EXECUTIVE ORDER NO. 59 PRESCRIBING THE POLICY GUIDELINES FOR COMPULSORY INTERCONNECTION OF AUTHORIZED PUBLIC TELECOMMUNICATIONS CARRIERS IN ORDER TO CREATE A UNIVERSALLY ACCESSIBLE AND FULLY INTEGRATED NATIONWIDE TELECOMMUNICATIONS NETWORK AND THEREBY ENCOURAGE GREATER PRIVATE SECTOR INVESTMENT IN TELECOMMUNICATIONS
WHEREAS, in recognition of the vital role of communications in nation-building, it has become the objective of government to promote advancement in the field of telecommunications and the expansion of telecommunications services and facilities in all areas of the Philippines; WHEREAS, there is a need to enhance effective competition in the telecommunications industry in order to promote the State policy of providing the environment for the emergence of communications structures suitable to the balanced flow of information into, out of, and across the country; WHEREAS, there is a need to maximize the use of telecommunications facilities available and to encourage investment in telecommunications infrastructure by service providers duly authorized by the National Telecommunications Commission (NTC); WHEREAS, there is a need to ensure that all users of the public telecommunications service have access to all other users of the service wherever they may be within the Philippines at an acceptable standard of service and at reasonable cost; WHEREAS, the much needed advancement in the field of telecommunications and expansion of telecommunications services and facilities will be promoted by the effective interconnection of public telecommunications carriers or service operators; WHEREAS, the Supreme Court of the Philippines, in the case of Philippine Long Distance Telephone Co. v. The National Telecommunications Commission [G.R. No. 88404, 18 October 1990, 190 SCRA 717, 734], categorically declared that "Rep. Act No. 6849, or the Municipal Telephone Act of 1989, approved on 8 February 1990, mandates interconnection providing as it does that 'all domestic telecommunications carriers or utilities . . . shall be interconnected to the public switch telephone network.'"; WHEREAS, under Executive Order No. 546 dated 23 July 1979, as amended, the NTC has the power, as the public interest may require, "to encourage a larger and more effective use of communications facilities, and to maintain effective competition among private entities whenever the NTC finds it reasonably feasible"; and WHEREAS, there is a need to prescribe the consolidated policy guidelines to implement Rep. Act No. 6849 and Executive Order No. 546, as amended. NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order: Section 1. The NTC shall expedite the interconnection of all NTC authorized public telecommunications carriers into a universally accessible and fully integrated nationwide telecommunications network for the benefit of the public. Section 2. Interconnection between NTC authorized public telecommunications carriers shall be compulsory. Interconnection shall mean the linkage, by wire, radio, satellite or other means, of tow or more existing telecommunications carriers or operators with one another for the purpose of allowing or enabling the subscribers of one carrier or operator to access or reach the subscribers of the other carriers or operators. Section 3. Interconnection shall be established and maintained at such point or points of connections, preferably at the local exchanges level and at the junction side of trunk exchanges as are required within a reasonable time frame and shall be for sufficient capacity and in sufficient number to enable messages conveyed or to be conveyed to conveniently meet all reasonable traffic demands for conveyance of messages between the system of the parties involved in the interconnection. Section 4. Interconnection shall permit the customer of either party freedom of choice on whose system the customer wishes his call to be routed regardless which system provides the exchange line connecting to the local exchange. Such a choice may be done initially through the use of distinct carrier access code assigned to the relevant connectable system
and ultimately, as the local exchange providers upgrade to stored-program-controlled (SPC) exchanges, comparatively efficient interconnect (CEI) or equal access pre-programmed option. Section 5. Interconnection shall be mandatory with regard to connecting other telecommunications services such as but not limited to value-added services of radio paging, trunking radio, store and forward systems of facsimile or messaging (voice or data), packet switching and circuit data switching (including the conveyance of messages which have been or are to be transmitted or received at such points of connection), information and other services as the NTC may determine to be in the interest of the public and in the attainment of the objective of a universally accessible, fully integrated nationwide telecommunications network. Section 6. Interconnection shall be negotiated and effected through bilateral negotiations between the parties involved subject to certain technical/operational and traffic settlement rules to be promulgated by the NTC; Provided, that if the parties fail to