SEC decision to revoke Rappler's license 'too severe' – lawyer

LEGAL BATTLE. Rappler will challenge the ruling of the Securities and Exchange Commission. 

 
 
 
 
 
 
 

MANILA, Philippines – Rappler Incorporated argued that the penalty imposed by the Securities and Exchange Commission (SEC) for an allegedly unconstitutional Philippine Depositary Receipt (PDR) provision is "too severe."

Rappler's lawyer Francis Lim said the SEC decision to nullify the PDRs issued by Rappler Holdings Corporation to Omidyar Network Fund LLC as well as revoke the articles of incorporation of Rappler are "anti-investor and anti-business."

 

"If there is any violation at all, we believe that the penalty meted out by SEC is too severe...Imagine revoking the articles of incorporation of Rappler Incorporated, which is not even a party to PDRs," Lim said in an interview with ANC's Early Edition on Wednesday, January 17.

Lim cited the Supreme Court (SC) decision on the case of Gamboa v Teves promulgated on June 28, 2011, where it held that the "capital" requirement in Section 11, Article XII of the 1987 Constitution refers only to shares of stock entitled to vote in the election of directors.

In 2011, the High Court ordered the SEC to apply this definition of "capital" in determining the extent of allowable foreign ownership in the case of PLDT Incorporated, and to impose appropriate sanctions if there was a violation of Section 11, Article XII, of the Constitution.

A former dean of the Pamantasan ng Lungsod ng Maynila (PLM) then filed a petition, alleging that the foreign ownership guidelines set by the SEC in 2013 were "tailor-made" to allow PLDT to skirt the law limiting foreign ownership in public utilities to 40%.

But in November 2016 and April 2017, the SC affirmed its earlier decision to reject the petition to nullify the foreign ownership guidelines set by the SEC.

Throwback to Gamboa v Teves

"Control, according to [the] SC decision in Gamboa vs Teves, is done through [the] Board of Directors who manages the company," Lim said.

But SEC Chairperson Teresita Herbosa said PLDT's case and that of Rappler are two different issues. 

"PLDT's case stemmed from a decision of the SC, changing the way it should compute foreign equity ownership in nationalized activities," Herbosa replied in a text message.

"Here, the constitutional provision has been there since before Rappler came into existence and it is clear: 100% Filipino ownership. [This] means 100% control, management, veto power should have been complied with from the time Rappler came about," she added.

Is the decision to revoke Rappler's incorporation papers too harsh? The SEC chief thinks otherwise.

"SEC orders revocation of companies even for just failing to submit annual reportorial requirements. Is it not fair to revoke also on ground of violation of the Constitution and the law?" Herbosa said.

Lim argued, however, that there is no factual basis for the SEC decision because Rappler, in December 2017, submitted a waiver of the provision in the Omidyar PDRs.

"[The] provision being mentioned by SEC was already waived by Omidyar before [the] SEC decision. We believe there is no factual basis for the SEC to revoke the Omidyar PDRs, much less articles of incorporation of Rappler Inc," Lim said. 

But Herbosa said what was submitted was just a photocopy of the waiver and not a document subscribed by a notary or a Philippine consulate.

"Therefore, the purported waiver is of no substantial value to the formal proceedings against the respondents," the SEC decision states.

The probe was initiated after Herbosa's office received a "referral letter" from the Office of the Solicitor General (OSG) on December 22, 2016, asking it to conduct an investigation into Rappler "for any possible contravention of the strict requirements of the 1987 Constitution."

A show-cause order was only issued in August 2017 to Rappler, after the SEC conducted an "internal, inter-departmental investigation" between December 2016 and July 2017. The SEC decision to revoke Rappler's license to do business and to nullify the Omidyar PDRs was issued last January 11.

Rappler will exhaust all legal means to challenge the decision, which it views as pure harassment. Various media groups and human rights advocates in the Philippines and abroad have also condemned the decision as an attack on freedom of the press. (READ: Stand with Rappler, defend press freedom– Rappler.com

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Party-list solons want seat of gov't transferred to Davao City

Two party-list lawmakers from the House of Representatives has filed a resolution seeking to relocate the seat of government from Metro Manila to Davao City.

Kabayan party-list Representatives Ron Salo and Ciriaco Calalang, who was only installed to the post on Monday, filed House Bill 6968 on Tuesday.

