PLDT VS TELCO

Petition for certiorari: Whether or not NTC acted with grave abuse of discretion.
R.A. No. 2090- act granting felix alberto and company a FRANCHISE to establish RADIO AND DOMESTIC
AND TRANSOCEANIC TELECOMMUNICATION,
- Felix alberto co was the former name; later on, it was called CELLCOM Inc.
- CELLCOM was also the name when they applied in the SEC—however, this was withdrawn and
abandoned.

Respondent ETCI, due to urgent public need, filed an application for the issuance of a CPCN
- to construct, install, establish, and operate a CELLULAR MOBILE SYSTEM AND AN ALPHA NUMERIC
PAGING SYSTEM IN MANILA AND SOUTHERN LUZON.

PLDT then now filed an opposition regarding the application of respondent ETCI, primarily based on the
following:
1. PLDT claimed that ETCI is not capacitated or qualified under its LEGISLATIVE FRANCHISE to operate a
systemwide telephone network;
2. Lacks the facility needed for successful operation of the proposed cellular mobile telephone system;
3. PLDT ALREADY HAD A PENDING APPLICATION PRIOR TO THE APPLICATION OF ETCI. PLDT uses the
claim of PRIOR OPERATOR AND PROTECTION OF INVESTMENT.
4. PLDT also claimed that if ETCI will be granted CPCN—it will result in needless, uneconomical, and
harmful duplication of what the PLDT already offers.

However, NTC OVERRULED. NTC ruled that ETCI franchise carries with it the PRIVILEGE TO OPERATE
AND MAINTAIN A CELLULAR MOBILE TELEPHONE SERVICE. Thus, PLDT filed a motion for
reconsideration. However, NTC maintained its decision.

Year 1988, NTC issued the first challenged order.

- NTC claimed that there is indeed a necessity and a PRIMA FACIE evidence that ETCI is legally,
financially, and technically capable to provide CELLULAR MOBILE SERVICE. Thus NTC granted a
provisional authority to install, operate, and maintain a cellular mobile telephone system. INITIALLY
IN MANILA ONLY and WITH CONDITION.
Among the conditions are as follows:
a. Within 90 days after acceptance of ETCI of the said provisional authority—PLDT AND ETCI shall enter
into an INTERCONNECTION AGREEMENT that will be submitted in the COMMISSION for approval.

PLDT then now claimed that order made by NTC regarding the provisional order is a violation of due
process and that the GRANT of provisional authority as jurisdictionally and procedurally INFIRM.
However, NTC denied reconsideration.

PLDT then now urges to nullify the decision of NTC; it further claimed to desist ETCI from any act in
connection with the implementation of the said order.
SC then now granted the petition made by the PLDT; SC issued a TRO between PLDT and ETCI from
continuing any act related to the implementation of the provisional authority. SC required PLDT to post
a bond of 5M where PLDT complied.

ETCI then now filed a petition to lift the TRO—which was however denied by the SC.

The case was set for oral arguments, the following issues were raised:
1. Determination of the scope of RA No. 2090 as a franchise;
2. Transfer of share of stock of a corporation holding a CPCN;
3. The principle and reason behind the interconnection agreement of ETCI and PLDT;

ISSUE: Whether or not NTC gravely abused its discretion in granting the petition filed by ETCI applying
for CPCN.

HELD: SC find no grave abuse of discretion regarding the grant made by NTC in favor ETCI of CPCN. It is
supported by the following reasons:

1. NTC has jurisdiction- NTC is the regulatory agency of the National Government with JURISDICTION
OVER TELECOMUNNICATION ENTITIES. Hence, NTC is legally clothed with authority to grant and has
discretion to grant provisional permit/authority.
- the NTC granted a provisional authority—exactly 18 months unless sooner renewed; limited only in
METRO MANILA;
- The provisional authority was granted after observing due process, reception of evidence, with various
oppositors INCLUDING PLDT. Thus, showing ETCI is financially, technically, legally capable to be granted
CPCN.

This ruling made by SC was challenged by PLDT claiming that the grant made by NTC has no distinction
between CPCN and provisional authority.
- However, SC stated that there are basic differences between the two.
- What should be borne in mind is that provisional authority would be meaningless if the grantee were
not allowed to operate.
- it is only limited to 1 out of 4 phase; is limited as it is granted only within 18 months;

2. The coverage of ETCI’S FRANCHISE

- RA No. 2090 grants the right and privilege of constructing, installing, establishing, and operating in the
entire Philippines radio stations for reception and transmission of messages on radio stations in the
foreign and domestic public fixed point-to-point and public base, aeronautical and land mobile stations.