reach an agreement within ninety (90) days from date of notice to the NTC and the other party of the request to negotiate, the NTC shall, on application of any of the parties involved, determine the terms and conditions that the parties have not agreed upon but which appear to the NTC to be reasonably necessary to effect a workable and equitable interconnection and traffic settlement. Section 7. Interconnection among public communications carriers shall be effected in such a manner that permits rerouting of calls from an international gateway operator which is rendered inoperative, whether in whole or in part, in the event of strikes, lock-outs, disasters, calamities and similar causes, to another international gateway operator not so affected. A public telecommunications carrier shall be allowed such permits to operate an international gateway as may be necessary to service its own network requirements; Provided, that its subsidiaries shall not be given a permit to operate another international gateway. Section 8. In prescribing the applicable technical/operational and traffic settlement rules, the NTC shall consider the following: 8.1 The technical/operational rules should conform with the relevant recommendations of the Consultative Committee on International Telegraph and Telephone (CCITT) and the International Telecommunications Union (ITU). 8.2 For traffic settlement rules: (a) Either meet-on-the-air and/or midpoint circuit interconnection between parties; (b) For local exchange point of interconnection, settlement shall be on the basis of volume of traffic on the local connection based on per minute with day and night rate differential. In case of store and forward services for facsimile, data and voice mail, settlement shall be on the basis of equivalent monthly trunk line charges as generally charged by the local exchange carrier (LEC) to its customer owning their own PABX; (c) For junction exchange point of interconnection, settlement shall be on the basis of volume of traffic carrier over: (i) short haul connection not (ii) long haul connection exceeding 150 kilometers.
exceeding
150
kilometers;
and
Similarly, a per minute rate shall be evolved with day and night differential. The determination of the per minute rate is based on the principle of recognizing recovery of the toll related cost and fair return of the investment of the facilities employed in making the toll call exchange between the systems. (d) Subsidies which shall be approved on the basis of the sound public policy shall be allowed in two (2) ways: (i) for operator assisted calls - an operator surcharge kept by the system that employs the operator; and (ii) access charge - the principle of access charge is an assistance to the unprofitable rural telephone development, remote pay stations, etc., thereby assuring the universal service obligation of the PSTN operators. The introduction of the access charge may result in a charge that will be passed on to the subscribers of the PSTN. Section 9. Interconnection shall at all times satisfy the requirements of effective competition and shall be effected in a non-discriminatory manner. Section 10. The Points of Connection (PC) between public telecommunications carriers shall be defined by the NTC, and the apportionment of costs and division of revenues resulting from interconnection of telecommunications networks shall be approved or prescribed by the NTC. Section 12. Interconnection and revenue-sharing agreements approved or prescribed by the NTC may be revoked, revised, or amended as the NTC deems fit in the interest of the public service.
Section 13. In the implementation of this Executive Order, the NTC may, after due notice and hearing, impose the following penalties in case of violation of any of the provisions hereof: 13.1. Imposition of such administrative fines, penalties and sanctions as may be allowed or prescribed by existing laws; 13.2. Suspension of further action on all pending and future applications for permits, licenses or authorizations of the violating carrier or operator and in which particular case, the NTC shall be exempted from compliance with the provisions of Executive Order No. 26 dated 7 October 1992 on the period for the disposition of cases or matters pending before it; 13.3. With the approval of the President, directive to the appropriate government financial or lending institutions to withhold the releases on any loan or credit accommodation which the violating carrier or operator may have with them; 13.4. Disqualification of the employees, officers or directors of the violating carrier or operator from being employed in any enterprise or entity under the supervision of the NTC; and 13.5. In appropriate cases, suspension of the authorized rates for any service or services of the violating carrier or operator without disruption of its services to the public. Section 14. The NTC is directed to promulgate the implementing rules to this Executive Order within ninety (90) days from the date of effectivity hereof. Section 15. All executive orders, administrative orders, and other issuance inconsistent herewith are hereby repealed, modified or amended accordingly. Section 16. This Executive Order shall take effect immediately. DONE in the City of Manila, this 24th day of February in the year of Our Lord, Nineteen Hundred and Ninety-Three. (Sgd.) FIDEL V. RAMOS By the President (Sgd.) ANTONIO T. CARPIO Chief Presidential Legal Counsel
