DOJ: Congress may allow NTC to give ABS-CBN provisional authority to operate beyond franchise lapse


Posted at Feb 27 2020 04:29 PM | Updated as of Feb 27 2020 04:42 PM

MANILA - ABS-CBN Corp may continue operations pending renewal of its franchise as Congress may allow the National Telecommunications Commission to issue broadcast companies provisional authority, the Department of Justice has said. 

Issuing guidance to the NTC amid issues surrounding the media giant's franchise, Justice Secretary Menardo Guevarra cited how Congress has previously allowed broadcast companies to continue operations pending franchise renewal as an "equitable practice. 

"...[T]here is sufficient equitable basis to allow broadcast entities to continue operating while the bills for the renewal of their respective franchise remain pending with Congress," read the 6-page Department of Justice letter addressed to NTC Commissioner Gamaliel Cordoba dated Feb. 26. 

"However, a more stable legal environment could be created if Congress, by a concurrent resolution, would authorize the NTC to issue a provisional authority to these broadcasting companies under such terms and conditions as it may deem necessary, until Congress' final disposition of the franchise renewal bills," it said. 

Cordoba had requested DOJ's legal opinion on Feb. 12. In his response, Guevarra said the department was constrained from issuing a formal legal opinion as the matter involves "substantial rights" of a private entity. 

He added that the question of whether or not ABS-CBN may continue operations beyond the lapse of its franchise on May 4, 2020 would be better deliberated in Congress, noting that the license has yet to lapse. 

Several bills remain pending at the House of Representatives for ABS-CBN's franchise renewal, with House Speaker Alan Peter Cayetano saying the matter was "not that urgent" and that he was eyeing May to begin proceedings on the proposals. 

On Wednesday, following repeated vows to oppose the network's broadcast license renewal, President Rodrigo Duterte said he was accepting the apology the network issued at a Senate hearing on Monday for 2016 political ads that had offended him. 

Still, he left the decision up to Congress, where a majority are his allies.

"Congress may still be able to timely act on the renewal of the franchise, thus making our opinion unnecessary," Guevarra said in his letter. 

Instead issuing a guidance, the DOJ echoed the opinion of several lawmakers that there are ways for ABS-CBN to be allowed to continue operations. 

"This appears to be an equitable practice that has been previously adopted by Congress in favor of broadcast companies whose bills for renewal of franchise have already been filed, but have not yet been enacted into law by Congress," Guevarra said. 

"The practice has benefited several companies which were similarly situated," he said, citing the Philippine Telegraph and Telephone Corp., Smart Communications and the Catholic Bishops Conference of the Philippines for the operations of its broadcast arm. 

Guevarra noted that "the same treatment be extended to all entities seeking the renewal of their franchises with are about to expire." 

"Otherwise, it runs afoul of the basic principles of fairness and justice," the letter read. 

"It likewise undermines the trust and the reasonable expectation of the citizens that the state shall govern impartially and will not draw distinctions that are irrelevant to a legitimate objective." 

Guevarra also noted a gap in existing laws on franchises, saying they "do not provide for the status of the operations of a radio and/or television franchise" pending measures for their license renewal. 

"There is nothing in our existing laws that declares that the franchisee can continue to operate pending the renewal of its franchise; neither is there anything in these laws which prohibits the franchisee from operating until Congress acts on the bill for the renewal of the franchise," it said. 

In this case, "equity comes in to fill the gap," Guevarra said. 

"It is our hope that Congress will apply principles of equity in dealing with a situation where no fault or negligence may be attributed to entities seeking the renewal of their respective franchise," he said. 


In his guidance, Guevarra also noted that Congress has the power to "define and preserve the rights of the franchise applicant pending final determination" of the fate of a firm's franchise renewal. 

He said Congress "has the implied power to authorize ABS-CBN to continue its operations pending final action on the renewal of the franchise" as it has done for other companies. 

The DOJ also affirmed the NTC's power to issue provisional authority for a broadcast company to continue operations pending its franchise renewal. 

"An applicant who has been previously granted a franchise by Congress could be considered a qualified applicant...and could, accordingly, be issued a provisional authority to operate, subject to Congress' eventual disposition of the franchise renewal bill," the letter said. 

Senate Minority Leader Franklin Drilon earlier filed a joint resolution that seeks to extend ABS-CBN's current franchise until December 31, 2022, and a separate concurrent resolution expressing the chamber's sentiment urging the NTC to allow the network to operate beyond May 4.

As ABS-CBN's franchise renewal bills remain pending in Congress, it is also facing a quo warranto petition before the Supreme Court, filed by Solicitor General Jose Calida over alleged violations of its franchise provisions. 

The network has asserted in did not violate the law. 

Facing a Senate hearing on Monday, ABS-CBN executives also said it was compliant with business ownership rules, contrary to allegations, and asserted that the network has no political agenda. 

The tax bureau has also said the network has been paying taxes promptly, also contrary to allegations. 

- with a report from Mike Navallo, ABS-CBN News