Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Sixteenth Congress
Third Regular Session

House BitLNo, 6813

Introduced by Representative NEPTALI M. GONZALES II

EXPLANATORY NOTE

This Bill seeks to grant MAKINIG NETWORK, INC. a franchise to construct, install,
establish, operate and maintain radio and television broadcasting stations throughout the
Philippines.

In shaping the country's future, broadcast media plays an important role. It helps
mold an informed and educated Filipino society by promoting public participation and
encouraging public opinion on important matters concerning the country,

Investors should be encouraged to invest in the radio and television broadcasting
business to assist the government in disseminating information on issues and matters of
public concern. The MAKINIG NETWORK, INC. is a private corporation interested in the
telecommunications business for domestic audiences and other related business. It
desires to operate radio and television stations throughout the Philippines with its central
base of operations located at Ortigas Center, San Antonio, Pasig City.

The more radio and television utilities there are in the field to enhance competition,
the more information will be made available, thus giving the public more information and
entertainment to be delivered to them.

This is the reason why MAKINIG NETWORK INC. seeks to offer itself as one of the
service providers in the radio and television broadcasting industry. This bill seeks to grant
the company the franchise required for it to be able to operate and offer its services and
therefore open the way for more opportunities for access to radio and television services
through the fostering of healthy competition.

In the light of the foregoing, approval of this measure is earnestly sought.

NEPTALI M. GQNZALES II


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
Third Regular Session

House sittno, 6313

Introduced by REP. NEPTALI M. GONZALES Il

AN ACT
GRANTING THE MAKINIG NETWORK, INC. A FRANCHISE TO CONSTRUCT,
INSTALL, ESTABLISH, OPERATE AND MAINTAIN RADIO AND TELEVISION
BROADCASTING STATIONS THROUGHOUT THE PHILIPPINES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Nature and Scope of Franchise. - Subject to the provisions of the 1987
Philippine Constitution and applicable laws, rules and regulations, there is hereby granted
to Makinig Network, Inc., hereunder referred to as the grantee, its successors or
assignees, a franchise to construct, install, establish, operate and maintain for commercial
purposes and in the public interest, radio and/or television broadcasting stations
throughout the Phil
San Antonio, Pasig City where frequencies and/or channels are still available for radio

pines, with its central base of operations located at Ortigas Center,

and/or television broadcasting, including digital television system, 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.

SEC. 2. Manner of Operation of Stations or Facilities. - The stations or facilities of
the grantee shall be constructed and operated in a manner as will, at most, result only in
the minimum interference on the wavelengths or frequencies of existing stations or other
stations which may be established by law, without in any way diminishing its own right to
use its assigned wavelengths or frequencies and the quality of transmission or reception
thereon as should maximize rendition of the grantee’s services and/or the availability

thereof.


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

SEC. 4. Responsibility to the Public. - The grantee shall provide adequate public
service time to enable the government, through the said broadcasting stations or facilities,
to reach the population on important public issues; provide at all times sound and
balanced programming; assist in the functions of public information and education;
conform to the ethics of honest enterprise; and not use its stations and facilities for the
broadcasting of obscene and indecent language, speech, act, or scene, or for the
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.

SEC. 5. Right of Government. - A special right is hereby 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 stations or
facilities of the grantee; to temporarily suspend the operation of any station or facility in the
interest of public safety, security and public welfare; or to authorize the temporary use and
operation thereof by any agency of the government, upon due compensation to the
grantee, for the use of said stations or facilities during the period when they shall be so

operated

The radio spectrum is a finite resource that is part of the national patrimony and
the use thereof is a privilege conferred upon the grantee by the State and may be
withdrawn anytime after due process.

SEC. 6. Term of Franchise. — This franchise shall be in effect for a period of twenty-five
(25) years, unless sooner revoked or cancelled. This franchise shall be deemed ipso facto
revoked in the event the grantee fails to comply with any of the following conditions:

(a) Commence operations within one (1) year from the approval of its operating permit
by the NTC;


(b) Commence operations within three (3) years from the effectivity of this Act; and
(c) Operate continuously for two (2) years.

SEC. 7. Acceptance and Compliance. — Acceptance of this franchise shall be given in
writing to the Congress of the Philippines, 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 effectivity of this Act. Upon giving such acceptance,
the grantee shall exercise the privileges granted under this Act. Non-acceptance shall
render the franchise void.

