Franchise for Iddes Broadcast Group operations

Franchise grant and authorized broadcasting activities

Section 1 grants Iddes Broadcast Group, Inc. (the “grantee”), its successors or assigns, a franchise to construct, install, establish, operate and maintain radio and television broadcasting stations for commercial purposes and in the public interest.
Section 1 limits the grant to locations where frequencies and channels are still available for radio and television broadcasting.
Section 1 authorizes broadcasting through microwave, satellite or whatever means, including the use of new technologies in television and radio systems.
Section 1 authorizes the use of corresponding technological auxiliaries and facilities, special broadcast and other program and distribution services, and relay stations.

How stations must operate and interference limits

Section 2 requires construction and operation in a manner that results, at most, in minimum interference on wavelengths or frequencies of existing stations or other stations that may be established by law.
Section 2 preserves the grantee’s right to use its selected wavelengths or frequencies without diminishing its own right.
Section 2 requires that transmission or reception quality be maintained in a manner that maximizes rendition of the grantee’s services and/or availability thereof.

NTC permits and frequency authorization

Section 3 requires the grantee to secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for the construction and operation of its stations and facilities.
Section 3 prohibits the grantee from using any frequency in the radio/television spectrum without NTC authorization.
Section 3 directs that the NTC shall not unreasonably withhold or delay the grant of such authority.

Public responsibility, programming standards, and prohibited content

Section 4 requires the grantee to provide adequate public service time so the government can reach the population on important public issues.
Section 4 requires the grantee to provide sound and balanced programming at all times.
Section 4 requires the grantee to assist in the functions of public information and education.
Section 4 requires the grantee to conform to the ethics of honest enterprise.
Section 4 prohibits the grantee from using its stations or facilities to broadcast obscene and indecent language, speech, act or scene, or to disseminate deliberately false information or willful misrepresentation to the detriment of the public interest.
Section 4 prohibits inciting, encouraging, or assisting in subversive or treasonable acts through broadcasts.

Government rights, franchise term, and conditions for revocation

Section 5 reserves to the President of the Philippines, in times of war, rebellion, public peril, calamity, emergency, disaster, or disturbance of peace and order, the right to temporarily take over and operate the grantee’s stations or facilities.
Section 5 authorizes the President to temporarily suspend operation of any station or facility in the interest of public safety, security and public welfare, or to authorize temporary use and operation by any government agency.
Section 5 requires due compensation to the grantee for such temporary use or operation during the relevant period.
Section 5 states that the radio spectrum is a finite resource part of the national patrimony, and use is a privilege conferred by the State that may be withdrawn anytime after due process.
Section 6 grants the franchise for a term of twenty-five (25) years from the date of effectivity, unless sooner revoked or cancelled.
Section 6 provides automatic ipso facto revocation if the grantee fails to comply with any of the following conditions:
- Commence operations within one (1) year from NTC approval of its operating permit or provisional authority.
- Operate continuously for two (2) years.
- Commence operations within three (3) years from the effectivity of Republic Act No. 9131.

Acceptance, bond, and compliance consequences

Section 7 requires the grantee to give written acceptance of the franchise within sixty (60) days from the effectivity of Republic Act No. 9131.
Section 7 provides that upon giving acceptance, the grantee shall exercise the privileges granted.
Section 7 states that nonacceptance renders the franchise void.
Section 8 requires the grantee to file a bond issued in favor of the NTC.
Section 8 provides that the NTC determines the bond amount to guarantee compliance with the franchise conditions.
Section 8 provides that if, after three (3) years from approval of the grantee’s permit by the Commission, the grantee has fulfilled the conditions, the bond shall be cancelled by the Commission.
Section 8 provides that otherwise, the bond shall be forfeited in favor of the government and the franchise shall be ipso facto revoked.

