QuestionsQuestions (Republic Act No. 7816)
RA 7816 grants the Manila Broadcasting Company (grantee) the franchise to construct, install, operate, and maintain radio and television broadcasting stations in the Philippines for commercial purposes and in the public interest, including technological auxiliaries/facilities, special broadcast and other broadcast distribution services and relay stations, and communication facilities for the grantee’s private use in its broadcast services, subject to the Constitution and applicable laws.
The grantee must construct and operate its stations in a manner that results in only the minimum interference with wavelengths/frequencies of other existing (and future) stations, without diminishing its own right to use selected wavelengths/frequencies and without impairing the quality of transmission/reception, so as to maximize rendition and/or availability of its services.
The grantee must secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for its stations and must not use any frequency in the radio and television spectrum without authorization by the NTC. The NTC must not unreasonably withhold or delay authority.
The grantee must: provide reasonable public service time to enable government access to the population on important public issues; provide sound and balanced programming; promote public participation such as community programming; assist public information and education functions; conform to the ethics of honest enterprise; and must not broadcast obscene/indecent content, deliberately false information/willful misrepresentation to the detriment of public interest, or content that incites/encourages/assists subversive or treasonable acts.
In times of rebellion, public peril, calamity, emergency, disaster, or disturbance of peace and order, the President may temporarily take over and operate the stations, temporarily suspend operation of any station for public safety/security/public welfare, or authorize temporary government use and operation of the stations upon due compensation to the grantee.
The franchise term is 25 years from the date of approval of the Act unless sooner revoked or cancelled. If the grantee fails to operate continuously for two (2) years, the franchise is deemed ipso facto revoked.
Acceptance must be given in writing within 60 days after approval of the Act. Upon acceptance, the grantee may exercise the franchise privileges. Non-acceptance renders the franchise void.
The grantee pays the same taxes on real estate/buildings/personal property exclusive of the franchise as other entities pay. In addition, it pays a franchise tax equivalent to 3% of all gross receipts of the radio/TV business transacted under the franchise, in lieu of all taxes on the franchise or earnings thereof. However, income taxes under Title II of the NIRC pursuant to Section 2 of Executive Order No. 72 remain payable unless amended or repealed.
The grantee must file the tax return and pay the tax due with the Commissioner of Internal Revenue or authorized representatives according to the NIRC, and the return is subject to audit by the Bureau of Internal Revenue.
Section 9 references the constitutional mandate to democratize ownership of public utilities. The grantee must continue to maintain its status as a publicly-held corporation.
RA 7816 prohibits the grantee from requiring any previous censorship of any speech/play/act/scene or other matter to be broadcast/telecast. However, during any broadcast, the grantee must cut off from the air content if its tendency is to propose/incite treason, rebellion, or sedition, or if the language/theme is indecent or immoral. Willful failure to do so is a valid cause for cancellation of the franchise.
The grantee must hold the national, provincial, and municipal governments harmless from claims, accounts, demands, or actions arising out of accidents or injuries (to property or persons) caused by the construction or operation of its stations.
The grantee may not lease, transfer, grant usufruct of, sell, or assign the franchise or rights/privileges acquired thereunder, nor merge with another corporation/entity without prior approval of Congress. Any transferee/assignee must be subject to the same conditions/limitations of the Act.
If any section or provision is held invalid, the rest of the provisions not affected by the invalidity remain valid.
The grantee must comply with and be subject to a future general broadcast policy law that Congress may enact. This means the franchise is not insulated from future broadcast policy regulations passed by Congress.
Section 15 provides that the franchise may be amended/altered/repealed by Congress when public interest requires and is not an exclusive grant. Section 16 provides effectivity 15 days from publication in at least two newspapers of general circulation.