<SEC-DOCUMENT>0001193125-12-346184.txt : 20120928
<SEC-HEADER>0001193125-12-346184.hdr.sgml : 20120928
<ACCEPTANCE-DATETIME>20120809111338
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001193125-12-346184
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20120809

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PHILIPPINE LONG DISTANCE TELEPHONE CO
		CENTRAL INDEX KEY:			0000078150
		STANDARD INDUSTRIAL CLASSIFICATION:	TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
		BUSINESS PHONE:		0116328143552

	MAIL ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
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<TITLE>Correspondence</TITLE>
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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>P<SMALL>HILIPPINE</SMALL> L<SMALL>ONG</SMALL> D<SMALL>ISTANCE</SMALL>
T<SMALL>ELEPHONE</SMALL> C<SMALL>OMPANY</SMALL> <SMALL>HAS</SMALL> <SMALL>CLAIMED</SMALL> <SMALL>CONFIDENTIAL</SMALL> </B></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><SMALL>TREATMENT</SMALL> <SMALL>OF</SMALL> <SMALL>PORTIONS</SMALL> <SMALL>OF</SMALL> <SMALL>THIS</SMALL> <SMALL>LETTER</SMALL>
<SMALL>IN</SMALL> <SMALL>ACCORDANCE</SMALL> <SMALL>WITH</SMALL> 17 C.F.R. &#167; 200.83 </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">August&nbsp;9, 2012 </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><U>Via EDGAR </U></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Mr.&nbsp;Larry Spirgel
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Assistant Director </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Division of
Corporation Finance </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Securities and Exchange Commission </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2">100 F Street, N.E. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Washington, D.C. 20549 </FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">United States of America </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Re:</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Philippine Long Distance Telephone Company</B> </FONT></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Annual Report on Form 20-F for the Fiscal Year </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><U>ended December&nbsp;31, 2011
filed on March&nbsp;28, 2012 (File No.&nbsp;001-03006)</U> </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Dear Mr.&nbsp;Spirgel: </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">This is in response to the comment letter of the Staff (the &#147;Staff&#148;) of the Securities and Exchange Commission (the
&#147;Commission&#148;), dated July&nbsp;12, 2012, relating to the Annual Report on Form 20-F of Philippine Long Distance Telephone Company (the &#147;Company&#148;) for the fiscal year ended December&nbsp;31, 2011 (the &#147;2011 Form 20-F&#148;),
which was filed with the Commission on March&nbsp;28, 2012. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">For your convenience, the Company has included the Staff&#146;s
comments in this response letter in italicized form and keyed its responses accordingly. The Company&#146;s responses to the comments are set forth below. The page numbers in the responses, unless otherwise indicated, refer to the page numbers of
the 2011 Form 20-F. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I><U>Notes to Consolidated Financial Statements, page 188 </U></I></B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Note 26. Provisions and Contingencies, page 288 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>1.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We refer to your disclosure in the last sentence of the note on page 294 indicating that certain disclosures required by IAS 37 were not provided as it may prejudice
your position in ongoing claims, litigations and assessments. IAS 37, paragraph 92, indicates that the omission of the required disclosures may occur in extremely rare cases. In that regard, tell us the reason why you are unable to provide all of
the required disclosures in aggregate by class. Also tell us the aggregate amount of provisions you have accrued as of December&nbsp;31, 2011 and 2010 related to contingencies. </I></FONT></TD></TR></TABLE>

