari; Exceptions.—Clearly,
Extelcom violated the rule on exhaustion of administrative remedies when it
went directly to the Court of Appeals on a petition for certiorari and
prohibition from the Order of the NTC dated May 3, 2000, without first
filing a motion for reconsideration. It is well-settled that the filing of a
motion for reconsideration is a prerequisite to the filing of a special civil
action for certiorari. The general rule is that, in order to give the lower court
the opportunity to correct itself, a motion for reconsideration is a
prerequisite to certiorari. It also basic that petitioner must exhaust all other
available remedies before resorting to certiorari. This rule, however, is
subject to certain exceptions such as any of the following: (1) the issues
raised are purely legal in nature, (2) public interest is involved, (3) extreme
urgency is obvious, or (4) special circumstances warrant immediate or more
direct action.
Same; Same; Same; Same; Same; That the Order of the NTC became
immediately executory does not mean that the remedy of filing a motion for
reconsideration is foreclosed to the petitioner.—This case does not fall
under any of the recognized exceptions to this rule. Although the Order of
the NTC dated May 3, 2000 granting provisional authority to Bayantel was
immediately executory, it did not preclude the filing of a motion for
reconsideration. Under the NTC Rules, a party adversely affected by a
decision, order, ruling or resolution may within fifteen (15) days file a
motion for reconsideration. That the Order of the NTC became immediately
executory does not mean that the remedy of filing a motion for
reconsideration is foreclosed to the petitioner.

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322 SUPREME COURT REPORTS ANNOTATED

Republic vs. Express Telecommunication Co., Inc.

Same; Same; Same; Same; The general rule is that purely


administrative and discretionary functions may not be interfered with by the
courts—courts have no supervising power over the proceedings and actions
of the administrative departments of the government; The established
exception to the rule is where the issuing authority has gone beyond its
statutory authority, exercised unconstitutional powers or clearly acted
arbitrarily and without regard to his duty or with grave abuse of discretion.
—The Court of Appeals erred in annulling the Order of the NTC dated May
3, 2000, granting Bayantel a provisional authority to install, operate and
maintain CMTS. The general rule is that purely administrative and
discretionary functions may not be interfered with by the courts. Thus, in
Lacuesta v. Herrera, it was held: x x x (T)he powers granted to the
Secretary of Agriculture and Commerce (natural resources) by law
regarding the disposition of public lands such as granting of licenses,
permits, leases and contracts, or approving, rejecting, reinstating, or
canceling applications, are all executive and administrative in nature. It is a
well recognized principle that purely administrative and discretionary
functions may not be interfered with by the courts. (Coloso vs. Board of
Accountancy, G.R. No. L-5750, April 20, 1953) In general, courts have no
supervising power over the proceedings and actions of the administrative
departments of the government. This is generally true with respect to acts
involving the exercise of judgement or discretion and findings of fact. (54
Am. Jur. 558-559) x x x. The established exception to the rule is where the
issuing authority has gone beyond its statutory authority, exercised
unconstitutional powers or clearly acted arbitrarily and without regard to his
duty or with grave abuse of discretion. None of these obtains in the case at
bar.
Same; Same; Same; Same; In petitions for certiorari, evidentiary
matters or matters of fact raised in the court below are not proper grounds
nor may such be ruled upon the proceedings.—In petitions for certiorari,
evidentiary matters or matters of fact raised in the court below are not
proper grounds nor may such be ruled upon in the proceedings. As held in
National Federation of Labor v. NLRC: At the outset, it should be noted that
a petition for certiorari under Rule 65 of the Rules of Court will prosper
only if there is a showing of grave abuse of discretion or an act without or in
excess of jurisdiction on the part of the national Labor Relations
Commission. It does not include an inquiry as to the correctness of the
evaluation of evidence which was the basis of the labor official or officer in
determining his conclusion. It is not for this Court to re-examine conflicting
evidence, re-evaluate the credibility of witnesses nor substitute the findings
of fact of an administrative tribunal which has gained expertise in its special
field. Considering that the findings of fact of the labor arbiter

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Republic vs. Express Telecommunication Co., Inc.


and the NLRC are supported by evidence on record, the same must be
accorded due respect and finality.
Same; Same; Same; Same; Courts will not interfere in matters which
are addressed to the sound discretion of the government agency entrusted
with the regulation of activities coming under the special and technical
training and knowledge of such agency; Administrative agencies are given a
wide latitude in the evaluation of evidence and in the exercise of their
adjudicative functions, latitude which includes the authority to take judicial
notice of facts within its special competence.—This Court has consistently
held that the courts will not interfere in matters which are addressed to the
sound discretion of the government agency entrusted with the regulation of
activities coming under the special and technical training and knowledge of
such agency. It has also been held that the exercise of administrative
discretion is a policy decision and a matter that can best be discharged by
the government agency concerned, and not by the courts. In Villanueva v.
Court of Appeals it was held that findings of fact which are supported by
evidence and the conclusion of experts should not be disturbed. This was
reiterated in Metro Transit Organization, Inc. v. National Labor Relations
Commission, wherein it was ruled that factual findings of quasi-judicial
bodies which have acquired expertise because their jurisdiction is confined
to specific matters are generally accorded not only respect but even finality
and are binding even upon the Supreme Court if they are supported by
substantial evidence. Administrative agencies are given a wide latitude in
the evaluation of evidence and in the exercise of its adjudicative functions.
This latitude includes the authority to take judicial notice of facts within its
special competence.
Courts; Supreme Court; The divisions of the Supreme Court are not to
be considered as separate and distinct courts—the Supreme Court remains a
unit notwithstanding that it works in divisions.—This Court finds that the
Manifestations of Extelcom alleging forum shopping on the part of the NTC
and Bayantel are not impressed with merit. The divisions of the Supreme
Court are not to be considered as separate and distinct courts. The Supreme
Court remains a unit notwithstanding that it works in divisions. Although it
may have three divisions, it is but a single court. Actions considered in any
of these divisions and decisions rendered therein are, in effect, by the same
Tribunal. The divisions of this Court are not to be considered as separate
and distinct courts but as divisions of one and the same court.

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324 SUPREME COURT REPORTS ANNOTATED

Republic vs. Express Telecommunication Co., Inc.

