In recent discussions, Surigao del Sur 2nd district Rep. Johnny Pimentel raised concerns about Manila Electric Company’s (Meralco) compliance with its congressional franchise, hinting at potential violations. However, Meralco stands firm in its rebuttal against these allegations.
The crux of the issue revolves around whether Meralco upheld its obligation regarding the annual submission of operational reports in accordance with its congressional franchise. Pimentel, serving as a vice chairman of the House Committee on Legislative Franchises, pointed out that Meralco’s submissions covered solely the years 2018 to 2022, a claim that raises questions about the utility’s adherence to Republic Act (RA) No.9209 enacted in 2003. This act mandates Meralco to furnish Congress with these reports on an annual basis.
“In compliance with Republic Act 9209, submissions should occur yearly. Yet, as confirmed by the Committee Secretariat, reports were only provided for selective years,” Pimentel emphasized during a recent committee hearing, suggesting a breach of Section 14 of Republic Act 9209 by Meralco.
Failure to meet these legal obligations, as stipulated by Republic Act 9209, could serve as grounds for the cancellation or revocation of Meralco’s franchise—a significant concern considering the company’s 20-year franchise history. Pimentel highlighted that Meralco should have submitted a total of 20 reports during this period but, as per records, only seven have been submitted, raising doubts about their adherence to legal requirements.
These concerns have led some House members, notably Santa Rosa lone district Rep. Dan Fernandez, to advocate for the division of Meralco’s extensive franchise into three parts, citing allegations of monopolistic behavior by the utility.
Nevertheless, Meralco’s head of Regulatory Management, lawyer Jose Ronald Valles, vehemently refutes these claims, asserting the company’s consistent compliance with its reportorial obligations. Valles stressed, “Contrary to assertions of non-compliance, Meralco has consistently delivered its annual financial and operational reports since 2002, following the granting of its franchise in 2001.”
Valles further substantiated Meralco’s stance by highlighting the public accessibility of its annual reports, available not only to Congress but also to the Philippine Stock Exchange (PSE) and the Securities and Exchange Commission (SEC). Being a publicly listed entity, Meralco is bound by corporate reportorial standards, ensuring transparency and adherence to regulations.
Meralco, in its defense, emphasizes its strict adherence to the law, operating well within the confines of its franchise while serving approximately 7.6 million customers in the National Capital Region (NCR) and neighboring provinces.
The ongoing debate regarding Meralco’s compliance with its franchise obligations underscores the importance of transparency, legal adherence, and corporate responsibility in the power distribution sector. As discussions persist, a clearer understanding and resolution regarding these allegations will determine the future course for this industry giant.