Republic Act No. 2612

The President of the Philippines is hereby authorized to negotiate and contract with the Export and Import Bank of Tokyo, Japan, or with any other foreign financial institutions or foreign manufacturing corporations or their duly authorized agents, in the name and on behalf of the Republic of the Philippines, one or several loans not to exceed twelve million dollars for the purpose of financing a nationwide telecommunications expansion and improvement project of the Republic of the Philippines.

The President of the Philippines is hereby further authorized to guarantee, absolutely and unconditionally, as primary obligor and not as surety merely, in the name and on behalf of the Republic of the Philippines, the payment of the loan or loans herein authorized as well as the performance of all or any of the obligations undertaken by the Republic of the Philippines in the territory of said Republic pursuant to loan agreements entered into with the Export and Import Bank of Tokyo, Japan, or with any other foreign financial institutions or foreign manufacturing corporations or their duly authorized agents, for the implementation of the nationwide telecommunications expansion and improvement project provided for in this Act.

Pursuant to the authority granted under sections one and two of this Act, the President of the Philippines is empowered to enter into agreements with the Export and Import Bank of Tokyo, Japan, or with any other foreign financial institutions or foreign manufacturing corporations or their duly authorized agents, or such terms and conditions as he shall deem proper to effectuate the purposes of this Act.

The total principal amount of loans contracted or guaranteed by the Republic of the Philippines pursuant to the provisions of this Act shall not exceed the sum of twelve million dollars in currency of the United States of America, or its equivalent in other countries.

There is hereby created a committee with the Deputy Auditor General as chairman, and the Deputy Commissioner of the Budget, the Director of the Bureau of Telecommunications, the Secretary of General Services and the Chairman of the National Power Board, as members, which shall make a canvass of the prices of the telecommunications equipments required in this Act and to recommend for approval by the President the procurement by public bidding of only such equipments as the prices and quality thereof are most favorable to the government: Provided, That in case of public bidding, such bidding shall be done in the Philippines.

Any agreement entered into pursuant to the provisions of this Act may provide that such agreement, and all payments made pursuant thereto, shall be exempt from all taxes, contributions and restrictions of the Republic of the Philippines, its provinces, cities and municipalities.

Any such loans or loans, shall be exempt from taxes, duties, fees, imposts, charges, contributions and restrictions of the Republic of the Philippines, its provinces, cities and municipalities.

Telecommunications equipment and accessories of the latest model and brand new procured and imported under this Act shall be exempt from all taxes, duties, fees, imposts, charges, contributions and restrictions of the Republic of the Philippines, its provinces, cities and municipalities.

The Bureau of Telecommunications shall handle the execution of the nationwide telecommunications expansion and improvement project provided for in this Act and shall be responsible for its subsequent operation: Provided, That the projects in the municipalities and barrios shall be installed with the consent of the municipal council and barrio council concerned.

The funds needed by the Bureau of Telecommunications as peso counterpart fund for the nationwide telecommunications expansion and improvement project provided for in this Act shall be taken from economic development bonds issued under Republic Act Numbered One thousand and from other fund sources of the Republic of the Philippines.

This Act shall take effect upon its approval.