The Securities and Exchange Commission (SEC) has affirmed its January 11, 2018 decision revoking the corporate license of online media outlet Rappler for violating the constitutional restrictions on foreign ownership and control of mass media in the Philippines.
In upholding its ruling, the SEC said the donation by American firm Omidyar Network of its $1.5 million investment in the form of Philippine Depository Receipts (PDRs) to Rappler’s Filipino staff as well as the waiver of its rights just affirmed the news website’s violation of the Constitution.
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“The fact that the waiver was issued only during the pendency of the proceedings with the Commission clearly showed that its execution was merely an afterthought, and made for no other purpose than to make it appear and convince the Commission (and the Court of Appeals) that Omidyar will not exercise control over Rappler even if the same was granted in the ON PDRs,” the SEC said.
“In fact, no amount of effort can salvage the legal existence of Rappler and Rappler Holdings Corp. (RHC) by virtue of the fact that the infirmity that tainted their certificates of incorporation is based on contracts that are void for being contrary to the Constitution and the laws,” the SEC said.
The Commission en banc said “public interest would be served if the revocation of the certificates of incorporation of Rappler and RHC is sustained because it will implement the policy of respecting and fully complying with the provisions of the Constitution, to which every Filipino owes allegiance.”
The five-man collegial body has directed the SEC’s Registration and Monitoring Department to implement the revocation of the business registration of Rappler and RHC.
SEC said the “cases where the Supreme Court recognized and allowed violations of the constitutional prohibition on acquisition of land to be cured are not applicable and could not be used in the instant case because as ruled by the CA, the foreign equity restriction on mass media implies zero foreign control and the mere grant of such control already violates the Constitution.”
Apart from this, the SEC also noted that Rappler and RHC were not denied their right to due process as they were properly notified of the charges against them and they were able to explain their side through the pleadings that were submitted.
SEC said it already imposed the penalty of revocation as early as 2018 after the completion of proceedings which were actively participated in by Rappler and RHCC.
The CA affirmed and reiterated its 2018 decision upholding the SEC’s ruling in a resolution dated February 21, 2019.
The Supreme Court on September 25, 2019 then issued a resolution declaring the case closed and terminated.