EIGHTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

House Bill No.
EXPLANATORY NOTE

This bill seeks to grant to the National Telecommunications Commission (NTC) the
power of jurisdiction and regulation over all foreign programs through the granting of Landing
Rights to foreign programmers. in particular, the NTC shall regulate the manner. rates, terms
and conditions by which foreign programs from foreign programmers are made available to
cable TV operators for the benefit of the consuming public. Likewise the NTC shall be vested
with the authority to resolve any and all disputes between the said foreign programmers and
cable TV operators.

The 1987 Constitution stresses the right of the people to information and education
which go hand in hand in attaining the progress and development of our economy and the
preservation and enrichment of our culture. To ensure the enjoyment of the said rights and
the attainment of the stated aims, ownership requirements have been imposed on relevant
industries such as the 100% Filipino ownership requirement on entities engaged in the mass
media industry

However, due to the advancements in technology and the practices in the relevant
industries, the Filipino ownership requirement on its own has not proven to be flexible nor
broad enough to implement the mandate of the 1987 Constitution. The reality is that a
substantial percentage of the mass media content disseminated throughout the country
originates from foreign entities. This is markedly so with regards to the audio-visual content
provided by foreign programmers to cable TV operators. As the cable TV industry is a mass
media industry that has considerable effect and influence on the consuming public's
mindset, perspective and even behavior, government intervention must be present. Such
government intervention will also allow for the proper collection of the applicable taxes,
thereby aiding in shoring _up the government's finances.

There is a need therefore, to regulate the manner, rates, terms and conditions by
which foreign programs from forelan programmers are made available to cable TV operators
for the benefit of the consuming public. Such need shail be addressed by granting Landing
Rights and vesting the NTC with the power of jurisdiction and regulstion over all foreign
programs as well as the authority to resolve any and all disputes between foreign
programmers and cable TV operators, thereby ensuring non-discriminatory access to
appropriate and desirable content under the framework of transparency and fair play. for the
{full attainment of the progress and development of our economy and the preservation and
enrichment of our culture.

Hence, the immediate passage of this bills earnestly sought

RUFUSA. RODRIGHEZ


EIGHTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

Rufus B.

3769

___ Introduced by Representati
House Bill No.

AN ACT
REGULATING FOREIGN PROGRAMMING THROUGH THE GRANTING OF LANDING
RIGHTS, DESIGNATING THE NATIONAL TELECOMMUNICATIONS COMMISSION AS
THE APPROPRIATE REGULATORY BODY AND FOR OTHER PURPOSES

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

PART |. GENERAL PROVISIONS
Section 1. Title - This Act shall be known as the “Landing Rights Act

Section 2. Declaration of Policy — It is the deciered policy of the State to regulate the
manner, rates, terms and conditions by which foreign programs from foreign programmers
are made avaiiabie to cable TV operators for the benefit of the consuming pubiic.

itis thus the State's responsibility to quarantee the right to information and education
of the consuming public, through granting of Landing Rights and vesting the National
Telecommunications Commission with the power of jurisdiction and regulation over all
foreign programs as well as the authority to resolve any and all disputes between foreign
programmers and cable TV operators, thereby ensuring non-discriminatory access to
appropriate and desirable content under the framework of transparency and fair play, for the
full attainment of the progress and development of our economy and the preservation and
enrichment of our culture

Section 3. Construction and Interpretation - The provisions of this Act shall be liberally
construed in order to carry out the declared policy of the State.

Section 4. Definition of Terms — for the purposes of this Act, the following terms shall refer
to their respective definitions:

a. Cable TV Operator — refers to a party duly authorized by the Commission to provide
signals directly to the consuming public through the use of the appropriate technical
facilities.

b. Commission — refers to the National Telecommunications Commission or its
successor agency as the appropriate regulatory body which shall implement the
provisions of this Act.

c. Consuming Public — refers to the consumers or end users of the signal such as the
subscribers of the cable TV operators

d. Foreign Channel - refers to a particular foreign program assigned a name by the
foreign programmer from whom it originates and a number by the cable TV operator
which provides it directly to the consuming public.

e. Foreign Program — refers to @ signal transmitted or distributed into/in the territory of
the Philippines which originate from a foreign programmer.

f. Foreign Programmer — refers to any party from whom signals originate and which
fall into any of the following categories’

4. is not 100% Filipino owned. or:


is incorporated outside of the territory or laws of the Philippines, or:

maintains its headquarters outside of the territory of the Philippines, or.

maintains its primary transmission facilities outside of the Philippines, or.

