2023 Laws of Puerto Rico › TITLE TWENTY-SEVEN - Public Service (§§ 1 — 2641) › PART II - Communications (§§ 265 — 539) › Chapter 25 - Telephone Authority (§§ 401 — 425) › § 409 - Subsidiary corporations

The Authority is hereby empowered to create by resolution, such subsidiary corporations that it deems convenient to carry out the purposes of this chapter and to lend and give funds and transfer any of its properties to such subsidiary corporations. Said subsidiary corporations shall be public corporations wholly owned by the Authority and shall have the powers and duties conferred [upon] the Authority by the provisions of this chapter, that are assigned to them by the Board of Directors. The Board of Directors shall appoint the members of the Board of Directors of any of such subsidiary corporations; Provided, That the Board of Directors thereof shall include the President of the Bank among its members.
All the general powers granted to the Authority under this chapter are hereby granted to said subsidiaries in the performance of their powers and duties assigned to them by the Board of Directors.
The Controller of Puerto Rico shall supervise all the income, accounts and disbursements of the Puerto Rico Telephone Authority, and of any subsidiaries created under this section which are established under the provisions of this chapter.
(a) Subsidiary operating public broadcasting facilities.— Pursuant to the powers provided in this chapter, the Puerto Rico Telephone Authority and the Department of Education are hereby authorized to seek the transfer of the license to operate nonprofit public radio and television services issued by the Federal Communications Commission of the United States.
In the event of such a transfer, a subsidiary nonprofit public corporation of the Telephone Authority shall be created, which shall be known as the “Puerto Rico Public Broadcasting Corporation”.
(b) Legislative purpose.— Subsections (b) to (g) of this section have the purpose of creating a subsidiary public corporation which shall operate independently and separately from any entity of the Authority, with the necessary operational and financial capacity to integrate, develop and operate the communications facilities owned by the people of Puerto Rico in an effective manner and pursuant to the provisions and limitations established hereinafter. These facilities shall be used for educational, cultural and public service purposes for the people in general, and not for private purposes, or partisan politics or sectarian propaganda, except as provided in Article 3.016 of the “Electoral Act of Puerto Rico”.
The programs broadcast by the Puerto Rico Broadcasting Corporation shall be guided by a policy of excellence, objectivity and balance in everything of a controversial nature.
The programming shall reflect harmony between the imparting of knowledge and practical information. It must also emphasize the broadest view of knowledge with attention to the philosophy and perception of social, economic and cultural reality as something tied to history with a commitment at the same time to a better future. The programming of the stations must contribute to the development of a critical conscience and highlight human dignity and values in its broadcasts.
The Puerto Rico Public Broadcasting Corporation shall abstain from purchasing or renting radio or television programs identified as syndicated programming whose only apparent value is entertainment. However, public interest programs of an educational, informational, cultural, documentary, musical, historical nature or sports events or other similar programs will not be affected by this limitation regardless of their syndicated programming classification.
(c) Board of Directors of the Puerto Rico Public Broadcasting Corporation.— The powers, faculties and duties of the Puerto Rico Public Broadcasting Corporation shall be exercised, and its operational and administrative policy shall be determined by a Board of Directors.
The Board shall be constituted by the Executive Director of the Puerto Rico Telephone Authority, the Secretary of Education, the President of the University of Puerto Rico, the Executive Director of the Institute of Puerto Rican Culture and seven (7) private citizens in representation of the public interest. The members in representation of the public interest shall be appointed by the Governor with the advice and consent of the Senate, and at least three (3) of them shall be persons of proven interest, knowledge and experience in education, culture, the arts, science or radio and television communications. Members in representation of the public interest shall receive per diems as indicated below and shall hold office for a term of five (5) years each and until their successors are appointed and take office. The initial appointments shall be for the following terms: one member for one (1) year; one member for two (2) years; one member of three (3) years; one member for four (4) years and one member for five (5) years. Any vacancy in said offices shall be filled for the unexpired term thereof through an appointment that must be made within a term not to exceed sixty (60) days from the date the vacancy occurred. Provided, That, except for the Executive Director of the Telephone Authority, the officials or employees of the Telephone Authority and its subsidiaries, or persons with direct and substantial financial interests in the commercial radio and television industry shall not be members of the Puerto Rico Public Broadcasting Corporation.