Same; Forum Shopping; Circular No. 28-91 was designed to serve as


an instrument to promote and facilitate the orderly administration of justice
and should not be interpreted with such absolute literalness as to subvert its
own ultimate and legitimate objective or the goal of all rules of procedure—
which is to achieve substantial justice as expeditiously as possible.—The
rules on forum shopping should not be literally interpreted. We have stated
thus: It is scarcely necessary to add that Circular No. 28-91 must be so
interpreted and applied as to achieve the purposes projected by the Supreme
Court when it promulgated that circular. Circular No. 28-91 was designed to
serve as an instrument to promote and facilitate the orderly administration of
justice and should not be interpreted with such absolute literalness as to
subvert its own ultimate and legitimate objective or the goal of all rules of
procedure—which is to achieve substantial justice as expeditiously as
possible.
Same; Same; Even assuming that separate actions have been filed by
two different parties involving essentially the same subject matter, no forum
shopping was committed where the parties did not resort to multiple judicial
remedies.—Even assuming that separate actions have been filed by two
different parties involving essentially the same subject matter, no forum
shopping was committed as the parties did not resort to multiple judicial
remedies. The Court, therefore, directed the consolidation of the two cases
because they involve essentially the same issues. It would also prevent the
absurd situation wherein two different divisions of the same court would
render altogether different rulings in the cases at bar.
Same; Parties; Administrative Law; National Telecommunications
Commission; The NTC has legal standing to file and initiate legal action in
cases where it is clear that its inaction would result in an impairment of its
ability to execute and perform its functions.—We rule, likewise, that the
NTC has legal standing to file and initiate legal action in cases where it is
clear that its inaction would result in an impairment of its ability to execute
and perform its functions. Similarly, we have previously held in Civil
Service Commission v. Dacoycoy that the Civil Service Commission, as an
aggrieved party, may appeal the decision of the Court of Appeals to this
Court.
Same; Actions; Appeals; Certiorari; While Rule 65 of the Rules of Civil
Procedure provides that public respondents shall not appear in or file an
answer or comment to the petition or any pleading therein, no similar
proscription exists under Rule 45.—As correctly stated by the NTC, the rule
invoked by Extelcom is Rule 65 of the Rules of Civil Procedure, which
provides that public respondents shall not appear in or file an answer or

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Republic vs. Express Telecommunication Co., Inc.

comment to the petition or any pleading therein. The instant petition, on the
other hand, was filed under Rule 45 where no similar proscription exists.
PETITIONS for review on certiorari of a decision of the Court of
Appeals.

The facts are stated in the opinion of the Court.


The Solicitor General for the Republic.
Quiason, Makalintal, Barot, Torres and Ibarra for Bayantel.
Belo, Gozo, Parel, Asuncion & Lucila for respondent EXTEL-
COM.
Fernando Ma. Alberto for private respondent.

YNARES-SANTIAGO, J.:

On December 29, 1992, International Communications Corporation


(now Bayan Telecommunications, Inc. or Bayantel) filed an
application with the National Telecommunications Commission
(NTC) for a Certificate of Public Convenience or Necessity (CPCN)
to install, operate and maintain a digital Cellular Mobile Telephone
System/Service (CMTS) with prayer for a Provisional Authority 1
(PA). The application was docketed as NTC Case No. 92-486.
Shortly thereafter, or on January 22, 1993, the NTC issued
Memorandum Circular No. 4-1-93 directing all interested applicants
for nationwide or regional CMTS to file their respective applications
before the Commission on or before February 15, 1993, and
deferring the acceptance
2
of any application filed after said date until
further orders.
On May 6, 1993, and prior to the issuance of any notice of
hearing by the NTC with respect to Bayantel’s original application,
Bayantel filed an urgent ex-parte motion to admit an amended

_______________

1 Rollo, G.R. No. 147210, pp. 84-92.


2 Ibid., p. 150.

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326 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.
3
application. On May 17, 1993, the notice of hearing issued by the
NTC with respect to this amended application was published in the
Manila Chronicle. Copies of the application as well as the notice of
hearing were mailed to all affected parties. Subsequently, hearings
were conducted on the amended application. But before Bayantel
could complete the presentation of its evidence, the NTC issued an
Order dated December 19, 1993 stating:

In view of the recent grant of two (2) separate Provisional Authorities in


favor of ISLACOM and GMCR, Inc., which resulted in the closing out of
all available frequencies for the service being applied for by herein
applicant, and in order that this case may not remain pending for an
indefinite period of time, AS PRAYED FOR, let this case be, as it is, hereby
ordered ARCHIVED without prejudice to its reinstatement if and when the
requisite frequency 4becomes available.
SO ORDERED.

On June 18, 1998, the NTC issued Memorandum Circular No. 5-6-
98 re-allocating five (5) megahertz (MHz) of the radio frequency
spectrum for the expansion of CMTS networks. The re-allocated 5
MHz were taken from the following bands: 1730-1732.5/1825-
5
1827.5 MHz and 1732.5-1735/1827.5-1830 MHz.
Likewise, on March 23, 1999, Memorandum Circular No. 3-3-99
was issued by the NTC re-allocating an additional five (5) MHz
frequencies for CMTS service, namely: 1735-1737.5/1830-1832.5
MHz; 1737.5-1740/1832.5-1835 MHz; 1740-1742.5/1835-1837.5
6
MHz; and 1742.5-1745/1837.5-1840 MHz.
On7 May 17, 1999, Bayantel filed an Ex-Parte Motion to Revive
Case, citing the availability of new frequency bands for CMTS
operators, as provided for under Memorandum Circular No. 3-3-99.
On February 1, 2000, the NTC granted BayanTel’s motion to
revive the latter’s application and set the case for hearings on Febru-

_______________

3 Id., pp. 152-163.


4 Id., p. 164.
5 Id., p. 166.
6 Id., p. 167.
7 Id., pp. 168-170.

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Republic vs. Express Telecommunication Co., Inc.
8
ary 9, 10, 15, 17 and 22, 2000. The NTC noted that the application
was ordered archived without prejudice to its reinstatement if and
when the requisite frequency shall become available.
Respondent Express Telecommunication Co., Inc. (Extelcom)
filed in NTC Case No. 92-486 an Opposition (With Motion to9
Dismiss) praying for the dismissal of Bayantel’s application.
Extelcom argued that Bayantel’s motion sought the revival of an
archived application filed almost eight (8) years ago. Thus, the
documentary evidence and the allegations of respondent Bayantel in
this application are all outdated and should no longer be used as
basis of the necessity for the proposed CMTS service. Moreover,
Extelcom alleged that there was no public need for the service
applied for by Bayantel as the present five CMTS operators—
Extelcom, Globe Telecom, Inc., Smart Communication, Inc.,
Pilipino Telephone Corporation, and Isla Communication
Corporation, Inc.—more than adequately addressed the market
demand, and all are in the process of enhancing and expanding their
respective networks based on recent technological developments.
Extelcom likewise contended that there were no available radio
frequencies that could accommodate a new CMTS operator as the
frequency bands allocated in NTC Memorandum Circular No. 3-3-
99 were intended for and had in fact been applied for by the existing
CMTS operators. The NTC, in its Memorandum Circular No. 4-1-
93, declared it its policy to defer the acceptance of any application
for CMTS. All the frequency bands allocated for CMTS use under
the NTC’s Memorandum Circular No. 5-11-88 and Memorandum
Circular No. 2-12-92 had already been allocated to the existing
CMTS operators. Finally, Extelcom pointed out that Bayantel is its
substantial stockholder to the extent of about 46% of its outstanding
capital stock, and Bayantel’s application undermines the very
operations of Extelcom.
On March
10
13, 2000, Bayantel filed a Consolidated Reply/
Comment, stating that the opposition was actually a motion seeking
a reconsideration of the NTC Order reviving the instant

_______________

8 Id., p. 171.
9 Id., pp. 173-181.
10 Id., pp. 182-189.

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Republic vs. Express Telecommunication Co., Inc.