Tax obligations and government-harmless provisions

Section 9 subjects the grantee, its successors or assigns, to payment of all taxes, duties, fees, charges, and other impositions under the National Internal Revenue Code (NIRC) of 1997, as amended, and other applicable laws.
Section 9 preserves existing specific tax exemptions, incentives, or privileges under relevant law and provides that nothing therein repeals those.
Section 9 extends to the grantee all rights, privileges, benefits, and exemptions accorded to existing and future broadcasting station franchises.
Section 9 requires the grantee to file the return with the city or province where its facility is located and to pay taxes due to the Commissioner of Internal Revenue or duly authorized representatives under the NIRC.
Section 9 provides that the return is subject to audit by the Bureau of Internal Revenue.
Section 12 requires the grantee to hold harmless the national, provincial, city and municipal governments from all claims, accounts, demands, or actions arising from accidents or injuries (to property or persons) caused by the construction or operation of the stations.

Content regulation, reply right, and self-regulatory duty

Section 10 prohibits the grantee from requiring previous censorship of any speech, play, act or scene, or other matter to be broadcast.
Section 10 requires the grantee, during any broadcast, to cut off from the air any speech, play, act or scene, or other matter being broadcast if it tends to propose and/or incite treason, rebellion or sedition.
Section 10 requires the cut-off where the language used or the theme is indecent or immoral.
Section 10 states that a willful failure to cut off as required constitutes a valid cause for cancellation of this franchise.
Section 11 grants any person aggrieved by a remark, report, statement, commentary or similar broadcast by broadcasters using the grantee’s facilities the right to reply in the same program or in any other program chosen by the aggrieved party.

Transfer limits and congressional approval requirement

Section 13 prohibits the grantee from leasing, transferring, granting usufruct of, selling, or assigning the franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation, or other commercial or legal entity.
Section 13 prohibits the grantee from merging with any other corporation or entity.
Section 13 prohibits transferring the controlling interest of the grantee, whether as a whole or in parts and whether simultaneously or contemporaneously, to any such person or entity.
Section 13 requires prior approval of the Congress of the Philippines for any sale, transfer, assignment, merger, or transfer of controlling interest described.
Section 13 provides that any person or entity receiving the franchise or rights becomes subject to the same conditions, terms, restrictions and limitations of the Act.

Ownership participation: dispersal requirement

Section 14 requires the grantee, in accordance with constitutional provisions encouraging public participation in public utilities, to offer at least thirty percentum (30%) of its outstanding capital stock.
Section 14 allows a higher percentage if later provided by law.
Section 14 requires offering the shares in any securities exchange in the Philippines within five (5) years from the time the grantee achieves the status of a national broadcasting network.
Section 14 defines a “national broadcasting network” as one that operates three (3) or more radio and/or television stations.
Section 14 provides ipso facto franchise revocation for noncompliance with the required dispersal.

Compliance with future broadcast policy and equality clause

Section 15 requires the grantee to comply with and be subject to the provisions of a general broadcast policy law that Congress may hereafter enact.
Section 16 provides that any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or that may be granted later, ipso facto becomes part of previously granted telecommunications franchises.
Section 16 requires immediate and unconditional accord of such advantages to grantees of such franchises.
Section 16 provides an exception: the equality rule does not apply to or affect provisions of telecommunications franchises concerning territory covered, the life span, or the type of service authorized.

Reporting and ongoing congressional oversight

Section 19 requires the grantee to submit an annual report to the Congress of the Philippines on compliance with franchise terms and conditions and on operations.
Section 19 requires submission within sixty (60) days from the end of every year.

Effect of invalid provisions, amendment/repeal, and exclusivity

Section 17 provides a separability rule: if any section or provision is held invalid, the other provisions not affected remain valid.
Section 18 makes the franchise subject to amendment, alteration or repeal by the Congress of the Philippines when the public interest so requires.
Section 18 provides that the franchise shall not be interpreted as an exclusive grant of the privileges provided.

Charter chronology and legislative history

Republic Act No. 9131 provides legislative approval signatures by the Senate President (Aquilino Q. Pimentel Jr.) and the Speaker of the House of Representatives (Feliciano Belmonte Jr.) and the presiding heads of the legislative chambers.
Republic Act No. 9131 states that it originated in the House of Representatives and was finally passed by the House of Representatives on February 6, 2001 and by the Senate on January 29, 2001.