Law Summary
Station Operation and Frequency Interference
- Stations must be constructed and operated to minimize interference with other existing or legally established stations.
- The grantee’s rights to selected wavelengths or frequencies and transmission quality must be preserved.
National Telecommunications Commission (NTC) Approval
- Prior permits and licenses from the NTC are required for all stations.
- Use of any radio or television frequency is prohibited without NTC authorization.
- The NTC shall not unreasonably withhold or delay approvals.
Public Service and Programming Responsibilities
- The grantee must allocate reasonable public service airtime for government to address important issues.
- Programming should always be sound, balanced, and promote public participation.
- The grantee must assist in public information and educational tasks and uphold ethical business practices.
- Broadcasting of obscene, indecent content, false information, or material that incites subversion or treason is prohibited.
Government Rights During Emergencies
- The President may temporarily take over or suspend operations of stations during rebellion, public peril, calamity, or emergency.
- Temporary use by government agencies is authorized with due compensation to the grantee.
Franchise Term and Continuity
- The franchise is granted for 25 years from approval.
- Failure to continuously operate for two years will result in automatic revocation of the franchise.
Acceptance of Franchise
- The grantee must accept the franchise in writing within 60 days of approval.
- Failure to accept renders the franchise void and ineffective.
Taxation Provisions
- The grantee pays taxes on real estate, buildings, and personal property similar to other taxpayers.
- A franchise tax of 3% of gross receipts from broadcast business under the franchise is imposed.
- Franchise tax is in lieu of all taxes on the franchise or earnings, but income taxes remain applicable.
- The grantee must file returns and pay taxes to the Commissioner of Internal Revenue, subject to audit.
Public Ownership Requirements
- At least 30% of the grantee’s common stock must be publicly offered through stock exchanges within three years.
- No single person or entity can own more than 5% of the stock offerings.
Self-Regulation and Content Censorship
- No prior censorship of content is required.
- The grantee must cut off content that incites treason, rebellion, or sedition, or contains indecent or immoral themes.
- Failure to do so constitutes grounds for franchise cancellation.
Liability and Hold Harmless Clause
- The grantee holds the national and local governments harmless from claims arising from accidents or injuries related to station construction or operation.
Restrictions on Transfer or Assignment
- The franchise or rights cannot be sold, leased, transferred, assigned, or merged without prior Congressional approval.
- Successors or transferees are subject to the same terms and conditions.
Separability Clause
- If any provision is declared invalid, other provisions remain unaffected and valid.
Compliance with Future Broadcast Policies
- The grantee shall comply with any general broadcast policy law enacted by Congress in the future.
Amendability and Non-Exclusivity
- The franchise is subject to amendment, alteration, or repeal by Congress based on public interest.
- It is not an exclusive grant of the privileges.
Effectivity
- The Act takes effect 15 days after publication in two newspapers of general circulation in the Philippines.