The Lopezes still have a lot of explaining to do

Monday June 29, 2020 ()

The House of Representatives' Committee on Legislative Franchises will resume today, June 29, 2020, deliberations on the grant of a 25-year franchise renewal to the Lopez-owned ABS-CBN network.

Eugenio Lopez III
(Eugenio "Gabby" Lopez III)

There are three issues that have been raised against the network, which was ordered shut down by the National Telecommunications Commission last month upon the expiration of its franchise. The Solicitor General, Jose Calida, also filed a quo warranto petition against the network before the Supreme Court. Last week, the Court dismissed this petition.

The first issue is the citizenship of ABS-CBN's former president and chief executive officer, Eugenio "Gabby" Lopez III. He is now chairman emeritus.

The second issue is the issuance of Philippine Depositary Receipts - an investment instrument given to foreigners when they invest in local corporations.

The third is the alleged violation of franchise terms with the creation of ABS-CBN Convergence Corp. that created the KBO sale of ABS-CBN teleseryes, concerts and movies produced by ABS-CBN itself.

In the first issue, the committee found that Lopez, born to Filipino parents, became a US citizen by virtue of his birth on American soil. Dual allegiance and loyalty come to play here. Mass media exert great influence on the minds of the people, and if dual citizens have control over media, what will happen to the opinion formed by the public?

Dual citizens are banned from becoming lawmakers. The 1987 Constitution, through Article VI, Section 26, says so.

And then, according to the records of the Securities and Exchange Commission , the corporate structure of ABS-CBN has been layered in an obvious attempt to circumvent the constitutional provision on the ownership of mass media organizations. ABS-CBN Holdings Corp. was created by the Lopezes as the issuer and receptacle of PDRs at P46.00 per share (132 million shares). As of today, the value has ballooned to P6.072 billion. Indeed the network is profitable.

No matter how the lawyers of ABS-CBN try to wiggle out of the hole, they would never be able to get out of this. When you own shares in a corporation, whether or not you cannot vote, that is still ownership in any language!

The third issue, first raised by the Solicitor General, is the alleged violation of the legislative franchise. The Lopezes created yet another firm to sell movies, teleseryes and concerts.

If the legislators could be honest to themselves, then they would know that the ABS-CBN franchise must not be renewed.

Sources:

  • Address these issues, To the point, Emil Jurado, June 29, 2020, Manila Standard

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