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+ REPUBLIC OF THE PHILIPPINES
CONGRESS OF THE PHILIPPINES
HOUSE OF REPRFSENTATIVES
QUEZON CITY

SECOND REGULAR SESSION
wouse sito __5147

Introduced by: REP. DAKILA CARLO ENRIQUEZ CUA

AN ACT
AMENDING REPUBLIC ACT NO. 7306 —
AN ACT PROVIDING FOR I ESTABLISHMENT OF THE PEOPLE'S TELEVISION
NETWORK, INCORPORATED, DEFINING ITS POWERS AND FUNCTIONS.
PROVIDING FOR ITS SOURCES OF FUNDING AND FOR OTHER PURPOSES

EXPLANATORY NOTE

The People’s Television Network Inc. (PTN1) is the flagship television network owned by the
Philippine Government, PTNI began operations in 1974 as Government Television (GTV-4) and was
the broadcast arm of the National Media Production Center (NMPC). In 1980, GTV-4 evolved into
the Maharlika Broadcasting System (MBS). Following the People Power Revolution in 1986, MBS.
was renamed People's Television (PTV).

In 1992, the network became a government-owned and controlled corporation known as
People’s Television Network, Inc. (PTNA) by virtue of Republic Act No. 7306 which was signed by
President Corazon C, Aquino

On July 16, 2001, PTNI adopted the name National Broadcasting Network (NBN) as its call
name, in recognition of the need to develop a new image in line with its new programming thrusts.

Since 1992, PTNI has been operating on revenues it generates on its own. It generates its
revenue through airtime sales, commercial spots co-productions, inter-agency collaborative programs
and equipment rental. In July 2001, the Network stopped airing commercial advertisements. as
stipulated in its Charter. To augment its operational requirements, PYNL has received government
subsidies released as needed based on requests made by the Network from the National Government.


‘thus, there is an urgent need to regenerate and improve the information mechanisms of
government. Under its Charter, the Network does not receive annual appropriation for operations.
Mrer 2001, PTNUNBN by cxpress provision of law, specifically, section 19 of Title VII of RA 7306,
Cannot engage in commercial advertising which has made it difficult to meet its daily ‘operational
expenses. Curtenily, PTNUNBN is under financial rehabilitation and is in serious need of capital
Jalyston to be able move towards it being self-sufficient and commercially viable once again

This bill sceks to amend the PTV Charter to do the following: (a) to allow the network to
generate funds from advertising and airtime sales and the same shall be utilized by PTV solely for its
Sperations and capital expenditure: {b) for government to approve @ capital infusion to jumpstart the
rehabilitation of the network; and (¢) for the network to adopt other measures that will help restore
the viability of the network operations

Thus, approval of this bill is highly endorsed

Dal RLO ENRIQUEZ CUA


REPUBLIC OF THE PHILIPPINES
CONGRESS OF THE PHILIPPINES
HOUSE OF REPRESENTATIVES
QUEZON CITY

SECOND REGULAR SESSION

Housr siLtNo.___ 51.4’?

Introduced by: REP. DAKILA CARLO ENRIQUEZ CUA

AN ACT
AMENDING REPUBLIC ACT NO, 7306 —

AN ACT PROVLDING FOR THE ESTABLISHMENT OF THE PEOPLE'S TELEVISION
NETWORK, INCORPORATED, DEFINING ITS POWERS AND FUNCTIONS,
PROVIDING FOR ITS SOURCES OF FUNDING AND FOR OTHER PURPOSES

Re it enacied by the Senate and the House of Represemattves of the Philippines in Congress assembled:

TITLE 1. — GENERAL PROVISIONS

SECTION 1. Title, — This Act shall be known as the "Amended Charter of the People's
Television Network, Incorporated”.