is a combination of any of the above categories.

g. Free-to-Air Signal — refers to a signal which is transmitted or distributed intofin the
territory of the Philippines which may be freely received and provided for
consumption

h. Illegal Foreign Programmer — refers to a foreign programmer without a Landing
Right or one with a Landing Right which has been suspended, revoked or which has
expired and has not been renewed.

i. Landing Right — refers to the right to transmit in/into the territory of the Philippines a
particular foreign program/foreign channel, granted to the foreign programmer from
whom it originates after the said foreign programmer's proper application is duly filed
with and approved by the Commission.

j. Signal — refers to electromagnetic waves used for the transmission of content such
as audio or audio-visual media and/or other data and information

ARON

Section 5. The Commission — The National Telecommunications Commission is hereby
designated as the appropriate regulatory body which shail impiement the provisions of this
Act. In particular the Commission shall be vested with the jurisdiction over and regulation of
all foreign programs, including the power to grant, renew and revoke Landing Rights, as well
as the authority to resolve any and all disputes between foreign programmers and cable TV
‘operators to ensure non-discriminatory access to appropriate and desirable content under
the framework of transparency and fair piay.

Likewise, the Commission shail also be granted other powers and functions
necessary to carry out the provisions of this Act, including the formulation of the appropriate
Implementing Rules and Regulations to be issued no later than six months from the

effectivity of this Act.

PART I. PROCEDURES FOR COMPLIANCE
Section 6. Requisites for the Grant of an Original Landing Right ~ An original Landing
Right shail only be granted to a foreign programmer which has paid the mandated
application fee. proven its possession of the specified requirements and submitted a duly
executed application. The application shall be filed in the form and manner prescribed by the
Commission. serve as a legal manifestation of the foreign programmer that it possesses all
the requirements as specified by the Commission and shail contain among other things the
following
a. The particulars of the foreign programmer — which shall include the name
address, incorporation details and papers of the foreign programmer as well as the
names, addresses, nationalities and positions of its primary officers and, where
applicable, the name and address of its local representative for the purposes of
notices and legal processes
b. An undertaking whereby the foreign programmer submits to the applicable
laws of the Philippines and the jurisdiction of the Commission — which shall bind
the foreign programmer to comply with the laws of the Philippines, including the
applicable tax laws, and the jurisdiction and regulation of the Commission to grant,
renew and revoke Landing Rights as well as its authority to resolve any and all
disputes between foreign programmers and cable TV operators
¢. Respective technical and financial profiles of the foreign programmer — which
shall allow the Commission to determine whether or not the foreign programmer has
the capability to provide a continuous, wide-ranging and high-quality signal for the
whole duration of the effectivity of its Landing Right
4d. Duly certified copies of contracts with cable TV operators — which shall allow the
Commission to monitor and prevent the circumvention of the said contracts and the
provisions of this Act, and


e. Proposed uniform rates to be offered — which shall be adjusted, finalized and
approved by the Commission on the basis of the data and information submitted by
the foreign programmer and the cable TV operators and considerations of
reasonableness, transparency and fair play.

Section 7. Proof of Payment of Taxes — As an annual requirement for the enjoyment of the
Landing Right to be granted, the forelan programmer concemes shall be required to submit
proof of payment of any and ail applicable taxes in the form and manner prescribed by the
Commission

Section 8. Procedure for the Grant of an Original Landing Right — The procedure for the
grant of an original Landing Right shall be initiated with the filing by a foreign programmer of
a duly executed application and the payment of the mandated fee. Upon such initiation, the
Commission shall proceed to determine the completeness and sufficiency of the application
form, mandated fee and the other requirements.

The Commission may schedule hearings and/or the submission of proofs to
substantiate the claims of the applicant foreign programmer, as it deems necessary, and
shall notify the said applicant of any and all flaws and problems in its application. Thereafter.
the Commission shall issue a written order granting or not granting the application, with the
factual and legal antecedents, within six months of the filing of the same. An original Landing
Right thus granted shall have an effectivity period of five years

Section 9. Requisites and Procedure for the Renewal of a Landing Right — The
Tequisites and procedure for the renewal of a Landing Right shail be analogous to those for
the grant of an original Landing Right, except for the following:

a. That the requisites should be completed and submitted at least six months before the

expiration of the pre-existing Landing Right

b. That the foreign programmer shall also submit proof of payment of any and all

applicable taxes paid during the last three years.

c. That the fee for the renewal of the pre-existing Landing Right shall be an amount
equivalent to eighty percent (80%) of the fee charged for the grant of the original
Landing Right:

That the new Landing Right shail only be effective for a period of three years, and;

@ That in case a foreign programmer's Landing Right was not renewed or was revoked
the former would have to follow the requisites and procedure for the grant of an
original Landing right

a

Section 10. Exclusivity of a Landing Right — A Landing Right granted under the provisions
of this Act is exclusive to a particular foreign program or foreign channel originating from a
foreign programmer. It may not be sold, leased out or otherwise reassigned to a different
foreign program or foreign channel, whether such originate from the same or a different
foreign programmer.