MEMORANDUM CIRCULAR NO. 9-7-93 SUBJECT: IMPLEMENTING GUIDELINES ON THE INTERCONNECTION OF AUTHORIZED PUBLIC TELECOMMUNICATIONS CARRIERS Pursuant to the provisions of Executive Order No. 59 series of 1993 mandating interconnection and the power of the Commission to encourage a larger and more effective use of communication facilities and to maintain effective competition, the National Telecommunications Commission (NTC) by virtue of the powers vested upon it by law do hereby promulgate the following guidelines: ARTICLE SCOPE AND DEFINITION OF TERMS Section 1. These guidelines shall be applicable to all duly authorized public telecommunications carriers. Section 2. For the purpose of this circular, the following terms and phrases shall be defined as: Access Charge – a remuneration paid to the local exchange carrier by the interconnecting carriers for accessing the facilities and/or customer base of such local exchange carrier which is needed by the interconnecting carriers for the origination and/or termination of all types of traffic derived from the interconnection. Commission – shall refer to the National Telecommunications Commission Interconnection – shall refer to the linkage, by wire, radio, satellite or other means, of two or more existing telecommunications carriers or operators with one another for the purpose of allowing or enabling the subscribers of one carrier or operator to access or reach the subscribers of the other carriers or operators. Inter-exchange Carrier (IXC) – a public telecommunications carrier providing transmission and switching facilities which connect local exchanges as well as IGFs within the Philippines enabling them to offer telecommunications services of any type, whether of voice, data or images for which there is a charge separate from the rate schedule applied to subscribers within a local exchange area.
Interface – shall refer to facilities consisting of but not limited to equipment, devices and materials required to make two telecommunications systems or networks interwork with each other. International Gateway Facility (IGF) – a facility consisting of international transmission, switching and network management facilities which serve as point of entry and exit in the Philippines of international traffic between the national network and point/s outside the Philippines. International Gateway Facility (IGF) Operator – a public telecommunications carrier providing IGF services. Local Exchange Carrier (LEC) – a public telecommunications carrier offering telecommunications services, primarily but not limited to voicetovoice service within a contiguous geographic service area furnished to individual subscribers under a common local exchange rate schedule Point of Interconnection – shall refer to the point where signals are conveyed from one telecommunications network to another telecommunications network. Point of Presence – a specific point as defined on the network where point of interconnection shall occur in such a way that interconnection between and among local exchange carriers, inter-exchange carriers and international gateway facilities operations can be made efficiently and effectively. Public Telecommunications Carrier (PTC) – shall refer to a duly enfranchised and NTC certificated telecommunications carrier and/or any entity duly authorized by law including the government to provide public telecommunications services. ARTICLE II GENERAL PROVISIONS Section 3. All authorized public telecommunications carriers shall be interconnected into a universally accessible and fully integrated nationwide telecommunications network for the benefit of the public. Section 4. All IXCs and IGFs shall interconnect with all LECs to provide freedom of choice to toll facilities. Section 5. Authorized public telecommunications carrier requesting for interconnection shall submit to the party with whom interconnection is requested all information necessary to effect interconnection copy furnish the Commission. Section 6. Interconnection among authorized public telecommunications carriers in accordance with Section 3 shall be compulsory and may be effected through the following process. 6.1 Negotiation 6.1.1 Subject to existing technical/operational and settlement rules or which may hereafter be promulgated by the Commission, public telecommunications carriers, may on their own initiative negotiate and enter into an interconnection agreement, upon the request of the party seeking interconnection. 6.1.2 The interconnection agreement entered into by parties through negotiation shall be submitted to the Commission within ten (10) days from date of execution of the Agreement for approval by the Commission within thirty (30) days. 6.1.3 The start of the negotiation shall be from the time the party requesting interconnection shall have submitted to the other party of the complete data or information, to wit: 1. Copy of the CPCN/PA and franchise 2. System or network configuration 3. Proposed point of connection 4. Trunk requirements 5. Proposed traffic routing 6. Traffic forecast and assumptions used (at least five years) 7. Traffic types and services covered 8. Proposed compensation/settlement 9. Proposed interface 10. Proposed implementation schedule Both parties shall provide each other basic information such as: 1. Description of existing and future network relevant to interconnection. 2. List of exchanges (existing and planned) suitable for interconnection including number of lines available. 6.2 Submission by Parties to the Commission 6.2.1 Should parties fail to reach an agreement in ninety (90) days from start of negotiations in accordance with Section 6.1.3 Article II