SECTION 2. Declaration of Policies. — In consonance with the Constitutional recognition
of the vital role of communication and information in nation-building, and the important
aspect played by the broadcasting industry. it is hereby declared as the policy of the Stare to:

a)

b)

c)

4)

a)

Fully develop communication structures suitable to the needs and aspirations of the
nation and in accordance with a policy that respects the freedom of speech and of the
press;

Give priority to education, science and technology, arts, culture, and sports to foster
patriotism and nationalism, accelerate social progress, and promote total human
liberation and development:

Develop the broadcasting industry as a medium for the development, promotion and
advancement of Filipino nationalism, culture and values that serve as an instrument
in the struggle for Filipino sovereignty. identity, national unity and integration;
Harness the resources of the government and the private sector towards a close,
continuous and balanced cooperation in order to take advantage of technological
advances in the broadcasting industry:

Maintain a broadcast industry system that serves as a vital link for participative
democracy and effective government information dissemination through
developmental communication, free from any political or partisan influence and held
accountable directly to the people;

Encourage the development and broadcast of balanced programs which feature,
among others, educational, wholesome entertainment, cultural, public affairs and
sports, and



g) ENSURE THAT THE GOVERNMENT TELEVISION SHALL NOT
UNDULY COMPETE WITH THE PRIVATE TELEVISION SECTOR FOR
ADVERTISING AND COMMERCIAL INTEREST AS FAR AS
PRACTICABLE;

hy) PROVIDE QUALITY ALTERNATIVE PROGRAMS FOR THE BENEFIT

AND MORAL UPLIFTMENT OF THE CITIZENRY.

TITLE il. -— CREATION AND DOMICILE

SECTION 3, Creation. There shall be created a body corporate ta be called "The
“People's Television Network, Incorporated,” hereinafter referred to as the "Network," which
shall engage in television broadcasting in the Philippines, The Network shall be government
owned and controlled corporation under a Board of Directors to be appointed by the President
of the Philippines

SECTION 4. Corporate Existence. — The legal existence of the Network shall be for a
period of fifty (0) years from the effectivity of RA 7306, NOTHWIATSTANDING, ANY
PROVISION OF LAW TO TIVE CONTRARY: PROVIDED, HOWEVER, THAT AT
TLE END OF THE SAID PERIOD, THE NETWORK SHALL AUTOMATICALLY
CONTINUE TO EXIST FOR ANOTHER FIFTY (50) YEARS, UNLESS
OTHERWISE PROVIDED BY LAW.

SECTION 5, Domicile, — Whe Network shall have its principal office and domicile in the
‘Metropolitan Manila area. Tt may also establish offices, branches and/or stations in any part
of the Philippines as its Board of Directors may sce fit.

SECTION S-A. — THE GOVERNMENT OF THE PHILIPPINES, THROUGH THE
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES AND THE
BUREAU OF LANDS, SHALL IDENTIFY AND APPROPRIATE ALIENABLE
GOVERNMENT LAND FOR THE NETWORK TO ESTABLISH AND BUILD ITS
MAIN BROADCAST CENTER AND MAJOR PROVINCIAL STATIONS, FOR
POSSIBLE EXPANSION.

TITLE M1. — FRANCIISE AND LICENSE TO OPERATE

SECTION 6. Franchise Grant. — Subject to the provision of the Constitution, laws, orders,
decrees not inconsistent herewith, the network is hereby granted a franchise to construct,
maintain and operate television broadcasting stations and satellite receiving and transmitting
facilities in the Philippines for a period co-terminus with the corporate existence of the
Network

SECTION 7. License to Operate. — The National Telecomanunications Commission
(NTC) shall forthwith cause the issuance to the Network of the corresponding license to
operate upon compliance with all its requirements


TITLE IV.— POWERS AND FUNCTIONS
SECTION 8. Powers of the Netw ‘ork. - - The Network shall have the following powers:

a) to sue or be sucd in its corporate name;

b) to have continuous succession in its corporate name,

¢} to adopt and use a corporate seal,

4) to adopt by-laws pot contrary to law, morals, o public policy. and to amend or repeal
the same in accordance with the provisions of existing laws;

¢) to ACQUIRE, purchase, receive, take of grant, hold, convey, sell, lease, pledge,
‘mortgage and otlierwise deal with such real and personal property;

f) to establish, purchase, install, construct. use and tmaimain national, regional.
provincial community stations and facilities for television broadcasting throughout
and in any part of the country,

4) to enter into joint ventures or partnerships with other broadcasting authorities and
Stations or anternational agencies or private organizations for the purpose of
promoting its broadcasting services,

bh) to raise, borrow or obtain funds, from any source, private oF government. foreign or
omestic and to enter into any Gnancial or credit arrangements in order to support
‘and carry out its objectives and purposes. subject to the pertinent laws governing
public debt and expenditure,

i) w receive donations and grants from any source whether Jocal or foreign and avail of
official development assistance and ‘concessional loans provided by foreign
governments, foundations or financial institutions,

j) to emer into, make, perform and carry out contracts of any kind and description in
furtherance of the corporate purpose with any person, firm, association or
corporation;

k) to accept corporate institutional support for developmental programs and to determine
Che crnditions subject to which said programs may be accepted for television
transmission, and

1) to exercise the general powers outlined in the Corporation Code of the Philippines, as
cll as each other incidental powers as may be necessary to catry on its activities

SECTION 9, Functions of the Nerwork. — The Network shall have the following functions:

a) to setve primarily as a vehicle for the State for purposes of education, science and
technology, arts, culture, and sports in order to foster national pride and identity,

b)_ to serve as u vehicle for bringing the Government closer to the people in order to
cnhance their awareness of the programs. policies, thrusts, and directions of the
Government,

¢} to ensure that the programs broadcast by the Network maintain a high general
Mandard in all respects, and in particular, in respect to their content and quality and
proper balance of educational, news, public affairs, entertainment, and spors
programs,

d) to serve as an effective outiet for alternative programming;

©) TO PROVIDE AIRTIME 10 LEGITIMATE PEOPLE'S ORGANIZATIONS
AND NON GOVERNMENT ORGANIZATIONS IN THE PROMOTION OF
THEIR PROGRAMS AND PROJECTS;

1) to serve as an effective medium for national unity and politicat stability by reaching
as much of the Filipino population as possible through the effective use of modern
broadcasting technology: and



included in the programs broadcast by the Network which

g) to ensure that notl
shall;

1. offend public morals, good taste, or decency.

2. offend any racial group or promole ill-will between different races or different
public groups, prescribing such programs as would promote strictly partisan
politics and propaganda,

Offend the followers of any religious faith, sect, or order, or

4. outrage public feeling in general

TITEE V. ~ CORPORATE STRUCTURE

SECTION 10. fhe Board of Directors — The corporate powers of the Network shal! be
exercised, all its business conducted and all its property controled and held by the Board of
Directors. It shall be composed of five (5) members who shall be appointed by the President
of the Philippines. The Board shall be made up of the following

a) two (2) members from the Government sector,

b) two (2) members from the private sector, one (1) of whom shall have at least ten (10)
years of experience in the broadcast industry, and

c) one (1) member trom the educational sector.

SECTION 10-A, The Advisory Bourd. — THE PRESIDENT OF THE PHILIPPINES
SHALL. APPOINT SEVEN (7) SECTORAL MEMBERS WITH WIDE EXPERIENCE
AND EXPERTISE IN THEIR RESPECTIVE FIELDS OF WORK TO CONSTITUTE
THE ADVISORY BOARD.

THE MEMBERS OF THE ADVISORY BOARD MAY BE CHOSEN FROM AMONG
NOMINEES Of’ ASSOCIATIONS AND ORGANIZATIONS REPRESENTING
VARIOUS STAKEHOLDERS IN THE BROADCAST INDUSTRY AND THEY
SHALL SERVE WITH A FIXED TERM OF ONE (1) YEAR.

TRE ADVISORY BOARD SHALL SERVE AS THE STRATEGIC AND POLICY
MAKING BODY THAT WILL FORMULATE POLICIES TO GOVERN THE
NETWORK. THE CHAIRMAN OF THE BOARD OF DIRECTORS SHALL BE AN
EX-OFFICIO MEMBER OF THE ADVISORY BOARD.

SECTION 11. Quailifications of the Members of the Board. — The members of the Board
shall be of proven and unquestionable probity. integrity, honesty, impartiality, reputation, and
knowledgeable of the broadcast industry. They shall not be, in any way. connected with any
other broadcasting corporation or hold any position that may conflict with their functions and
duties as Directors of the Network

[fa member shall be appointed to another government office or suns for any elective position,
he shall be deemed to have vacated membership in the Board on the day of his appointment
or filing of his candidacy, as the case may be.


SECTION 12. erm of the Members of Board. — The initial appointees of the President of
the Philippines shall have the following terms:

a) three (3) directors, one from each sector, for two (2) years, and
b) the other two (2) directors, one (1}} each from the government and private sector, for
four (4) years.

Subsequent appointees shall serve a term of ONE (1) YEAR TERM SUBJECT TO
REAPPOINTMENT BY TBE PRESFIDENT. Appointment to any vacancy In the
Board shall be for the unexpired portion of the term of the predecessor.

THE MEMBERS SHALL ELECT AMONG THEMSELVES ONE WHO WT.L
SERVE AS CHAIRMAN OF THE BOARD, THE BOARD SHALL MEET AT
LEAST TWICE A MONTH TO DISCUSS MATTERS OF POLICY IN ORDER
‘0 EFFECTIVELY CARRY OU'l THE PROVISIONS OF THIS ACT.

SECTION 13. Functions and Duties of the Board of Directors. — The general functions
and duties of the Board of Directors shall be as follows

a) to carry out the provisions of this Act.

b) to exercise the corporate powers, and conduct all business of the Network:

¢) to decide matters of policy; and

d) to submit to the President of the Philippines and the Congress a comprehensive
annual report on the operation of the Network within the first sixty (60) days of the fiscal
year.

SECTION 14, The Network General Manager. — The Network General Manager shall be
elected by the Board, of which he need not be a member. In the latter case, he shall serve as
an ex-officio member of the Board. He shall also be the Chief operating Officer of the
‘Nenwork, who shall be responsible for the proper administration and management of the
Network in accordance with the policies taid down by the Board

If the Network General Manager is absent, or is incapacitated by reason of illness or for any
other cause, is temporarily unable to perform his duties, the Board of Directors may designate
an officer-in-charge to act in his place and stead during such absence from duty

SECTION LS. Powers ancl Functions af the Network General Manager. — Subject to the
control and supervision of the Board, the Network General Manager shall have the following
powers and fisnetions

a) submit policy recommendations and propose measures necessary to carry out the
objectives and functions of the Network for the consideration of the Board;

b)_ recommend to the Board for approval an organizational structure and plantilla for
personnel of the Network, in accordance with existing laws, rules and regulations;

©) execute, administer and implement policies and measures approved by the Board:

d} Submit (o the Board an annuat budget and such supplemental budgets as may be
necessary for its consideration and approval,

e) represent the Network, its dealings with other persons, entities, agencies and
institutions, whether public or private. domestic or foreign, subject to the limitations
and conditions hereinprovided:



£) appoint, subject to the confirmation by the Board, discipline or remove for cause,
officer and personnel of the Network in accordance with the Civil Service Law, rules
and regulations; and

4) perform such other functions and duties which may be assigned to him by the Board.

