Manner of operation and interference limits
- The grantee must construct and operate stations or facilities so that, at most, they result in only the minimum interference on the wavelengths or frequencies of existing stations or other stations that may be established by law.
- The grantee’s operation must not diminish its privilege to use its assigned wavelengths or frequencies.
- Operations must preserve the quality of transmission or reception to maximize the grantee’s service rendition and/or availability.
NTC permits and spectrum authorization
- The grantee must secure from the National Telecommunications Commission (NTC) the appropriate permits and licenses for the construction and operation of its stations or facilities.
- The grantee must not use any frequency in the radio/television spectrum without authorization from the NTC.
- The NTC must not unreasonably withhold or delay authority for construction and operation.
Public responsibilities and programming standards
- The grantee must provide, free of charge, adequate public service time that is reasonable and sufficient for government use to reach the pertinent populations on important public issues, and to relay important public announcements and warnings concerning public emergencies and calamities when necessity, urgency, or law requires.
- The grantee must provide programming that is at all times sound and balanced.
- The grantee must promote public participation; assist in public information and education; conform to the ethics of honest enterprise; and promote audience sensibility and empowerment, including closed captioning.
- The grantee must not use its stations or facilities to broadcast:
- obscene or indecent language, speech, act, or scene; or
- deliberately false information or willful misinterpretation to the detriment of public interest; or
- content that incites, encourages, or assists subversive or treasonable acts.
- The public service time must be equivalent to a maximum aggregate of ten percent (10%) of paid commercials or advertisements, allocated based on need to the executive, legislative, judiciary, constitutional commissions, and international humanitarian organizations duly recognized by statutes.
- The NTC must increase public service time in cases of extreme emergency or calamity and must issue rules and regulations for this purpose; the rules’ effectivity begins upon applicability with other similarly situated broadcast franchise holders.
Government rights over spectrum and takeover
- The law states that the radio spectrum is a finite resource part of the national patrimony, and use is a privilege conferred upon the grantee by the Senate that may be withdrawn anytime after due process.
- 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, to:
- temporarily take over and operate the grantee’s stations or facilities; and/or
- temporarily suspend the operation of any station or facility in the interest of public safety, security, and public welfare; and/or
- authorize temporary use and operation by any government agency upon due compensation to the grantee for the use of the stations or facilities during the period of operation.
Franchise term, loss of franchise, and continuous operation
- The franchise is effective for twenty-five (25) years from the effectivity of the Act, unless sooner revoked or cancelled.
- The franchise is deemed ipso facto revoked if the grantee fails to operate continuously for two (2) years.
Self-regulation, censorship limits, and cancellation trigger
- The grantee must not require any previous censorship of any speech, play, act, scene, or other matter to be broadcast from its stations.
- During any broadcast, the grantee must cut off from the air any speech, play, act, scene, or other matter being broadcast if:
- its tendency is to propose and/or incite treason, rebellion, or sedition; or
- the language used therein or the theme thereof is indecent or immoral.
- Willful failure to cut off the broadcast under these grounds constitutes a valid cause for cancellation of the franchise.
Government immunity from certain claims
- The grantee must hold the national, provincial, city, and municipal governments free from all claims, liabilities, demands, or actions arising out of accidents causing injury to persons or damage to properties during the construction or operation of the grantee’s stations.
Employment creation obligations
- The grantee must create employment opportunities and allow on-the-job trainings in its franchise operation.
- Priority must be accorded to residents in areas where any of the grantee’s offices is located.
- The grantee must follow applicable labor standards and allowance entitlement under existing labor laws, rules and regulations, and similar issuances.
- Employment opportunities or jobs created must be reflected in the General Information Sheet to be submitted to the Securities and Exchange Commission annually.
Transfer, sale, and ownership change controls
- The grantee must not:
- sell, lease, transfer, grant usufruct of, or assign the franchise or the rights and privileges acquired thereunder; or
- merge with any other corporation or entity; or
- transfer the controlling interest of the grantee—whether simultaneously or contemporaneously—to any person, firm, company, corporation, or entity— without prior approval of Congress of the Philippines.
- Congress must be informed of any sale, lease, transfer, grant of usufruct, or assignment, and any merger or transfer of controlling interest, within sixty (60) days after completion of the transaction.
- Failure to report such change of ownership to Congress renders the franchise ipso facto revoked.
- Any person or entity to which the franchise is sold, transferred, or assigned is subject to the same conditions, terms, restrictions, and limitations of the Act.
Public participation in ownership
- The grantee must offer to 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 the commencement of operations.
- If public offer of shares is not applicable, the grantee must apply other methods of encouraging public participation in citizens and corporations operating public utilities as allowed by law.
- Noncompliance with the required public participation renders the franchise ipso facto revoked.
Annual reporting to Congress and NTC requirement
- The grantee must submit an annual report to Congress through the Committee on Legislative Franchise of the House of Representatives and the Committee on Public Services of the Philippine Senate.
- The report must cover compliance with franchise terms and conditions and the grantee’s operations.
- The annual report must be submitted on or before April 30 of every year during the term of the franchise.
- The reportorial compliance certificate issued by Congress must be required before any application for permit or certificate is accepted by the NTC.
Penalty for late annual report submissions
- Failure to submit the requisite annual report to Congress results in a fine of Five hundred pesos (P500.00) per working day of noncompliance.
- The fine is collected by the NTC from the delinquent franchise grantee, separate from reportorial penalties imposed by the NTC.
- The collected fine must be remitted to the National Treasury.
Equality clause and franchise advantages
- Except to taxes and customs duties, any advantage, favor, privilege, exemption, or immunity granted under existing franchises—or granted for radio and/or television broadcasting for which Congress gives prior review and approval—becomes part of this franchise and must be accorded to the grantee immediately and unconditionally.
- The equality clause does not apply to or affect provisions of broadcasting franchises concerning territorial coverage, the term, or the type of service authorized.
Nonexclusivity and amendability
- Congress may amend, alter, or repeal the franchise when the public interest so requires.
- The franchise is not interpreted as an exclusive grant of the privileges provided in the Act.
Separability and effect of invalid provisions
- If any section or provision is held invalid, all other provisions not affected remain valid.
Repeal of inconsistent issuances
- All laws, decrees, orders, resolutions, instructions, rules and regulations, and other issuances, or parts thereof, inconsistent with the Act are repealed, amended, or modified accordingly.
Effectivity, approval, and publication rule
- Republic Act No. 11354 was approved on July 25, 2019.
- The Act takes effect fifteen (15) days after its publication in the Official Gazette or in a newspaper of general circulation.