Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

NINETEENTH CONGRESS
First Regular Session
a4
HOUSE BILL 0, 3785

introduced by HON. JOHN TRACY F. CAGAS

AN ACT
RENEWING FOR ANOTHER TWENTY-FIVE (25) YEARS THE FRANCHISE
GRANTED TO POLYTECHNIC FOUNDATION OF COTABATO AND ASIA. INC.
NDER REPUBLIC ACT NO, 8995 ENTITLED “AN ACT GRANTING THE
HNIC FOUNDATION OF COTABATO AND ASIA, INC. A FRANCHISE TO.
CONSTRUCT, INSTALL, OPERATE AND MAINTAIN RADIO AND TELEVISION
BROADCASTING STATIONS IN THE PHILIPPINES"

EXPLANATORY NOTE

Article I] Section 24 of the Constitution expressly provides that “the State recognizes the
Vital role of communication and information in nation-building.” The aforecited constitutional
provision clearly underscores the crucial role of modernizing and establishing new communication
facilities in order to constantly apprise the Filipinos all over the country’ of the important events
that are happening in our nation

Communication transcends all barriers as it conquers all by swiftly disseminating vital
information. The proliferation of radio and television broadcast networks is a vivid manifestation
that the Philippines is slowly but surely catching up with its Asian counterparts insofar as the
communication industry is concerned,

The role of the broadcasting organization in serving the needs of the public and clients in
information, educational and entertainment for the Filipino viewers should be given the utmost
jon since the services they perform to all classes of viewers. in I, is beyond
ion

In view hereof, this bill seeks to grant a franchise to POLYTECHNIC FOUNDATION OF
COTABATO AND ASIA. INC. to construct, install, operate and maintain radio and television
broadcasting stations in the Philippines.

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Itis for these foregoing premises that the approval of this bill is earnestly sought



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

NINETEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 3785

Introduced by REP. JOHN TRACY F. CAGAS

AN ACT
RENEWING FOR ANOTHER TWENTY-FIVE (25) YEARS THE FRANCHISE
GRANTED TO POLYTECHNIC FOUNDATION OF COTABATO AND ASIA, INC.
UNDER REPUBLIC ACT NO, 8995 ENTITLED "AN ACT GRANTING THE
POLYTECHNIC FOUNDATION OF COTABATO AND ASIA, INC. A FRANCHISE
TO CONSTRUCT,INSTALL, OPERATE AND MAINTAIN RADIO AND

TELEVISION BROADCASTING STATIONS IN 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 Constitution and applicable laws, rules and regulations, the
franchise granted to the Polytechnic Foundation of Cotabato and Asia, Inc.
hereunder referred to as the Grantee, its successors or assignees, under
Republic Act No. 8995 to construct, install, operate, and maintain for
commercial purposes and in the public interest, radio and television
broadcasting stations in the Philippines, where frequencies and channels are
still available for radio and television broadcasting, including digital television
system, through microwave, satellite or whatever means, as well as the use of
any new technology in radio and television systems, with the corresponding
technological auxiliaries and facilities, special broadcast and other program
and distribution services and relay stations is hereby renewed for another
Twenty- Five (25) years.

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 privilege to use its assigned

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wavelengths or frequencies and the quality of transmission or reception
thereon as should maximize rendition of the Grantee's services and the
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 or facilities and shall not use
any frequency in the radio spectrum without authorization from the NTC. The
NTC, however, shall not unreasonably withhold or delay the grant of any such
authority.

In case of any violation of the provisions of this franchise, the NTC shall
have the authority to revoke or suspend, after due process, the permits or
licenses it issued pursuant to the franchise. The NTC may recommend to
Congress of the Philippines the revocation of the franchise for any violation of
the provisions of this franchise.

SEC. 4. Responsibility to the Public. The Grantee shall provide, free
of charge, adequate public service time which is reasonable and sufficient to
enable the government, through the broadcasting stations or facilities of the
Grantee, to reach the pertinent populations or portions thereof, on important
public issues and relay important public announcements and warnings
concerning public emergencies and calamities, as necessity, urgency, or law
may require; provide at all times sound and balanced programming; promote
public participation; assist in the functions of public information and education;
conform to the ethics of honest enterprise; promote audience sensibility and
empowerment including closed captioning; and not use its stations or facilities
for the broadcasting of obscene or indecent language, speech, act, or scene,
the dissemination of deliberately false information or willful misrepresentation,
to the detriment of public interest, or to incite, encourage, or assist in
subversive or treasonable acts.

