"The chilling effect argument is the one that matters most to journalists like me."
The Supreme Court has no jurisdiction to cancel the franchise of ABS-CBN Corp., the company said in its comment filed with the high court, on the quo warranto petition of the government, through the solicitor general, to revoke the Lopez-owned company’s television franchise.
ABS-CBN was being technical in its argument. The rules of court on quo warranto, it explained, do not cover misuse, abuse of public office, position or franchise. “Significantly, Rule 66 of the 1997 Rules does not provide for the revocation or forfeiture of the franchise,” the comment said.
Congress is the one empowered to revoke the respective legislative franchises of the respondents (ABS-CBN and its telco company, ABS-CBN Convergence). Granting the petition would violate the fundamental principle of separation of powers.
ABS-CBN pointed out: “The filing of the Petition directly with this Honorable Court violates the doctrine of hierarchy of courts. It also disregards the fundamental rule that this [Supreme] Court is not a trier of fact. The Republic violated the doctrine of hierarchy of Courts.”
Among the “facts” to be resolved, per ABS-CBN:
• Who offered the KBO to the viewing public;
• Whether the KBO offerings were authorized by the NTC;
• Whether there was a transfer of controlling interest in Multi-Media Telephony Inc. (now Respondent Convergence) or of its franchise;
• Whether Convergence could have complied with the requirements for the listing of its shares with the Philippine Stock Exchange;
• Whether stockholder rights were granted to holders of the ABS-CBN PDRs; and
• Whether the Securities and Exchange Commission (“SEC”) approved the issuance and sale of the PDRs.
Contrary to SolGen Jose Calida’s allegations before the SC, the company said ABS-CBN did not violate its legislative franchise in offering Kapamilya Box Office (“KBO”) on its digital terrestrial television service, “TVPlus.” ABS-CBN Convergence did not violate its franchise.
ABS-CBN explained that while TVPlus was and is an ABS-CBN service, KBO was not when it was launched. KBO was a value-added service (“VAS”) of Convergence.
ABS-CBN only started offering KBO when Convergence suspended its operations. NTC approved the KBO offerings.
ABS-CBN is not prohibited by law, including its legislative franchise, from providing pay-per-view services alongside its “free-to-air” channels through the frequencies assigned to it by NTC itself.
Meanwhile, the ABS-CBN Philippine Depository Receipts (“PDRs”) do not violate the foreign ownership restriction under the Constitution or the conditions of ABS-CBN’s franchise. The Constitution requires 100-percent Filipino ownership of media companies.
Finally, ABS-CBN said, “the [SolGen] Petition, if granted, will have a chilling effect on the press.”
And, assuming that respondents (ABS-CBN and Convergence) committed the violations alleged in the Petition, the Republic’s remedy lies before
administrative tribunals, the company said. Among these agencies are: the Securities and Exchange Commission, the National Telecommunications Commission, and the Philippine Competition Commission.
Whether ABS-CBN operated a pay-per-view channel through free-to-air signals, and whether ABS-CBN “monopolize[s] the frequencies or airwaves” through its investment in Amcara, are matters within the exclusive primary jurisdiction of the NTC and the PCC, ABS-CBN said.
On the other hand, issues on the purported transfer of Convergence’s legislative franchise without Congressional approval, and its failure to offer its shares to the public, should have been left to Congress. Congress can, in turn seek the assistance of the NTC and the SEC, as well as the PSE, in resolving these issues, ABS-CBN said.
On ABS-CBN PDRs, the Republic should have referred the matter to the SEC for investigation and action, as the SEC is “the government agency invested with the jurisdiction to determine at the first instance the observance by a public utility of the nationality requirement prescribed vis-à-vis the ownership of public utilities,” ABS-CBN said.
The TV company recalled that the Honorable Court’s refusal to look into the legality of the sale of the PLDT shares despite the Constitution’s nationality requirements for public utilities, proves that the issue was not compelling enough to disregard the hierarchy of courts.
PLDT is controlled by the Salim group of Indonesia.
Whatever the arguments of both sides, SolGen and ABS-CBN, the chilling effect argument is the one that matters most to journalists like me.
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