Issue link: https://digital.shearman.com/i/1425143
S H E A R M A N & S T E R L I N G L L P | 4 3 Despite this, it is thought that the attempted use of legislation to affect a change in the interpretation of the constitution is likely to result in a constitutional challenge if the amendments are passed into law. Foreign investment up to 100 percent is currently permitted where the corporation is engaged in the generation and supply of electricity; however, transmission and distribution are currently restricted and it is thought will remain so under the proposals. One other major issue being debated at the Philippine Senate is the proposal to retain telecommunications under the definition of a public utility. While some senate members have raised security concerns with the proposal to liberalize the sector, business groups are backing the proposed changes for the sake of telecommunications upgrades that they see as critical for maximizing the development potential of other industries. Although SB No. 2094 was certified as urgent by President Rodrigo R. Duterte, discussions in the Senate seem to have hit an impasse. The passage of the proposed amendments to the PSA into law should be a welcome development for foreign investors. However, to attract the levels of foreign investment needed for critical infrastructure, it seems likely that foreign investors will also look beyond the liberalization of these sectors to supporting policies, continued reform in governance and other matters that foreign investors regard as important when making major infrastructure investments. For now, it remains a wait and see situation. Minerva A. Santos S e n i o r P a r t n e r P u n o L a w Philippines T +63 2 8284 6707 masantos@punolaw.com Angelo Francesco F. Herbosa Associate P u n o L a w Philippines T +63 2 8631 1261 afherbosa@punolaw.com David Clinch Partner Singapore T +65 6230 3892 david.clinch@shearman.com