application, and thus cannot dwell on the material allegations or the


merits of the case. Furthermore, Extelcom cannot claim that
frequencies were not available inasmuch as the allocation and
assignment thereof rest solely on the discretion of the NTC.
In the meantime, the NTC issued on March 9, 2000
Memorandum Circular No. 9-3-2000, re-allocating the following
radio frequency bands for assignment to existing CMTS operators
and to public telecommunication entities which shall be authorized
to install, operate and maintain CMTS networks, namely: 1745-
1750MHz/1840-1845MHz; 1750-1775MHz/1845-1850MHz; 1765- 11
1770MHz/1860-1865MHz; and 1770-1775MHz/1865-1870MHz.”
On May 3, 2000, the NTC issued an Order granting in favor 12
of
Bayantel a provisional authority to operate CMTS service. The
Order stated in pertinent part:
On the issue of legal capacity on the part of Bayantel, this Commission has
already taken notice of the change in name of International Communications
Corporation to Bayan Telecommunications, Inc. Thus, in the Decision
entered in NTC Case No. 93-284/94-200 dated 19 July 1999, it was
recognized that Bayan Telecommunications, Inc., was formerly named
International Communications Corp. Bayantel and ICC Telecoms, Inc. are
one and the same entity, and it necessarily follows that what legal capacity
ICC Telecoms has or has acquired is also the legal capacity that Bayantel
possesses.
On the allegation that the Commission has committed an error in
allowing the revival of the instant application, it appears that the Order
dated 14 December 1993 archiving the same was anchored on the non-
availability of frequencies for CMTS. In the same Order, it was expressly
stated that the archival hereof, shall be without prejudice to its reinstatement
“if and when the requisite frequency becomes available.” Inherent in the
said Order is the prerogative of the Commission in reviving the same,
subject to prevailing conditions. The Order of 1 February 2001, cited the
availability of frequencies for CMTS, and based thereon, the Commission,
exercising its prerogative, revived and reinstated the instant application. The
fact that the motion for revival hereof was made ex-parte by the applicant is
of no moment, so long as the oppositors are given the opportunity

_______________

11 Id., pp. 202-203.


12 Id., pp. 217-230.

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Republic vs. Express Telecommunication Co., Inc.

to be later heard and present the merits of their respective oppositions in the
proceedings.
On the allegation that the instant application is already obsolete and
overtaken by developments, the issue is whether applicant has the legal,
financial and technical capacity to undertake the proposed project. The
determination of such capacity lies solely within the discretion of the
Commission, through its applicable rules and regulations. At any rate, the
oppositors are not precluded from showing evidence disputing such capacity
in the proceedings at hand. On the alleged non-availability of frequencies
for the proposed service in view of the pending applications for the same,
the Commission takes note that it has issued Memorandum Circular 9-3-
2000, allocating additional frequencies for CMTS. The eligibility of existing
operators who applied for additional frequencies shall be treated and
resolved in their respective applications, and are not in issue in the case at
hand.
Accordingly, the Motions for Reconsideration filed by SMARTCOM and
GLOBE TELECOMS/ISLACOM and the Motion 13
to Dismiss filed by
EXTELCOM are hereby DENIED for lack of merit.

The grant of the provisional authority was anchored on the following


findings:

COMMENTS:

1. Due to the operational mergers between Smart Communications,


Inc. and Pilipino Telephone Corporation (Piltel) and between Globe
Telecom, Inc. (Globe) and Isla Communications, Inc. (Islacom),
free and effective competition in the CMTS market is threatened.
The fifth operator, Extelcom, cannot provide good competition in
as much as it provides service using the analog AMPS. The GSM
system dominates the market.
2. There are at present two applicants for the assignment of the
frequencies in the 1.7 Ghz and 1.8 Ghz allocated to CMTS, namely
Globe and Extelcom. Based on the number of subscribers Extelcom
has, there appears to be no congestion in its network—a condition
that is necessary for an applicant to be assigned additional
frequencies. Globe has yet to prove that there is congestion in its
network considering its operational merger with Islacom.
3. Based on the reports submitted to the Commission, 48% of the total
number of cities and municipalities are still without tele-

_______________

13 Id., pp. 218-219.

330

330 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

phone service despite the more than 3 million installed lines


waiting to be subscribed.

CONCLUSIONS:

1. To ensure effective competition in the CMTS market considering


the operational merger of some of the CMTS operators, new CMTS
operators must be allowed to provide the service.
2. The re-allocated frequencies for CMTS of 3 blocks of 5 Mhz x 2 is
sufficient for the number of applicants should the applicants be
qualified.
3. There is a need to provide service to some or all of the remaining
cities and municipalities without telephone service.
The submitted documents are sufficient to determine compliance to
4. the technical requirements. The applicant can be directed to submit
details such as channeling plans, exact locations of cell sites, etc. as
the project implementation progresses, actual area coverage
ascertained and traffic data are made available. Applicant appears
to be technically qualified to undertake the proposed project and
offer the proposed service.

IN VIEW OF THE FOREGOING and considering that there is prima


facie evidence to show that Applicant is legally, technically and financially
qualified and that the proposed service is technically feasible and
economically viable, in the interest of public service, and in order to
facilitate the development of telecommunications services in all areas of the
country, as well as to ensure healthy competition among authorized CMTS
providers, let a PROVISIONAL AUTHORITY (P.A.) be issued to
Applicant BAYAN TELECOMMUNICATIONS, INC. authorizing it to
construct, install, operate and maintain a Nationwide Cellular Mobile
Telephone Systems (CMTS), subject to the following terms and conditions
without prejudice to a final decision after completion of the hearing which
shall be called within thirty (30) days from grant of authority, in accordance
with Section 3, Rule
14
15, Part IV of the Commission’s Rules of Practice and
Procedure. x x x.

Extelcom filed
15
with the Court of Appeals a petition for certiorari and
prohibition, docketed as CA-G.R. SP No. 58893, seeking the
annulment of the Order reviving the application of Bayantel, the

_______________

14 Id., pp. 224-226.


15 Id., pp. 231-271.

331

VOL. 373, JANUARY 15, 2002 331


Republic vs. Express Telecommunication Co., Inc.

Order granting Bayantel a provisional authority to construct, install,


operate and maintain a nationwide CMTS, and Memorandum
Circular No. 9-3-2000 allocating frequency bands to new public
telecommunication entities which are authorized to install, operate
and maintain CMTS.
On September16 13, 2000, the Court of Appeals rendered the
assailed Decision, the dispositive portion of which reads:

WHEREFORE, the writs of certiorari and prohibition prayed for are


GRANTED. The Orders of public respondent dated February 1, 2000 and
May 3, 2000 in NTC Case No. 92-486 are hereby ANNULLED and SET
ASIDE and the Amended Application of respondent Bayantel is
DISMISSED without prejudice to the filing of a new CMTS application.
The writ of preliminary injunction issued under our Resolution dated
August 15, 2000, restraining and enjoining the respondents from enforcing
the Orders dated February 1, 2000 and May 3, 2000 in the said NTC case is
hereby made permanent. The Motion for Reconsideration of respondent
Bayantel dated August
17
28, 2000 is denied for lack of merit.
SO ORDERED.
18
Bayantel filed a motion for reconsideration of the above decision.
The NTC, represented by the Office of the Solicitor
19
General (OSG),
also filed its own motion for reconsideration. On the other hand,
Extelcom filed a Motion for Partial Reconsideration, praying that
NTC20Memorandum Circular No. 9-3-2000 be also declared null and
void.
On February 9, 2001, the Court of Appeals issued the assailed
Resolution denying all 21of the motions for reconsideration of the
parties for lack of merit.

_______________

16 Associate Justice Presbitero J. Velasco, Jr., ponente; Associate Justices Bernardo


Ll. Salas and Edgardo P. Cruz, concurring.
17 Rollo, G.R. No. 147210, pp. 78-79.
18 Ibid., pp. 439-462.
19 Id., pp. 464-484.
20 Id., pp. 488-500.
21 Id., pp. 81-83.

