Majority of the Senate may have passed the bill that allows 100 percent foreign ownership of public services but lawmakers who contested the proposed law amening the 85-year-old Public Service Act warned that the entry of foreign players carried with it substantial risks to national security.

Nineteen of the 24 senators voted in favor of the bill.

Aside from the telcos, Senate Bill 2094 is also expected to affect local firms engaged in other forms of telecommunications, domestic shipping, air carriers, railways and subways will also be facing competition from global players in their industries.

President Rodrigo Duterte is expected to sign the bill into law as his administration had earlier certified as urgent.

In voting against the bill, Sen. Risa Hontiveros said she was saddened that many crucial services such as telecommunications were totally opened up to foreign ownership when foreign participation could have been limited to only 70 percent.

She said the bill could potentially open the doors to foreign interests “that may have malevolent designs on our national security.”

Hontiveros added that the government “does not even have the rudiments of a cyber defense doctrine nor a cyber defense operations center that would allow us to engage in this new theater of international conflict.”

Aside from Hontiveros, also opposing the bill were Senate President Pro-Tempore Ralph Recto, and opposition senators Kiko Pangilinan and Leila de Lima.

De Lima asked, “Who is the government trying to please?”

She said the country “must not lose sight of (its) national security concerns.”

Meanwhile, presidential candidate and Labor leader Leody de Guzman said the bill’s goal of providing Filipino consumers with better service providers was nothing more than “an excuse to further liberalize the economy and relieve the government of its responsibilities to provide essential services to its people.”

But Sen. Grace Poe-Llamanzares, principal co-author of the bill along with Sen. Franklin Drilon, said that the measure includes safeguards to protect national security, such as prohibiting foreign companies from owning capital in public service firms classified as engaged in critical infrastructure.

Moreover, all foreign investments will be reviewed by the National Security Council.

Poe-Llamanzares said: “The main purpose of this measure is to provide consumers with choices, and I believe that by opening our economy to a diverse set of investors, we could provide our fellow Filipinos with more and better choices.”

The 1987 Constitution states that companies operating as public utilities must be 60 percent owned by Filipinos. But the new bill limits the definition of public utilities to electricity distribution, electricity transmission, water pipeline distribution and sewerage, airports, seaports, and public utility vehicles.

The bill thus gives a clearer distinction between public utilities and public services.

As expected, foreign business groups praised the measure which they said, “will create jobs, improve technology, modernize and lower the prices of services to the benefit of Filipino consumers.”

The Joint Foreign Chambers issued a statement stating that the “game changing” law will match policies of such Southeast Asian countries like Indonesia, Singapore, Thailand, and Vietnam which have already adopted the policy.

While the country’s third telco Dito Telecommunity has not reacted to the bill, the two others – Globe Telecom and PLDT/Smart Communications – maintained a neutral attitude to the changes in the law.

Globe Telecom issued a statement to media saying the legislation “will benefit more future telcos.”

PLDT/Smart Communications CEO Alfredo Panlilio said, “We are closely watching the development and the opportunities and challenges that could result from its passage.”

He added: “There is no desire to increase foreign equity in PLDT at present, so in that sense PLDT is neutral on this issue.”

Both companies are well within the 40 percent foreign ownership limit based on their latest statements.

PLDT/Smart said its foreign ownership level was 22.19 percent of total outstanding shares of stock, while for Globe Telecom, it is 26.62 percent as of the third quarter of this year.

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