----- Original Message -----
From: "Manny Villar" <mb_villar@yahoo.com>
To: <news@pldt.com>
Sent: Tuesday, March 08, 2005 2:01 PM
Subject: News Release-o/s Villar

 

Office of Senator Manny Villar

Rm. 525, Senate of the Philippines, GSIS Financial Center, Pasay City

( 552-6601 to 80 loc. 6507, 6508, and 6511 ™o 7
552-6734

NEWS RELEASE8 March 2005

VILLAR: SHOULD UNUSED VALUE OF PREPAID PHONE CARDS BE FORFEITED?
Filed Senate Resolution to look into Unused Value Forfeiture Policy of
telecom firms

Senator Manny Villar, Chairman of the Senate Committee on Finance,
is questioning the legality of the unused value forfeiture policy being
implemented by telecommunication companies to billions of prepaid cellular
phone subscribers in the country.

Villar filed Senate Resolution 200 directing the Senate Committee on
Public Services to conduct an inquiry on the said policy imposed by telecom
firms for possible violation of Republic Act (RA) 7925, which provides that
rates of telecom firms ™gmust be fair, reflective of a fair return on their
investments, reasonable and are not distorted such that the public is
adversely affected.

It came to my attention that the value of prepaid cards that phone
subscribers buy, if not consumed or used within a certain period of time,
are being forfeited in favor of telecom companies. The forfeited values are
then included in their operating revenue. I would like to know whether such
policy or practice violates certain laws,™h says Villar, President of the
Nacionalista Party.

Furthermore, Villar adds, I also find the consumption or time
limit imposed on prepaid cards too short or restrictive especially for
low-income earners. Those who buy prepaid cards are people with tight
budgets, forfeiting the stored value of the phone cards they bought too soon
or forfeiting them at all is like taking away their hard-earned money, even
if its just a few centavos or pesos.™h

Villar cites on his resolution, Globe Telecommunication put a 15-day
limit for P100-denominated prepaid cared and a 60-day limit for P250-,
P300-, P500- and P1,000-denominated prepaid cards. Smart Communications, on
the other hand, put a 60-day limit for P300, P500- and P1,000-denominated
cards and a three-day limit for P30 auto load, six-day limit for P60 auto
load, 12-day limit for P115 auto load and 30-day limit for P200 auto load.

According to Villar, ™gConsidering that the number of prepaid card
subscribers have reached billions, we can already assume that the unused
values that get forfeited also reach millions or even billions of pesos. In
this case, the telecom companies gain becomes the phone subscribers loss.™h

In 2003, Smart Communications reported operating revenues worth
P4.99 billion, from which P4.09 billion or 82% came from its over 10.7
million prepaid subscribers. In the case of Globe Telecommunications, from
its P8.08-billion reported revenues for the first nine months of 2003, P7.41
billion or a hefty 91.7% also came from its over 7.4 million prepaid
subscribers.

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