Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SIXTEENTH CONGRESS
Second Regular Session

5783

House Bill No.

Introduced by: HON. SALVIO B. FORTUNO

EXPLANATORY NOTE

The Rinconada Broadcasting Corporation (RBC) was incorporated and
registered with the Securities and Exchange Commission (SEC) on March 2,
1987 for the purpose of engaging in commercial radio programming and
broadcasting on a nationwide coverage.

After four (4) years of its incorporation and registration with SEC, RBC
was granted a legislative franchise to establish radio stations for domestic
telecommunications, broadcasting and telecasting by virtue of Republic Act No.
7158 on September 28, 1991 for a period of twenty-five (25) years

However, the legislative franchise of this broadcasting company is about
to expire in 2016 and there is an urgent need to seek a legislative fiat for its
continued operation.

This bill therefore seeks to renew the franchise of the —Rinconada
Broadcasting Corporation to enable it to continue its tradition of excellence and
an enduring legacy of disseminating timely, accurate and truthful information to
the Filipino people.

In view of the foregoing reasons, the approval of this bill is earnestly

sought.

SALWIO B. FORTUNO
Representative
Fifth istrict, Camarines Sur


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SIXTEENTH CONGRESS
Second Regular Session

House BillNo.__ 9783

Introduced by: HON. SALVIO B. FORTUNO

AN ACT

RENEWING THE FRANCHISE GRANTED TO RINCONADA BROADCASTING
CORPORATION (RBC) UNDER REPUBLIC ACT No. 7158 ENTITLED, “AN
ACT GRANTING THE RINCONADA BROADCASTING CORPORATION A
FRANCHISE TO CONSTRUCT, INSTALL, ESTABLISH, OPERATE AND
MAINTAIN FOR COMMERCIAL PURPOSES RADIO BROADCASTING
STATIONS AND TELEVISION BROADCASTING STATIONS IN THE
PHILIPPINES AND FOR OTHER PURPOSES”

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 Rinconada Broadcasting Corporation (RBC) 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, where
frequencies and/or channels are still available for radio and/or television
broadcasting, including digital television system, Internet Protocol (IP) -related
services and IP-value-added services, through microwave, satellite or whatever
means, including the use of any 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 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

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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, 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. Tax Provisions. - The grantee, its successors or assigns, shall
be subject to the payment of all taxes, duties, fees or charges and other
impositions under the National Internal Revenue Code of 1997, as amended, and
other applicable laws: Provided, That nothing herein shall be construed as
repealing any specific tax exemptions, incentives or privileges granted under any
relevant law: Provided, further, that all rights, privileges, benefits and exemptions
accorded to existing and future broadcasting stations franchises shall likewise be
extended to the grantee. The grantee shall file the return with the city or province
where its facility is located, and pay the taxes due thereon to the Commissioner
of Internal Revenue or his duly authorized representatives in accordance with the
National Internal Revenue Code and the return shall be subject to audit by the
Bureau of Internal Revenue.

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, or Assignment of
Franchise. - 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 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. - | 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 shall 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, 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 shall 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 in full
force and effect

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, - This Act shall take effect fifteen (15) days from its
publication in the Official Gazette or in any newspaper of general circulation in
the Philippines

Approved,