The Securities and Exchange Commission (SEC) of the Philippines, today, January 15, 2018, revoked the registration of Rappler, a popular online news organization, due to alleged violations in nationality restrictions on control and ownership of mass media organizations.
While many netizens see this as an attack on press freedom, others believe that Rappler deserves the revocation of their registration.
The SEC announced their findings today and cited that since Rappler is funded by Omidyar Network, their registration goes against constitutionally mandated restrictions on ownership of mass media organizations.
Omidyar Network is a fund started by Pierre Omidyar, the entrepreneur who founded eBay, and in 2015 Rappler submitted to the SEC their Omidyar-related documents. Along with the revocation of Rappler’s Certificate of Incorporation, the SEC has also voided the Omidyar Philippine Depositary Receipt (PDR). The SEC’s decision will now be forwarded to the Department of Justice for further action.
A PDR indicates that the owner has no voting rights on the board, nor decision-making in management and day-to-day company operations. There are other sizable media companies who also have PDRs.
In a decision dated January 11 but made public only today, the SEC wrote, “The En Banc finds Rappler, Inc. and Rappler Holdings Corporation, a Mass Media Entity and its alter ego, liable for violating the constitutional and statutory Foreign Equity Restriction in Mass Media, enforceable through laws and rules within the mandate of the commission.”
To its readers, Rappler wrote, “The SEC’s kill order revoking Rappler’s license to operate is the first of its kind in history – both for the Commission and for Philippine media. What this means for you, and for us, is that the Commission is 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.”
Rappler has a history of being investigated by the Philippine government. Bloggers supportive of the current administration have also publicly questioned the media outfits ownership for some time now.
In December of 2016, the Office of the Solicitor General issued an order that resulted in the SEC investigation of Rappler’s PDRs.
In July 2017 the SEC created a “Special Panel” to hold a “formal, in-depth examination of Rappler Inc and its parent, Rappler Holdings Corporation, as to possible violations of nationality restrictions on ownership and/or control of Mass Media entities.”
Rappler had denied all allegations against the media organization: “Philippine Depositary Receipts (PDRs) do not indicate ownership. This means our foreign investors, Omidyar Network and North Base Media, do not own Rappler. They invest, but they don’t own. Rappler remains 100% Filipino-owned.”
Rappler asserted in a statement on their website today that they 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. We will hold the line.”
The organisation called on their readers to stand with them to defend press freedom and said today:
“We thought this day would never come, even as we were warned in the first of week of December last year that the Securities and Exchange Commission (SEC) would be handing down a ruling against us.
“Because we have acted in good faith and adhered to the best standards in a fast-evolving business environment, we were confident that the country’s key business regulator would put public interest above other interests that were at play in this case. We were, in fact, initially relieved that it was the SEC that initiated what appeared to us as a customary due diligence act, considering our prior information that it was the Office of the Solicitor General that had formed, as early as November 2016, a special team to build a case against us.
“We were wrong.
“The SEC’s kill order revoking Rappler’s license to operate is the first of its kind in history – both for the Commission and for Philippine media.
“What this means for you, and for us, is that the Commission is 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. All because they focused on one clause in one of our contracts which we submitted to – and was accepted by – the SEC in 2015.
“Now the Commission is accusing us of violating the Constitution, a serious charge considering how, as a company imbued with public interest, we have consistently been transparent and above-board in our practices. Every year since we incorporated in 2012, we have dutifully complied with all SEC regulations and submitted all requirements even at the risk of exposing our corporate data to irresponsible hands with an agenda. Transparency, we believe, is the best proof of good faith and good conduct.
“All these seem not to matter as far as the SEC is concerned. In a record investigation time of 5 months and after President Duterte himself blasted Rappler in his second SONA in July 2017, the SEC released this ruling against us.”
Rappler called the actions taken against it “pure and simple harassment” and added that it intends 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.”
The group has filed motions for reconsideration to the judicial system and will proceed with its operations, promising to uphold the freedom of the press, which is promised by the Philippine constitution.
Meanwhile, Filipinos on social media seem to be divided on the SEC’s decision, with some people decrying the loss of press freedom, while others rejoicing at the revocation of Rappler’s SEC registration.
Many netizens, angered with what they perceived to be Rappler’s bias against the Duterte administration, felt that the news outfit deserved what it got.
The above comment translates to: You should have just been a blogger, Rappler. At least then it would have been okay to take sides. Since you are obviously anti-Duterte, that’s okay for a blogger, but not as a news network.
Rappler simply replied: