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Several business groups on Monday said they support the Senate’s proposed amendments to the Public Service Act, a law that defines which services count as utilities and should be majority-owned by Filipinos, according to a report by ABS-CBN.
In a joint statement, the business groups said they “strongly support liberalization of the Philippine economy through passage of amendments to the Public Service Act.”
The statement was signed by the Joint Foreign Chambers (JFC), which is composed of some of the biggest foreign business groups in the country, the Foundation for Economic Freedom, Makati Business Club, and the UP School of Economics Alumni Association.
“By opening up key economic sectors and limiting the definition of public utilities to natural monopolies, we believe this reform will be one of the most important reforms of President Rodrigo Duterte and the 18th Congress,” the groups said.
Under the current law, transportation and telecommunications are regarded as public utilities, and companies that offer these services must be 60 percent owned by Filipinos. Foreign ownership in these industries is limited to 40 percent.
The business groups said any moves to retain 60-40 foreign equity restrictions, specifically for the major transportation and telecommunications sectors, and add legislative franchise requirements where none existed, will thwart the intention of the bill and the positive impact it can bring to the business community and consumers.
“Both transportation and telecommunications are not natural monopolies,” they said.
Instead of keeping service sectors closed to foreign investment in the guise of national security, it is important to carefully balance the need to attract foreign investments while protecting national security, they said.
Duterte has said that amending the PSA is a priority of his administration. The bill will attract more foreign investments into the country according to government economic managers.