PLDT claims that the ETCI’S franchise is limited only to "radio stations" and excludes telephone
services such as the establishment of the proposed Cellular Mobile Telephone System (CMTS).
However, NTC included such in their grant of CPCN to ETCI.
- Thus the commission, takes into consideration various definition of the term radiotelephony.
Although the telephone service is not explicitly included in the definition—it can liberally be construed
to be included as the operation of cellular mobile telephone service which carries message needs the
aid of radiowaves.

This construction was given by an administrative agency who possessed special knowledge, expertise,
and experience; thus, its construction should be given weight and finality. This construction can only be
set aside when there is proof of gross abuse of discretion, fraud, or error in law.

3. THE STATUS OF ETCI FRANCHISE

PLDT claims that the status of ETCI franchise had lapsed as ETCI did not even start the construction of
the radio system authorized under the franchise as explicitly required RA. No. 2090.
- whether or not its franchise had remained unused from the time of its issuance are questions
beyond the jurisdiction of the courts.
- PLDT assailing such is a collateral attack which is not allowed.
- the abuse of a franchise is a public wrong and not a private injury; hence, it should be assailed in a
direct proceeding.
- what is assailed is not the unlawful exercise of ECTI but rather the jurisdiction of the NTC.

4. ETCI’S Stock Transactions

ETCI admits that on year 1964, ALBERTOS AS THE ORIGINAL OWNERS OF MORE THAN 40% WERE SOLD
TO THE ORBES.
- Year 1968, albertors re-purchased the shares they sold.
- Year 1987, albertos sold again more than 40% of their shares to HORACIO YALUNG.
Thereafter, the present stockholders acquired their ETCI shares.

PLDT claimed that the transfer of stock made in year 1987 was also a transfer of franchise which needs
congressional approval pursuant to RA NO. 2090—the approval was not obtained—hence, the franchise
should be invalidated. This claim is based on section 10 of ra no 2090.

However, the SC clarify this matter; section 10 is directed to the grantee of the franchise which is the
corporation itself and refers to sale, lease, or assignment of franchise. IT DOES NOT INCLUDE THE
TRANSFER OF SALE OF SHARES OF A CORPORATION BY THE LATTER’S STOCKHOLDER.

THE SALE OF SHARE OF STOCK OF A PUBLIC UTILITY IS GOVERNED BY ANOTHER LAW.

- transfers of shares of a public utility corporation need only NTC approval, not Congressional
authorization. Such authorization was given when the NTC issued the provisional approval.
- The franchise is not thereby invalidated by the transfer of the shares. A corporation has a personality
separate and distinct from that of each stockholder. It has the right of continuity or perpetual
succession

5. THE NTC INTERCONNECTION ORDER BETWEEN ETCI AND PLDT. This was one of the conditions
imposed by the NTC to the provisional authority it granted to ETCI.
PLDT opposes such condition. "the NTC is not empowered to compel such a private raid on PLDT's
legitimate income arising out of its gigantic investment;" that "it is not public interest, but purely a
private and selfish interest which will be served by an interconnection under ETCI's terms” was their
argument.

HOWEVER, SC STATED THAT PLDT CANNOT JUSTIFIABLY REFUSE TO SUCH INTERCONNECTION.

- Pursuant to RA. No. 6849: mandates interconnection encompassing all domestic carriers or utilities.
- Such regulation of the use and ownership of telecommunication systems is in the exercise of plenary
police power of the state.
- Pursuant also to section 6 of the 1987 phil consti—declaring that state may intervene when the
common good demands. Such intervention is the interconnection ordered by the NTC which purpose is
to promote the rapid expansion of telecommunication services in all area of the Philippines.
- Hence, NTC as a regulatory agency, only exercises its authority to regulate the use of
telecommunication. Thus, PLDT cannot claim denial of due process as they will be continued to be heard
during the proceedings regarding the interconnection.

The interconnection is not a parasitic dependence on the side of the ETCI but rather it is intended to
reach out the greatest number of people;

6. ULTIMATE CONSIDERATION
- the decisive considerations are the PUBLIC NEED, PUBLIC INTEREST, AND THE COMMON GOOD.
- Article 2 section 24 of the 1987 phil consti—recognizes the vital role of communication and
information in nation building.