TITLE VI. — PROGRAM STANDARDS

SECTION 16, General Program Standards, -- The Board of Directors is mandated to set
up a Code of Standards, inclusive of the following aspects:

a) Presentations of News

b) Public Affairs Programs and Commentaries

¢) Public Service Programs

d) Educational Programs

¢) Children’s Programs

£) Agriculture and Livelihood Programs

g) Women and Youth Issues

h) Lovally-produced and foreign produced programs.

SECTION 17, USE OF BLOCKTIMERS. — THE USE OF BLOCKTIMERS SHALL
BE ALLOWED BUT LIMITED TO EDUCATION, SPORTS, QUALITY
ENTERTAINMENT PROGRAMS, AND SUCH PROGRAMS WHICH PROMOTE
NATIONAL INTEREST, SUBJECT TO QUALITY STANDARDS SET BY THE
BOARD OF DIRECTORS, THE NETWORK SHALL ASSUME SOLIDARY
LIABILITY WITH EACH OF THE INDIVIDUAL PRODUCERS, FOR THE
CONTENT OF ALL PROGRAMS SHOWN BY BLOCKTIMERS.

TITLE VIL — FINANCLAL PROVISIONS,

SECTION 18, CAPITALIZATION, — THE ADDITIONAL AUTHORIZED CAPITAL
STOCK OF THE NETWORK SHALL BE SUBJECT TO APPROPRIATION IN THE
GENERAL APPROPRIATIONS ACT,

SECTION 19. REVENUE GENERATION. —THE NETWORK SHALL BE
ALLOWED TO GENERATE FUNDS FROM ADVERTISING AND AERTIME SALES.
IN ACCORDANCE WiTIL THE POLICIES AND RATES SET BY THE BOARD OF
DIRECTORS. SUBJECT TO EXISTING LAWS, ALL FEES OR OTHER REVENUES
COLLECTED OR RECEIVED BY THE NETWORK SHALL BE RETAINED BY IT
AND UTLLIZED SOLELY FOR ITS OPERATIONS AND CAPITAL.
EXPENDITURES,

SECTION 19-A. EXEMPTION FROM RA No. 7656.- THE NETWORK SHALL BE
EXEMPT FROM REMITTING FIFTY PERCENT (50%) OF ITS ANNUAL NET
EARNINGS AS PROVIDED BY RA No. 7656, SUBJECT TO THE APPROVAL OF
TILE DEPARTMENT OF FINANCE, PROVIDED, THAT THE ANNUAL NET
EARNINGS BE USED SOLELY FOR ITS OPERATIONS AND CAPITAL
EXPENDITURES.



TITLI: VAL - ADMINISTRATIVE PROVISIONS

SECTION 20. Record of Transactions, — The Network shall keep proper accounts and
records of all its tcansactions and affairs, and shall do all things necessary to ensure that all
payments made out of its moneys are correctly made and properly authorized, and that
adequate control is maintained over the assets of, or in the custody of, the Network and the
expenditures incurred by the Network. The Network shall be subject to audit by the
Commission on Audit

TITLE IX — TAX EXEMPTIONS

SECTION 21. Vax Exemptions on Importations. — The importations of equipment.
apparatus and materials to he actually, directly and exclusively used in the operation of the
Network, whether purchased from or donated by any foreign government and/or private
entity shall be free fiom the payment of any and all forms of taxes, license fees and customs
duties that may be levied upon them. Such equipment and apparatus shall include cameras,
TV monitors and recorders, TV transmitters, electronic tubes, editing machines, and all such
necessary equipment required for television broadcasting: provided, that the subsequent
importation of the equipment, apparatus and materials shall be subject to review by the
Department of Finance: provided, further, that in the event the equipment, apparatus and
materials are sold to non-tax exempt persons or entities, the buyers shall be considered the
exporters who shall then be subject to tax

SECTION 21-A, EXEMPTION FROM REAL PROPERTY TAX. - SUBJECT ‘VO THF.
PROVISIONS OF THE LOCAL GOVERNMENT CODE AND THE NATIONAL
INTERNAL REVENUE CODE, THE NETWORK SHALL BE EXEMPT FROM.
REAL PROPERTY TAX PROVIDED THAT SAVINGS FROM REAL PROPERTY
TAX EXEMPTION WILL BE USED TO FUND CAPITAL EXPENDITURES AND
OPERATIONS FOR THE NETWORK.