Seven (7) members of the Board of Directors shall constitute a quorum for the handling of the subsidiary’s affairs and every decision must be adopted by a majority vote. The functions of the members of the Board of Directors, as well as their attendance [at] the meetings shall not be delegated.
No later than thirty (30) days after the date on which all of its members have been appointed, the Board shall meet, organize, and elect from among its members a Chairperson, and a Vicechairperson who will act for the Chairperson when he is absent. It shall also appoint an Executive Director for the Puerto Rico Public Broadcasting Corporation and a Secretary of the Board. These officials shall hold office at the will of the Board which will determine their functions, responsibilities and duties and will fix their remuneration and other benefits.
Board members will not receive any remuneration whatsoever for the performance of their duties as such, but those who are not public officials or employees shall be entitled to per diems that shall not exceed fifty dollars ($50) for each meeting they attend, as provided by the Board of Directors.
The Board of Directors of the Puerto Rico Public Broadcasting Corporation shall have the power to approve, amend and repeal those regulations it deems necessary or convenient in order to carry out its ends, purposes and activities. The Board of Directors of the Puerto Rico Public Broadcasting Corporation shall determine the distribution and use of its capital improvements and the operations or functioning budget in accordance with its needs and plans, and may delegate on [sic] the Executive Director or on any other of its officials, employees or agents those powers and duties it deems proper, except the power to approve, amend and repeal regulations.
The Executive Director shall be in charge of the general administration of the Puerto Rico Public Broadcasting Corporation and will be responsible to the Board of Directors for executing the policy that it establishes and the general supervision of all its officials, employees and agents.
Those members of the Board of Directors who are not ex officio members may only be removed for just cause.
(d) General powers of the Puerto Rico Public Broadcasting Corporation.— The Puerto Rico Public Broadcasting Corporation shall broadcast and promote educational, sports, artistic, musical, cultural and public interest programs subject to the limitations established in the franchises granted by the Federal Communications Commission of the United States of America.
The Puerto Rico Public Broadcasting Corporation is hereby granted all necessary and convenient powers to carry out and achieve its purposes and functions including, but not limited to, the following:
(1) To exist ad perpetuam as a subsidiary nonprofit corporation.
(2) To adopt, alter and use a corporate seal.
(3) To adopt, amend and repeal regulations to govern its affairs and activities and prescribe the necessary rules, regulations and norms in order to perform its functions and duties, pursuant to the provisions of Act No. 112 of June 30, 1957, known as the “Rules and Regulations Act of Puerto Rico”.
(4) To maintain its offices in the place or places it shall determine.
(5) To sue and be sued.
(6) To receive, administer, and comply with the legal requirements and conditions concerning any gift, concession, or donation of any property or money.
(7) To enter into and to execute agreements, leases, contracts and other instruments necessary or pertinent in the exercise of its powers and functions.
(8) To acquire any property or interest thereon through any legal means including, but not limited to, the acquisition through purchase, lease, bequest, legacy or donation, and to possess, conserve, use and exploit such property or interest therein.
(9) To acquire, construct, reconstruct, improve, expand, conserve and make optimum use of any broadcasting facilities.
(10) To fix and collect reasonable fees, rights and rates, and other terms and conditions for services for the use of its broadcasting facilities or for any equipment rented or sold pursuant to applicable federal and local laws and regulations.
(11) To appoint and hire such officials and employees and grant them such powers and duties, and pay them such compensation for their services that the Board of Directors may determine in accordance with the personnel regulations promulgated.
