Rappler may file new incorporation papers, says Herbosa as she rues ‘political’ angle in SEC move

February 25, 2018 - 11:38 AM
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Securities and Exchange Commission Chairperson Teresita J. Herbosa. BUSINESSWORLD FILE PHOTO

MANILA – Online news site Rappler.com may reorganize and file new incorporation papers with the Securities and Exchange Commission (SEC) anytime, as long as the company would no longer have foreign ownership.

SEC Chairperson Teresita J. Herbosa said the companies controlling Rappler.com, namely Rappler Inc. and its parent Rappler Holdings, Inc., could withdraw the petition they filed with the Court of Appeals (CA) questioning the commission’s decision, thus allowing them to organize as a mass media firm anew.

“There are many ways of coming up, dissolving Rappler and reorganizing another corporation to engage and offer the same business but make sure it’s 100% Filipino….They can do that anytime. In fact they can withdraw the case at anytime. The courts would allow you to do that,” Ms. Herbosa told reporters after a forum held in Quezon City on Friday.

To recall, the SEC had revoked Rappler’s incorporation papers last January for failing to meet the constitutional limits on foreign ownership, focusing on its sale of Philippine Depository Receipts (PDR) to foreign entities Omidyar Network Fund LLC and NBN Rappler LP.

The SEC also voided the PDRs issued to Omidyar Network, as per Section 71.2.of the Securities Regulation Code for being a fraudulent transaction.

Rappler then filed a petition before the CA last Jan. 29 questioning the decision, saying that the PDRs sold to Omidyar Network did not constitute control.

Once the CA decides on the petition, the losing party will then have the option to elevate the case to the Supreme Court, which will have the final say on the matter. Should the courts uphold the SEC’s decision, Rappler would have to be dissolved.

Ms. Herbosa however clarified that Rappler may still reorganize and “get in the same business of mass media.”

Asked if the company can keep its name, Ms. Herbosa said this would be no problem.

“When it comes to names, the SEC recognizes if you own the name and you want to reorganize or reincorporate the same name, as long as you own the name, then there is no problem,” Ms. Herbosa said.

Ms. Herbosa also noted that it is “unfair and unkind” to say that the decision to revoke Rappler’s incorporation papers was politically motivated.

“When I decided to become SEC chair, I knew there will be instances when hard decisions will not be accepted by everyone. That to me was really unfair and unkind to say that the decision is politically motivated,” Ms. Herbosa said.

The SEC decision against Rappler highlighted the tension between the press and the administration of President Rodrigo R. Duterte, who has slammed media for their critical coverage of his bloody war on the narcotics trade.

Earlier this week, Mr. Duterte banned Rappler.com’s senior reporter Pia I. Ranada from covering Malacañang due to “loss of trust,” according to Presidential Spokesperson Herminio Harry L. Roque, Jr. — Arra B. Francia