SEC revokes Rappler’s license; FAPCNY, journalists’ groups denounce ruling

NEW YORK – The Securities and Exchange Commission, in a decision dated Jan. 11, has revoked the certificate of incorporation of news website Rappler for violating the Philippine Constitution’s foreign equity restrictions on mass media.

In its statement, Rappler refuted SEC’s claims, saying the company is 100-percent Filipino owned.

“We intend to not only contest this through all legal processes available to us but also to fight for our freedom to do journalism and for your right to be heard through an independent platform like Rappler,” Rappler said in an official statement to its readers.

“We’ve been through a lot together, through good and bad—sharing stories, building communities, inspiring hope, uncovering wrongdoing, battling trolls, exposing the fake. We will continue bringing you the news, holding the powerful to account for their actions and decisions, calling attention to government lapses that further disempower the disadvantaged,” it added.

Article XVI, Section 11(1) of the Philippine Constitution, and Section 2 of Presidential Decree 1018 stipulates that “ownership and management of mass media shall be limited to Filipino citizens, corporations, cooperatives, or associations.”

Besides revoking its certificate of incorporation, the SEC also voided Omidyar Network’s Philippine depositary receipts (PDRs) saying these were fraudulent transactions of the Securities Regulation Code.

According to the Manila Times, senators on both sides of the aisle reacted to SEC’s ruling. Sen. Richard Gordon commended the SEC for enforcing the constitutional restriction on media ownership.

“If the media outlet is guilty of the alleged foreign ownership percentage claim, it should be done with due process and give Rappler a chance to prove the accusation as incorrect,” Gordon said.

Sen. Grace Poe, head of the Senate Committee on Public Information and Mass Media, wants to examine the supposed violations committed by Rappler.

“I will not yet say if the move was right or wrong because we have a process that should be followed,” she added.

In its defense, the SEC said “(t)he 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”.

Solicitor General Jose Calida, who was reported to have asked the SEC to probe Rappler in 2016, said he would help the corporate regulator defend its ruling in court.

Rappler is free to seek redress before our courts,” he said. “The OSG is ready to defend the sound decision of the SEC in any forum.”

The Filipino American Press Club of New York (FAPCNY) including the Foreign Correspondents of the Philippines (FoCAP) and the National Union of Journalists of the Philippines (NUJP) denounced the SEC decision.

FAPCNY said in a statement SEC’s revocation of Rappler’s certificate of incorporation “effectively shuts down the news company’s operation, and strikes a serious blow against press freedom in the Philippines.

“The press is an institution that is vital to the full functioning of democratic systems – it serves to keep the people informed so that they can make informed decisions and be better citizens and participants in society; it serves as a counter-balance against those who wield economic and political power; and it also serves as a watchdog against abuse of power.”

FAPCNY’s statement continued: “Only a free press, free from intimidation and harassment, can effectively perform these tasks and serve the public. Any attempt to muzzle the press diminishes its capacity to be of service to the people.”

The NUJP expressed its full support to Rappler. It said “[T]he NUJP declares it full support to Rappler and all other independent media outfits that the state has threatened and may threaten to shut down,” NUJP said.

“We call on all Filipino journalists to unite and resist every and all attempts to silence us,” it added.

For its part, FoCAP said: “The decision, which is tantamount to killing the online news site, sends a chilling effect to media organizations in the country. Journalists must be able to work independently in an environment free from intimidation and harassment. An assault against journalists is an assault against democracy.”

All three organizations urged the global community to defend press freedom and freedom of expression in the Philippines.

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