332

332 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

Hence, the NTC filed the instant petition for review on certiorari,
docketed as G.R. No. 147096, raising the following issues for
resolution of this Court:

A. Whether or not the Order dated February 1, 2000 of the


petitioner which revived the application of respondent
Bayantel in NTC Case No. 92-486 violated respondent
Extelcom’s right to procedural due process of law;
B. Whether or not the Order dated May 3, 2000 of the
petitioner granting respondent Bayantel a provisional
authority to operate a CMTS is in substantial compliance
with NTC Rules of Practice and Procedure and
Memorandum
22
Circular No. 9-14-90 dated September 4,
1990.
Subsequently, Bayantel also filed its petition for review, docketed as
G.R. No. 147210, assigning the following errors:

I. THE COURT OF APPEALS SERIOUSLY ERRED IN ITS


INTERPRETATION OF THE PRINCIPLE OF
“EXHAUSTION OF ADMINISTRATIVE REMEDIES”
WHEN IT FAILED TO DISMISS HEREIN
RESPONDENT’S PETITION FOR CERTIORARI
DESPITE ITS FAILURE TO FILE A MOTION FOR
RECONSIDERATION.
II. THE COURT OF APPEALS SERIOUSLY ERRED IN ITS
FINDING THAT THE REVIVAL OF NTC CASE NO. 92-
486 ANCHORED ON A EX-PARTE MOTION TO
REVIVE CASE WAS TANTAMOUNT TO GRAVE
ABUSE OF DISCRETION ON THE PART OF THE NTC.
III. THE COURT OF APPEALS SERIOUSLY ERRED WHEN
IT DENIED THE MANDATE OF THE NTC AS THE
AGENCY OF GOVERNMENT WITH THE SOLE
DISCRETION REGARDING ALLOCATION OF
FREQUENCY BAND TO TELECOMMUNICATIONS
ENTITIES.
IV. THE COURT OF APPEALS SERIOUSLY ERRED IN ITS
INTERPRETATION OF THE LEGAL PRINCIPLE THAT
JURISDICTION ONCE ACQUIRED CANNOT BE LOST
WHEN IT DECLARED THAT THE ARCHIVED
APPLICATION SHOULD BE DEEMED AS A NEW
APPLICATION IN VIEW OF THE SUBSTANTIAL
CHANGE IN THE CIRCUMSTANCES ALLEGED IN
ITS AMENDMENT APPLICATION.
V. CONTRARY TO THE FINDING OF THE COURT OF
APPEALS, THE ARCHIVING OF THE BAYANTEL
APPLICATION WAS A

_______________

22 Rollo, G.R. No. 147096, p. 16.

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VOL. 373, JANUARY 15, 2002 333


Republic vs. Express Telecommunication Co., Inc.

VALID ACT ON THE PART OF THE NTC EVEN IN


THE ABSENCE OF A SPECIFIC RULE ON
ARCHIVING OF CASES SINCE RULES OF
PROCEDURE ARE, AS A MATTER OF COURSE,
LIBERALLY CONSTRUED IN PROCEEDINGS
BEFORE ADMINISTRATIVE BODIES AND SHOULD
GIVE WAY TO THE GREATER HIERARCHY OF
PUBLIC WELFARE AND PUBLIC INTEREST.
VI. CONTRARY TO THE FINDING OF THE COURT OF
APPEALS, THE ARCHIVING OF BAYANTEL’S
APPLICATION WAS NOT VIOLATIVE OF THE
SUMMARY NATURE OF THE PROCEEDINGS IN THE
NTC UNDER SEC. 3, RULE 1 OF THE NTC REVISED
RULES OF PROCEDURE.
VII. THE COURT OF APPEALS SERIOUSLY ERRED IN ITS
FINDING THAT THE ARCHIVING OF BAYANTEL’S
APPLICATION WAS VIOLATIVE OF THE ALLEGED
DECLARED POLICY OF THE GOVERNMENT ON THE
TRANSPARENCY AND FAIRNESS OF
ADMINISTRATIVE PROCESS IN THE NTC AS LAID
DOWN IN SEC. 4(1) OF R.A. NO. 7925.
VIII. THE COURT OF APPEALS SERIOUSLY ERRED IN ITS
FINDING THAT THE NTC VIOLATED THE
PROVISIONS OF THE CONSTITUTION PERTAINING
TO DUE PROCESS OF LAW. IX. THE COURT OF
APPEALS SERIOUSLY ERRED IN DECLARING THAT
THE MAY 3, 2000 ORDER GRANTING BAYANTEL A
PROVISIONAL AUTHORITY SHOULD BE SET ASIDE
AND REVERSED.

i. Contrary to the finding of the Court of Appeals, there was


no violation of the NTC Rule that the legal, technical,
financial and economic documentations in support of the
prayer for provisional authority should first be submitted.
ii. Contrary to the finding of the Court of Appeals, there was
no violation of Sec. 3, Rule 15 of the NTC Rules of Practice
and Procedure that a motion must first be filed before a
provisional authority could be issued.
iii. Contrary to the finding of the Court of Appeals that a plea
for provisional authority necessitates a notice and hearing,
the very rule cited by the petitioner (Section 5, Rule 4 of the
NTC Rules of Practice and Procedure) provides otherwise.
iv. Contrary to the finding of the Court of Appeals, urgent
public need is not the only basis for the grant of a
provisional authority to an applicant;

334

334 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.
Contrary to the finding of the Court of Appeals, there was
v. no violation of the constitutional provision on the right of
the public to information when the Common Carrier
Authorization
23
Department (CCAD) prepared its evaluation
report.

Considering the identity of the matters


24
involved, this Court resolved
to consolidate the two petitions.
At the outset, it is well to discuss the nature and functions of the
NTC, and analyze its powers and authority as well as the laws, rules
and regulations that govern its existence and operations.
The NTC was created pursuant to Executive Order No. 546,
promulgated on July 23, 1979. It assumed the functions formerly
assigned to the Board of Communications and the
Telecommunications Control Bureau, which were both abolished
under the said Executive Order. Previously, the NTC’s functions
were merely those of the defunct Public Service Commission (PSC),
created under Commonwealth Act No. 146, as amended, otherwise
known as the Public Service Act, considering that the Board of
Communications was the successor-in-interest of the PSC. Under
Executive Order No. 125-A, issued in April 1987, the NTC became
an attached agency of the Department of Transportation and
Communications.
In the regulatory telecommunications industry, the NTC has the
sole authority to issue Certificates of Public Convenience and
Necessity (CPCN) for the installation, operation, and maintenance of
communications facilities and services, radio communications
systems, telephone and telegraph systems. Such power includes the
authority to determine the areas of operations of applicants for
telecommunications services. Specifically, Section 16 of the Public
Service Act authorizes the then PSC, upon notice and hearing, to
issue Certificates of Public Convenience for the operation of public
services within the Philippines “whenever the Commission finds that
the operation of the public service proposed and the authorization to
do business will promote the public interests in a proper

_______________

23 Rollo, G.R. No. 147210, pp. 15-17.


24 Rollo, G.R. No. 147096, p. 622.

335

VOL. 373, JANUARY 15, 2002 335


Republic vs. Express Telecommunication Co., Inc.
25
and suitable manner.” The procedure governing the issuance of
such authorizations is set forth in Section 29 of the said Act, the
pertinent portion of which states:

All hearings and investigations before the Commission shall be governed by


rules adopted by the Commission, and in the conduct thereof, the
Commission shall not be bound by the technical rules of legal evidence. x x
x.