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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Mr. Larry Spirgel</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2"> -
 2
 -</FONT></TD></TR></TABLE> <p STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Staff&#146;s comment is acknowledged. The Company respectfully advises the Staff
that the Company believes it has made the requisite disclosures in accordance with International Accounting Standard 37 (&#147;IAS 37&#148;). In Note 26 to the financial statements of the 2011 Form 20-F, the Company disclosed the general nature and
status of the Company&#146;s claims, litigations and assessments for which provisions have been accrued<B>.</B> The Company has omitted certain disclosures required by IAS 37, specifically paragraphs 84 (a), 84 (b), 84 (e), and 86-88 by electing for
an exemption from disclosure as permitted under IAS 37, paragraph 92, which permits the Company to withhold disclosure in cases where such disclosure could be expected to seriously prejudice the position of the Company in connection with a dispute
relating to the subject matter of the provision or contingent liability with other parties, as discussed further below. </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">[CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FURNISHED SEPARATELY TO THE SECURITIES AND EXCHANGE COMMISSION] </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The amount of aggregate accrued provisions principally consist of provisions relating to supervision and regulation fees of the National
Telecommunications Commission of the Philippines (the &#147;NTC&#148;) that are currently being disputed by the Company, as well as local and franchise taxes assessed by the local governmental units, such as state and municipal tax authorities (the
&#147;LGUs&#148;), that are currently being disputed by the Company. As a result of certain ambiguities in, as well as the uncertain application of, the applicable Philippine laws relating to the NTC fees and local and franchise taxes, the extent of
the Company&#146;s actual liability to the NTC and the LGUs for such fees and taxes is unclear. Management of the Company has determined that a portion of such fees and taxes qualifies for recognition as provisions under IAS 37, paragraph 14, and
has made a reasonable calculation of the amount of such provisions in consultation with its internal counsel and external counsel in the Philippines. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">The Company supplementally advises the Staff that it believes public disclosure of its aggregate accrued provisions during the pendency of its proceedings with the NTC and the LGUs could be expected to
seriously prejudice the position of the Company in such proceedings. As one of the largest telecommunication services providers for both fixed line and cellular telecommunications services, and as one of only three major local exchange carriers and
the owner of two of the three major cellular operators in the Philippines, the Company is frequently scrutinized, and subject to assessments, by the NTC and the LGUs. In particular, disputes with respect to such assessments account for a significant
portion of the Company&#146;s outstanding disputes. [CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FURNISHED SEPARATELY TO THE SECURITIES AND EXCHANGE COMMISSION] The Company&#146;s situation with the NTC and the LGUs represents an appropriate
circumstance under IAS 37, paragraph 92 whereby the omission of the disclosure would be permitted, given the nature of the Company&#146;s ongoing disputes, the counterparties involved and the industry (and the Company&#146;s position within such
industry). Moreover, the Company notes that neither of the other two major Philippine local exchange carriers nor the other major cellular operator discloses their accrued provisions for claims, litigations and assessments in their financial
statements. </FONT></P>

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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Mr. Larry Spirgel</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2"> -
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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">As a result of the foregoing, the management of the Company, in consultation with the
Company&#146;s internal counsel and external counsel in the Philippines, and having discussed with and received confirmation from the Company&#146;s audit committee, has concluded that it would be appropriate for the Company to avail itself of the
exemption from disclosure provided by IAS 37, paragraph 92. As required pursuant to IAS 37 in connection with the paragraph 92 exemption, the Company has provided in Note 26 to its consolidated financial statements the required disclosure of the
general nature of the dispute and the fact that, and the reason why, the generally required information has not been disclosed. In consideration of the foregoing, the Company believes it has made the requisite disclosures in accordance with IAS 37.
</FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">*&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;&nbsp;&nbsp;* </FONT></P>

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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Mr. Larry Spirgel</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2"> -
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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In connection with responding to the Staff&#146;s comments, the Company hereby
acknowledges that: </FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="3%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the Company is responsible for the adequacy and accuracy of the disclosure in the filings; </FONT></P></TD></TR></TABLE>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the Staff&#146;s comments or changes to disclosure in response to the Staff&#146;s comments do not foreclose the Commission from taking any action with
respect to the filings; and </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="3%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the Company may not assert the Staff&#146;s comments as a defense in any proceeding initiated by the Commission or any person under the federal
securities laws of the United States. </FONT></P></TD></TR></TABLE> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Thank you again for your time. Please feel free to contact Michael G.
DeSombre of Sullivan&nbsp;&amp; Cromwell (tel: (+852)&nbsp;2826 8696; fax: (+852)&nbsp;2826 1774; e-mail: desombrem@sullcrom.com), or the undersigned by phone at (+632)&nbsp;816 8534 or by e-mail at jacabal@pldt.com.ph, with any questions you may
have. </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P><DIV ALIGN="right">
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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Sincerely,</FONT></TD></TR>
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<TD HEIGHT="16"></TD></TR>
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<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:1px;border-bottom:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/ June Cheryl A. Cabal-Revilla</FONT></P></TD></TR>
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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">June Cheryl A. Cabal-Revilla</FONT></TD></TR>
<TR>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">First Vice President and Controller</FONT></TD></TR>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">cc:</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Terry French, Accounting Branch Chief </FONT></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Leigh Ann Schultz </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(Securities and Exchange Commission) </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Napoleon L. Nazareno, President and Chief Executive Officer </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Ma. Lourdes C. Rausa-Chan, Senior Vice President and Corporate Secretary </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Anabelle
Lim-Chua, Senior Vice President and Treasurer </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(Philippine Long Distance Telephone Company) </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Michael G. DeSombre </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Frank Yihe Jin </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(Sullivan&nbsp;&amp; Cromwell) </FONT></P>
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