Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
SEVENTEENTH CONGRESS
First Regular Session

3771

House Bill No.

Introduced by REP. ANICETO "JOHN D. BERTIZ III

EXPLANATORY NOTE

The Rinconada Broadcasting Corporation was incorporated and registered at the
Securities and Exchange Commission on March 02, 1987 with a primary purpose of establishing
a radio broadcasting network throughout the Philippines, to the extent that it may be authorized
by law.

On September 28, 1991, Rinconada Broadcasting Corporation was granted a legislative
franchise by Republic Act No. 7158 to construct, install, operate and maintain for commercial
purposes radio broadcasting stations and television stations in the Philippines. However, the
twenty-five year legislative franchise of this broadcasting company is expiring in 2016, hence
there is an urgent need to seek a legislative authorization for its continued operations

This bill therefore seeks to renew the legislative franchise to enable to continue its
commitment to public service and to its unfailing practice of disseminating timely, truthful and
precise information to the Filipino people.

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

REP. ANICETO “JOHN” R. BERTIZ Ill

EES


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
SEVENTEENTH CONGRESS

First Regular Session

3771

House Bill No.

Introduced by REP. ANICETO “JOHN” D. BERTIZ It!

AN ACT
RENEWING THE FRANCHISE GRANTED TO RINCONADA BROADCASTING CORPORATION
UNDER REPUBLIC ACT. NO. 7158 ENTITLED “AN ACT GRANTING THE RICONADA
BROADCASTING CORPORATION A FRANCHISE TO CONSTRUCT, INSTALL, OPERATE
AND MAINTAIN FOR COMMERCIAL PURPOSES RADIO BROADCASTING STATIONS AND
TELEVISION STATIONS IN THE PHILIPPINES AND FOR OTHER PURPOSES” FOR
ANOTHER TWENTY-FIVE (25) YEARS FROM THE EFFECTIVITY OF THIS ACT

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, the franchise granted to
Rinconada Broadcasting Corporation, under Republic Act No. 7158 entitled “An Act Granting The
Rinconada Broadcasting Corporation A Franchise To Construct, Install, Operate And Maintain
For Commercial Purposes Radio Broadcasting Stations And Television Stations In The
Philippines And For Other Purposes” hereunder referred to as the grantee, its successors or
assigns, a franchise to construct, install, establish, operate and maintain for commercial purposes
and in the public interest, radio and/or television broadcasting stations in the Philippines, is hereby
renewed for another twenty-five (25) years from the effectivity of this Act.

SEC. 2. Manner of Operation of Stations of 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 selected wavelengths


or frequencies and the quality of transmission or reception thereon as should maximize rendition
of the grantee's services and/or availability thereof.

SEC. 3. Prior Approval of the National Telecommunications Commission. ~ The grantee
shall secure from the National Telecommunications Commission (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, orto 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 from the effectivity of the Act, unless sooner revoked or cancelled. This franchise shall be
deemed ipso facto revoked in the event the grantee fails to operate continuously for two (2) years.


SEC. 7. Acceptance and Compliance. — Acceptance of this new 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 shalll 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 and 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 harmless 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, Usufruct, Assignment. - The grantee shall not lease,
transfer, grant the usufruct of, sell nor assign this franchise or the rights and privilege acquired
thereunder to any person, firm, company, corporation or other commercial or legal entity, nor
merge with any other corporation or entity, nor shall the controlling interest of the grantee be
transferred, whether as a whole or in parts 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 lease, transfer, granting the
usufruct of, sale or assignment of franchise or the rights or privileges acquired within sixty (60)


days after the completion of said transaction: Provided, further, That failure to report to Congress
such change of ownership shall render the franchise jpso 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 centum (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 the succeeding

year.

SEC. 15. Penalty Clause — Any grantee who fails to submit the Annual Report to Congress
will be fined Five Hundred Pesos (P500.00) per working day of non-compliance. Said fine will be
collected by the NTC from said delinquent franchise grantee separate from the reportorial
penalties imposed by NTC. The collected funds shalll accrue to the monitoring fund of the NTC in
line with its supervisory and regulatory functions. The reportorial compliance certificate issued by
Congress shall be required before any application for permit or certificate is accepted by NTC.

SEC. 16. Equality Clause. - Any advantage, favor, privilege, exemption, or immunity
granted under existing franchise, 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, however,


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That the foregoing shall neither apply to nor 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: Provided, further, That the foregoing shalll not apply to sale, lease,
transfer or grant of usufruct of legislative franchise with prior congressional approval.

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 Non-exclusivity 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. Publication. This Act shall be published, through the initiative of the Grantee,
fifteen (15) days after this Act is signed by the President of the Philippines or has lapsed into law.

SEC. 20 Effectivity Clause. — This Act shall take effect fifteen (15) days from the date of

its publication in at least two (2) newspapers of general circulation in the Philippines.

Approved,

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