In granting Bayantel the provisional authority to operate a CMTS,


the NTC applied Rule 15, Section 3 of its 1978 Rules of Practice and
Procedure, which provides:

Sec. 3. Provisional Relief.—Upon the filing of an application, complaint or


petition or at any stage thereafter, the Board may grant on motion of the
pleader or on its own initiative, the relief prayed for, based on the pleading,
together with the affidavits and supporting documents attached thereto,
without prejudice to a final decision after completion of the hearing which
shall be called within thirty (30) days from grant of authority asked for.
(italics ours)

Respondent Extelcom, however, contends that the NTC should have


applied the Revised Rules which were filed with the Office of the
National Administrative Register on February 3, 1993. These
Revised Rules deleted the phrase “on its own initiative”;
accordingly, a provisional authority may be issued only upon filing
of the proper motion before the Commission.
In answer to this argument, the NTC, through the Secretary of the
Commission, issued a certification to the effect that inasmuch as the
1993 Revised Rules have not been published in a newspaper of
general circulation, the NTC has been applying the 1978 Rules.
The absence of publication, coupled with the certification by the
Commissioner of the NTC stating that the NTC was still governed
by the 1978 Rules, clearly indicate that the 1993 Revised Rules have
not taken effect at the time of the grant of the provisional authority
to Bayantel. The fact that the 1993 Revised Rules were filed with
the UP Law Center on February 3, 1993 is of no moment. There is
nothing in the Administrative Code of 1987 which implies

_______________

25 Commonwealth Act No. 146, Section 16 (a).

336

336 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

that the filing of the rules with the UP Law Center is the operative
act that gives the rules force and effect. Book VII, Chapter 2,
Section 3 thereof merely states:
Filing.—(1) Every agency shall file with the University of the Philippines
Law Center three (3) certified copes of every rule adopted by it. Rules in
force on the date of effectivity of this Code which are not filed within three
(3) months from the date shall not thereafter be the basis of any sanction
against any party or persons.

(2) The records officer of the agency, or his equivalent


functionary, shall carry out the requirements of this section
under pain or disciplinary action.
(3) A permanent register of all rules shall be kept by the issuing
agency and shall be open to public inspection.

The National Administrative Register is merely a bulletin of


codified rules and it is furnished only to the Office of the President,
Congress, all appellate courts, the National Library, other public
offices or agencies as the Congress may select, and to other persons
at a price
26
sufficient to cover publication and mailing or distribution
costs. In a similar case, we held:

This does not imply however, that the subject Administrative Order is a
valid exercise of such quasi-legislative power. The original Administrative
Order issued on August 30, 1989, under which the respondents filed their
applications for importations, was not published in the Official Gazette or in
a newspaper of general circulation. The questioned Administrative Order,
legally, until it is published, is invalid within the context of Article 2 of
Civil Code, which reads:

“Article 2. Laws shall take effect after fifteen days following the completion of their
publication in the Official Gazette (or in a newspaper of general circulation in the
Philippines), unless it is otherwise provided. x x x”

The fact that the amendments to Administrative Order No. SOCPEC 89-
08-01 were filed with, and published by the UP Law Center in the National
Administrative Register, does not cure the defect related to the effectivity of
the Administrative Order.

_______________

26 Administrative Code of 1987, Book VII, Chapter 2, Section 7.

337

VOL. 373, JANUARY 15, 2002 337


Republic vs. Express Telecommunication Co., Inc.

This Court, in Tañada vs. Tuvera (G.R. No. L-63915, December 29,
1986, 146 SCRA 446) stated, thus:
“We hold therefore that all statutes, including those of local application and
private laws, shall be published as a condition for their effectivity, which
shall begin fifteen days after publication unless a different effectivity is
fixed by the legislature.
Covered by this rule are presidential decrees and executive orders
promulgated by the President in the exercise of legislative power or, at
present, directly conferred by the Constitution. Administrative Rules and
Regulations must also be published if their purpose is to enforce or
implement existing law pursuant also to a valid delegation.
Interpretative regulations and those merely internal in nature, that is,
regulating only the personnel of the administrative agency and not the
public, need not be published. Neither is publication required of the so-
called letters of instructions issued by administrative superiors concerning
the rules or guidelines to be followed by their subordinates in the
performance of their duties.
xxx
We agree that the publication must be in full or it is no publication at all
since its purpose is to inform the public of the contents of the laws.”
The Administrative Order under consideration is one of those issuances
which should be published for its effectivity, since its purpose is to enforce
and implement an existing law pursuant 27
to a valid delegation, i.e., P.D.
1071, in relation to LOI 444 and EO 133.

Thus, publication in the Official Gazette or a newspaper of general


circulation is a condition sine qua non before statutes, rules or
regulations can take effect. This is explicit from Executive Order
No. 200, which repealed Article 2 of the Civil Code, and which
states that:

Laws shall take effect after fifteen days following the completion of their
publication either in the Official Gazette or in a newspaper 28
of general
circulation in the Philippines, unless it is otherwise provided.

_______________

27 Philippine International Trading Corp. v. Angeles, 263 SCRA 421, 446-447


(1996).
28 E.O. 200, Section 1.

338

338 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

The Rules of Practice and Procedure of the NTC, which implements


Section 29 of the Public Service Act (C.A. 146, as amended), fall
squarely within the scope 29of these laws, as explicitly mentioned in
the case Tañada v. Tuvera.
Our pronouncement in Tañada vs. Tuvera is clear and categorical.
Administrative rules and regulations must be published if their purpose is to
enforce or implement existing law pursuant to a valid delegation. The only
exceptions are interpretative regulations, those merely internal in nature, or
those so-called letters of instructions issued by administrative superiors
concerning the rules and guidelines
30
to be followed by their subordinates in
the performance of their duties.

Hence, the 1993 Revised Rules should be published in the Official


Gazette or in a newspaper of general circulation before it can take
effect. Even the 1993 Revised Rules itself mandates that said Rules
shall take effect only
31
after their publication in a newspaper of
general circulation. In the absence of such publication, therefore, it
is the 1978 Rules that governs.
In any event, regardless of whether the 1978 Rules, or the 1993
Revised Rules should apply, the records show that the amended
application filed by Bayantel in fact included a motion for the
issuance of a provisional authority. Hence, it cannot be said that the
NTC granted the provisional authority motu proprio. The Court of
Appeals, therefore, erred when it found that the NTC issued its
Order of May 3, 2000 on its own initiative. This much is
acknowledged in the Decision of the Court of Appeals:

As prayer, ICC asked for the immediate grant of provisional authority to


construct, install, maintain and operate the subject service and to charge the
proposed rates and after due notice and hearing, approve the

_______________

29 146 SCRA 446 (1986).


30 PHILSA International Placement & Services Corp. v. Secretary of Labor, G.R. No.
103144, April 4, 2001, 356 SCRA 174.
31 Section 20 thereof provides: “These Revised Rules shall take effect fifteen (15) days after
its publication in a newspaper of general circulation.”