The bill, according to the proponents, seeks to address the issue of "Manila imperialism" and spur development in the countryside especially in Mindanao.

The lawmakers believe transferring the seat of government to Davao City will strengthen nationalism and sense of belongingness for the people in the countryside, and decongest Metro Manila and ease the traffic problem in the capital region.

If approved, the bill will push for the building of a National Government Center in Davao City, where the following offices will be located:

Presidential Palace
Vice-Presidential Palace
Senate
House of Representatives
Supreme Court
Constitutional Offices
National offices of government agencies
Salo and Calalang said that relocating and separating the seat of government from other centers takes precedence from two economic superpowers.

In the US, the political capital is Washington D.C. and the financial capital is New York City, while in China, the political capital is Beijing and the financial capital is Shanghai.

"Transferring the seat of government and separating it from the financial centers will address the destructive effects of traffic. This will prevent heavy losses in businesses and will significantly lessen travel time which can be spent for other productive activities," the bill's explanatory note read.

"Transferring the seat of government also means that it will prevent the further rise in population due to unmitigated migration, congestion and urban blight which hamper further development. It will also help arrest the continued rise of prices both in housing and other properties for sale and for rent," it added.

Relocation, job displacement

Under the transitory provisions of the bill, the construction of the National Government Center must be completed within three years upon the enactment of the law.

Metro Manila will remain the country's economic or finance center, but the offices of government agencies in the capital region will be converted into regional offices.

Malacañan Palace will remain as the official residence of the President of the Philippines in Manila.

Buildings with historical significance that have been vacated as a result of relocation will be transferred, managed and maintained by the National Historical Commission.

Permanent government employees who will be affected by the relocation will be given the option to resign or early retire and will be given mandated entitlements according to laws.

A total of P1 billion will be initially appropriated to implement the provisions of the proposed law which will be taken from the Presidential Savings of the current fiscal year.

For the succeeding years, the amount needed for the implementation of the law will be sourced from the annual General Appropriations Act. —ALG, GMA News

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Calida: Petitioners failed to present facts for nullification of Mindanao martial law extension

Solicitor General Jose Calida on Wednesday argued before the Supreme Court (SC) that there is a factual basis for the one-year extension of martial law in Mindanao which was requested by President Rodrigo Duterte and approved by Congress last month.

Speaking at the oral arguments on the consolidated petitions against the extension, Calida said the petitioners have failed to present facts to overturn the presumption of constitutionality of Resolution of Both Houses No. 4.

"The facts show that the rebellion has not been quelled. Sadly, Mindanao, the land of promise, is still beset by strife. Our armed forces are fighting the rebels in the mountains and the jungles. Our armed forces are fighting them in the cities and towns. Our armed forces will fight them wherever they inflict their violence on fellow Filipinos," the solicitor general said in his opening statement.

Calida also said the SC cannot review the manner by which the Congress deliberated upon and approved the President's request in response to petitioners' claim that Duterte's allies in Congress "unduly constricted" the period of debate and granted the extension with "inordinate haste."

Congress approved the one-year extension with on December 13, roughly three weeks before the December 31 expiration of the six-month extension of the May 23 proclamation that placed the whole of Mindanao under martial rule following attacks by ISIS-inspired Maute group in Marawi City.

"These issues are political and non-justiciable. They go into the wisdom of the congressional action. The 1987 Constitution itself allows the Congress to determine the rules of its proceedings," Calida said.

He added lawmakers did not act arbitrarily when they voted to extend martial law and continue the suspension of the privilege of the writ of habeas corpus in Mindanao until December 31, 2018.

Neither can the Court dictate on the President which commander-in-chief power to use to respond to the situation in Mindanao.

"As the Court discussed in Lagman [SC decision on original martial law proclamation], the power to choose, initially, which among these extraordinary powers to wield in a given set of conditions is a judgment call on the part of the President," Calida said.

Allegations of abuse and human rights violations cannot also nullify the extension, according to Calida.

"As stated previously, the Congress’ extension of martial law only requires that the rebellion persists and that public safety requires the extension of martial law. This means that alleged abuses and human rights violations cannot serve as a cause to invalidate the extension," he said.

Calida said the alleged abuses and human rights violations are unsubstantiated.

Assuming that there were human rights violations during the period of effectivity of martial law, the Court already ruled in that the alleged violations must be addressed in a separate proceeding, he added.