Despite the existence of monopoly in communication industry, it is still inadequate to accommodate

customers demand.
- the need was further emphasized during the earthquake happened on year 1990.
- After all, neither PLDT nor any other public utility has a constitutional right to a monopoly position in
view of the Constitutional proscription that no franchise certificate or authorization shall be exclusive in
character or shall last longer than fifty (50) years

Hence, petition dismissed for lack of merit. SC affirm the grant of provisional authority by the NTC.
NATIONAL POWER CORPORATION VS COURT OF APPEALS AND CAGAYAN ELECTRIC POWER AND
LIGHT CO. INC (CONSOLIDATED CASES)

Petition for review on certiorari: W/O the NPC has jurisdiction to determine whether it may supply
electric power DIRECTLY to the facilities of an industrial corporation in areas where there is existing
and operating electric power franchise.

FACTS: Year 1961, CEPALCO was granted a franchise pursuant to RA No. 3247 to construct, maintain,
and operate an electric light, heat and power system for the purpose of generating/distributing electric
light, heat, and power—within the CITY OF CAGAYAN DE ORO—FOR 50 YEARS.
- RA NO. 3570 expanded the area of coverage of the franchise to include the municipalities of Tagoloan
and Opol.

PD NO. 243 as issued created a body of corporate and politic known as PHIVDEC or the Philippines
veteran investment development corporation which is vested with authority to engage in commercial,
industrial, mining, agricultural enterprises.
- Year 1974, PD No. 538, created PHIVDEC INDUSTRIAL AUTHORITY (PIA) as a subsidiary of PHIVDEC
intended to carry out the government policy.
- Under PD NO. 538, the first area covered were the municipalities of Tagoloan and Villanueva which will
form part of PHIVDEC industrial Estate Misamis oriental. (PIE-MO)

PIA granted the FPI AND MAC authority to operate in its area of development. PIA ALSO GRANTED
CEPALCO A TEMPORARY AUTHORITY TO RETAIL ELECTRIC POWER TO THE INDUSTRIES OPERATING
WITHIN THE PIE-MO.
- The agreement provides that CEPALCO is authorized to operate, administer, construct, and distribute
electric power within the PHIVDEC INDUSTRIAL ESTATE, MISAMIS ORIENTAL—extensive to the coverage
provided under section 3 of PD NO. 538 FOR A PERIOD OF 5 YEARS, RENEWABLE FOR ANOTHER 5 YEARS
at the option of cepalco.
- after the end of 5th or 10th year, PIA has the option to take over the operation of the electric service and
acquire by purchase CEPALCO’S assets within PIE-MO. This option should be communicated with
CEPALCO within 24 months before the date of acquisition.

PIA then now contends that CEPALCO was no match to the power demands of the industries in PIE-MO
- PIA applied with the National power corporation or NPC, for direct power connection which was
approved by the NTC.
- One of the companies which entered into an agreement with NPC for a direct sale and supply of power
was FERROCHROME PHILS (FPI).

CEPALCO then now contends that the said agreement with NPC violated its right as the authorized
operator of an electric light, heat, and power system in the area and the NATIONAL ELECTRIFICATION
POLICY, CEPALCO then now filed a civil case against NPC.

However, NPC claimed that it was authorized by its charter to sell electric power “in bulk” to industrial
enterprises.

Lower court decision- Restrained the NPC from supplying power DIRECTLY TO FPI as the lower court
contends that such DIRECT SALE, SUPPLY, AND DELIVERY OF ELECTRIC POWER BY THE NPC TO FPI WAS
VIOLATIVE OF THE RIGHTS OF CEPALCO under its legislative franchise. Hence, it ordered NPC to
permanently desist from effecting such agreement.

Year 1989, THE SC denied the appeal made by NPC on the ground of statutory authority given to NPC as
regards direct supply of power to BOI- enteprises.
- SC emphasized that CEPALCO had not only been authorized by the PHIVDEC INDUSTRIAL AUTHORITY
(PIA) to provide electrical power to PHIVDEC INDUSTRIAL ESTATE; CEPALCO had in fact, supplied the
latters power requirement for the construction of its plant. CEPALCO reliability as a power supplier and
ability to match the NPC rates were never put in issue.