339

VOL. 373, JANUARY 15, 2002 339


Republic vs. Express Telecommunication Co., Inc.

instant application and grant


32
the corresponding certificate of public
convenience and necessity.

The Court of Appeals also erred when it declared that the NTC’s
Order archiving Bayantel’s application was null and void. The
archiving of cases is a widely accepted measure designed to shelve
cases in which no immediate action is expected but where no
grounds exist for their outright dismissal, albeit without prejudice. It
saves the petitioner or applicant from the added trouble and expense
of re-filing a dismissed case. Under this scheme, an inactive case is
kept alive but held in abeyance until the situation obtains wherein
action thereon can be taken.
In the case at bar, the said application was ordered archived
because of lack of available frequencies at the time, and made
subject to reinstatement upon availability of the requisite frequency.
To be sure, there was nothing irregular in the revival of the
application after the condition therefor was fulfilled.
While, as held by the Court of Appeals, there are no clear
provisions in the Rules of the NTC which expressly allow the
archiving of any application, this recourse may be justified under
Rule 1, Section 2 of the 1978 Rules, which states:

Sec. 2. Scope.—These rules govern pleadings, practice and procedure before


the Board of Communications (now NTC) in all matters of hearing,
investigation and proceedings within the jurisdiction of the Board. However,
in the broader interest of justice and in order to best serve the public
interest, the Board may, in any particular matter, except it from these rules
and apply such suitable procedure to improve the service in the transaction
of the public business. (italics ours)

The Court of Appeals ruled that the NTC committed grave abuse of
discretion when it revived Bayantel’s application based on an ex-
parte motion. In this regard, the pertinent provisions of the NTC
Rules:

Sec. 5. Ex-parte Motions.—Except for motions for provisional authorization


of proposed services and increase of rates, ex-parte motions

_______________

32 CA Decision, p. 5.

340

340 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

shall be acted upon by the Board only upon showing of urgent necessity 33
therefor and the right of the opposing party is not substantially impaired.

Thus, in cases which do not involve either an application for rate


increase or an application for a provisional authority, the NTC may
entertain ex-parte motions only where there is an urgent necessity to
do so and no rights of the opposing parties are impaired.
The Court of Appeals ruled that there was a violation of the
fundamental right of Extelcom to due process when it was not
afforded the opportunity to question the motion for the revival of the
application. However, it must be noted that said Order referred to a
simple revival of the archived application of Bayantel in NTC Case
No. 92-426. At this stage, it cannot be said that Extelcom’s right to
procedural due process was prejudiced. It will still have the
opportunity to be heard during the full-blown adversarial hearings
that will follow. In fact, the records show that the NTC has
scheduled several hearing dates for this purpose, at which all
interested parties shall be allowed to register their opposition. We
have ruled that there is no denial of due process where full-blown
adversarial
34
proceedings are conducted before an administrative
body. With Extelcom having fully participated in the proceedings,
and indeed, given the opportunity to file its opposition to the
application, there was clearly no denial of its right to due process.

In Zaldivar vs. Sandiganbayan (166 SCRA 316 [1988]), we held that the
right to be heard does not only refer to the right to present verbal arguments
in court. A party may also be heard through his pleadings, where
opportunity to be heard is accorded either through oral arguments or
pleadings, there is no denial of procedural due process. As reiterated in
National Semiconductor (HK) Distribution, Ltd. vs. NLRC (G.R. No.
123520, June 26, 1998, 291 SCRA 348), the essence of due process is
simply an opportunity to be heard, or as applied to administrative
proceedings, an opportunity to explain one’s side. Hence, in Navarro III vs.
Damaso (246 SCRA 260 [1995]), we held that a formal or trial-type hear-

_______________

33 Rule 5, Section 5; italics ours.


34 Smith Kline & French Laboratories Ltd. v. Court of Appeals, 276 SCRA 224, 241 (1997).

341

VOL. 373, JANUARY 15, 2002 341


Republic vs. Express Telecommunication Co., Inc.

ing is not at all times and not


35
in all instances essential. Plainly, petitioner
was not denied due process.

Extelcom had already entered its appearance as a party and filed its
opposition to the application. It was neither precluded nor barred
from participating in the hearings thereon. Indeed, nothing, not even
the Order reviving the application, bars or prevents Extelcom and
the other oppositors from participating in the hearings and adducing
evidence in support of their respective oppositions. The motion to
revive could not have possibly caused prejudice to Extelcom since
the motion only sought the revival of the application. It was merely
a preliminary step towards the resumption of the hearings on the
application of Bayantel. The latter will still have to prove its
capability to undertake the proposed CMTS. Indeed, in its Order
dated February 1, 2000, the NTC set several hearing dates precisely
intended for the presentation of evidence on Bayantel’s capability
and qualification. Notice of these hearings were sent to all parties
concerned, including Extelcom.
As regards the changes in the personal circumstances of
Bayantel, the same may be ventilated at the hearings during
Bayantel’s presentation of evidence. In fact, Extelcom was able to
raise its arguments on this matter in the Opposition (With Motion to
Dismiss) anent the re-opening and reinstatement of the application
of Bayantel. Extelcom was thus heard on this particular point.
Likewise, the requirements of notice and publication of the
application is no longer necessary inasmuch as the application is a
mere revival of an application which has already been published
earlier. At any rate, the records show that all of the five (5) CMTS
operators in the country were duly notified and were allowed to raise
their respective oppositions to Bayantel’s application through the
NTC’s Order dated February 1, 2000.
It should be borne in mind that among the declared national
policies under Republic Act No. 7925, otherwise known as the
Public Telecommunications Policy Act of the Philippines, is the
healthy competition among telecommunications carriers, to wit:

_______________

35 Bautista v. COMELEC, 298 SCRA 480, 486 (1998).

342

342 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

A healthy competitive environment shall be fostered, one in which


telecommunications carriers are free to make business decisions and to
interact with one another in providing telecommunications services, with the
end in view of36 encouraging their financial viability while maintaining
affordable rates.

The NTC is clothed with sufficient discretion to act on matters


solely within its competence. Clearly, the need for a healthy
competitive environment in telecommunications is sufficient
impetus for the NTC to consider all those applicants who are willing
to offer competition, develop the market and provide the
environment necessary for greater public service. This was the
intention that came to light with the issuance of Memorandum
Circular 9-3-2000, allocating new frequency bands for use of
CMTS. This memorandum circular enumerated the conditions
prevailing and the reasons which necessitated its issuance as
follows:
—the international accounting rates are rapidly
declining, threatening the subsidy to the local
exchange service as mandated in EO 109 and RA
7925;
—the public telecommunications entities which were
obligated to install, operate and maintain local
exchange network have performed their obligations in
varying degrees;
—after more than three (3) years from the
performance of the obligations only 52% of the total
number of cities and municipalities are provided with
local telephone service;
—there are mergers and consolidations among the
existing cellular mobile telephone service (CMTS)
providers threatening the efficiency of competition;
—there is a need to hasten the installation of local
exchange lines in unserved areas;
—there are existing CMTS operators which are
experiencing congestion in the network resulting to
low grade of service;
—the consumers/customers shall be given the
freedom to choose CMTS operators from
37
which they
could get the service.

_______________

36 R.A. 7925, Article II, Section 4 (f).


37 Rollo, G.R. No. 147210, pp. 202-203.

343

VOL. 373, JANUARY 15, 2002 343


Republic vs. Express Telecommunication Co., Inc.

