Title
Franchise renewal for Progressive Broadcasting
Law
Republic Act No. 10820
Decision Date
May 18, 2016
Republic Act No. 10820 renews the franchise of Progressive Broadcasting Corporation for 25 years, granting them the authority to construct and operate radio and television broadcasting stations throughout the Philippines, with the condition that they comply with regulations, provide public service time, and face potential temporary takeover or revocation by the President or Congress if they fail to meet their obligations.
franchise renewal
radio broadcasting stations
television stations

Franchise renewal and authorized services

  • Progressive Broadcasting Corporation, its successors, or assignees are renewed as the grantee.
  • The renewed franchise covers the authority granted under Republic Act No. 7163, entitled to grant Progressive Broadcasting Corporation a franchise to construct, install, operate, and maintain radio and television stations in Metro Manila and in Regions I, VI and VII, and to extend operations throughout the Philippines.
  • The franchise renewal also accounts for amendments under Republic Act No. 8162.
  • 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;
    • Operations through microwave, satellite, or whatever means, including new technologies in television and radio systems;
    • Corresponding technological auxiliaries and facilities;
    • Special broadcast and other program and distribution services and relay stations in the Philippines.
  • The franchise renewal runs for twenty-five (25) years from the effectivity of this Act, unless sooner revoked or cancelled (Section 1 and Section 6).

Operation standards and technical interference limits

  • The grantee must construct and operate its stations or facilities in a manner that results at most in the minimum interference on the wavelengths or frequencies of existing stations or other stations that may be established by law.
  • The grantee must ensure that minimizing interference does not diminish its own privilege to use its assigned wavelengths or frequencies and does not diminish the quality of transmission or reception.
  • The grantee’s operation must maximize the rendition of its services and/or the availability thereof (Section 2).

NTC permits, spectrum authorization, and frequency use

  • The grantee must secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for construction and operation of its stations and facilities.
  • The grantee must not use any frequency in the radio/television spectrum without authorization from the NTC (Section 3).
  • The NTC must not unreasonably withhold or delay the grant of such authority (Section 3).

Public service obligations and broadcast restrictions

  • The grantee must provide adequate public service time so that the government may reach the population on important public issues through the grantee’s broadcasting stations or facilities.
  • The grantee must provide sound and balanced programming at all times.
  • The grantee must assist in functions of public information and education.
  • The grantee must conform to the ethics of honest enterprise.
  • The grantee must not use its stations or facilities to broadcast obscene and indecent language, speech, act or scene, or
    • disseminate deliberately false information or willful misrepresentation to the detriment of the public interest, or
    • incite, encourage, or assist in subversive or treasonable acts (Section 4).

Government rights: takeover, suspension, and temporary use

  • A special right is reserved to the President of the Philippines during 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; or
    • temporarily suspend the operation of any station or facility in the interest of public safety, security and public welfare; or
    • authorize temporary use and operation by any government agency upon due compensation to the grantee (Section 5).
  • The radio spectrum is declared a finite resource that is 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, revocation triggers, and franchise voiding

  • The franchise term is twenty-five (25) years from effectivity, 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 the Act’s effectivity (Section 7).
  • Upon written acceptance, the grantee must exercise the privileges granted under the Act.
  • Nonacceptance renders the franchise void (Section 7).

Self-regulation and censorship limits

  • The grantee must not require any previous censorship of any speech, play, act or scene, or other matter to be broadcast from its stations.
  • During any broadcast, the grantee must cut off from the air the speech, play, act or scene, or other matter being broadcast if the tendency thereof is to propose and/or incite treason, rebellion, or sedition, or if the language used or the theme is indecent or immoral (Section 8).
  • Willful failure to cut off as required constitutes a valid cause for the cancellation of this franchise (Section 8).

Government indemnity for accidents and injuries

  • The grantee must hold the national, provincial, city, and municipal governments free from all claims, accounts, demands, or actions arising out of accidents or injuries (to property or persons) caused by the construction or operation of the grantee’s stations (Section 9).

Transfer limits and Congress approval

  • The grantee must not lease, transfer, grant the usufruct of, sell, or assign the franchise or rights and privileges acquired thereunder.
  • The grantee must not merge with any other corporation or entity.
  • The grantee must not transfer its controlling interest—whether as a whole or in parts, and whether simultaneously or contemporaneously—to any person, firm, company, corporation, or other commercial or legal entity—without prior approval of Congress (Section 10).
  • Congress must be informed of any lease, transfer, grant of usufruct, sale, assignment of franchise or rights and privileges, or of merger or transfer of the controlling interest within sixty (60) days after the completion of the transaction (Section 10).
  • Failure to report to Congress such change of ownership renders the franchise ipso facto revoked (Section 10).
  • 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 (Section 10).

Dispersal of ownership and public participation

  • The grantee must offer Filipino citizens at least thirty percent (30%) of its outstanding capital stock, or a higher percentage that may later be provided by law, in any securities exchange in the Philippines within five (5) years from the 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 renders the franchise ipso facto revoked (Section 11).

Reporting duties, deadlines, and NTC linkage

  • 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.
  • The annual report must cover compliance with the franchise terms and conditions and the grantee’s operations.
  • Reports must be submitted on or before April 30 of every year during the term of the franchise (Section 13).
  • A reportorial compliance certificate issued by Congress is required before any application for permit or certificate is accepted by the NTC (Section 13).

Financial penalty for late reporting

  • Failure to submit the required annual report to Congress is penalized with a fine of five hundred pesos (P500.00) per working day of noncompliance (Section 14).
  • The fine is collected by the NTC from the delinquent franchise grantee.
  • The collection is separate from reportorial penalties imposed by the NTC (Section 14).

Equality clause and franchise benefits

  • Any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or which may hereafter be granted for radio and/or television broadcasting, after prior review and approval of Congress, must become part of this franchise and be accorded to the grantee immediately and unconditionally (Section 15).
  • The equality clause does not apply to or affect provisions of broadcasting franchises concerning:
    • territory covered by the franchise,
    • the life span of the franchise, or
    • the type of service authorized by the franchise (Section 15).

Future broadcast policy and congressional authority

  • The grantee must comply with and be subject to the provisions of a general broadcast policy law which Congress may hereafter enact (Section 12).
  • The franchise is subject to amendment, alteration, or repeal by Congress when the public interest so requires, and it must not be interpreted as an exclusive grant of the privileges provided (Section 17).

Separability, and final operative effect

  • If any section or provision of the Act is held invalid, the remaining provisions not affected remain valid (Section 16).
  • The Act’s effectivity rule governs when obligations and rights under the renewal commence (Section 18).

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