Year 1990, FPI filed a new application for the direct supply of electric power from NPC.
- CEPALCO then now filed a complaint in the RTC of Quezon city for contempt against NPC officials. The
trial court ruled in favor of CEPALCO.
- hence, respondent NPC officials appealed such decision. SC affirmed the decision of the lower court.
- this decision also shows that the arrangement between FPI and CEPALCO to be permanent and without
the intervention of NAPOCOR’s influence or intervention.

NPC hearing committee proceeded with its hearings. However, CEPALCO question the committee’s
jurisdiction.
- in the report presented by FPI that CEPALCO charged higher rates than what the NPC would IF
ALLOWED TO SUPPLY POWER DIRECTLY TO FPI was given weight by the committee. However, the
committee did not agree on the contention that CEPALCO’s unreliability as a power supplier due to lack
of evidence.

FPI is entitled to a direct connection to NPC as applied for considering that CEPALCO is unwilling to
match the rates of NPC for directly serving FPI and that FPI is a duly registered BOI registered
enterprises.
- PD NO. 380 as amended by PD 395: NPC is statutorily empowered to directly service all the
requirements of a BOI registered enterprise.
- considering the "better and priority right" of PIA, the committee recommended that instead of a direct
power connection by the NPC to FPI, the connection should be made to PIA "as a utility user for its
industrial Estate at Tagoloan, Misamis Oriental.

CEPALCO filed with the energy regulatory board (ERB) a petition to order the discontinuance of all
existing direct supply power by the NPC within petitioner’s franchise area.
- ERB ruled that CEPALCO is relatively efficient and reliable as manifested by VERY LOW SYSTEM LOSSES
AND VERY HIGH POWER FACTORS. Hence, CEPALCO IS CAPABLE TO DISTRIBUTE POWER TO ITS
CONSUMERS WITHIN ITS FRANCHISE AREA.
- all direct connection of industries to NPC within the franchise area of CEPALCO is no longer necessary.

During the pendency of the aboitiz case, PIA contracted the NPC for the construction of a 138 kilovolt
transmission line from Namutalan substation to the receiving substation of PIA.
- Thus, CEPALCO filed a petition against the NPC AND PIA specifically praying for the issuance of TRO
which was however denied by the SC.
CEPALCO seeking exclusivity in the distribution of electric power to areas covered by its franchise.
- court ruled that the right of petitioner to supply electric power in the said area had been settled by the
rtc, hence, barred by res judicata.

CEPALCO then now filed an appeal in the CA.

- CA denied. CA ruled that since NPC is a public utility, it enjoys a protective mantle which prohibits court
from issuing a restraining order or prelim injuction INVOLVING INFRASTRACTURE AND NATURAL
RESOURCE DEVELOPMENT PROJECTS, OF, AND OPERATED BY THE GOVT.

HOWEVER, upon MOR, CA set aside its own decision. CA stated that the project proposed by the NPC is
not in furtherance of the public interest but rather intended to serve exclusively the needs of private
entities. MAC AND FERROCHROME. Thus, the CA issued a TRO: to cease and desist from proceeding with
the construction, completion, and operation.

"to determine which entity, the franchise holder or the NPC, has the right to supply electric power to
the entity applying for direct connection,

THE ERB and not the NPC is the admin body. Under PD 1206 as the charter of ERB provides that the
issuance of CPC for the operation of electric power utilities and services, the fixing of standards, etc
- NPC is not an admin body, hence, NPC cannot usurp a power it has never been conferred by its charter
—npc has no power to determine the validity of direct connection agreement it enters into in violation
of a power distributor’s franchise.

THUS, CONSIDERING THAT PIA, ENGAGE IN THE BUSINESS OF PUBLIC UTILITY, IT MUST FIRST APPLY FOR
A CPCN WITH THE ERB.
- ERB is the regulatory board; CEPALCO is the existing, hence should be given notice considering that it is
affected.

Consequently, CA affirmed the dismissal of the petition, annulled and set aside the decision of the
hearing committee of the NPC on direct connection with PIA, and ordered NPC to desist from continuing
the construction of that NPC-natumulan- PHIVDEC138kv tramission line.

NPC requested for an extension to file a proper petition.

In the meantime, PIA filed a MOR of the appellate court’s decision arguing mainly that as they are not a
party between CEPALCO and NPC, it was not bound to its decision. This argument was denied by the CA
on the grounds of stare decisis.