For his part, Major General Fernando Trinidad, Armed Forces of the Philippines deputy chief of staff for intelligence, spoke about the necessity for the extension.

"The scourge being brought by the communist rebels, the Abu Sayyaf group, and the presence of remnants, protectors, supporters and sympathizers of the DAESH pose a clear and present danger to the national security and hinder the facilitation of rehabilitation, recovery and reconstruction efforts in Marawi City and the attainment of peace, stability, economic development and prosperity in Mindanao," Trinidad said.

"Considering the magnitude of scope as well as the presence of rebel groups in Mindanao, public safety remains in danger and the security of Mindanao is at stake. As it is, the AFP is appealing is for the extension of martial law and the suspension of the privilege of the writ of habeas corpus for one year," he added.

The military official said the appeal was not intended to gain "extra power" for the AFP "but to hasten the accomplishment of the AFP's mandated task in securing the safety of our people in Mindanao and the whole country in general."

"The rebellion in Mindanao still exists. Many Mindanaoans have spoken supporting the extension of martial law. The fate of Mindanao now rests in our hands: the legislators, the Executive and the judiciary and the security sector alike," Trinidad said. — RSJ, GMA News

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Lawmakers say Sereno’s purchase of ‘predetermined’ vehicle violates law

The procurement official of the Supreme Court (SC) has claimed that the acquisition of Chief Justice Maria Lourdes Sereno’s P5.2-million security vehicle was “predetermined” and thus, according to House lawmakers, was a violation of the government’s procurement law.
Testifying before the House hearing on the determination of probable cause in Sereno’s impeachment on Wednesday, House justice committee members quizzed SC personnel about Sereno’s availing of a supposedly luxurious vehicle using public funds.

Pressed by House members on whether the Toyota Land Cruiser was already the choice of Sereno’s office for a security vehicle, Ma. Carina Cunanan, procurement head and assistant chief of SC’s administrative services, said: “It was already predetermined, your honor.”

 

But Cunanan explained that Sereno’s office did not specify the car’s brand in the procurement request. It was the procurement office who asked Sereno’s office about their preferred brand.
Cunanan explained that in the 2016 procurement plan of the high tribunal, it allotted P6 million for transportation equipment to the office of the chief justice. Other justices and SC officials were also given a budget of up to P2 million each for their transportation equipment.
Asked by ABS Rep. Eugene de Vera why Sereno had to purchase a Land Cruiser, Cunanan said they decided to consider the request because Sereno had never requested for a service vehicle since her appointment.
“The procurement of vehicle for the Chief Justice has always been included simply because when she was appointed as CJ, she never requested one,” Cunanan said.
“So in deference to her and by reason of her stature, we had to see to it that there’s also an amount allotted for her in the procurement of a vehicle,” she said.
“So we asked the office of the end user, in the event that we need to procure, and they said it was a Land Cruiser,” she added.
House Majority Leader Rodolfo Fariñas Sr. then pointed out: “When you procure, you don’t give a brand para fair. You should all specify the details, but not the brand.” /kga

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Congress must vote separately to amend, revise 1987 Constitution – Davide

Former Supreme Court (SC) Chief Justice Hilario Davide Jr. echoed the position of constitutionalist Father Joaquin Bernas that Congress should vote separately when voting on any amendments or revisions to the 1987 Constitution.
At a joint hearing at the Senate on the controversial Charter change (Cha-cha), Davide pointed out a provision in the Constitution which states that any amendments to or revisions may be proposed either by Congress upon a vote of three-fourths vote of all its members and through Constitutional Convention (Con-Con).

“Note should immediately be taken of the fact that the section does not state when acting as a Constituent Assembly, the Congress should be in a joint or separate session,” he said.

