NCCP Radio-TV Broadcasting Franchise Law

Nature of Operation Requirements

Section 2 requires construction and operation in a manner that results in minimum interference on the wavelengths or frequencies of existing stations or other stations established by law.
The operation must not diminish NCCP’s own privilege to use its assigned wavelengths or frequencies.
Section 2 requires maximizing rendition of NCCP services and ensuring the quality of transmission or reception and availability of services.

NTC Permits and Spectrum Authorization

Section 3 requires NCCP to secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for construction and operation of its stations or facilities.
Section 3 prohibits using any frequency in the radio spectrum without NTC authorization.
Section 3 directs that the NTC shall not unreasonably withhold or delay the grant of authority.
Section 3 authorizes the NTC, after due process, to revoke or suspend the permits or licenses issued under the franchise upon violation of the franchise provisions.
Section 3 allows the NTC to recommend to Congress the revocation of the franchise for franchise violations.

Public Service, Programming, and Child-Friendly Content

Section 4 requires NCCP to provide free of charge public service time that is adequate and reasonable and sufficient to enable the government to:
- react to pertinent populations or portions thereof on important public issues; and
- relay important public announcements and warnings concerning public emergencies and calamities as necessity, urgency, or law may require.
Section 4 requires NCCP to provide at all times sound and balanced programming and to promote public participation, and to assist public information and education functions.
Section 4 requires NCCP to conform to the ethics of honest enterprise and to promote audience sensibility and empowerment, including closed captioning.
Section 4 prohibits using NCCP stations or facilities for broadcasting:
- obscene or indecent language, speech, act or scene; or
- dissemination of deliberately false information or willful misrepresentation to the detriment of public interest; or
- inciting, encouraging, or assisting subversive or treasonable acts.
Section 4 states that public service time must be equivalent to a maximum aggregate of ten percent (10%) of paid commercials or advertisements.
Section 4 provides that the 10% public service time must be allocated based on the need of the Executive and Legislative branches, the Judiciary, Constitutional Commissions, and international humanitarian organizations duly recognized by statutes.
Section 4 mandates that the NTC shall increase public service time in case of extreme emergency or calamity, and the NTC must issue rules whose effectivity begins upon applicability with other similarly situated broadcast network franchise holders.
Section 4 requires compliance with Republic Act No. 8370, the “Children’s Television Act of 1997”, by allotting a minimum of fifteen percent (15%) of the daily total air time of each broadcasting network or station to child-friendly shows within regular programming.

Government Rights and Emergency Takeover

Section 5 states that the radio spectrum is a finite resource and part of the national patrimony, and that its use is a privilege conferred by the State that may be withdrawn any time after due process.
Section 5 reserves a special right to the President 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, transmitters, facilities, or equipment;
- temporarily suspend the operation of any NCCP station, transmitter, facility, or equipment in the interest of public safety, security, and public welfare; or
- authorize temporary use and operation by any government agency.
Section 5 requires due compensation to the Grantee for temporary use and operation during the period of such presidential action.

Franchise Term and Automatic Revocation

Section 6 provides that the franchise is effective for twenty-five (25) years from the effectivity of this Act, unless sooner revoked or cancelled.
Section 6 provides that the franchise is deemed ipso facto revoked if the Grantee fails to operate continuously for two (2) years.

Content Governance and Franchise Cancellation Cause

Section 7 prohibits NCCP from requiring previous censorship of any speech, play, act, or scene, or other matter to be broadcast from its stations.
Section 7 provides that NCCP is free from liability, civil or criminal, for any speech, play, act, or scene, or other matter if it constitutes a violation of law or infringement of a private right.
Section 7 requires NCCP, during any broadcast, to 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
- use indecent or immoral language, or present an indecent or immoral theme.
Section 7 provides that NCCP’s willful failure to cut off prohibited content constitutes a valid cause for cancellation of the franchise.

Government Claims Shield for Accidents

Section 8 requires NCCP to hold national, provincial, city, and municipal governments free from claims, liabilities, accounts, demands, or actions arising out of accidents causing injury to persons or damage to properties during NCCP construction or operation of stations, transmitters, facilities, or equipment.

