Media now in the firing line of Duterte’s ‘war’ 

The outpouring of condemnation recalls the day Congress voted to reduce the 2018 budget of the Commission on Human Rights to 1,000 pesos (Bt630) after President Rodrigo Duterte had lashed the rights watchdog for criticising the savagery of his so-called “war on drugs”. Rappler has been a fierce critic of the same campaign.
The blow-back then caused Congress to restore most of the commission’s budget.
The Securities and Exchange Commission’s ruling against Rappler last Thursday is an outrage because it invokes one constitutional provision and pays lip service to another, while completely ignoring a more fundamental provision in the constitution: the freedom of the press.
A close look at the technicality the SEC relies on shows it cannot possibly bear the weight of a decision that will lead to the closing of a news outlet. A wider look at the context proves that the decision is part of a pattern of harassment against the media in general: the Rappler ruling was a preordained ruling in search of a rationalisation.
The main argument of the decision is that a deal for the international Omidyar Network (ON) to invest in Rappler’s Philippine Depositary Receipts (PDR) contains “a repugnant provision”.
That provision requires Rappler to consult PDR holders if the company’s bylaws will be changed in a way that “will prejudice the rights in relation to the ON PDRs”.
This is only common sense, and an expression of a company’s readiness to comply with its fiduciary duties.
If the company were to change its business line, then naturally all investors must be consulted. But the SEC prefers to see this single provision, applicable to only one foreign investor, as granting control over Rappler’s operations to that investor.
The constitutional restriction on foreign ownership and management in certain industries (utilities, advertising, media, etc) is both strict (the ratios are in the constitution itself) and dependent on corporate definitions.
That flexibility is best illustrated by PLDT, one of the country’s largest enterprises, which for a long time followed a looser interpretation of the 40-per-cent cap on foreign ownership of telecom firms.
It believed that foreign investors can own more than 40 per cent of the voting shares (the real source of control) if the total proportion of foreign-owned equity (voting and nonvoting shares combined) did not exceed the 40-per-cent limit.
The Supreme Court struck this down in the Gamboa ruling – but neither the SEC or the SC sought to revoke PLDT’s licence.
That the current SEC jumped to this conclusion is shocking. If the “repugnant provision” were truly unconstitutional, there are other remedies short of decertifying a news organisation.
And why choose to run short?
Because as the Supreme Court has ruled again and again that freedom of the press is one of the fundamental basic rights necessary to a functioning democracy.
It is worth noting that the SEC decision itself says that the case was triggered by a letter from Solicitor General Jose Calida requesting an investigation into Rappler’s PDRs. (It is also worth noting that on Tuesday, Presidential Spokesperson Harry Roque, who used to speak on behalf of human rights, lied flat out when he asserted that the SEC was already investigating the case before Calida’s intervention.)
But in fact the solicitor general was merely following orders.
In his second State of the Nation Address, the constitutionally mandated forum for discussing an administration legislative and policy agenda, President Duterte asked that Rappler’s corporate veil be pierced: “Rappler, try to pierce the identity and you will end up American ownership [sic].”
There was no need for any piercing of the veil, because the company had been forthright. But this was part of a history of harassment against Rappler (and the Inquirer and ABS-CBN).
Orchestrated online abuse, including repeated threats of gang rape and murder; targeting by “fake news” fabricators; retaliatory government conduct, including tax audits; demeaning speech from high public officials: The SEC decision joins a sorry list of horrors thrown at journalists doing their jobs.
Time for the blow-back.