 

Davide then cited Bernas’ pronouncements and book on the 1987 Constitution.
In the book, Davide said Bernas noted that the provision in the Charter says nothing about a joint session.
“It’s submitted that each house may separately formulate amendments by a vote of three-fourths of all its members then pass it onto the other house for a similar process. Disagreements can be settled through a conference committee,” the former Chief Justice said still quoting Bernas’ book.
While Congress may decide to come together in joint session, Davide said the two chambers – the Senate and the House of Representatives – must vote separately.
“Since the Constitution is silent about the method…Congress should be free to choose which ever method it prefers,” he said.
“It is also submitted, however, that what is essential is that both houses vote separately. This is because the power to propose amendments is given not to a unicameral body but to a bicameral body.”
“I fully agree with Father Bernas,” Davide added. /kga

 

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Duque insists on full refund of gov’t payment for Dengvaxia

Health Secretary Francisco Duque III on Monday said he would demand full refund of the P3.5 billion the government paid to the French pharmaceutical giant Sanofi Pasteur for the Dengvaxia vaccines that the Department of Health (DOH) junked after the drug proved to be flawed.
Duque, who was in the Senate for a meeting with Sen. JV Ejercito, the health committee chair, told reporters that he agreed with Senate President Aquilino Pimentel III that a full refund was in order.

Pimentel said on Sunday that Sanofi Pasteur should fully refund the P3.5 billion the government had paid the company because “[a]ll the vaccines were defective from the beginning.”

“We will ask for a full refund eventually but for the meantime we want the immediate withdrawal of vials of vaccines that are still stored with our cold chain storage facilities,” Duque told reporters.

The DOH sent a letter to Sanofi Pasteur on Friday to demand refund of P1.4 billion in unused Dengvaxia supplies.
Sanofi Pasteur said on Monday that it had agreed to refund P1.4 billion to the Philippine government for unused supplies of Dengvaxia, but Duque said he had not yet personally received a response from the company.
“Sanofi Pasteur has responded positively to the Philippine Department of Health’s request that we provide reimbursement for the doses of Dengvaxia that were not used by the government in the public vaccination program,” Sanofi Pasteur said in a statement on Monday.
Not related to mess
But Sanofi Pasteur stressed that its decision was not related to any question of safety or quality involving Dengvaxia.
“Our decision to reimburse for unused doses is not related to any safety or quality issue with Dengvaxia. Rather Sanofi Pasteur hopes that this decision will allow us to be able to work more openly and constructively with the DOH to address the negative tone toward the dengue vaccine in the Philippines today,” the company said.
“Sanofi Pasteur strongly believes that this tone is due to a misunderstanding of the benefits and risks associated with the dengue vaccine and a lack of awareness among the general public, particularly parents of vaccinated children, that the overall benefit of dengue vaccination remains positive in high endemic countries like the Philippines,” it added.

Sanofi Pasteur also said it had requested a meeting with the DOH to discuss any questions involving the reimbursement, and to “find ways to inform the Filipino public in a more balanced and evidence-based way on dengue vaccination while also restoring public trust in vaccination programs, in general.”
The DOH paid Sanofi Pasteur P3.5 billion for Dengvaxia supplies in 2015 for a dengue immunization program.
It halted the program last Dec. 1 after Sanofi Pasteur announced that Dengvaxia worsened symptoms in vaccinated people who had no previous exposure to the dengue virus.
More than 830,000 schoolchildren had received at least one dose of Dengvaxia before the DOH could stop the program.
14 kids died
At least 14 of those children have died and the DOH is trying to determine if Dengvaxia is linked to their deaths.
“The Dengvaxia vaccine, which Sanofi Pasteur aggressively promoted and sold to the Philippine government, has undeniably failed to deliver its supposed clinical benefit and safety claims, hence, considered defective under Philippine civil laws,” Duque said in a statement earlier on Monday.
The Senate and the House of Representatives are investigating the controversy and 21 vaccinated children have brought graft charges against former President Benigno S. Aquino III and three members of his Cabinet.
The children also accused the former officials of violating the government procurement law.
Former Iloilo Rep. Augusto Syjuco also has brought plunder, graft and mass murder charges against the former officials for exposing more than 830,000 children to health risks by giving them Dengvaxia.
More charges coming
The Public Attorney’s Office (PAO), which is investigating the deaths of vaccinated children, said on Monday that it would bring criminal and civil charges against former government officials over the dengue immunization drive.
“Definitely, someone’s going to be charged. But the health workers and officers, we won’t charge you. You were only misled,” said PAO chief Persida Rueda-Acosta. —WITH A REPORT FROM JULIE M. AURELIO

 

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Health chief to review DOH contracts under Aquino

Health Secretary Francisco Duque III on Monday said he would order a review of the contracts entered into by the Department of Health (DOH) under the Aquino administration as he urged those who had evidence of corruption in the agency to come forward and file charges against the officials involved.
“I encourage those who are painting the Department of Health in a bad light to present evidence to substantiate their claims. I cannot allow accusers to tarnish the good reputation of the Department of Health, which it has gloriously built over the years, by spewing unsubstantiated allegations,” Duque said in a statement.