Clearly spelled out is the need to provide enhanced competition and


the requirement for more landlines and telecommunications facilities
in unserved areas in the country. On both scores, therefore, there was
sufficient showing that the NTC acted well within its jurisdiction
and in pursuance of its avowed duties when it allowed the revival of
Bayantel’s application.
We now come to the issue of exhaustion of administrative
remedies. The rule is well-entrenched that a party must exhaust all
administrative remedies before resorting to the courts. The
premature invocation of the intervention of the court is fatal to one’s
cause of action. This rule would not only give the administrative
agency an opportunity to decide the matter by itself correctly, but
38
38
would also prevent the unnecessary and 39
premature resort to courts.
In the case of Lopez v. City of Manila, we held:

As a general rule, where the law provides for the remedies against the action
of an administrative board, body or officer, relief to courts can be sought
only after exhausting all remedies provided. The reason rests upon the
presumption that the administrative body, if given the chance to correct its
mistake or error, may amend its decision on a given matter and decide it
properly. Therefore, where a remedy is available within the administrative
machinery, this should be resorted to before resort can be made to the
courts, not only to give the administrative agency the opportunity to decide
the matter by itself correctly, but also to prevent unnecessary and premature
resort to courts.

Clearly, Extelcom violated the rule on exhaustion of administrative


remedies when it went directly to the Court of Appeals on a petition
for certiorari and prohibition from the Order of the NTC dated May
3, 2000, without first filing a motion for reconsideration. It is well-
settled that the filing of a motion for reconsideration is a prerequisite
to the filing of a special civil action for certiorari.

The general rule is that, in order to give the lower court the opportunity to
correct itself, a motion for reconsideration is a prerequisite to certiorari. It
also basic that petitioner must exhaust all other available

_______________

38 Social Security System Employees Association v. Bathan-Velasco, 313 SCRA 250, 252
(1999).
39 303 SCRA 448, 458 (1999).

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344 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

remedies before resorting to certiorari. This rule, however, is subject to


certain exceptions such as any of the following: (1) the issues raised are
purely legal in nature, (2) public interest is involved, (3) extreme urgency is
obvious,
40
or (4) special circumstances warrant immediate or more direct
action.

This case does not fall under any of the recognized exceptions to this
rule. Although the Order of the NTC dated May 3, 2000 granting
provisional authority to Bayantel was immediately executory, it did
not preclude the filing of a motion for reconsideration. Under the
NTC Rules, a party adversely affected by a decision, order, ruling or
resolution may within fifteen (15) days file a motion for
reconsideration. That the Order of the NTC became immediately
executory does not mean that the remedy of 41
filing a motion for
reconsideration is foreclosed to the petitioner.
Furthermore, Extelcom does not enjoy the grant of any vested
interest on the right to render a public service. The Constitution is
quite emphatic that the operation of a public utility shall not be
exclusive. Thus:

No franchise, certificate, or any other form of authorization for the operation


of a public utility shall be granted to citizens of the Philippines or to
corporations organized under the laws of the Philippines at least sixty per
centum of whose capital is owned by such citizens, nor shall such franchise,
certificate or authorization be exclusive in character or for a longer period
than fifty years. Neither shall any such franchise or right be granted except
under the condition that it shall be subject to amendment, alteration, or
repeal by the Congress when 42
the common good so requires.
x x x x x x x x x.

In Radio Communications of 43 the Phils., Inc. v. National


Telecommunications Commission, we held:

It is well within the powers of the public respondent to authorize the


installation by the private respondent network of radio communications

_______________

40 Indiana Aerospace University v. Commission on Higher Education (CHED),


G.R. No. 139371, April 4, 2001, 356 SCRA 367.
41 Yasay v. Desierto, 300 SCRA 494, 505 (1998).
42 Constitution, Article XII, Section 11.
43 150 SCRA 450, 459 (1987).

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VOL. 373, JANUARY 15, 2002 345


Republic vs. Express Telecommunication Co., Inc.

systems in Catarman, Samar and San Jose, Mindoro. Under the


circumstances, 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
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). There is an express
provision in the petitioner’s franchise which provides compliance with the
above mandate (RA 2036, sec. 15).
Even in the provisional authority granted to Extelcom, it is expressly
stated that such authority is not exclusive. Thus, the Court of
Appeals erred when it gave due course to Extelcom’s petition and
ruled that it constitutes an exception to the rule on exhaustion of
administrative remedies.
Also, the Court of Appeals erred in annulling the Order of the
NTC dated May 3, 2000, granting Bayantel a provisional authority
to install, operate and maintain CMTS. The general rule is that
purely administrative and discretionary functions may 44not be
interfered with by the courts. Thus, in Lacuesta v. Herrera, it was
held:

x x x (T)he powers granted to the Secretary of Agriculture and Commerce


(natural resources) by law regarding the disposition of public lands such as
granting of licenses, permits, leases and contracts, or approving, rejecting,
reinstating, or canceling applications, are all executive and administrative in
nature. It is a well recognized principle that purely administrative and
discretionary functions may not be interfered with by the courts. (Coloso vs.
Board of Accountancy, G.R. No. L-5750, April 20, 1953) In general, courts
have no supervising power over the proceedings and actions of the
administrative departments of the government. This is generally true with
respect to acts involving the exercise of judgement or discretion and
findings of fact. (54 Am. Jur. 558-559) x x x.

The established exception to the rule is where the issuing authority


has gone beyond its statutory authority, exercised unconstitutional
powers or clearly acted arbitrarily and without re-

_______________

44 62 SCRA 115, 122 (1975).

346

346 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.
45
gard to his duty or with grave abuse of discretion. None of these
obtains in the case at bar.
Moreover, in petitions for certiorari, evidentiary matters or
matters of fact raised in the court below are not proper grounds nor
may such be ruled upon in the 46
proceedings. As held in National
Federation of Labor v. NLRC:

At the outset, it should be noted that a petition for certiorari under Rule 65
of the Rules of Court will prosper only if there is a showing of grave abuse
of discretion or an act without or in excess of jurisdiction on the part of the
national Labor Relations Commission. It does not include an inquiry as to
the correctness of the evaluation of evidence which was the basis of the
labor official or officer in determining his conclusion. It is not for this Court
to re-examine conflicting evidence, re-evaluate the credibility of witnesses
nor substitute the findings of fact of an administrative tribunal which has
gained expertise in its special field. Considering that the findings of fact of
the labor arbiter and the NLRC are supported by evidence on record, the
same must be accorded due respect and finality.

This Court has consistently held that the courts will not interfere in
matters which are addressed to the sound discretion of the
government agency entrusted with the regulation of activities
coming under47the special and technical training and knowledge of
such agency. It has also been held that the exercise of
administrative discretion is a policy decision and a matter that can
best be discharged
48
by the government agency concerned,
49
and not by
the courts. In Villanueva v. Court of Appeals it was held that
findings of fact which are supported by evidence and the conclusion
of experts should not be disturbed. This was reiterated in Metro
Transit Organization, Inc. v. National Labor Relations Commis-

_______________

45 Lacuesta v. Herrera, supra.


46 283 SCRA 275, 284 (1997); citing ComSavings Bank v. NLRC, 257 SCRA 307
(1996).
47 Concerned Officials of the Metropolitan Waterworks and Sewerage System
(MWSS) v. Vasquez, 240 SCRA 502, 529 (1995).
48 First Lepanto Ceramics v. Court of Appeals, 253 SCRA 552, 558 (1996).
49 205 SCRA 537, 544 (1992).

