Subject: [NEXTEL-1] Next Mobile submits DOJ report on ownership issue

From: [email-masked]
Date: Wed, 27 Aug 2003 00:21:41 -0400

Next Mobile submits DOJ report on ownership issue 
 
By Mary Ann Ll. Reyes
The Philippine Star 08/27/2003 

Next Mobile (formerly Nextel Communications Phils. Inc. or NCPI) 
submitted yesterday to the congressional committee on transportation 
and communications a copy of the Department of Justice resolution 
dated June 27, 2003 which finally settled the controversy regarding 
NCPI's shareholding structure. 

During yesterday's hearing, Catherine Laurel, Next Mobile director 
for legal affairs, advised the committee of the DOJ's clear and 
categorical findings that foreign ownership in NCPI did not exceed 
the 40 percent legally allowed in public utilities. 

Earlier, Rep. Prospero Nograles filed House Resolution No. 1076 
which seeks to look into allegations that foreigners have more than 
40-percent ownership in NCPI. 

The DOJ earlier dismissed for lack of evidence the complaint filed 
by one Paquito Sta. Maria de Jesus that NCPI's corporate 
shareholders, namely Top Mega, Joyce Link, Gamboa Holdings, and 
Emerald Investments violated the constitutional limitations on 
foreign equity. 

It explained that the "grandfather rule" on foreign equity upon 
which the complaint is based has long been abandoned. It has been 
superseded by the "control test" citing the department's earlier 
opinion rendered Jan. 19, 1989 and is now embodied in the Foreign 
Investments Act of 1991. 

Under the control test, NCPI's corporate shareholders qualify as 
Philippine nationals and the entirety of their respective shares of 
stocks in NCPI is accordingly computed as forming part of the 60-
percent Filipino equity therein, irrespective of whether 40 percent 
of their respective outstanding capital stocks are owned by foreign 
nationals. 

The DOJ further ruled in June that the evidence does not support the 
allegation that Gamboa Holdings and Emerald Investments are dummies 
of Nextel International Inc. (NII), the US-based telecommunications 
giant. 

According to the DOJ, false simulation of the minimum 60- percent 
Filipino equity in NCPI cannot be inferred from the fact that it was 
NII who put up the security collateral for the loaned amount used in 
buying the NCPI shares. Funds used by purchasing shareholders as 
payments for shares of stock bought need not come from their 
personal pockets or savings but may be either proceeds of loans or 
donated amount, the ruling said. It added that donees or borrowers 
then became owners of the money donated or loaned to them and if 
they invest it into shares of stocks, they themselves legally become 
absolute owners thereof. 

Likewise the DOJ stated that the false simulation of Filipino 
ownership cannot be inferred from the fact that it was a foreign 
shareholder who shared most of the funds which Gamboa and Emerald 
used in buying NCPI shares. Ownership or equity in a corporation is 
determined not by the actual amount paid or invested but by the 
number of outstanding shares held by the particular shareholder.

http://www.philstar.com/philstar/News200308270709.htm

------------------------ Yahoo! Groups Sponsor ---------------------~-->
Buy Ink Cartridges or Refill Kits for Your HP, Epson, Canon or Lexmark
Printer at Myinks.com. Free s/h on orders $50 or more to the US & Canada. http://www.c1tracking.com/l.asp?cid=5511
http://us.click.yahoo.com/l.m7sD/LIdGAA/qnsNAA/61FxlB/TM
---------------------------------------------------------------------~->

Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/