DOH ‘mafia’

 

Duque’s statement came after Dr. Francis Cruz, a consultant to then Health Secretary Paulyn Ubial, exposed on Saturday the operations of an alleged “mafia” in the DOH composed of several former and current officials linked to corruption, including the controversial procurement of Dengvaxia vaccine.
Cruz named the DOH officials, including former Health Secretary Janette Garin, whom he accused of pushing for the acquisition of dengue vaccine to gain profit.
He identified at least 18 incumbent and former DOH officials who allegedly benefited from the P3.5-billion immunization program.
Cruz identified them as Dr. Mario Villaverde, Dr. Gerardo Bayugo, Lilibeth David, Carol Taño; Assistant Secretaries Lyndon Lee-Suy and Nestor Santiago; OIC Directors Joyce Ducusin and Marvin Bello; Financial Management Service Director Larry Cruz; Directors Leonila Gorgolon, Ariel Valencia and Rio Magpantay; and Philippine Children’s Medical Center chief Julius Lecciones.
Former health officials linked by Cruz to the alleged mafia were Undersecretaries Nemesio Gako and Kenneth Hartigan-Go and Director Yolanda Oliveros.
Cruz alleged that the officials were involved in the conversion scheme, in which 90 percent of the project’s budget goes back to the agency and 10 percent goes back to the financier or suppliers.
Garin, in a statement, denied Cruz’s allegations, saying these were questionable and unsubstantiated.
There was no immediate comment from the current and former officials named by Cruz but Duque urged them to respond to the allegations and clear their names.

“While the allegations are still unsubstantiated at this point, I will order a review of the contracts entered into by the previous administration,” Duque said. —WITH A REPORT FROM JHOANNA BALLARAN

 

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Hazardous eruption of Mayon looms

EERIE GLOW With the night sky shrouded by thick clouds, the only visible sign of unrest from Mayon Volcano is an eerie glow from its crater as seen from the Binitayan-Kilicao bridge in Daraga town, Albay province. This photo was taken at 8 p.m. on Monday. —GEORGE GIO BRONDIAL
LEGAZPI CITY — Volcanologists warned on Monday of a possible hazardous eruption of Mt. Mayon in Albay province “within weeks or even within days,” as magma continued to pile up at its summit.

Amid the looming threat, the number of evacuated people rose to 15,410 in the towns of Camalig, Guinobatan and Malilipot, and in the cities of Tabaco and Ligao, reports from local governments and disaster response agencies showed.

The provincial government on Monday started discussion to place Albay under a state of calamity.

On Sunday night, the Philippine Institute of Volcanology and Seismology (Phivolcs) raised Alert Level 3 over Mayon after observations noted lava flow.
Intense lava flow
“There is an increasing tendency toward a hazardous volcanic eruption — with pyroclastic flow,” Phivolcs Director Renato Solidum said in a telephone interview. “We are monitoring it for the possible hazardous eruption within days or weeks.”
Solidum said the lava dome, which was formed at the crater in 2014, caused the intense lava flow on Sunday night.
“In 2014, lava was flowing slowly so a dome formed at the crater. On Saturday, lava flow punctured through the dome formed in 2014 so an intense lava flow happened on Sunday night,” he added.
The agency will raise Alert Level 4 if there is an indication of hazardous explosion with “lava fountaining,” Solidum said. Level 5 indicates an eruption is in progress.
“That will be based on the high gas content and the [frequency of] recorded tremors,” said the chief volcanologist.
Lava dome collapse

