By Alena Mae S. Flores | Posted on Sep. 02, 2013 at 12:02am
SM Investments Corp. is cautiously studying its exposure in the power generation industry, because of the cross ownership restrictions provided under the Electric Power Industry Reform Act of 2001.
SMIC chief finance officer Jose Sio said the conglomerate was interested in investing in the power generation business, but was studying the provisions of Epira on cross ownership.
“There are power generation, distribution… What we’re interested in is power generation,” Sio said.
Sio said the company hoped to resolve issues raised on conflicts of ownership between SMIC and National Grid Corporation of the Philippines, the operator of the power transmission network.
National Grid is controlled by the group of businessmen Henry Sy Jr. who also sits at the board of SM Investments. “That’s the area that we want to resolve. So we will see,” he said.
Section 45 of the Epira law on cross ownership, market power abuse and anti-competitive
behavior stated that no power generation company could hold an interest in the National Transmission Corp. or its concessionaire.
“No generation company, distribution utility, or its respective subsidiary or affiliate or stockholder or official of a generation company or distribution utility, or other entity engaged in generating and supplying electricity specified by ERC within the fourth civil degree of consanguinity or affinity, shall be allowed to hold any interest, directly or indirectly, in Transco or its concessionaire,” it said.
“Likewise, the Transco, or its concessionaire or any of its stockholders or officials or any of their relatives within the fourth civil degree of consanguinity or affinity, shall not hold any interest, whether directly or indirectly, in any generation company or distribution utility,” the law said. source
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