After Deal With TV5, ABS-CBN Must Clear 'Violations' First, According to NTC Chief

The BIR and SEC have previously cleared the network of any violations.

Pending the final closing of some transactions this August, the deal between ABS-CBN and TV5 is good to go. But if we were to ask the National Telecommunications Commission (NTC), there are still some supposed "violations" that ABS-CBN needs to address.

"Ang nakikita ko po na parang pong kailangan nating tingnan is mayroon po silang violations, so hindi po sila makakuha ng sarili nilang prangkisa, so ang ginagawa po nila is nasakay po sila dito sa TV5. Pero hanggang ngayon po, bitbit po nila ang kanilang mga violations," NTC Commissioner Gamaliel Cordoba claimed in an interview with Radyo Pilipinas.

While Cordoba didn't specify which violations ABS-CBN had to clear, he said that the two parties should obtain clearances from the likes of the Securities and Exchange Commission (SEC), Bureau of Internal Revenue (BIR), Bureau of Customs, and the NTC itself.

The panel cited issues such as ABS-CBN Chair Emeritus Gabby Lopez’s citizenship, the issuance of Philippine depositary receipts to foreigners, and tax-related matters, among others. The BIR and SEC, however, had already cleared the network of any wrongdoings during the hearing.


Understanding the ABS-CBN-TV5 Deal: What Exactly Happened?

Antitrust Body Issues Statement on Brewing ABS-CBN-TV5 Joint Venture

Cordoba had also referenced NTC Memorandum Order 3-06-2022, which prohibits a “franchise grantee” to enter into “mergers, joint ventures, sale, or any commercial agreement arrangements on matters within the Commission’s mandate and jurisdiction.”

In a move seemingly directed at ABS-CBN, the NTC had earlier released the memo to restrict blocktime agreements and mergers. The commissioner, meanwhile, asserted that a broadcast franchise is a “privilege, not a right.” He also said that the memo applies to all franchise holders.


“Dapat po ang franchise grantee ay hindi po makikipag-enter ng commercial arrangement sa isang entity na may mga obligasyon po sa national and local government,” he added. The commissioner expressed that ABS-CBN needs to seek approval from the Department of Justice, Land Registration Authority, Philippine Competition Commission (PCC), and other concerned agencies for the deal to continue.

The PCC had released a statement last week regarding the potential merger, as well.

“The Philippine Competition Commission (PCC) trusts that firms undertaking sizeable mergers or acquisitions conduct due diligence to ensure compliance with our antitrust law and engage in consultation with the Commission, where necessary," it said. “This includes M&A or joint venture transactions with considerable share in the markets they operate in—such as the reported transaction between TV5 and ABS-CBN, two of the top media firms in the country.”

If the network doesn't fulfill its obligations, then the NTC might just have to intervene. The NTC has yet to receive any additional details about the partnership agreement between the two parties. Once the two have submitted, it is only then that the agency gets to review any potential violation of government regulations.

After the denial of its franchise, ABS-CBN had entered into blocktime agreements with Zoe Broadcasting Network and TV5 for some shows. The new partnership agreement with TV5 right now will allow it to get 6,459,393 primary common shares in TV5, shelling out more than P2 billion and accounting for 34.99 percent ownership.

watch now
View More Articles About:
More Videos You Can Watch
About The Author
Esquire Philippines
View Other Articles From Esquire
Latest Feed
Load More Articles
Connect With Us