The ABS-CBN Franchise Renewal Brouhaha



The ABS-CBN franchise renewal issue has been simmering for weeks and has now reached a crescendo in the past few days with more politicians joining the fray and as the deadline looms in the horizon. The main crux of the issue is whether to renew the franchise for another 25 years which due to lapse on March 30 of this year. The issue is crystal clear but has been muddled by other issues since Solicitor General Jose Calida filed a quo warranto suit asking the Philippine Supreme Court to nullify the existing ABS-CBN franchise on legal grounds.

The Philippine Congress has the exclusive domain to grant or deny franchises. More specifically, the Lower House has the cog to start the process of renewal or denial of said franchise. The Lower House of the current Congress has not started hearings on the matter and with less than a month to go, the ABS-CBN franchise will most likely lapse before it can be renewed, if that is the desired outcome. Questioning the legality of the original franchise is within the domain of the court (i.e. compliance with the terms of the franchise).

The opposition is accusing Speaker Alan Cayetano of kowtowing to President Rodrigo Duterte who verbalized his opposition to the renewal of the franchise and vowed to block such renewal. But Malacañang through Presidential Spokesman Salvador Panelo pushed back to such notion and averred that the president will not interfere with the process and will let Congress do its job. And that the president was merely expressing his frustrations for ABS-CBN’s failure to air Duterte’s advertisements during the 2016 presidential campaign.

The quo warranto petition, however, buttressed the claim that Duterte is hell bent on getting his sweet revenge. Lately, Calida submitted an urgent motion for a gag order on ABS-CBN invoking the rule of sub judice since the court has already taken cognizance of the case. ABS-CBN has been using the network and its paid talents to present its case to the people clearly to paint the whole thing as press freedom matter and to make ABS-CBN look good.

Opposition stalwarts like VP Leni Robredo and several other senators and congressmen hammered on Calida’s moves as trying to muzzle freedom of expression and the press. Some even laments the 11,000 talents and employees who might lose their jobs if the media giant closes. Are these valid or strong strategies to win a franchise renewal? Siling Labuyo says no, the consequences of past elections.

The heated conversations that are taking place are clearly distorting what could otherwise be a routine matter. So, what is the real score? Siling Labuyo believes that the 2022 presidential campaign and the fight for the Speakership is well underway. The opposition wants the media giant (owned by the powerful Lopez clan) to be there for them in 2022. Duterte will try to prevent that in a legal way through the tried and tested quo warranto way and keeping Speaker Cayetano in place to see it through.

The case of former Chief Justice Marilou Sereno proved that the people will not rise up to defend the opposition. Many bright legal minds were adamant that Calida did not have legal grounds to oust the former Chief Justice. But that is now water under the bridge as Sereno was sent packing unceremoniously. The Supreme Court proved the opposition wrong and Calida right. That case solidified Calida’s bonafide as the quo warranto expert. Now, he is putting to bear, his expertise on the matter.

Calida’s approach sounds infeasible especially hearing the ABS-CBN defense that everybody is doing it (thus, it must be legitimate). ABS-CBN is talking about other media outlets using Philippine Depository Receipts (PDRs) to solicit funding from foreign donors (i.e. selling shares). Calida used a similar approach questioning the corporate status before the Securities and Exchange Commission (SEC) of the online news outlet Rappler.com. The SEC agreed and subsequently withdrew Rappler’s corporate status. The case is on appeal.

If the court agrees that ABS-CBN and its subsidiaries breached conditions set by Congress when it granted the franchise 25 years ago, then there is no franchise to renew. Calida thinks that boxing pay per views, Kapamilya Box Office (movie rentals) and special shows and concerts were not covered by the original franchise or that were not properly permitted.

If ABS-CBN loses, then it can reapply for a new franchise. Malacañang mouthpiece Sal Panelo even suggested for the media giant to do exactly that. But ABS-CBN will not do it outright knowing the process will take years and they will miss a critical election in 2022.

The renewal which could have taken place 5-years of the expiry date could have been granted during the time of President Noynoy Aquino, but didn’t get it. With Duterte’s people having the super majority in Congress now, it will be an uphill battle to get one. And if for some miracle, Congress passes a legislative act granting the franchise, it will still come to Duterte’s desk for signature. Do one see the possibility of a veto override? Doubtful.

How about the 11,000 talents and employees who will lose their jobs? Well, it is a question now whether the franchise can be extended while the renewal request is being considered. If not extended, obviously another media conglomerate will rise or one more of the existing ones will get bigger and stronger and can absorb them.

How about Calida invoking the sub judice rule, is that muzzling the press or freedom of expression? Well, let me put it this way. By using its media talents and programming to air its side, ABS-CBN is taking advantage of its leverage without giving due course or extensive coverage to Duterte’s or Calida’s point of view. And by doing so, the public is subjected to information that is one-sided. Calida’s request then, sounds reasonable. If the court agrees to gag ABS-CBN, then Speaker Cayetano will have an added ammo to hold in abeyance, any move towards renewal of the franchise until the Supreme Court rules on the constitutionality issue.

But the cited legal issues to me, are mere cover for the real big issue that will give life to the quo warranto petition and that is the citizenship of ABS-CBN Chairman Emeritus Eugenio ‘Gabby’ Lopez 3rd at the time he acquired the franchise in 1995. Gabby Lopez III was known to be a U.S. citizen and later became a dual citizen. The Dual Citizen Law took effect in 2003. If it can be shown he was not a full Filipino citizen at the time, then the Philippine Constitution disqualifies him from owning the franchise.

So at this point, expect a full court press in the coming days as both sides try to get the upper hand for 2022. All these talks about speech and press freedom, are but smokescreen and nervous retort to soften the impact of probably another quo warranto surprise with majority of sitting Supreme Court justices now in the Duterte appointed majority, including the sitting Chief Justice.