By Arjay L. Balinbin, Senior Reporter
ABS-CBN Corp. and TV5 Network, Inc. of the Pangilinan group’s MediaQuest Holdings, Inc. announced on Wednesday that they had decided to halt closing preparations for their partnership to address concerns regarding the deal.
“To address the issues which have been raised by certain legislators and the National Telecommunications Commission (NTC) on the proposed investment by ABS-CBN for a minority interest in TV5, ABS-CBN and TV5 have agreed to a pause in their closing preparations,” the two media companies said in a statement.
“This pause will give the space for both media organizations to respond to the issues, and accommodate any relevant changes to the terms,” they added.
ABS-CBN and TV5 expect that their partnership will “have a favorable impact on Philippine media and on free-to-air television — which remains the most affordable and extensive source of entertainment and public service to Filipinos.”
NTC Commissioner Gamaliel A. Cordoba told a House committee hearing on Wednesday that TV5 and ABS-CBN should first obtain clearances.
In a recent statement, Mr. Cordoba said the commission has issued a memorandum order prohibiting franchise grantees from entering into commercial agreements — in which the commission has jurisdiction — with parties “that have outstanding obligations to the national and local governments.”
“The franchise grantee shall ensure that all the parties it transacts or enters into agreements with obtain clearances from the Bureau of Internal Revenue, Bureau of Customs, NTC, and Securities and Exchange Commission,” he noted.
The commercial agreements together with these clearances should be submitted by the franchise grantee to the NTC “prior to consummation.”
Under the partnership deal previously signed by the two media companies, the equity of the MediaQuest group — which is owned and controlled by the PLDT Beneficial Trust Fund — in TV5 will be reduced to 64.79% of the voting and outstanding capital stock, allowing it to retain control of the television network.
Sagip Party-list Rep. Rodante D. Marcoleta, a known critic of ABS-CBN, said during Wednesday’s hearing that the regulators should investigate if the PLDT Beneficial Trust Fund can be used to invest in mass media.
“We will have to see if this funding can be utilized to invest in media outfits and if it is coming from Filipino citizens,” he said.
According to the PLDT group’s statement in 2013, “all of the trustees, as well as beneficiaries, of the PLDT Beneficial Trust Fund are Filipino citizens.”
Philippine Competition Commission Commissioner Johannes Benjamin R. Bernabe told the same hearing that the two networks have yet to inform the commission of the transaction.
“We will be looking at whether the transaction will likely or substantially lessen competition,” Mr. Bernabe said.
“We still cannot categorically say if ABS-CBN and TV5 violated the law with the investment deal,” he added.
Terry L. Ridon, a public investment analyst and convenor of think tank InfraWatch PH, said in a statement that “the transaction does not require the prior approval of Congress as this does not involve the sale of controlling shares of TV5 to another entity.”
He noted that the transaction is not a competition concern, as both entities are not the dominant players in the broadcast sector.
“The transaction breaches no NTC regulation, as ABS-CBN has more than adequately shown that it has no outstanding obligations in any agency of government,” he added.
ABS-CBN was forced to stop its broadcast operations in May 2020 after former President Rodrigo R. Duterte’s allies in Congress denied its franchise renewal application.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — with John Victor D. Ordoñez