The stage is set for a Senate inquiry into the reported P69.2-billion share-swap deal between Philippine Long Distance Telephone Co. (PLDT) and Digital Telecommunications Philippines Inc. (Digitel).

Sen. Joker Arroyo paved the way for the inquiry to be conducted by the Committee on Public Services, chaired by Sen. Ramon “Bong” Revilla Jr., after Arroyo filed Resolution 477 seeking to determine “whether the transaction is consistent with their legislative franchises and that the [PLDT-Digitel] arrangement would be to the public interest.”

Arroyo pointed out that both PLDT and Digitel operate by virtue of a legislative franchise granted by Congress under Republic Acts (RA) 7082 and 9180, respectively.

He cited reports that the so-called share-swap deal involved the purchase by PLDT of 51.55 percent stake in Digitel.

According to Arroyo, the PLDT group, composed of Smart Communications Inc., Pilipino Telephone Corp. (Talk ’N Text) and Connectivity Unlimited Resources Inc. (Red Mobile), plus Digitel’s Sun Cellular brand, would control 70 percent of the total cellular subscribers.

He warned that such an agreement could “result in a duopoly” with PLDT’s Smart, Talk ’N Text, Red Mobile and Sun Cellular, on one hand, and Globe Telecom Inc. on the other. The senator voiced concern that this raises the question “of whether it is to the public good.”

Arroyo invoked Section 16 of Republic Act 9180, which states that “the grantee shall not lease, transfer, grant the usufruct of, sell, or assign this franchise or the rights and privileges acquired hereunder to any person, firm, company, corporation, or other commercial or legal entity, nor merge with any other corporation or entity, nor shall the controlling interest of the grantee be transferred, whether as a whole or in parts and whether simultaneously or contemporaneously, to any such person, firm, company, corporation, or entity without the approval of the Congress of the Philippines.”