TITLE X, — EMPLOYEES OF THE NETWORK

SECTION 22. Civil Service Law Coverage for Employees. — ‘the hiring, appointment.
employment, promotion, disciplinary control, and other terms and conditions of the service of
all employees of the Network, and such other matters affecting its employees shall be
consistent with the provisions of the Civil Service Law, rules and regulations: PROVIDED,
HOWEVER, THAT POSITIONS CONSIDERED AS CREATIVE AND ARTISTIC IN
NATURE SHALL BE EXEMPTED FROM THE QUALIFICATION STANDARDS
AND CIVIL SERVICE ELIGIBILITY REQUIREMENTS.

SECTION 23. Salary Scale Jor Officials cael Employees. — The rates of compensation and
classes of positions in the Network shall not be covered by Republic Act 6758 and the
Compensation and Position Classification Board (CPCB)

SECTION 24. GSIS Coverage for Employees. — All employees hired by the Network shall
be deemed members of the Governments Service insurance System (GSIS) for the purpose of
employee benefits


TITLE XL. — MISCELLANEOUS PROVISIONS

SECTION 25. Tremwsition Clause. — All the powers, functions, assets and liabilities,
capital, accounts, contracts, and facilities pertaining to the People's Television (PTV), and all
equipments relating to television broadcasting owned by the government shall be transferred
to the Network,

SECTION 26. Transitory Provision. — The Network General Manager shall recommend
to the Board of Directors a corporate plan thal includes programming direction, budget
‘organizational plan ang structure, a staffing pattern and compensation plan within ninety (90)
days from the eflectivity of this Act. Said corporate structure shall be implemented by the
Network General Manager within thirty (30) days after its approval by the Board of
Directors: provided, that the current and incumbent employees of the People's Television
{PTV) shall be absorbed and accommodated by the Network

SECTION 26-4. REORGANIZATION OF THE NETWORK. - NINETY (90) DAYS
FROM THE APPROVAL OF THIS ACT, THE BOARD OF DIRECTORS IS
HEREBY EMPOWERED TO REORGANIZE. THE NETWORK TO MAKE. TT
MORE EFFECTIVE AND INNOVATIVE. FOR THIS PURPOSE, THE BOARD MAY
ABOLISH OR CREATE OFFICES, TRANSFER FUNCTIONS, EQUIPMENT,
PROPERTIES, RECORDS, AND PERSONNEL, INSTITUTE COST-CUTTING AND
OTHER RELATED MEASURES TO CARRY OUT THE SAID OBJECTIVE:
PROVIDED, THAT ANY OFFICIAL OR EMPLOYEE OF THE NETWORK WHO
MAY BE PHASED OUT BY REASON OF THE REORGANIZATION AUTHORIZED

HEREIN SHALL BE ENTITLED TO SUCH BENEFITS AS MAYBE DETERMINED
BY EXISTING LAWS.

SECTION 27. Amendments. — The provisions of this Act shall be subject to amendments,
alteration or repeal by the Congress of the Philippines, when public interest so requires

SECTION 28, Separabitity Clause. — If any provision or part of this Act is declared
invalid or unconstitutional, the remainder shall not be affected thereby and shall contimue to
be in full force and effect

SECTION 29. Repealing Clause. All laws, decrees, executive orders, administrative
orders, rules and regulations, and other issuances or parts thereof inconsistent herewith are
hereby repealed, amended or modified accordingly

SECTION 30. Lffectivity Clause. — This Act shall take effect fifteen (15) days after its
publication in two (2) national newspapers of general circulation.

Approved: