Operation and Interference Standards
- Stations must be operated to minimize interference with frequencies of existing or future stations.
- The grantee retains the right to use its frequencies without diminishing transmission or reception quality.
Regulatory Compliance and Approvals
- The grantee must secure permits and licenses from the National Telecommunications Commission (NTC) before construction and operation.
- Unauthorized use of frequencies is prohibited.
- The NTC must not unreasonably delay or withhold approvals.
Public Service Obligations
- The grantee must provide adequate airtime for government to air important public information.
- Programming must be sound, balanced, honest, and educational.
- Stations must avoid broadcasting obscene, indecent, false information, or content inciting subversion or treason.
Government's Special Rights
- The President may temporarily take over, suspend, or authorize government use of the stations during war, rebellion, emergencies, etc., with due compensation.
- The radio spectrum is a state-owned limited resource; usage privileges may be withdrawn after due process.
Franchise Duration and Revocation Conditions
- The franchise term is 25 years from effectivity, unless revoked sooner.
- Ipso facto revocation occurs if the grantee: (a) fails to start operations within one year after NTC permit approval; (b) ceases operations for two continuous years; or (c) fails to commence operations within three years from the act's effectivity.
Acceptance of Franchise
- The grantee must accept the franchise in writing within 60 days of effectivity.
- Non-acceptance voids the franchise.
Bond Requirement
- The grantee must post a bond in favor of the NTC to guarantee compliance with franchise conditions.
- The bond amount is determined by NTC.
- Fulfillment of conditions after three years leads to bond cancellation; failure results in forfeiture and franchise revocation.
Tax Obligations
- The grantee pays taxes on real estate, buildings, and personal property like other entities.
- Additional payment of value-added tax or a 5% franchise tax on gross receipts of broadcasting business, whichever is higher.
- Income tax obligations remain under existing laws.
- Tax filings and payments are made to the Commissioner of Internal Revenue and subject to audit.
Self-Regulation and Broadcast Content Control
- No prior censorship is required before broadcasts.
- However, the grantee must cut off broadcast if content incites treason, rebellion, sedition, or is indecent/immoral.
- Failure to do so is grounds for franchise cancellation.
Liability Warranty to Governments
- The grantee holds national and local governments harmless from claims or injuries due to construction or operation of its stations.
Restrictions on Transfer and Ownership Changes
- The franchise or rights cannot be leased, transferred, sold, assigned, merged, or have controlling interest transferred without prior Congressional approval.
- Any successor entity is subject to the same conditions and restrictions.
Ownership Dispersal Requirements
- At least 30% of outstanding capital stock must be offered in a Philippine securities exchange within 5 years after attaining the status of a national broadcasting network (three or more stations).
- Noncompliance results in ipso facto revocation.
Compliance with Future Broadcast Policy Laws
- The grantee shall adhere to any general broadcast policy law enacted by Congress.
Separability Clause
- Invalidity of any section does not affect the validity of other provisions.
Repealability and Nonexclusivity
- Congress may amend, alter, or repeal the franchise as public interest requires.
- The franchise is not exclusive.
Annual Reporting Requirement
- The grantee must submit an annual report to Congress within 60 days after each year-end detailing compliance with franchise terms and operations.
Effectivity of the Act
- The act takes effect 15 days after publication in two or more newspapers of general circulation.
- The law lapsed into effect without the President's signature per constitutional provision.