On Thursday, a Securities and Exchange Commission (SEC) official clarified that ABS-CBN Holdings Corp did not violate its regulations when it issued Philippine Depositary Receipts (PDRs).
According to SEC Commissioner Ephyro Luis Amatong, the question on whether or not the sale of financial instruments to foreigners violates the rule of 100-percent Filipino ownership in mass media is still up for the supreme court to decide.
“As far as we are concerned… wala pa kaming basehan para sabihin na nag-violate sila ng regulations namin,” he said during the joint congressional committee.
“We are not aware of any violation. No complaint has been filed with us.”
Amatong said that PDRs of ABS-CBN and GMA Network appear to be similar almost “word for word.”
The chair of the House Committee on Public Accountability Cong. Jose Sy-Alvarado also said that other broadcast companies that issued PDRs should also be scrutinized for possible violations.
Amatong also said that the SEC has not received any report that ABS-CBN violated the law by allowing a foreign holder of its PDR to convert it into a common saver, responding to Agusan Del Norte Rep. Lawrence Fortun.
Carlo Katigbak, ABS-CBN President, said that the company was willing to “modify or alter” its PDR and the government should disqualify these financial instruments “equally across the entire media industry”.
“We acted in good faith by going to the SEC to secure approval before offering it to the public, and at the time, the SEC agreed that the instrument was legal,” he said.
ABS-CBN legal counsel Cynthia Del Castillo also said during the network’s franchise hearing that public should take note that PDRs are issued by ABS-CBN Holdings, a company incorporated to invest in shares, while ABS-CBN Broadcasting Corp is the company involved in mass media.
“This contractual arrangement has nothing to do with ABS-CBN Broadcasting because ang parties po ng kontratang ito is covered by the investors and ABS-CBN Holdings. Hindi po party sa PDRs and ABS-CBN Broadcasting,” Del Castillo said.
“Ang rights po ng PDR holders (The PDR holders’ rights) are only against ABS-CBN Holdings. And wala po silang (they have no rights) rights on ownership or management of mass media corp which is ABS-CBN Broadcasting Corp,” she added.
On May 5, the National Telecommunication Commission shut down the network the day after the franchise expired. Solicitor General Jose Calida also raised ABS-CBN’s alleged PDR violation in its Supreme Court petition to revoke it the previous 25-year broadcast franchise.
GMA Network also released a statement on the PDR issue, maintaining its legality and compliance with the regulations of the Securities and Exchange Commission and of the Philippine Stock Exchange.
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