Franchise coverage and purpose
- The franchise granted to Progressive Broadcasting Corporation (the grantee), including its successors or assignees, under Republic Act No. 7163, as amended by Republic Act No. 8162, is renewed for another twenty-five (25) years (Section 1).
- The renewed franchise authorizes the grantee to construct, install, establish, operate and maintain for commercial purposes and in the public interest radio and/or television broadcasting stations (including digital television system) (Section 1).
- Broadcasting is allowed through microwave, satellite or whatever means, including the use of new technologies in television and radio systems, with the corresponding technological auxiliaries and facilities, special broadcast and other program, and distribution services and relay stations in the Philippines (Section 1).
- The Act renews the earlier stated purpose of extending operations throughout the Philippines (Section 1).
How stations must be operated
- Stations and facilities must be constructed and operated in a manner that results at most in minimum interference on the wavelengths or frequencies of existing stations or other stations that may be established by law (Section 2).
- The grantee’s operation must not diminish its own privilege to use its assigned wavelengths or frequencies (Section 2).
- The grantee must maximize the quality of transmission or reception on its assigned frequencies and services availability (Section 2).
National Telecommunications Commission authority
- The grantee must secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for construction and operation of its stations and facilities (Section 3).
- The grantee must not use any frequency in the radio/television spectrum without NTC authorization (Section 3).
- The NTC must not unreasonably withhold or delay the grant of such authority (Section 3).
Public service and broadcast restrictions
- The grantee must provide adequate public service time to enable the government, through the grantee’s broadcasting stations or facilities, to reach the population on important public issues (Section 4).
- The grantee must provide sound and balanced programming at all times (Section 4).
- The grantee must assist in the functions of public information and education (Section 4).
- The grantee must conform to the ethics of honest enterprise (Section 4).
- The grantee must not use its stations or facilities to broadcast obscene and indecent language, speech, act, or scene, or for dissemination of deliberately false information or willful misrepresentation to the detriment of the public interest, or to incite, encourage, or assist in subversive or treasonable acts (Section 4).
Government takeover and public necessity
- 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 (Section 5).
- The President may temporarily take over and operate the grantee’s stations or facilities (Section 5).
- The President may temporarily suspend the operation of any station or facility in the interest of public safety, security and public welfare (Section 5).
- The President may authorize temporary use and operation by any government agency upon due compensation to the grantee during the period of such operation (Section 5).
- The law declares that the radio spectrum is a finite resource part of the national patrimony and its use is a privilege conferred by the State that may be withdrawn any time after due process (Section 5).
Term, acceptance, and franchise forfeiture
- The franchise is effective for twenty-five (25) years from the effectivity of this Act, unless sooner revoked or cancelled (Section 6).
- The franchise is deemed ipso facto revoked if the grantee fails to operate continuously for two (2) years (Section 6).
- Acceptance of the new franchise must be given in writing to Congress, through the Committee on Legislative Franchises of the House of Representatives and the Committee on Public Services of the Senate, within sixty (60) days from effectivity of this Act (Section 7).
- Upon acceptance, the grantee must exercise the privileges granted by the Act (Section 7).
- Nonacceptance renders the franchise void (Section 7).
Self-regulation undertaking and cancellation
- The grantee must not require previous censorship of any speech, play, act, or scene, or other matter to be broadcast (Section 8).
- During any broadcast, the grantee must cut off from the air any speech, play, act, or scene, or other matter if its tendency is to propose and/or incite treason, rebellion, or sedition, or if the language used or theme is indecent or immoral (Section 8).
- Willful failure to cut off as required constitutes a valid cause for cancellation of this franchise (Section 8).
Liability and government warranty
- The grantee must hold national, provincial, city, and municipal governments free from all claims, accounts, demands, or actions arising out of accidents or injuries (whether to property or persons) caused by the grantee’s construction or operation of the stations (Section 9).
Transfer, lease, control changes
- The grantee must not lease, transfer, grant usufruct of, sell, or assign the franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation, or other commercial or legal entity, and must not merge with any other corporation or entity (Section 10).
- The grantee must not allow the controlling interest of the grantee to be transferred, whether as a whole or in parts, and whether simultaneously or contemporaneously, to any such person or entity without the prior approval of Congress (Section 10).
- Congress must be informed within sixty (60) days after completion of the transaction of any lease, transfer, grant of usufruct, sale, or assignment, or of any merger or transfer of the controlling interest (Section 10).
- Failure to report the change of ownership to Congress renders the franchise ipso facto revoked (Section 10).
- Any person or entity that acquires the franchise through sale, transfer, or assignment must be subject to the same conditions, terms, restrictions, and limitations of the Act (Section 10).
Dispersal of ownership and compliance
- The grantee must offer Filipino citizens at least thirty percent (30%) (or a higher percentage if later provided by law) of its outstanding capital stock in any securities exchange in the Philippines within five (5) years from commencement of its operations (Section 11).
- Where public offer of shares is not applicable, the grantee must implement establishment of cooperatives and other methods of encouraging public participation by citizens and corporations operating public utilities (Section 11).
- Noncompliance with dispersal requirements renders the franchise ipso facto revoked (Section 11).
Follow-on broadcast policy and reports
- The grantee must comply with and be subject to a general broadcast policy law which Congress may hereafter enact (Section 12).
- The grantee must submit an annual report to Congress, through the Committee on Legislative Franchises of the House of Representatives and the Committee on Public Services of the Senate, on:
- compliance with the franchise terms and conditions, and
- operations,
- on or before April 30 of every year during the term of the franchise (Section 13).
- The reportorial compliance certificate issued by Congress is required before any application for a permit or certificate is accepted by the NTC (Section 13).
Monetary penalty for report noncompliance
- Failure to submit the required annual report is penalized with a fine of five hundred pesos (P500.00) per working day of noncompliance (Section 14).
- The NTC collects the fine from the delinquent franchise grantee, separate from tab reportorial penalties imposed by the NTC (Section 14).
Equality clause for broadcast franchise benefits
- Any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or granted for radio and/or television broadcasting in the future, becomes part of this franchise upon prior review and approval of Congress and must be accorded to the grantee immediately and unconditionally (Section 15).
- The equality clause must not apply to or affect provisions of broadcasting franchises concerning territory covered, the life span of the franchise, or the type of service authorized (Section 15).
Effect on validity, amendment, and exclusivity
- If any section or provision is held invalid, all other provisions not affected remain valid (Section 16).
- The franchise is subject to amendment, alteration, or repeal by Congress when the public interest so requires and is not interpreted as an exclusive grant of the privileges provided (Section 17).