Section 11. Time Period for Compliance — Foreign programmers have one year from the
effectivity of this Act to comply with the procedures and requirements for the arant of Landing
Rights.

PART Ill. EFFECTS AND REMEDIES IN CASE OF NONCOMPLIANCE
Section 12. Effects of Failure to Comply — Failure to comply with the provisions of this Act
shall produce the following effects:

a. As to the status of the foreign programmer — the foreign programmer at fault shall
be deemed to be an illegal foreign programmer and as such its rights and privileges
shall be immediately suspended.

b. As to the status of the foreign programmer's contract with a cable TV operator
= the contract with a cable TV operator of a foreign programmer at fault shall be


deemed to be immediately terminated;

c. As to the status of the foreign programs originating from the foreign
programmer — the foreign programs originating from the foreign programmer at fault
shail immediately be deemed to be free-to-air signals, and

d. As to the application of other fines and penalties ~ the foreign programmer at
fault shall also be liable for other fines and penalties as provided in the following
sections.

Section 13. Grounds for the Revocation of Landing Rights ~ The following shall be the
grounds for the revocation of Landing Rights:

a. Continued or repeated violations — violations of this Act which last for more than
three months as well as three violations of this Act within the span of one year are
grounds for the revocation of landing rights:

b. Ignoring the commission's jurisdiction and/or authority — refusal or failure to pay
the applicable fees or fines as well as the refusal or failure to follow the orders of the
Commission are grounds for the revocation of landing rights

c. Employing schemes and machinations for circumvention ~ the employment of
schemes and machinations for the circumvention of the provisions of this Act, such
as the direct delivery of a foreign program to the consuming public by the foreign
programmer with or without a Landing Right. shail be @ ground for the revocation of
landing rights

Section 14. Applicable Fines and Other Penaities — A party which fails to comply with or
Violates any provision of this Act shall be liabie to pay a fine which shall not be less than five
thousand Pesos (P5,000.00) but in no case shall be more than one hundred thousand Pesos
(P100,000.00) depending on the severity of the act or omission involved.

Provided, that inthe case of a foreign programmer which elther ignores the
Commission's jurisdiction and/or authority or employs schemes and machinations for
circumvention, the applicable fine shall not be less than one hundred thousand Pesos
(P100,000.00) but in no case shall be more than five hundred thousand Pesos
(P500,000.00), accordingly.

Provided further, that in the case of a party which wilffully aids a foreign programmer
either in ignoring the Commission's jurisdiction and/or authority or in employing schemes
and machinations for circumvention, the applicable fine shall not be less than ten thousand
Pesos (P10,000.00) but in no case shall be more than two hundred thousand Pesos
(P200,000 00), accordingly.

Section 15. Remedies in Case of Failure to Comply or of a Dispute ~ The party which
incurs an injury as a result of the failure to comply or violation of the provisions of this Act
shall within 30 days of the discovery of the supposed failure or violation, file a formal request
for investigation with the Commission in the form and manner prescribed by the latter.

in case of a dispute between foreign programmers and cable TV operators, either of
the parties may file a formal request for investigation with the Commission also in the form
and manner prescribed by the fatter.

PART IV. FINAL PROVISIONS
Section 16. Appropriations - The amount necessary for the implementation of this Act shall
be included in the General Appropriations Act of the year following its enactment into law
and thereafter.

Section 17. Transitory Provision — Any revocation, modification or novation of pre-existing
valid contracts as weil as any new contracts and acts made after the effectivity of this Act
shail be subject to the provisions of this new body of laws.


Section 18. Separability Clause - If any provision of this Act is held invalid, all other
provisions not affected thereby shail remain vaiid.

Section 19. Repealing Clause - All laws, Presidential Decrees, Executive Orders, rules and
regulations or any other issuances or parts thereof inconsistent with this Act are hereby

repealed or amended accordingly

Section 20. Effectivity - This Act shali take effect fifteen (15) days from the date of its
publication in at least two (2) newspapers of general circulation

Approved,