Marcoleta claims TV5 violated its broadcasting franchise with ABS-CBN deal

Metro Manila (CNN Philippines, August 16) — The lawmaker who has staunchly opposed the renewal of ABS-CBN’s broadcasting franchise claims TV5 has violated its franchise by entering into a deal with ABS-CBN.

SAGIP party-list Rep. Rodante Marcoleta said TV5 violated Section 10 of its broadcasting franchise by entering an agreement with ABS-CBN, which bought common shares in TV5 worth ₱2.16 billion. MediaQuest Holdings, the media arm of the MVP Group, still has the controlling stake in TV5 at 64.79%.

READ: ABS-CBN to acquire a third of TV5, Cignal to buy into Sky Cable 

"With the substantial purchase of the outstanding stocks of ABS-CBN, I believe Section 10 of the franchise of TV5 was violated because the rights and obligations have virtually been transferred to ABS-CBN," Marcoleta said in his privilege speech at the House of Representatives on Monday.

"Pupwede ba Mr. Speaker na ang isang network na di na natin binigyan ng lisensiya—because of these established violations, wala na siyang prangkisa—pwede ba siyang sumakay ng ganun ganun lang without settling the obligations to the country, to the government?" he added.

[Translation: Is it right Mr. Speaker for a network with a rejected application for franchise renewal—because of these established violations, it does not have any franchise—to engage in a deal without settling the obligations to the country, to the government?]

Marcoleta also said he thinks “the merger left a bad taste in the mouth." He added that it should be looked into because an Indonesian is reportedly involved.

"MediaQuest, the parent company of TV5 is owned by PLDT Beneficial Trust Fund. And the grapevine is so loud that PLDT Beneficial Trust Fund is owned by an Indonesian national," he claimed.

MediaQuest is an affiliate of telecommunications company PLDT, both chaired by Manny Pangilinan. The businessman is also the managing director and CEO of Hong Kong-based First Pacific Holdings.

"If you will reminisce that the PDRs (Philippine Depositary Receipts) were utilized indirectly as conduits for foreigners to own mass media in this country by desecrating and circumventing the very Constitution that we have, baka naman ang mangyari, ganito rin, magigising na lang tayo (the same thing might happen again, we will just wake up) and we will have to see déjà vu once again," Marcoleta said.

PDRs are financial instruments used by media entities to allow foreign investments, but do not equate to ownership of non-Philippine nationals. This was among the issues tackled by Congress during its inquiry into ABS-CBN franchise in 2020. But the Securities and Exchange Commission (SEC) said no constitutional violations were made as the PDRs were allowed and registered with the government.

ABS-CBN, which has been boosting its presence on several digital platforms, went off the air in May 2020 after a cease-and-desist order issued by the National Telecommunications Commission following the lapse of its franchise.

Former President Rodrigo Duterte admitted in June that he used "presidential powers" against ABS-CBN. He also reiterated that the company "never paid taxes” — a claim debunked by the SEC and the Bureau of Internal Revenue.

During the 17th Congress, Marcoleta was one of the 70 congressmen who voted "yes" to reject the ABS-CBN franchise, which eventually rendered around 11,000 employees jobless during the height of the COVID-19 pandemic.

READ: TIMELINE: ABS-CBN franchise 

In the 19th Congress, Marcoleta filed a resolution calling for an investigation into ABS-CBN's possible violations of its franchise and requesting to determine the administrative fines that must be imposed. Marcoleta said ABS-CBN should be fined over ₱1 trillion for its supposed violations.

READ: Marcoleta seeks probe vs ABS-CBN anew 

In a statement last week, think tank Infrawatch PH said the deal between the two networks "is not a franchise issue, as this involves no transfer of controlling stakes requiring congressional approval."

"More importantly, Congress should focus on more important public concerns, such as economic recovery and social programs, instead of wasting time inquiring on content sharing deals between media entities," it added.

CNN Philippines is reaching out to TV5 and ABS-CBN for comments on the issue. This story will be updated to include their statements as soon as they are available.

CNN Philippines' Glee Jalea and Xianne Arcangel contributed to this report.