Employment and On-the-Job Trainees

Section 9 requires NCCP to create employment opportunities and to accept on-the-job trainees in franchise operations.
Section 9 requires priority to residents of the place where the principal office of NCCP is located.
Section 9 requires compliance with applicable labor standards and allowance entitlement under existing labor laws, rules and regulations, and similar issuances.
Section 9 requires employment opportunities or jobs created to be reflected in the General Information Sheet (GIS) submitted to the Securities and Exchange Commission (SEC) annually.

Restrictions on Franchise Transfer and Ownership Changes

Section 10 prohibits NCCP from selling, leasing, transferring, granting usufruct of, or assigning the franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation, or other commercial or legal entity.
Section 10 prohibits NCCP from merging with any corporation or entity.
Section 10 prohibits transfer of the controlling interest of NCCP, whether simultaneously or contemporaneously, without prior approval of Congress.
Section 10 requires NCCP to inform Congress, through the Office of the Speaker and Office of the Senate President, of any sale, lease, transfer, grant of usufruct, assignment, merger, or controlling interest transfer within sixty (60) days after completion of the transaction.
Section 10 provides that failure to report to Congress such change of ownership causes the franchise to be deemed ipso facto revoked.
Section 10 provides that any person or entity to which the franchise is sold, transferred, or assigned is subject to the same conditions, terms, restrictions, and limitations of this Act.

Required Annual Reporting and Congressional Compliance

Section 11 requires NCCP to submit an annual report on compliance with franchise terms and conditions and on its operations to Congress through:
- the Committee on Legislative Franchises of the House of Representatives, and
- the Committee on Public Services of the Senate.
Section 11 sets the annual reporting deadline as on or before April 30 of every year during the term of the franchise.
Section 11 requires the annual report to include:
- an update on commencement of activities, development, operation, or expansion of business;
- audited financial statements;
- the latest GIS officially submitted to the SEC, if applicable;
- certification of the NTC on the status of permits and operations; and
- an update on dispersal of ownership undertaking, if applicable.
Section 11 requires the reportorial compliance certificate issued by Congress before any application for permit or certificate is accepted by the NTC.

Financial Penalty for Late Annual Reports

Section 12 imposes a fine for failure to submit the requisite annual report to Congress.
Section 12 sets the fine at Five hundred pesos (P500.00) per working day of noncompliance to the NTC.
Section 12 provides that the fine is collected separately from reportorial penalties imposed by the NTC.
Section 12 directs that the fine is remitted to the Bureau of Treasury.

Equality Clause and Nonexclusive Franchise Nature

Section 13 requires that any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or granted later for radio and television broadcasting after prior review and approval of Congress, becomes part of this franchise and is accorded to NCCP immediately and unconditionally.
Section 13 provides that the equality clause does not apply to or affect provisions of broadcasting franchises concerning territorial coverage, the term, or the type of service authorized.

Congressional Amendment and Separability

Section 14 makes the franchise subject to amendment, alteration, or repeal by Congress when the public interest so requires.
Section 14 provides that the franchise is not to be interpreted as an exclusive grant of the privileges provided.
Section 15 provides that if any section or provision is held invalid, the remaining provisions not affected remain valid.

Repeal of Inconsistent Issuances and Effectivity

Section 16 repeals, amends, or modifies inconsistent laws, decrees, orders, resolutions, instructions, rules and regulations, and other issuances or parts thereof.
Section 17 provides that the Act takes effect fifteen (15) days after its publication in the Official Gazette or in a newspaper of general circulation.

Effectivity Through Presidential Signature Lapse

The Act was approved on June 02, 2022 and lapsed into law without the President’s signature in accordance with Article VI, Section 27 (1) of the Constitution.
The Act originated in the House of Representatives and was passed by the House on September 20, 2021 and by the Senate on January 31, 2022.
The Act appears in the Official Gazette as 118 OG No. 30, 8402 (July 25, 2022).