Your Condo Developer Could Be Sued for Signing Up With Just One Internet Company. This One Was.
Calling all consumers! There is now a government agency that keeps companies in check in case they threaten to monopolize or abuse a single industry or market. The Philippine Competition Commission (PCC), which was formed in 2016, is an independent government body that promotes “fair market competition,” enabling consumers to gain access to goods and services from multiple providers, thereby eliminating a monopoly in industries.
The PCC has already investigated a number of mergers and acquisitions, the most popular of which was the multimillion-dollar joint venture of Grab and Uber last year. But the government body isn’t investigating only the big names.
Last April 8, the PCC announced it had filed a case against home developer Urban Deca Homes Manila Condominium Corp. and its parent company, listed firm 8990 Holdings Inc., for “imposing a sole internet service provider (ISP) on its residents and tenants” in its condominium property in Tondo, Manila.
"Abuse of dominant position"
Based on the government body’s investigation, Urban Deca Homes Manila and Itech Rar Solutions Inc., a broadband service provider, were found to have an “exclusive deal,” preventing residents of the condo developer from availing of other ISPs, likewise prohibiting other service providers from servicing the potential customers in Urban Deca’s units.
“The probe was triggered by numerous complaints filed by unit owners and tenants of Urban Deca Homes Manila claiming they were prevented from applying for other ISPs when the in-house ‘Fiber to Deca Homes’ service was slow, expensive, and unreliable,” the PCC said in a statement.
Rates of the services were also found to be almost double the cost of other ISPs. For example, “Fiber to Deca Homes” charges P1,249 a month for a broadband connection that promises speeds of up to 2Mbps. For the same amount, residents could've availed of a 5Mbps broadband plan with other networks.
According to the government body, the scheme violates section 15 of the Philippine Competition Act, particularly the provision prohibiting “abuse of dominant position.” This is the first time the PCC has filed a case against any firm or company for breaching the said provision. Any firm, company, or individual found guilty of such an act could face a fine of up to P100 million.
In a disclosure to the Philippine Stock Exchange (PSE), 8990 Holdings Inc. neither confirmed nor denied the allegations as the firm simply acknowledged the case filed against the company.
“The legal team of 8990 Holdings Inc is currently looking into the matter and intends to respond with its verified Answer within forty-five days from receipt of said summons,” the company said.
While nothing has been set in stone, the case filed by the PCC can prove to be critical in the pursuit of future consumer complaints against abusive companies and can be seen as a fair warning to other businesses that monopolies may be harder to impose on the market, even on a smaller scale.