Public service time referred herein shall be equivalent to a maximum
aggregate of ten percent (10%) of paid commercials or advertisements which
shall be allocated based on need to the Executive and Legislative branches,
the Judiciary, Constitutional Commissions, and international humanitarian
organizations duly recognized by statutes: Provided, That the NTC shall
increase the public service time in case of extreme emergency or calamity.
The NTC shall issue rules and regulations for this purpose, the effectivity of
which shall commence upon applicability with other similarly situated
broadcast network franchise holders.

Pursuant to Republic Act No. 8370, otherwise known as the “Children’s
Television Act of 1997”, the Grantee shall allot a minimum of fifteen percent
(15%) of the daily total air time of each broadcasting network or station to
child-friendly shows within its regular programming.

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SEC. 5. Right of the Government. —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 that may be withdrawn any
time after due process.

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 these shall be so
operated.

SEC. 6. Term of Franchise. —This franchise shall be in effect for a
period of twenty-five (25) years from the effectivity of this 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. 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, but if any such
speech, play, act or scene, or other matter should constitute a violation of the
law or infringement of a private right, the Grantee shall be free from any
liability, civil or criminal, for such speech, play, act or scene, or other matter:
Provided, That the Grantee, during any broadcast, shall cut off the airing of
speech, play, act or scene, or other matter being broadcast if the tendency
thereof is to propose 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. 8. Warranty in Favor of the National and Local Governments.
-The Grantee shall hold the national, provincial, city, and municipal
governments of the Philippines 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 stations of the Grantee.

SEC. 9. Commitment to Provide and Promote the Creation of
Employment Opportunities. - The Grantee shall create employment
opportunities and accept on-the-job trainees in the franchise operations:
Provided, That priority shall be accorded to the residents of the place where
the principal office of the Grantee is located: Provided, further, That the
Grantee shall comply with the applicable labor standards and allowance
entitlement under existing labor laws, rules and regulations and similar
issuances.

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The employment opportunities or jobs created shall be reflected in the
General Information Sheet (GIS) to be submitted to the Securities and
Exchange Commission (SEC) annually.

SEC. 10. 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 the controlling interest
of the Grantee be transferred, simultaneously or contemporaneously, to any
person, firm, company, corporation, or entity without the prior approval of
Congress. The Grantee shall inform Congress, through the Office of the
Speaker of the House of Representatives and Office of the Senate President,
of any sale, lease, transfer, grant of usufruct, or assignment of franchise or the
fights and privileges acquired thereunder, or of the merger or transfer of the
controlling interest of the Grantee, within sixty (60) days after the completion
of the said transaction. Failure to report to Congress such change of
ownership shall render the franchise ipso facto revoked. 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. 11. 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 percent (30%) of its
outstanding capital stocks, or a higher percentage that may hereafter be
provided by law, in any securities exchange in the Philippines within five (5)
years from the effectivity of this Act: Provided, That in cases where public offer
of shares is not applicable, 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. 12. Reportorial Requirement. - The Grantee shall submit an
annual report on its compliance with the terms and conditions of the franchise
and on its operations 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 or before April 30 of every
year during the term of its franchise.

The annual report shall include an update on the commencement of
activities, development, operation, and expansion of business; audited
financial statements; latest GIS officially submitted to the SEC, if applicable;
certification of the NTC on the status of its permits and operations; and an
update on the dispersal of ownership undertaking, if applicable.


The reportorial compliance certificate issued by Congress shall be
required before any application for permit or certificate is accepted by the
NTC.

SEC. 13. Fine. - Failure of the Grantee to submit the requisite annual
report to Congress shall be penalized by a fine of One hundred pesos
(P100.00) per working day of non compliance to the NTC. The fine shall be
collected separately from the reportorial penalties imposed by the NTC, and it
shall be remitted to the Bureau of the Treasury.

SEC. 14. Equality Clause. - Any advantage, favor, privilege,
exemption, or immunity granted under existing franchises, or which may
hereafter be granted for radio and 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 territorial coverage, the term, or the type
of service authorized by the franchise.

SEC. 15. Repealability and Nonexclusivity Clause. —This franchise
shall be subject to amendment, alteration, or repeal by Congress when the
public interest so requires and shall not be interpreted as an exclusive grant of the
privileges herein provided for.

SEC. 16. Separability Clause. — |f any of the sections or provisions of
this Act is held invalid, all other provisions not affected thereby shall remain
valid.

SEC. 17. Repealing Clause. — All laws, decrees, orders, resolutions,
instructions, rules and regulations, and other issuances or parts thereof which
are inconsistent with the provisions of this Act are hereby repealed, amended,
or modified accordingly.

SEC. 18. Effectivity. - This Act shall take effect fifteen (15) days after
its publication in the Official Gazette or in a newspaper of general circulation