Manner of operation and frequency use
- The Grantee must construct and operate its stations or facilities in a way that results in only the minimum interference on wavelengths or frequencies of existing stations or other stations that may be established by law.
- Operations must not diminish the Grantee’s own privilege to use its assigned wavelengths or frequencies and must maximize the quality of transmission or reception and the availability of the Grantee’s services.
- The Grantee must secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for construction and operation of its stations or facilities.
- The Grantee must not use any frequency in the radio spectrum without NTC authorization, and the NTC must not unreasonably withhold or delay grant of such authority.
NTC oversight and potential franchise revocation
- If the Grantee violates provisions of the franchise, the NTC may revoke or suspend, after due process, the permits or licenses it issued pursuant to the franchise.
- The NTC may recommend to Congress of the Philippines the revocation of the franchise for any violation of franchise provisions.
- The Grantee must comply with the requirement that any broadcast operation affecting frequencies depends on NTC permits and licenses.
Public service and broadcast standards
- The Grantee must provide free of charge adequate public service time that is reasonable and sufficient for the government, through the Grantee’s broadcasting stations or facilities, to reach the pertinent populations or portions thereof on important public issues.
- The Grantee must relay important public announcements and warnings concerning public emergencies and calamities, as necessity, urgency, or law requires.
- The Grantee must maintain sound and balanced programming at all times.
- The Grantee must promote public participation and assist in the functions of public information and education.
- The Grantee must conform to the ethics of honest enterprise and promote audience sensibility and empowerment, including closed captioning.
- The Grantee must not use its stations or facilities to broadcast obscene or indecent language, speech, act or scene, or the dissemination of deliberately false information or willful misrepresentation to the detriment of public interest.
- The Grantee must not use its stations or facilities to incite, encourage, or assist in subversive or treasonable acts.
- Public service time is equivalent to a maximum aggregate of ten percent (10%) of paid commercials or advertisements, allocated based on the need of the Executive and Legislative branches, the Judiciary, Constitutional Commissions, and international humanitarian organizations duly recognized by statutes.
- In extreme emergency or calamity, the NTC must increase public service time and must issue rules and regulations for this purpose, whose effectivity begins upon applicability with other similarly situated broadcast franchise holders.
- Pursuant to Republic Act No. 8370, the Grantee must allot a minimum of fifteen percent (15%) of the daily total air time of each broadcasting network or station to child-friendly shows within its regular programming.
Government rights during national emergencies
- The franchise recognizes that the radio spectrum is a finite resource and part of the national patrimony, and its use is a privilege conferred by the State that may be withdrawn anytime after due process.
- A special right is reserved to the President of the Philippines in times of war, rebellion, public peril, calamity, emergency, disaster, or disturbance of peace and order:
- to temporarily take over and operate the Grantee’s stations or facilities;
- to temporarily suspend operation of any station or facility for public safety, security, and public welfare; or
- to authorize temporary use and operation by any government agency for due compensation to the Grantee during the period of such operation.
Franchise continuity, self-regulation, and cancellation
- The franchise is deemed ipso facto revoked if the Grantee fails to operate continuously for two (2) years.
- The Grantee must not require any previous censorship of any speech, play, act or scene, or other matter for broadcast.
- The Grantee is free from civil or criminal liability for a speech, play, act or scene, or other matter if it constitutes a violation of law or infringement of a private right.
- During any broadcast, the Grantee must cut off the airing of speech, play, act or scene, or other matter if its tendency is to propose or incite treason, rebellion, or sedition, or if the language used or the theme is indecent or immoral.
- Willful failure to cut off airing as required constitutes a valid cause for the cancellation of the franchise.
Public accountability and government immunity for injuries
- The Grantee must hold national, provincial, city, and municipal governments free from claims, liabilities, demands, or actions arising from accidents causing injury to persons or damage to properties during construction or operation of the stations.
Employment and training commitments
- The Grantee must create employment opportunities and accept on-the-job trainees in franchise operations.
- Priority must be given to residents of the place where the principal office of the Grantee is located.
- The Grantee must comply with applicable labor standards and allowance entitlement under existing labor laws, rules and regulations, and similar issuances.
- The employment opportunities or jobs created must be reflected in the General Information Sheet (GIS) submitted to the Securities and Exchange Commission (SEC) annually.
Transfer restrictions and ownership reporting
- The Grantee must not sell, lease, transfer, grant the usufruct of, or assign this franchise or its rights and privileges to any person, firm, company, corporation, or other commercial or legal entity.
- The Grantee must not merge with any other corporation or entity.
- The Grantee must not transfer the controlling interest of the Grantee to any other person, firm, company, corporation, or entity simultaneously or contemporaneously without the prior approval of Congress.
- The Grantee must inform Congress—through the Office of the Speaker of the House of Representatives and the Office of the Senate President—of any sale, lease, transfer, grant of usufruct, assignment of franchise (or rights and privileges), and any merger or controlling interest transfer, within sixty (60) days after completion of the transaction.
- Failure to report ownership changes to Congress renders the franchise ipso facto revoked.
- Any person or entity to which the franchise is sold, transferred, or assigned must be subject to the same conditions, terms, restrictions, and limitations of the Act.
Dispersal of ownership requirement
- The Grantee must offer Filipino citizens at least thirty percent (30%) of its outstanding capital stocks, or a higher percentage that may later be required by law.
- The offer must be made in any securities exchange in the Philippines within five (5) years from the effectivity of the Act.
- If public offer of shares is not applicable, the Grantee must implement other methods to encourage public participation by citizens and corporations operating public utilities.
- Noncompliance with the dispersal undertaking renders the franchise ipso facto revoked.
Annual reporting and NTC-related certificate
- The Grantee must submit an annual report on compliance with franchise terms and conditions and on its operations to Congress of the Philippines through:
- the Committee on Legislative Franchises of the House of Representatives, and
- the Committee on Public Services of the Senate,
on or before April 30 of every year during the term of the franchise.
- The annual report must include:
- an update on commencement of activities, development, operation, and expansion of business;
- audited financial statements;
- the latest GIS officially submitted to the SEC, if applicable;
- a certification of the NTC on the status of its permits and operations; and
- an update on dispersal of ownership undertaking, if applicable.
- The reportorial compliance certificate issued by Congress must be required before any application for permit or certificate is accepted by the NTC.
Monetary fine for late annual reports
- Failure to submit the requisite annual report to Congress is penalized by a fine of Five hundred pesos (P500.00) per working day of noncompliance to the NTC.
- The fine is collected separately from reportorial penalties imposed by the NTC.
- The fine must be remitted to the Bureau of the Treasury.
Equality clause and nonexclusivity
- Any advantage, favor, privilege, exemption, or immunity granted under existing franchises—or granted for radio and television broadcasting in the future after prior review and approval of Congress—must become part of this franchise and must be accorded to the Grantee immediately and unconditionally.
- The equality clause does not apply to or affect provisions of broadcasting franchises concerning territorial coverage, term, or type of service authorized by the franchise.
- The franchise is subject to amendment, alteration, or repeal by Congress when public interest requires and is not interpreted as an exclusive grant of the privileges provided.
Separability, repeal, and effectivity
- If any section or provision is held invalid, the remaining provisions not affected remain valid under the separability clause.
- All laws, decrees, orders, resolutions, instructions, rules and regulations, and other issuances—or parts thereof—inconsistent with the Act are repealed, amended, or modified accordingly under the repealing clause.
- The Act takes effect fifteen (15) days after its publication in the Official Gazette or in a newspaper of general circulation.
- The Act was approved on March 29, 2022.