Ed Laguerta, Phivolcs resident volcanologist here, said the lava dome collapsed at 9 a.m. on Monday, generating pyroclastic flow that led to ashfall in Guinobatan and Camalig towns.
“The cause of it is … hot lava within the surface. There’s no phreatic (steam-driven) eruption,” Laguerta said.
Alert Level 3 remains hoisted over Mayon. The danger zone has also been extended to a 7-kilometer radius of the volcano from 6 km.
“With its present status, a possible violent magmatic eruption may happen … but we need to do more study that’s why a team will be sent here to do more assessment,” Laguerta said.
Motorists were forced to switch on their vehicles’ headlights to improve road visibility and avoid accidents following the ashfall.
Evacuation
Camalig Mayor Ahrdail Baldo said residents were worried that lava and lahar flow would hit local communities, especially if heavy rain persisted.
Though the local government has prepared for evacuation, Baldo said “I’m worried about food supply for evacuees if they will stay longer at evacuation centers, particularly if we run out of funds.”
The Albay Public Safety and Emergency Management Office is studying the possibility of putting up tents to accommodate more evacuees, according to its chief, Cedric Daep.
Santo Domingo Mayor Herbie Aquas said at least 3,000 residents were evacuated from communities considered danger zones.
Ligao Mayor Patricia Gonzalez-Alsua said 369 families were staying at a compound of a technical and vocational school in Nasisi village.
In Guinobatan town, Mayor Ann Ongjoco suspended classes in all levels.
A total of 3,784 people have been staying in four schools used as evacuation centers in Guinobatan.
“Some residents here, especially the elders, are not afraid of the volcano anymore so they do not listen to us when we evacuate them,” said Florentin Nares, village chief of Muladbucad Grande.
“But when the alert level was raised to 3 [on Sunday night], I had them evacuated even in the middle of heavy rain,” Nares said.
Deadly eruptions
The 2,460-meter Mayon, a tourist attraction in Albay because of its near-perfect cone shape, has a long history of deadly eruptions.
In 1814, more than 1,200 people were killed when lava flows buried the town of Cagsawa.
An explosion in August 2006 did not kill anyone, but four months later, a typhoon unleashed an avalanche of volcanic mud from the slopes that claimed 1,000 lives.
Four foreign tourists and their local tour guide were killed when Mayon last erupted in May 2013. —With reports from Jaymee Gamil and the wires

 

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SEC orders closure of Rappler site

Teresita Herbosa
The Securities and Exchange Commission (SEC) has moved to shut down Rappler Inc., which operates a news website critical of the Duterte administration, claiming it violated the Constitution’s restriction on foreign ownership of local media.
The corporate watchdog also accused Rappler of violating the antidummy law, the Corporation Code and the Securities Regulation Code.
Rappler, founded by a group led by broadcast journalist Maria Ressa, said the decision was “pure and simple harassment” and called it “the seeming coup de grace to the relentless and malicious attacks against us since 2016.”

“We intend to not only contest this through all legal processes available to us but also to fight for our freedom to do journalism,” it said in a statement.
Malacañang, however, dismissed claims that the SEC order was an attack on press freedom.
“Not true. The Constitution limits media ownership to Filipinos. Rappler must comply,” presidential spokesperson Harry Roque said.
Rappler CEO Ressa, in a press conference shown live on Facebook, said the SEC decision was political in nature. “I appeal to the government to realize that we are here to make the country stronger and help make the right decisions.”
In a ruling dated Jan. 11, the SEC revoked the certificate of incorporation of Rappler Inc., which the regulator identified as the “mass media entity that sold control to foreigners.”
Also stripped of its certificate of registration was Rappler’s 98.77-percent stockholder—Rappler Holdings Corp.—
which the SEC said was “existing for no other purpose than to effect deceptive scheme to circumvent the Constitution.”
The 1987 Constitution states that “ownership and management of mass media shall be limited to citizens of the Philippines, or to corporations, cooperatives or associations, wholly owned and managed by such citizens.”
eBay founder

In the ruling, the SEC declared “void” the Philippine depositary receipts (PDRs) issued by Rappler Holdings to Omidyar Network Fund LLC, a fund created by eBay founder Pierre Omidyar and his wife, claiming this was a “fraudulent” transaction under the Securities Regulation Code.
The decision was signed by SEC Chair Teresita Herbosa and Commissioners Antonieta Ibe, Ephyo Luis Amatong and Emilio Aquino. Commissioner Blas James Viterbo did not take part in the decision.
The SEC referred the decision to the Department of Justice “for appropriate action.”
The SEC secretary, Armand Pan, said the decision was not final and executory, as Rappler could appeal within 15 days.
Rappler noted that the SEC’s “kill order” revoking its license to operate was the first for both the commission and the Philippine media.
The news outfit said the SEC decision amounted to “ordering us to close shop, to cease telling you stories, to stop speaking truth to power and to let go of everything that we have built—and created—with you since 2012.”
‘Elaborate scheme’
The SEC cited “substantial evidence” that Rappler and Rappler Holdings had intentionally created an elaborate scheme upon which its receipt of more than $1 million from a foreign investor would be theoretically defensible.
Under the scheme, “the investor would never own stock and would never receive dividends and he would never become an officer or director, but respondents would still be able to give him his money’s worth in the form of negative control and cash contributions, all through a private contractual arrangement,” it said.
The SEC said it had been deliberating on the case since Dec. 22, 2016, when it received a letter from the Office of the Solicitor General (OSG) requesting an investigation into Rappler and Rappler Holdings Corp.
The OSG called for the probe “for any possible contravention of the strict requirements of the 1987 Constitution” on the issuances of PDRs to NBN Rappler LP, a Washington DC-based investment firm, and Omidyar Network.
The SEC said the Omidyar Network PDRs might be categorized as an equity derivative, since its value was dependent on the underlying equity.