IN GR NO. 112702:
- petitioner NPC claims that CEPALCO is not entitled to relief due to forum-shopping.
CA affirmed the decision of the lower court not because of res judicata but only on one unresolved
issue: Whether NPC has the power to determine the propriety of direct power connection from its lines
to any entity located within the franchise area of another public utility.
Litis pendetia cannot be invoked due to the dismissal of one of the cases cited by NPC.
- Litis pendetia must concur the following requisites:
a. Identity of the parties; b. Identity of rights and relief; c. Identity in the 2 cases – will amount to res
judicata. This is intended to avoid multiplicity of suits.

THE PRINCIPAL AND COMMON ISSUE RAISED IN THESE CONSOLIDATED CASES; Whether or not the
NPC may supply power in the PIE-MO area where CEPALCO has a DIRECT FRANCHISE.
Petitioner PIA asserts that it may receive power directly from the NPC because it is a public utility. It
claims that as PD 538 empowers PIA to be a public utility to operate and serve the power needs within
PIE-MO (a specific area constituting a small portion of petitioner’s coverage.

It should be noted that PIA is a subsidiary of PHIVIDEC with governmental and proprietary functions
pursuant to PD 538. Thus, PIA is authorized to render INDIRECT service to the public by its
administration of the PHIVIDEC industrial areas like the PIE-MO.
- As suggested, a CPC is not necessary for it to avail of a direct power connection from the NPC.
- Such authority may not be exercised in such a manner to prejudice the rights of existing franchisee.

The contract of July 6, 1979 was not renewed. However, such fact would not remove the violation
regarding the contract, its rules and regulation, when PIA applied to NPC for direct power connection.
- this is aggravated by NPC’s favourable decision to PIA.
- it is immaterial whether the direct connection is merely an improvement (mere increase in the
voltage),
- PD 40 provides that distribution of electric power should be regulated by NPC; same pd also provides
that the distribution shall be undertaken by cooperatives, private utilities such as CEPALCO, local govt,
subject to state regulation.

The capability of private entities, such as CEPALCO, can only be determined after a hearing (due
process).
- This was allegedly fulfilled by NPC as they claimed that they already notified CEPALCO.
- However, the SC clarify that NPC IS NOT THE PROPER ADMIN BODY VESTED WITH AUTHORITY TO
CONDUCT A HEARING.

CEPALCO also stated that NPC is not the proper authority to conduct a hearing; it stated in the CA that
ERB is the proper admin body.
Upon the effectivity of RA No. 7638, the issue of whether or not the non-power rate powers and
functions of the ERB are included in the jurisdiction of the DOE.
- This was answer in the affirmative; the price jurisdiction, powers, and functions are clearly transferred
to DOE.
- the parameter of the said transfer is circumscribed by section 3 of EO No. 172; thus the other related
functions of ERB which is not under section 3, is not included in the transfer.

RA NO. 7638 impliedly repeal all provisions under EO 172 that are inconsistent with the policy of the
said RA.
- HENCE, SC STATED THAT ONLY THOSE UNDER SECTION 3 OF EO. 172 is transferred.
THUS, the determination of which the 2 public utility has the right to supply power to an area within the
coverage of BOTH is NOT A FIX-RATE function, thus, it should be under ERB and not DOE.
Hence, the claim of NPC that is has the authority to entertain direct connection applications as part of its
express authority to sell electric power bulk IS NOW BASELESS. THEY HAVE NO AUTHORITY AT ALL; NON
FIXING RATE IS NOT WITHIN THEIR JURISDICTION AT ALL, EVEN WITHOUT THE LEGISLATIONS
MENTIONED.

SC ALSO CLARIFIED that a public hearing WOULD NOT UNDULY PREJUDICE CEPALCO, AS COURT, BASING
ON PREVIOUS DECISION, IS NOT IN FAVOR OF EXCLUSIVITY OF FRANCHISE IN PUBLIC UTILITY.

EXCLUSIVITY IS ONLY GIVEN WHEN THE PRESENT COMPANY IS ABLE, SELF-SUFFICIENT, AND CAN MEET
THE PUBLIC DEMANDS/INTERESTS.
- It is to be noted that monopoly is explicitly mentioned in the consti that is within the regulatory power
of the state.

Hence, both petition are denied. THE DOE is directed to conduct a hearing which of which should supply
electric power to the industries of PIE-MO or PHIVDEC industrial estate-misamis oriental

IS IT CEPALCO OR THE NPC?