347

VOL. 373, JANUARY 15, 2002 347


Republic vs. Express Telecommunication Co., Inc.
50
sion, wherein it was ruled that factual findings of quasi-judicial
bodies which have acquired expertise because their jurisdiction is
confined to specific matters are generally accorded not only respect
but even finality and are binding even upon the Supreme Court if
they are supported by substantial evidence.
Administrative agencies are given a wide latitude in the
evaluation of evidence and in the exercise of its adjudicative
functions. This latitude includes the authority to take judicial notice
of facts within its special competence.
In the case at bar, we find no reason to disturb the factual
findings of the NTC which formed the basis for awarding the
provisional authority to Bayantel. As found by the NTC, Bayantel
has been granted several provisional and permanent51 authorities
before to operate various telecommunications services. Indeed, it
was established that Bayantel was the first company to comply with
its obligation to install local exchange lines pursuant to E.O. 109 and
R.A. 7925. In recognition of the same, the provisional authority
awarded in favor of Bayantel to operate Local Exchange Services in
Quezon City, Malabon, Valenzuela and the entire Bicol region was
made permanent and a CPCN for the said service was granted in its
favor. Prima facie evidence was likewise found showing Bayantel’s
legal, financial and technical capacity to undertake the proposed
cellular mobile telephone service.
Likewise, the May 3, 2000 Order did not violate NTC
Memorandum Circular No. 9-14-90 dated September 4, 1990,
contrary to the ruling of the Court of Appeals. The memorandum
circular sets forth the procedure for the issuance of provisional
authority thus:

EFFECTIVE THIS DATE, and as part of the Commission’s drive to


streamline and fast track action on applications/petitions for CPCN other
forms of authorizations, the Commission shall be evaluating
applications/petitions for immediate issuance of provisional authorizations,
pending hearing and final authorization of an application on its merit.
For this purpose, it is hereby directed that all applicants/petitioners
seeking for provisional authorizations, shall submit immediately to the

_______________

50 263 SCRA 313, 319 (1996).


51 Order dated May 3, 2000, pp. 3-4.

348

348 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

Commission, either together with their application or in a Motion all their


legal, technical, financial, economic documentations in support of their
prayer for provisional authorizations for evaluation. On the basis of their
completeness and their having complied with requirements, the Commission
shall be issuing provisional authorizations.

Clearly, a provisional authority may be issued even pending hearing


and final determination of an application on its merits.
Finally, this Court finds that the Manifestations of Extelcom
alleging forum shopping on the part of the NTC and Bayantel are
not impressed with merit. The divisions of the Supreme Court are
not to be considered as separate and distinct courts. The Supreme
Court remains a unit notwithstanding that it works in divisions.
Although it may have three divisions, it is but a single court. Actions
considered in any of these divisions and decisions rendered therein
are, in effect, by the same Tribunal. The divisions of this Court are
not to be considered as separate
52
and distinct courts but as divisions
of one and the same court.
Moreover, the rules on forum shopping should not be literally
interpreted. We have stated thus:

It is scarcely necessary to add that Circular No. 28-91 must be so interpreted


and applied as to achieve the purposes projected by the Supreme Court
when it promulgated that circular. Circular No. 28-91 was designed to serve
as an instrument to promote and facilitate the orderly administration of
justice and should not be interpreted with such absolute literalness as to
subvert its own ultimate and legitimate objective or the goal of all rules of
procedure—which
53
is to achieve substantial justice as expeditiously as
possible.

Even assuming that separate actions have been filed by two different
parties involving essentially the same subject matter, no forum
shopping was committed as the parties did not resort to multiple
judicial remedies. The Court, therefore, directed the con-

_______________

52 Uy v. Limsiongco, 41 Phil. 94, 101 (1920).


53 Cabarrus, Jr. v. Bernas, 279 SCRA 388, 394-395 (1997); Gabionza v. Court of
Appeals, et al., 234 SCRA 192, 198 (1994); Cruz v. Court of Appeals, 309 SCRA
714, 725 (1999).

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Republic vs. Express Telecommunication Co., Inc.

solidation of the two cases because they involve essentially the same
issues. It would also prevent the absurd situation wherein two
different divisions of the same court would render altogether
different rulings in the cases at bar.
We rule, likewise, that the NTC has legal standing to file and
initiate legal action in cases where it is clear that its inaction would
result in an impairment of its ability to execute and perform its
functions. Similarly, we54 have previously held in Civil Service
Commission v. Dacoycoy that the Civil Service Commission, as an
aggrieved party, may appeal the decision of the Court of Appeals to
this Court.
As correctly stated by the NTC, the rule invoked by Extelcom is
Rule 65 of the Rules of Civil Procedure, which provides that public
respondents shall not appear in or 55
file an answer or comment to the
petition or any pleading therein. The instant petition, on the other
hand, was filed under Rule 45 where no similar proscription exists.
WHEREFORE, in view of the foregoing, the consolidated
petitions are GRANTED. The Court of Appeals’ Decision dated
September 13, 2000 and Resolution dated February 9, 2001 are
REVERSED and SET ASIDE. The permanent injunction issued by
the Court of Appeals is LIFTED. The Orders of the NTC dated
February 1, 2000 and May 3, 2000 are REINSTATED. No
pronouncement as to costs.
SO ORDERED.

Davide, Jr. (C.J., Chairman), Puno, Kapunan and Pardo,


JJ., concur.

Petitions granted, judgment and resolution reversed and set


aside.

Notes.—A decision or resolution of a division of the Court, when


concurred in by a majority of its Members who actually took part in

_______________

54 306 SCRA 425, 437 (1999).


55 1997 Rules of Civil Procedure, Rule 65, Section 5, second paragraph.

350

350 SUPREME COURT REPORTS ANNOTATED


Republic vs. Express Telecommunication Co., Inc.

the deliberations on the issues in a case and voted thereon, and in no


case without the concurrence of at least three of such Members, is a
decision or resolution of the Supreme Court (Section 4[3], Article
VIII, 1987 Constitution). The Court en banc is not an appellate court
to which decisions or resolutions of a division may be appealed. (In
the Matter of the Special Petition to the Supreme Court En Banc for
the Issuance of a Writ of Certiorari to Annul the Resolution of the
First Division of the Supreme Court dated June 22, 1988 [Gloria
Jopson Asuncion, Petitioner], G.R. No. 84907, 3 November 1988)
PLDT has no right to treat its subscribers as its proprietary assets
to be “exploited” by PLDT alone, rather than as customers to be
served in the manner that a public utility is supposed to serve the
public. (PLDT vs. National Telecommunications Commission, 241
SCRA 486 [1995])
Only the NTC and its Chairman may be considered as
indispensable parties in a petition for certiorari when it is they whom
the petitioner seeks to be chastised and corrected by the court for
having acted in grave abuse of discretion amounting to lack or
excess of jurisdiction in their adherence and defense of the
Chairman’s one-man rule—the oppositors are not absolutely
necessary for the final determination of the issue of grave abuse of
discretion because the task of defending the public respondents
primarily lies in the Office of the Solicitor General. (GMCR, Inc. vs.
Bell Telecommunication Philippines, Inc., 271 SCRA 790 [1997])

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