MANILA - ABS-CBN Corp said Thursday it was willing to buy back Philippine Deposit Receipts (PDRs) issued to foreigners if regulators, courts or even Congress so orders this, as long as rival media firms will be asked to do the same.
At a hearing on ABS-CBN's franchise application, Manila Rep. Benny Abante asked ABS-CBN officials if the company was willing to buy back its PDRs should Congress deem the instruments as illegal.
ABS-CBN CEO Carlo Katigbak said that while the Securities and Exchange Commission has said that PDRs are legal, the company would follow authorities if they determine that PDRs violate the Constitution.
“Our sentiment is that 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. Pero po if the SEC, a court of law, or even Congress wishes to disqualify the use of PDRs equally across the entire media industry then ABS-CBN will be willing to modify alter or comply with the order if so directed,” Katigbak said.
Other media companies, including ABS-CBN's chief rival, GMA Network, have holding firms that sell PDRs. The holding firms, not the PDR holders, hold stakes in the firms.
Abante’s question followed an earlier claim by Rep. Michael Defensor that PDRs were an "excuse" to allow foreigners to circumvent the strict constitutional provision on full Filipino ownership in media companies.
ABS-CBN has maintained that PDRs do not violate the Constitutional mandate that media companies should be 100-percent owned and controlled by Filipinos.
The company's legal counsel has said that these financial instruments do not amount to ownership of shares, nor do they give holders the right to vote for the company's board of directors.
Congressmen meanwhile plan to scrutinize PDRs issued by all local broadcasters for possible violation of the country's foreign ownership restriction in mass media.
In a statement, GMA Network said it maintains the legality of its issuance of PDRs saying this was done in compliance with the regulations of the SEC and of the Philippine Stock Exchange.
“The Network will fully comply and submit the necessary documents as requested in the House of Representatives’ committee hearing held today, June 11, 2020,” it said.