A rappler employee exits its office at the Capitol Commons in Pasig on Monday, January 15, 2018 after Maria Reesa and Chay Hofilena gave a press briefing to media as the Securities and Exchange Commission (SEC) orders the revocation of its license to operate. INQUIRER PHOTO / GRIG C. MONTEGRANDE
“The foreign equity restriction is very clear. Anything less than 100-percent Filipino control is a violation. Conversely, anything more than exactly zero-percent foreign control is a violation,” it said.
Subservient
“Here, the stockholders must have prior discussion with and approval of at least two-thirds of the PDR Holdings, meaning Rappler is at the very least under obligation to consult with Omidyar Network.
“The stockholder has become, in effect, subservient to the holder. It is neither 100-percent control by the Filipino stockholders nor is it zero-percent control by the foreigner PDS holders,” the SEC said.
Rappler said that for every year since it incorporated in 2012, it had dutifully complied with all SEC regulations and submitted all requirements.
Chay Hofileña, acting managing editor, said the suspension of the PDRs had little effect on Rappler operations. “It’s business as usual, no changes.” —With reports from Jodee A. Agoncillo, Philip C. Tubeza, and the wires

 

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Robredo camp hits alleged plan to abolish VP post under federalism

ABOLITION? The camp of Vice President Leni Robredo slams the alleged plan to abolish the OVP under the proposed amendments to the 1987 Constitution. File Photo by OVP

MANILA, Philippines – The camp of Vice President Leni Robredo hit the alleged plan to abolish the Office of the Vice President under the administration’s proposed federal form of government.

In a statement, Barry Gutierrez, Robredo’s legal adviser, said the only time the country did not have a vice president was during the time of the late dictator Ferdinand Marcos.

He then questioned if such proposals is meant to push a supposed hidden agenada.

“The Office of the Vice President has been a feature of our republic for over 80 years, ever since it was created under the 1935 Constitution. The only time since then that we have had no VP was during the dictatorship of Ferdinand Marcos,” Gutierrez said.

“That said, the current proposals to revise the Constitution are supposedly anchored on a drive to promote and institute a federal system of government. The question therefore is, how does abolishing the OVP relate to the establishment of Federalism? Or is the abolition already in service of some other, unstated, agenda?” he added.

Gutierrez was reacting to the statement of former Bayan Muna representative Neri Colmenares, who said that the current Cha-cha proposal may abolish the OVP and allow President Rodrigo Duterte’s reelection in 2022.

“Under the PDP-Laban Constitution, the office of the Vice President will be abolished by 2019 if they succeed in having the new constitution ratified during the 2019 elections,” Colmenares said in a statement.

“While PDP Laban may argue that they will not apply this to VP Robredo, this is not expressed in PDP Laban Constitution since they have refused to divulge their transitory provision,” he added.

Colmenares also said that Robredo would be a lame duck vice president under the current proposal.

Citing Section 7, Article VII of the PDP Laban-backed constitution, Colmenares said it is the “Senate President and if incapacitated, the Speaker who shall succeed Pres. Duterte in case of death, or removal from office.”

“The Vice-President is not mentioned at all in the line of succession because, upon ratification of the new Constitution, her office no longer exists,” said the former solon.

Duterte allies have also proposed the cancellation of the midterm elections in 2019, seeking to allow incumbent officials to continue in a holdover capacity. Opposition lawmakers have strongly condemned such moves. – Rappler.com

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