SEC. 8. Bond. - The grantee shall file a bond with the NTC, in the amount that the
NTC shall determine, to guarantee compliance with and fulfillment of the conditions under
which this franchise is granted. If after three (3) years from the date of the approval of its
permit by the Commission, the grantee shall have fulfilled the same, the bond shall be
cancelled by the Commission. Otherwise, the bond shall be forfeited in favor of the
government and the franchise ipso facto revoked.

SEC. 9. Self-regulation by and Undertaking of Grantee. - The grantee shall not
require any previous censorship of any speech, play, act or scene, or other matter to be
broadcast from its stations: Provided, That the grantee, during any broadcast, shall 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 the language used
therein or the theme thereof is indecent or immoral: Provided, further, That willful failure to
do so shall constitute a valid cause for the cancellation of this franchise.

SEC. 10. Warranty in Favor of National and Local Governments. - The grantee shall
hold the national, provincial, city and municipal governments of the Philippines free from all
claims, accounts, demands, or actions arising out of accidents or injuries, whether to
property or to persons, caused by the construction or operation of the stations of the
grantee.

SEC. 11. Sale, Lease, Transfer, Grant of Usufruct, or Assignment of Franchise. -
The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign this franchise
or the rights and privileges acquired thereunder to any person, firm, company, corporation
or other commercial or legal entity, nor merge with any other corporation or entity, nor shall


transfer the controlling interest of the grantee, whether as a whole or in part, and whether
simultaneously or contemporaneously, to any such person, firm, company, corporation, or
entity without the prior approval of the Congress of the Philippines: Provided, That
Congress shall be informed of any sale, lease, transfer, grant of usufruct, or assignment of
franchise or the rights or privileges acquired thereunder, or the merger or transfer of the
controlling interest of the grantee, within sixty (60) days after the completion of said
transaction: Provided, further, That failure to report to Congress such change of ownership
shalll render the franchise ipso facto revoked: Provided, finally, That any person or entity to
which this franchise is sold, transferred or assigned, shall be subject to the same
conditions, terms, restrictions, and limitations of this Act.

SEC. 12. Dispersal of Ownership. - In accordance with the constitutional provision
to encourage public participation in public utilities, the grantee shall offer to Filipino citizens
at least thirty per cent (30%) or a higher percentage that may hereafter be provided by law
of its outstanding capital stock in any securities exchange in the Philippines within five (5)
years from the commencement of its operations: Provided, That in cases where public
offer of shares is not applicable, establishment of cooperatives and other methods of
encouraging public participation by citizens and corporations operating public utilities must
be implemented. Noncompliance therewith shall render the franchise ipso facto revoked.

SEC. 13. General Broadcast Policy Law. - The grantee shall comply with and be
subject to the provisions of a general broadcast policy law, which Congress may hereafter
enact.

SEC. 14. Reportorial Requirement. — The grantee shall submit an annual report to
the Congress of the Philippines, through the Committee on Legislative Franchises of the
House of Representatives and the Committee on Public Services of the Senate, on its
compliance with the terms and conditions of the franchise and on its operations on or
before April 30 of every year during the term of its franchise. The reportorial compliance
certificate issued by Congress shall be required before any application for permit or
certificate is accepted by the NTC.

SEC. 15. Penalty Clause - Failure of the grantee to submit the requisite annual
report to Congress shall be penalized by a fine of five hundred pesos (P500.00) per
working day of noncompliance. The fine shall be collected by the NTC from the delinquent


franchise grantee separate from the reportorial penalties imposed by the NTC.

SEC. 16. Equality Clause. - Any advantage, favor, privilege, exemption, or immunity
granted under existing franchises, or which may hereafter be granted for radio and/or
television broadcasting, upon prior review and approval of Congress, shall become part of
this franchise and shall be accorded immediately and unconditionally to the herein
grantee: Provided, That the foregoing shall neither apply to nor affect the 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.

SEC. 17. Separability Clause. — If any of the sections or provisions of this Act is
held invalid, all other provisions not affected thereby shall remain valid.

SEC. 18. Repealability and Nonexclusivity Clause. — This franchise shall be
subject to amendment, alteration, or repeal by the Congress of the Philippines when the
public interest so requires and shall not be interpreted as an exclusive grant of the
privileges herein provided for.

SEC. 19. Effectivity. — This Act shalll take effect fifteen (15) days after its publication
in the Official Gazette or in a newspaper of general circulation.

Approved,