Section 18Sec./Art. 18

Sale, Lease, Transfer, Grant of Usufruct, Or Assignment of Franchise.

The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign this franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation or other commercial or legal entity, nor merge with any other corporation or entity, nor transfer the controlling interest of the grantee, whether simultaneously or contemporaneously, to any person, firm, company, corporation, or entity without the prior approval of the Congress of the Philippines and compliance with legal requirements stipulated in the other statutes: Provided, That the foregoing limitations shall not apply to any: (1) transfer or issuance of shares of stock in the implementation of requirements for the dispersal of the grantees ownership pursuant to Section 19 of this Act; (2) transfer or sale of shares of stock to an investor or investors; (3) issuance of shares of stock to any investor out of the unissued authorized capital stock of the grantee or pursuant to or in connection with any increase in the grantees authorized capital stock which shall result in the dilution of the stockholdings of the grantees then existing stockholders; (4) combination thereof where such transfer, sale, or issuance is effected in order to enable the grantee to raise the necessary capital or financing for the provision of any of the services authorized by this Act or carry out any of the purposes for which the grantee has been incorporated or organized; (5) sale, transfer, or assignment by the stockholders of the grantee in favor of a holding company, the controlling stockholders of the grantee: Provided, further, That any such transfer, sale, or issuance in accordance with any applicable constitutional limitation.

The grantee shall inform Congress, through the Office of the

Speaker of the House of Representatives and the Office of the Senate President, of any sale, lease, transfer, grant of usufruct, or assignment of franchise or the rights and privileges acquired thereunder, or of the merger or transfer of the controlling interest of the grantee, within sixty (60) days after the completion of the said transaction. Failure to report to Congress such change of ownership shall render the franchise ipso facto revoked. Any person or entity to which this franchise is sold, transferred, or assigned shall be subject to the same conditions, terms, restrictions, and limitations of this Act.