PLDT Inc. on Friday warned it would terminate its service agreement with DITO Telecommunications Corp. for the latter’s alleged failure to settle arrears amounting to more than P400 million.
PLDT, the country’s largest telecom company, said it served a notice of material breach and demand for payment on DITO “for refusing to pay P429.72 million worth of contracted services which the company has fully performed and delivered, relating to the building and provisioning of transmission facilities that DITO required and is using for the delivery of telecommunication services to subscribers”.
“DITO has 30 days from receipt of the notice of material breach or until Nov. 4, 2022, to remedy the breach and pay the P429.7 million owed to PLDT, otherwise PLDT will exercise all of its rights under the law and contract to protect its interests, including suspension or termination of the parties’ service agreement,” the company said.
PLDT’s wireless unit Smart Communications and DITO signed an interconnection agreement in February 2021 to allow inter-network calls between their respective subscribers.
Representatives from DITO were unavailable for comments as of press time
Globe Telecom earlier said that DITO also owed P622 million in bypass compensation for interconnection violations. Globe said there were “fraudulent calls” made using DITO’s network to Globe which bypassed “proper voice traffic channels”.
Globe said that as the aggrieved party, it was entitled to bypass compensation as stipulated in the agreement. DITO refused to compensate Globe for such violations, Globe said.
DITO filed a complaint with the Philippine Competition Commission in August against Globe and Smart for anti-competitive behavior.
DITO alleged that Smart and Globe blocked about 70 percent to 80 percent of calls made by its subscribers to the rival networks.
DITO chief administrative officer Adel Tamano said Section 15 (C) of the Philippine Competition Act deems there is abuse of dominant position when a dominant entity makes a “transaction subject to acceptance by the other parties of other obligations which, by their nature or according to commercial usage, have no connection with the transaction.”
Smart described DITO’s filing of the complaint with the PCC as forum-shopping.
Smart said DITO “failed to prevent its network from being misused for fraud, with DITO SIMs masking international calls as domestic, resulting in huge monetary losses for Smart.”