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Friday, March 29, 2024

An ill-advised move

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REGARDLESS of the legal issues at hand, the move to shut down the news portal Rappler over allegations of foreign ownership is a mistake that could quickly backfire on the administration.

The move was initiated by the Office of the Solicitor General, which urged the Securities and Exchange Commission in December 2016 to investigate the ownership of Rappler, which has been critical of the Duterte administration. This month, more than a year later, the SEC stripped the online news portal of its certificate of incorporation for allegedly violating the restrictions on foreign ownership in mass media and the Anti-Dummy Law.

Rappler allegedly violated constitutional restrictions on ownership and control of mass media entities when it sold Philippine depository receipts to Delaware-based Omidyar Network, a fund created by eBay founder and entrepreneur Pierre Omidyar.

The SEC said the sale contained “repugnant” provisions including the need for Rappler to obtain the consent of 2/3 of PDR holders on corporate actions. This provision, the SEC said, has made Rappler “subservient” to the PDR holder, which is a violation of the Constitution.

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“Where mass media is concerned no control whatsoever may be granted. 100-percent Filipino control means zero-percent foreign control. Control is any influence over corporate policy and not limited to ownership of stock,” the SEC said.

PDR are instruments that give foreign investors a passive economic interest in Philippine company, and have been used, in fact, by broadcast giants ABS-CBN Holdings Corp. and GMA Holdings Inc. as a way to raise funds.

Against this backdrop, the SEC decision to revoke Rappler’s certificate of incorporation seems selective and arbitrary, particularly since it has not launched a similar investigation into other media organizations that have issued PDRs.

Regardless of what the President’s spokesman says, one need not be in the opposition to view the move to shut down Rappler as an obvious attempt to silence critical voices. In going after Rappler in this manner, the administration has given the news portal even more prominence than it perhaps deserves, and makes it look like the victim of state oppression.

Instead of strength, the move projects weakness and pettiness and suggests the administration is not robust enough to withstand critical news coverage.

The case against Rappler is a regulatory issue; if there is something amiss in the news portal’s corporate structure, it should be fined and given the opportunity to correct its deficiencies.

Beyond Rappler, the administration must recognize that it cannot control what independent media organizations say. In practical terms, what is the value of silencing Rappler, when the BBC, CNN, Reuter and other international news organizations continue to report and interpret the news in ways the administration might also find objectionable?

If the Duterte administration were truly confident in its policies and program of government, it would embrace the view famously expressed by the English writer Evelyn Beatrice Hall, who wrote, “I disapprove of what you say, but I will defend to the death your right to say it.”

The moderate voices in the President’s inner circle need to weigh in now before this ill-advised action leaches support away from the administration and becomes a distraction from the more important issues at hand.

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