[Fintech Alliance.ph supporting the call to amend PSA] More biz groups back changes to Public Service Act
Thirteen more private sector groups want certain provisions of a bill seeking to amend the Public Service Act to be revisited to ensure the measure would lead to more foreign investments in the country.
Cebu Business Club, Cebu Leads Foundation, Financial Executives Institute of the Philippines, Fintech Alliance.ph, Guild of Real Estate Entrepreneurs and Professionals Inc., Institute for Solidarity in Asia Inc., Investment House Association of the Philippines, Management Association of the Philippines, Makati Business Club, National Real Estate Association Inc., Philippine Council of Associations and Association Executives, Philippine Chamber of Commerce and Industry, and Philippines Institute of Certified Public Accountants said in a joint statement they strongly support the passage of Senate Bill 2094 which seeks to update the Public Service Act, but have concerns on some provisions.
Of particular concern is the reciprocity clause which requires a similar treatment by the home country of the foreign investor before being allowed to own more than 40 percent of the capital of public services engaged in critical infrastructure.
The groups also said the provision governing investments by foreign-state owned enterprises, which can be interpreted as prohibiting sovereign wealth funds from investing in public service classified as critical infrastructure, needs to be given a second look.
“We strongly urge that these provisions be revisited and/or refined as they pose obstacles to the achievement of the bill’s avowed objective to attract more foreign investments,” the groups said.
The groups said the bill is seen as a low-hanging fruit that would encourage foreign investments to the country, instead of amending the Constitution which is highly controversial and ill-timed under present circumstances.
Under the Constitution, public utilities should be 60 percent Filipino-owned.
Proposed amendments to the Public Service Act would define public utilities and provide a distinction from public services, as well as limit public utilities to natural monopolies involving distribution and transmission of electricity, water, and sewerage.
The groups said the co-mingling of the two concepts has adversely affected the country’s ability to attract foreign investments.
As a result, the country has lagged behind its neighbors in terms of foreign investments.
Once approved into law, the amendments are expected to allow the country to capture more foreign investments in telecommunications, transportation and other sectors.
“It will put in place a legal framework that will encourage more foreign investments in the Philippines and will foster strong competition that will benefit the consumers, boost job creation, and expand our economy while, at the same time, safeguarding our national interests against foreign domination of critical infrastructure,” the groups said.
Earlier, foreign business groups American Chamber of Commerce of the Philippines, Australian-New Zealand Chamber of Commerce Philippines, British Chamber of Commerce Philippines, Canadian Chamber of Commerce of the Philippines, Dutch Chamber of Commerce in the Philippines, European Chamber of Commerce of the Philippines, French Chamber of Commerce and Industry in the Philippines, German-Philippine Chamber of Commerce and Industry, Japanese Chamber of Commerce & Industry of the Philippines Inc., Korean Chamber of Commerce Philippines, Nordic Chamber of Commerce of the Philippines, Philippine Association of Multinational Companies Regional Headquarters Inc., Philippine-Swiss Business Council, and Spanish Chamber of Commerce in the Philippines called on Congress to immediately approve the bill.
The Senate recently started the plenary debate on the proposed measure, while the House of Representatives approved its version on third and final reading in March last year.