MANILA–A Securities and Exchange Commission (SEC) official on Thursday said ABS-CBN Holdings Corp did not violate its regulations when it issued Philippine Deposit Receipts (PDRs), which are under scrutiny as the country's largest media and entertainment network seeks congressional approval for a new operating franchise.
But the question on whether the sale of these financial instruments to foreigners violates the rule on 100-percent Filipino ownership in mass media is still up for the Supreme Court to decide, said SEC Commissioner Ephyro Luis Amatong.
"As far as we are concerned… wala pa kaming basehan para sabihin na nag-violate sila ng regulations namin," he told a joint congressional committee.
(As far as we are concerned… we don't have any basis yet to say that they violated our regulations.)
"We are not aware of any violation. No complaint has been filed with us."
Solicitor General Jose Calida earlier raised ABS-CBN's alleged PDR violation in its Supreme Court petition to revoke its previous 25-year broadcast franchise.
The National Telecommunications Commission shut down the network on May 5, the day after the franchise expired despite a pending application for a new one, which had been pending in Congress since 2014.
Scrutiny of PDRs issued by ABS-CBN Holdings Corp over alleged constitutional violation has raised concern that it may also hit other broadcast companies, which sold similar investment instruments.
Amatong said ABS-CBN and GMA-7 PDRs appeared to be almost "word for word."
Asked if ABS-CBN was acting in good faith when its holding company offered PDRs following existing regulations, he replied: "I would say both ABS-CBN and GMA-7."
Cong. Jose Sy-Alvarado, chair of the House Committee on Public Accountability, on Thursday said other broadcast companies which issued PDRs should also be scrutinized for possible violations.
Responding to Agusan Del Norte Rep. Lawrence Fortun, Amatong said the SEC has not received any report that ABS-CBN violated the law by allowing a foreign holder of its PDR to convert it into common shares.
ABS-CBN President and CEO Carlo Katigbak said the company was willing to "modify or alter" its PDRs should government disqualify these financial instruments "equally across the entire media industry."
"We acted in good faith by going to the SEC to secure approval before offering it to the public, and at the time, the SEC agreed that the instrument was legal," he said.
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