CUC tasked to regulate prepaid phone cards
The Senate yesterday set the initial step in clamping down on illegal prepaid telephone service providers in the CNMI with the passage of a proposed law that will regulate the sector and protect the public from fraudulent businessmen on the island.
Senate President Paul A. Manglona and Sen. Juan P. Tenorio co-sponsored the bill authorizing the Commonwealth Utilities Corporation to promulgate rules and regulations governing the operations of prepaid phone cards here.
The measure will also assess registrations fees of $200 for establishment of this type of business, while assessing penalties for illegal activities of up to $5,000 and/or imprisonment of up to five years once the court finds the operator guilty of felony charges.
Senate Bill 11-149, passed 9-0 during a session yesterday, will affect every entity offering to provide prepaid calling card services over its own telecommunications networks or through resale of services obtained from another service provider.
According to the Legislature’s findings, sale of these cards has jumped in recent months and its growth has continued despite the absence of government regulations. It did not provide figures.
Prepaid phone cards are available in convenient stores, but customers who purchase these items have no means of recourse if these were found to be fraudulent.
“The inability for a consumer to hold their prepaid phone card service provider responsible for service failures prompts CNMI to introduce the regulatory standards… which will benefit the consumer and provide guidelines for start-up businesses,” according to the bill.
Tenorio stressed in an interview the need to subject these companies to the regulations of the Federal Communications Commission to ensure they comply with the U.S. requirements.
“They should be licensed here to do business and be subjected to FCC regulations,” he told reporters. “We are losing revenues too (since) a lot of these companies are underground.”
The filing of the legislation in the Senate came as a surprise as the House of Representatives has begun its investigation into the proliferation of these cards.
Rep. David M. Apatang, who chairs the House Committee on Public Utilities, Transportation and Communications, has met with various government officials and representatives of major phone companies to address mounting concerns with the mushrooming of this type of service.
In previous interviews, the legislator has said he would introduce legislation to regulate the sector and allow the government to issue permits and collect taxes.
Prepaid cards currently available in the market carry toll-free numbers which one must dial first before you get connected and are priced much lower than prevailing rates of existing phone companies such as IT&E, MTC and MPCI.
Popular among the thousands of nonresident workers on the island, these cards can readily be bought in stores for less than $10 and be used for as much as 40 minutes for calls to the Philippines, or nearly two hours for mainland or Guam connection.