The personnel of the Puerto Rico Public Broadcasting Corporation shall be excluded from the provisions of Act No. 5 of October 14, 1975, known as the “Public Service Personnel Act of Puerto Rico”. Nevertheless, the Puerto Rico Public Broadcasting Corporation shall comply with the provisions of Section 10.6 of said act.
(12) To carry out all acts that are necessary and convenient to execute the powers granted by this or any other chapter.
(13) To accept, promote and encourage the citizenry to make donations of any kind, provided their acceptance does not imply an obligation to transmit information or material in conflict with the norms that govern its broadcasts.
Likewise, and without being subject to the provisions of § 23 of Act June 29, 1954, No. 91, known as the “Income Tax Act”, any donation made to the Puerto Rico Public Broadcasting Corporation may be claimed in its entirety in the income tax return as a deduction from the adjusted gross income in the case of individuals or as a deduction from the net income in the case of corporations and partnerships.
(e) Reports.— Within sixty (60) days after the close of each fiscal year, the Puerto Rico Public Broadcasting Corporation shall submit reports on its activities to the Telephone Authority, the Legislature and the Governor, including the following:
(1) A summary of the work carried out during the fiscal year in compliance with the purposes provided by this chapter and a work plan, including specific projects and activities for the following year.
(2) A financial statement prepared in accordance with generally accepted accounting principles for government bodies.
(3) A cash flow projection for the following fiscal year.
(4) Statistical charts that adequately reflect the operational phases of the Corporation in a comparative and reliable manner.
(5) A list of capital investments.
(f) Prohibition of operation by private enterprise.— The Puerto Rico Telephone Authority shall not, even with prior authorization of the Federal Communications Commission, sell, transfer, lease or submit the Puerto Rico Public Broadcasting Corporation to any other transaction that has as its purpose that said corporation and/or the services operated by it be administered or operated by private enterprise.
The radio and television stations operated through the Puerto Rico Public Broadcasting Corporation, which in turn is attached as a subsidiary to the Puerto Rico Telephone Authority, are of an educational, cultural nature and are the property of the people of Puerto Rico, and must be maintained as a public forum for the free expression of ideas.
(g) Autonomy.— It is hereby prohibited for any person to bring undue pressure or influence on the representatives of said corporate entity. It is hereby provided that the Board of Directors shall protect the credibility of the Puerto Rico Public Broadcasting Corporation and resist unappropriate interventions in order to thus preserve full responsibility for the autonomy of the functions of the institution.
In order to maintain the programmatic autonomy of the Puerto Rico Public Broadcasting Corporation, it shall present to the Telephone Authority annually a list of the total disbursements it expects to incur for its activities and functioning. It shall also list the capital improvements plan and the acquisition of assets, such as properties, which are needed to carry out the purposes of this chapter.
The Corporation shall also present to the Telephone Authority the total income it expects to receive through appropriations of funds of the Commonwealth of Puerto Rico, grants from the federal government and those properly generated within the power of this chapter.
With this information the Telephone Authority shall provide for those additional resources needed to carry out the annual working plan presented by the Puerto Rico Public Broadcasting Corporation to be authorized or transferred in a lump sum.
Once the necessary approvals and authorizations are obtained, including the approval of the Federal Communication Commission, all licenses to operate the radio and television services of the People [of] Puerto Rico shall be transferred to the Public Broadcasting Corporation for Puerto Rico, as well as all the installations, properties, funds of any nature, records and equipment that are being used or that have been assigned to be used by the Authority’s subsidiary presently in charge of the operation of said services or by any other government agency with respect to the operation of the public broadcasting facilities.
History —May 6, 1974, No. 25, Part 1, p. 136, § 9; June 4, 1983, No. 92, p. 226; Jan. 21, 1987, No. 7, p. 934, § 4; Aug. 18, 1989, No. 77, p. 339, § 1; Sept. 12, 1996, No. 215, § 9; renumbered as § 7 and amended on June 24, 1998, No. 94, § 9.