hereof, the Commission shall, on the application of any of the parties involved, formally hear the parties to draw up the terms and conditions of the Interconnect Mandate. 6.2.2 The Commission shall resolve the issue of mandating interconnection within thirty (30) days from the time the same is filed with the Commission. The resolution made by the Commission on the terms and conditions of any interconnection mandate is immediately executory. Section 7. Interconnection shall at all times satisfy the requirements of fair competition and shall be effected in a non-discriminatory manner. Section 8. All parties to an Interconnect Agreement or Interconnect Mandate shall be obligated to comply with all the terms and conditions as approved by the Commission and shall be subject to the penalties herein prescribed pursuant to EO 59. ARTICLE III TECHNICAL/OPERATIONS REQUIREMENTS Section 9. The interconnecting parties shall maintain and operate their facilities in accordance with their respective obligations in the Interconnect Agreement/Interconnect Mandate approved by the Commission and shall comply with the provisions of NTC MC No. 10-17-90 (Service Performance Standards) and NTC MC No. 10-16-90 (Technical Standards) and such other standards that the Commission shall prescribe upon consultation with the industry. Section 10. Interconnecting parties shall: 10.1 Cooperate and provide facilities in their respective system for testing, agree on an standard on trouble reporting, testing and restoral and see to it that information are shared between them to facilitate the efficient routing of messages over all points of connection. 10.2 Maintain over all grade of service as defined in MC 10-17-90 10.3 Exchange traffic and facility forecasts on a semi-annual basis to facilitate allocation of facilities for future requirements, as well as provide basic information such as the description of the existing and future network relevant to interconnection and list of exchanges (existing and planned) suitable for interconnection including number of lines available. 10.4 Provide additional circuits based on traffic measurements and studies to be conducted covering a period of thirty (3) days separately but simultaneously by both parties. Parties shall compare study results and agree on the number of circuits to be added. In the event that the parties cannot reach an agreement, the matter shall be brought to the Commission for final action. Implementation of the additional circuits shall be done within the next fifteen (15) days after the number of circuits has been agreed unless acquisition of additional facilities is involved which were not included in the facility forecasts exchange on a semi-annual basis. In the event that the interconnection trunks are underutilized with reference to the mandated grade of service, the excess trunks may be deactivated within fifteen (15) days from receipt of notice in writing from either party; provided, that a party requesting disconnection of underutilized interconnection trunks can show by convincing evidence that either the disconnected circuits are urgently needed for other purposes by the requesting party or that the measured traffic and the historical growth of the affected circuit has shown a consistent record of underutilization over a period of at least six (6) months. Section 11. Public telecommunications carriers which do not meet the prescribed service performance and technical standards shall be required to upgrade their facilities to comply with said national standards within reasonable period. Section 12. The transmission link/s and terminating facilities needed to effect interconnection shall be provided by each of the interconnecting parties in accordance with the traffic requirements of each of the parties. Section 13. The interconnection Agreement and/or Interconnect Mandate approved or prescribed by the Commission may be revoked, revised or amended by the Commission for just and valid cause in the interest of public service strictly observing due process. Section 14. PTCs shall provide as many points of presence as necessary to effect an efficient interconnection. Section 15. The inter-exchange carrier shall provide interconnecting facilities up to the main distribution frame (MDF) of the local exchange carriers with 5000 exchange lines or less per local area. For LECs with more than 5000 exchange line Section12 shall apply; provided that the pending application for local telephone service in a particular local area is less than 25% of the
number of working direct exchange lines. The international gateway operator shall provide the interconnecting trunks up to the MDF of the LEC when the IXCs cannot provide the required toll facilities. In case an LEC also provides an IXC facility, all types of traffic shall be routed via the trunk level. Section 16. Interconnection shall be for a reasonable time frame and for sufficient capacity and in sufficient number to enable messages conveyed to conveniently meet all reasonable traffic demands for conveyance of messages between the system of the parties involved in the interconnection. Section 17. Pursuant to Sect. 4 of Executive Order 59 local exchange provider or carrier (LEC’s) shall agree with the interexchange carrier and/or the IGF operator interconnecting with the former to provide an exclusive fixed carrier access code with prior coordination and subject to the approval of the Commission, in order that any subscriber of the LEC may access the long distance carrier of choice. Ultimately, as the Local Exchange Carrier (LEC) upgrades to storedprogramcontrol (SPC) exchanges they may implement equal access preprogrammed option and still allow the subscriber at the time of his call freedom of selection of any other interexchange or international gateway carrier. ARTICLE IV OPERATION OF AN INTERNATIONAL GATEWAY Section 18. Interconnection among public communications carriers shall be effected in such a manner that permits rerouting of calls from an international gateway operator which is rendered inoperative whether in whole or in part in the event of strikes, lockouts disasters, calamities and similar caused to other international gateway operators. Section 19. The subsidiaries as defined in EO 109 of a public telecommunication carrier operating an authorized international gateway shall not be allowed to operate another gateway. Section 20. The technical/operating rules shall whenever applicable, be in accordance with duly approved and adopted International Telecommunications Recommendations. ARTICLE V CHARGES AND SETTLEMENTS Section 21. Settlement shall be effected through bilateral negotiations between interconnecting parties and shall conform with the following: 21.1 The reasonable cost of interconnection shall be shared by the interconnect parties in accordance with the traffic requirements and the terms and conditions of the Interconnect Agreement or Interconnect Mandate, as the case maybe; provided, however that when one of the interconnecting parties is a local exchange carrier with 5000 exchange lines or less in which case Article III Section 15 shall apply. 21.2 For networks interconnected at the local exchange level, the LEC shall charge a network access charge based on the volume of traffic either on a per minute or volume of information with appropriate day and night differentiation. In case of store and forward facsimile, data and voice mail, paging, trunked radio and other services interconnected to the local exchange network, and where the services derived from such interconnection would generate local traffic, the settlement shall be on the basis of the equivalent monthly trunk lines charges as generally charged by the LEC to the customer owning their own PABXs. However, where toll traffic are derived from such services, Section21.3 shall apply for settlement purposes. 21.3 For networks interconnected at the trunk exchange level, the network access charge shall be determined as follows: Each LEC shall develop a standardized procedure, hereafter known as a “Cost Manual,” for calculating the costs of the facilities used in the provision of toll carrier interconnection service. 1. The starting point for calculation of LEC costs shall be the total company books that conform to generally accepted accounting principles. 2. Individual companies with more detailed accounting structures can use that information to develop their costs of service, provided that the account detail conforms to generally accepted accounting principles. 3. Investments or expenses that can be identified as directly attributed to toll carrier interconnection service can be directly assigned to
that service category. 4. An investment or expense which is utilized in the production of toll carrier interconenction service and one or more other services (e.g., basic local exchange service) shall be allocated using a methodology which most appropriately reflects the cost-causative characteristics of the services. To the extent feasible, LECs should use existing records/reports to allocate the investment or expense into the appropriate service categories. If existing carrier records do not provide sufficient detail, it may become necessary to perform a “special study” (recognizing cost-causality) to allocate investments and expenses among the appropriate service categories. If a carrier can demonstrate that allocation on the basis of cost causation is impracticable or unreasonable for certain investments or expenses, it may allocate those costs using an explicit allocation formula subject to approval by the Commission. 5. A portion of common “overhead” costs of the LEC, such as general administrative costs, shall be allocated to the toll carrier interconnection service category based on a specific allocation formula that will be subject to review by the Commission. Within one hundred and eighty (180) days of the effective date of this Circular, each LEC shall furnish the Commission with a copy of its Cost Manual and a full reporting of the costs determined in accordance with the Cost Manual, for review and final approval by the Commission. Section 22. In the course of the bilateral negotiations process, each LEC shall develop network and end user access charges for toll carrier interconneciton, based on the costs of providing toll interconnection service as defined by the LEC’s approved Cost Manual and associated cost study results, in the following manner: 22.1 Network access charges applicable to the toll provider on a per minute basis, that recognize the volume of traffic carried, the distance covered, and an appropriate differential between the day and night rate periods. The access charge rates for inbound vs. outbound calls may be deaveraged as negotiated by the parties, subject to the approval of the Commission. 22.2 An operator surcharge for operator-assisted toll calls shall be collected and kept by the service provider employing the operator. 22.3 An end user access charge shall be collected monthly and kept by the LEC, which recovers a portion of the non-traffic-sensitive costs of the local exchange switching facilities used jointly in the provision of basic local service and toll carrier interconnection service. The end used access charge shall in no case exceed ten percent (10%) of the end user’s recurring monthly charge for basic local exchange service subject to the approval of the Commission. 22.4 For each LEC, the total annual revenue generated by the network access charges, operator surcharge, and end user access charge under reasonable estimates or forecasts of associated demand shall be equal to the total costs determined for the toll carrier interconnection service category in accordance with the LEC’s Cost Manual. 22.5 All access charges, whether end user, operator surcharge, network access charges, shall be subject to approval of the Commission. Section 23. Access charge scheme of revenue shall be fully implemented not alter than two (2) years from the effectivity of this Circular. Section 24. The interconnecting parties shall submit to each other monthly settlement reports and other reports needed for the settlement within ninety (90) days following the end of each month. The party with balance after reconciling their settlement reports shall pay the other party said balance not later than thirty (30) days after the reports have been received by both parties. Amounts due which are not paid within the said period shall bear interest at mutually agreed rate. ARTICLE VI TRANSITORY PROVISION Section 25. Interconnecting parties may agree that existing PTCs who do not presently comply with the prescribed standards, may enter or maintain their existing Agreement whereby they shall used technical standards other than those specified in NTC MC No. 10-16-90 for a period not exceeding three (3) years from the effectivity of this circular. Section 26. Existing settlement shall remain in force for a period not exceeding two (2) years from the approval of this circular. Section 27. Interim settlement agreements using the revenue sharing scheme pursuant to NTC Case No. 88-145 may be entered into by the interconnecting
parties for a period not exceeding two (2) years from the approval of this circular. ARTICLE VII PENALTIES FOR VIOLATIONS Section 28. Any violation of the order promulgated by the Commission pursuant to Executive Order 59 and its Implementing Guidelines shall, upon due notice and hearing, be subject to any or combinations of the following penalties. 28.1 Imposition of such administrative fines, penalties and sanctions as may be allowed or prescribed by existing laws. 28.2 Suspension of further on all pending and future applications for permits, licenses or authorizations of the violating carrier or operator. 28.3 Disqualification of the responsible employees, officers or directors of the violating carrier or operator from being employed in any enterprise or entity under the supervision of the Commission. 28.4 Suspension of the authorized rates for any service or services of the violating carrier or operator without disruption of its services to the public. ARTICLE VIII FINAL PROVISIONS Section 29. Any portion or section of this circular which maybe declared to be invalid or unconstitutional shall not affect the validity of the other remaining portions or sections. Section 30. All existing memoranda, circulars, rules and regulations inconsistent with the provisions of this circular are hereby repealed or amended accordingly. Section 31. This circular shall take effect fifteen (15) days after its publication in the official gazette or newspaper of general circulation, provided further that at least three (3) certified copies thereof shall be filed with the University of the Philippines law Center. Done in the City of Quezon, this 23rd day of July, in the year of our Lord, nineteen hundred and ninety three. (SGD.) SIMEON L. KINTANAR Commissioner
MEMORANDUM CIRCULAR NO. 07-13-90 SUBJECT: RULES AND REGULATIONS GOVERNING THE INTERCONNECTION OF LOCAL TELEPHONE EXCHANGES AND PUBLIC CALLING OFFICE, WITH THE NATIONWIDE TELECOMMUNICATIONS NETWORK/S, THE SHARING OF REVENUE DERIVED THEREFROM, AND FOR OTHER PURPOSES. Pursuant to the powers vested upon the National Telecommunications Commission (NTC) to encourage a larger and effective use of communications facilities and in line with the State’s program to pursue and foster in a n orderly and vigorous manner, the interconnection of all municipalities in the country, the following rules and regulations on the interconnection of telephone exchanges with the nationwide telecommunications network/s, including the sharing of revenue derived therefrom are hereby promulgated for the information, guidance and compliance of all concerned. SECTION 1 DEFINITION OF TERMS a. Interconnecting company (ICC) – A local exchange operator duly enfranchised and certificated/certified by the NTC or a government entity technically and financially capable to install, operate and maintain telephone systems in designated services areas. b. Interconnection – For the purpose of this Circular, interconnection shall refer to a situation where an inter-connecting company is interconnected to the nationwide telecommunications network/s. c. Public Calling Office – a Telecommunications facility at which the public may, by the payment of appropriate fees, place as well as receive long distance telephone calls and/or be capable of voice and data transmission. d. National Telecommunications Development Plan – A Master Plan, which includes all plans, related to the overall development of telecommunications facilities and services of both government and enfranchised telecommunications networks operators. The Plan shall include, among others, the following: 1. Development Priorities 2. System Development Plan 3. Numbering Plan 4. Transmission Plan 5. Signalling
6. Switching and Routing 7. Synchronization 8. Charging (rates and tariff) SECTION 2. INTERCONNECTION 2.1 Interconnection of local exchanges and/or the public calling offices with the nationwide telecommunications network/s shall conform with the Master Development Plan. 2.2 Enfranchised and certificated/certified local exchanges, PCO’s and government-own systems shall comply with Spectrum Management, Technical Standards and Fundamental Technical Plans promulgated by the Commission. These Standards shall include but not limited to the following: 1. Transmission, routing, switching, signalling, numbering, charging and synchronization. 2. Radio Equipments 3. Service performance standards 4. Customer premises equipment 5. Outside plant 6. Frequency Management, including planning, engineering & assignment. 2.3 Operators whether private or government of existing local exchanges or PCO’s which do not meet interconnect standards shall be required to provide interface equipment and devices in coordination with the interexchange or transmission network operator/s. 2.4 Trunking requirement will based on best estimates for new local exchanges and on periodic acceptable traffic studies from existing local exchanges. These studies shall be conducted jointly by the operators of local exchanges and the interexchange or transmission network/s and submitted to the Commission. 2.5 Interconnecting parties shall share the cost of interconnection in accordance with their respective responsibilities; maintain and operate their facilities; and comply with their obligations as agreed upon and approved by the Commission or as prescribed by the Commission. 2.6 A Traffic Agreement format shall be prescribed by the Commission taking into consideration submitted recommendations. SECTION 3. REVENUE SHARING 3.1 Traffic settlement agreements shall be based upon: (1) a recovery of tollrelated costs and a fair return on the investment of both companies in the facilities used in making the toll calls exchanged between the systems and (2) a subsidy to local exchange providers. 3.2 Until modified by the NTC, the share of each operator shall be in accordance with the Order of this Commission in Case No. 88-145 issued on April 19, 1990. 3.3 The Commission shall prescribe/approve an Amended Interconnection and Toll Revenue Sharing Agreement, taking into consideration the submitted documents from interconnecting parties in compliance with the Order in Case No. 88-145 and other relevant recommendations. 3.4 Shares on revenue shall be settled within ninety (90) days from receipt of settlement statements. 3.5 The Interconnect and revenue sharing Agreements approved or prescribed by the Commission may be revoked, revised or amended as the Commission deems fir in the interest of public service. Any Memorandum, Circular, rules and regulations of the Commission inconsistent with the provisions of this Circular are hereby deemed revised, revoked, or amended. This Circular shall take effect immediately Quezon City, Philippines, July 12, 1990. JOSEFINA T. LICHAUCO Acting Commissioner FLORENTINO L. AMPIL FIDELO Q. DUMLAO Deputy Commissioner Deputy Commissioner