NOW Telecom appeals to SC over ‘erroneous’ NTC fine

NOW Telecom Inc. of businessman Mel Velarde has elevated its appeal to the Supreme Court to settle the P2.6 billion in spectrum regulatory fees or SRF and associated charges it allegedly owes the National Telecommunications Commission.

The company, through a 22-page comment dated 1 September 2023 filed before the SC, pointed out that the regulatory fees and penalties imposed were "erroneous" and needed to be recomputed.

NOW Telecom is disputing the NTC's calculation, which was based on the total capital stock of P13.57 billion instead of the subscribed and paid-up capital of P1.39 billion.

The company pointed out that the additional paid-in capital of P12.17 billion should be excluded from the computation.

Thus, it requested the High Court to order NTC to recompute the SRF and base it solely on its capital stock of P1.39 billion and set aside the regulator's letters assessments dated 5 July 2025, and 23 December 2005.

Additionally, the company also asked the SC to delete the imposition of any penalty and interest.

"We are confident that this SRF issue will be finally resolved. NOW Telecom continues to appeal to the Marcos administration to (maintain) a level playing field, for NOW to compete head-on with China Telecom/DITO and Huawei-equipped SMART and GLOBE," Velarde said in a press statement on Tuesday.

NOW Telecom also contended that the NTC's reference to a COA letter was flawed due to discrepancies.

The COA letter claims over P3 billion in unresolved receivables that spanned 14 years.

"The crucial COA Letter was conspicuously absent from NTC's official documents, replaced by correspondence with the Office of the Solicitor General, casting doubts on the authenticity of the claim," it added.

NOW Telecom additionally said that "the staggering amount imposed by the NTC as penalties and interest does not align with the purpose of the law."

"As the term itself implies, the amount of the SRF collected is supposed to be commensurate to, and is simply intended to reimburse the NTC for the costs it incurs in supervising and regulating the telecommunications industry," the company said, adding that the SRF is not a tax or a revenue-raising measure.

Last June, it can be recalled that the Securities and Exchange Commission or SEC fined NOW Corp. and Velarde P1 million each for allegedly "misleading disclosures" about the P2.6-billion unpaid obligation of affiliate company NOW Telecom to the government.

In a seven-page order dated 15 June 2023, the SEC affirmed that NOW Corp. and Velarde were administratively liable for violating the Securities Regulation Code or SRC for disclosing misleading information to the public.

The disclosure in question was the one posted on 10 November 2021, which stated that NOW Corp. was unaware of the details surrounding the motions filed by the NTC with the SC.

The SEC pointed out that as one of the concurrent key officials of both NOW Corp. and NOW Telecom, Velarde is "considered to have ipso facto participated in the transactions" relating to the unpaid SRF and SUF liability of NOW Telecom.