Recently, the Congress proposed a measure allowing 100 percent foreign ownership in the telecom industry as well as other public utilities. This prompted foreign telcos to express their intention in entering the Philippine market.
On Monday, March 21, Durterte finally signed the said measure amending the Public Service Act. This means that foreigners may now fully own companies in the telecommunication, shipping, airline, railway, toll road, and transport network vehicle industries. Gone is the 40% ownership limit on foreign ownership as previously imposed.
The bill was pushed aggressively as the country is said to be in need of measures like this to recover from the economic downturn caused by the COVID-19 pandemic. Socioeconomic Planning Secretary Karl Chua added that foreign investors “react favorably to a more liberalized regime.”
Earlier this year, several European telecommunications companies expressed their intent to enter the Philippine market after the announcement of the proposed amendment in the Public Service Act. In addition, European Chamber of Commerce of the Philippines (ECCP) President Lars Wittig said that the ratification of the bill amending the 85-year old Public Service Act (PSA) is an “absolute massive game-changer and it will create double-digits, billion dollar investments.”
With foreign telco companies now allowed to enter the Philippine market, this could give existing telco companies a run for their money.