VDA. DE LAT ET AL VS THE PUBLIC SERVICE COMMISSION AND DIAZ

This is a petition for review of the decision of the PSC which granted private respondent DIAZ a CPC.

FACTS: Year 1970, private respondent DIAZ filed an application with PSC for a CPCN to operate and
maintain an ICE PLANT SERVICE IN DAVAO CITY where he alleged that he is financially capable to
OPERATE AND MAINTAIN SUCH PUBLIC UTILITY; he further claimed that the public necessity and
convenience will be promoted with the approval of his application. The application was published in 2
newspaper of general circulation which are EL DEBATE and THE PHILIPPINES HERALD.

SAID APPLICATION WAS ALSO SENT TO PETITIONERS VDA. DE LAT ET AL as they the affected operators
regarding the said application. Thus, petitioner VDA. DE LAT, filed a petition opposing the application of
respondent DIAZ.

However, when the case was set for hearing; petitioners failed to attend—hence, the court allowed
respondent DIAZ to present its evidence. Hence, the petitioners claimed that they had filed an urgent
motion for postponement as their counsel made a mistake of noting down the schedule. Hence,
petitioner filed a petition to re-open the case. However, on the same day, PSC also granted a
PROVISIONAL AUTHORITY (DIFFERENT FROM TEMPORARY PERMIT), to operate the ICE PLANT FOR 6
MONTHS. The commission stated that there was indeed an urgent need for an ice plant in DAVAO CITY.
The provisional authority granted was extended twice.

Thus, the PSC GRANTED A CPC TO OPERATE A 2-TON ICE PLANT IN DAVAO CITY.

In the present petition, petitioners are asking for the nullification of said CPC granted by the PSC to
private respondent DIAZ to rendered it null and void and it was granted without due process as they are
deprived to be present in the hearing and deprived to cross-examine the witnesses of private
respondent. ALSO, THEY CLAIMED THAT THIS WILL JUST AMOUNT TO COMPETITION THAT WOULD
DAMAGE THEIR BUSINESS.

2 ISSUES RAISED IN THIS PETITION: WHETHER OR NOT PETITIONERS WERE DEPRIVED OF THEIR DAYS IN
COURT;
WHETHER OR NOT THE PRIVATE RESPONDENT WAS VALIDLY AWARDED A CPC TO OPERATE AN ICE
PLANT IN DAVAO CITY.

HELD: SC held that the first issue is without merit. SC stated that they were given notice and opportunity
to be heard; private respondent also complied with due process as there was indeed a publication.

SC stated that petitioners should have known the date of the hearing; their execuses cannot be
tolerated. There are 3 oppositors, SC stated that it is unbelievable that none of them found out about
the mistake in the schedule.

ON THE SECOND ISSUE, SC STATED THAT PSC TAKE THEIR TIME PRIOR GRANTING THE CPC; AS THEY
GRANTED FIRST PROVISIONAL AUTHORITY PRIOR GRANTING CPC.

SC also clarified that Private respondent DIAZ deserves to be awarded the CPC.
DIAZ satisfied all the requisites needed.
a. The applicant must be a citizen of the Philippines or at least 60% of its capital is known by Filipino
citizen; b. applicant must be financially capable of undertaking the proposed service and meeting the
responsibilities incident to its operation; c. The business sought will promote the public interest.

SC stated that there is no doubt that all these requisites are present kay DIAZ.

His financial capability and the public necessity of the ice plant do not have any doubt at all:
- he is a co-owner of a parcel of land with a reasonable market value.
- he is also engaged in the fishing business.
- the oppositors only are only serving mere 1/3 of the population.

it is apt to stress the principle that nobody has the exclusive right to secure a franchise or a Certificate
of Public Convenience. The paramount consideration should always be the public interest and public
convenience.

The grant of CPC, as claim by petitioners, would result to competition, is not meritorious.
- the grant is only a 2 ton ice plant and only in Davao City. The petitioners are serving almost 63 tons of
ice daily who operates not just in davao city.

the opponent would be deprived of their profits on the capital invested in its business. The mere
possibility of reduction in the earnings of a business is not sufficient to prove ruinous competition. It
must be shown that the business would not have sufficient gains to pay a fair rate of interest on its
capital investments.

The decision is hereby affirmed.

SANTIAGO DIVINAGARCIA VS CONSOLIDATED BROADCASTING SYSTEM INC AND PEOPLES
BROADCASTING SERVICE INC

FACTS: