Securities and Exchange Commission revokes news website Rappler’s registration

Local news website Rappler announced earlier today that the Philippines’ Securities and Exchange Commission (SEC) revoked their registration.

According to Rappler, the SEC accused the online media outlet of violating constitutional restrictions on ownership and control of mass media entities.

In the current Philippine constitution, media outlets have to be 100 percent Filipino owned.

Their reasoning was that funds coming from Omidyar Network, a fund created by eBay founder and entrepreneur Pierre Omidyar, constituted foreign ownership of the company.

“The En Banc finds Rappler, Incorporated 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.”

Rappler explained that Omidyar’s investment was made through Philippine Depository Receipts (PDRs), an instrument that allows foreign companies to invest in local media without giving any ownership.

The SEC voided the Omidyar PDRs and revoked Rappler’s Certificate of Incorporation.

During the State of the Nation Address (SONA) last July, and again in October, President Rodrigo Duterte himself claimed that Rappler was 100 percent owned by Americans.

Rappler denies this.

“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 said in a statement after Duterte’s SONA.

The company was founded in 2012 by veteran Filipina journalists Maria Ressa, Glenda Gloria, Beth Frondoso, Gemma Mendoza, and Marites Vitug.

(Read more about who owns Rappler here)

According to Rappler, “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.”

The company said in a statement, “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,” Rappler said.

Duterte had publicly attacked other media outlets for critical coverage of his government including ABS-CBN and the Philippine Daily Inquirer.

He threatened to block the franchise renewal of ABS-CBN, while his friend Ramon Ang, president of the San Miguel Corporation, purchased the Philippine Daily Inquirer.

In a statement released earlier today, Rappler said they intend to fight the SEC’s move. “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.”


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