Business

ABS-CBN abides by tax, labor and corporate laws — gov't

February 24, 2020 | 5:53pm

In this Feb. 24, 2020, photo, ABS-CBN President and CEO Carlo Lopez Katigbak attends the Senate inquiry on the compliance of the broadcast network's compliance with the terms and conditions of its franchise.

The STAR / Mong Pintolo

MANILA, Philippines — Embattled broadcast giant ABS-CBN Corp. pays the right taxes, follows corporate regulations and complies with all labor laws, state officials revealed on Monday, effectively vindicating the network from attacks that it broke the law and therefore should not have its franchise renewed once it expires in May.

In a hearing by a Senate panel on Monday, the government cleared ABS-CBN of any tax deficiencies, a key criticism held by some quarters against the network's franchise renewal.

"As far as ABS-CBN is concerned, they are regularly filing and paying their taxes for the past number of years," said Simplicio Cabantac Jr., head of the Bureau of Internal Revenue's Large Taxpayers Audit Division 3.

Specifically, Cabantac said the 66-year-old media company paid a total of P14.4 billion in taxes from 2016 to 2019, excluding income levies last year which are yet to be due until April 15 this year. As far as withholding taxes are concerned, Carlo Katigbak, the network's president and CEO, said ABS-CBN remitted to the BIR P8.86 billion in the 10 years ending 2018.

Ephyro Luis Amatong, commissioner of the Securities and Exchange Commission (SEC), also told senators that as far as corporate practices are concerned, the SEC is not "aware of any violation or any ongoing complaint or investigation involving ABS-CBN."

Senators also inquired about the network's labor practices amid workers' fears the network will be shut down and deprive them of livelihood. Mark Nepomuceno, former head of ABS-CBN Corporate Services Group, said the company secured a "clearance" from the Labor department last year, stating it is "fully compliant" of rules governing general labor standards, occupational safety and health, and security of tenure.

With ABS-CBN cleared of any labor malpractices, tax evasion and corporate wrongdoing, what is there left to be fixed is President Rodrigo Duterte's bad blood with the network.

Duterte has repeatedly mentioned he would block any bill that would renew ABS-CBN's franchise for another 25 years even as his alter-egos also insist the matter of extending the franchise is better left to Congress.

Under the Constitution, Duterte can veto a bill that passed by both houses of Congress. A vote of two-thirds of legislature, currently populated by Duterte allies, can override that veto.

"Is the President mad at you that is why you are having a difficult time?" Senator Lito Lapid said in the hearing, to which ABS-CBN chair Martin Lopez responded that they can only make a guess as to the supposed "anger" of the president to ABS-CBN "based on TV reports and pronouncements of the President" himself.

The Senate public services committee held the hearing on Monday after the House of Representatives sat on ABS-CBN's franchise bill since 2016, the first time it was filed in Congress.

Since then, the network has repeatedly refiled the measure in the legislature, and currently there are 11 bills seeking ABS-CBN's franchise renewal pending at the Lower House.

While the Senate hearing helped clear issues for ABS-CBN, senators are on a bind to proceed with formal process of legislating the network's franchise without the Lower House first approving it. Proceedings on the bill finally kicked off simultaneous with the Senate hearing, but supposedly only to hear parties for and against the franchise renewal.

House Speaker Alan Cayetano, a Duterte ally, was quick to say that the formal legislative process will not begin until May. Justice Secretary Menardo Guevarra, in the Senate hearing earlier, said that ABS-CBN may have until May 4 before its current franchise expires, not until March 30 as most people believe, because the franchise only takes effect 15 days after publication. The franchise was published April 19, 1995 and only took effect May 4 that year.

Even then, the network still faces a court case filed by no less than the solicitor-general before the Supreme Court, seeking to invalidate its already-expiring franchise.

ABS-CBN shares rose 17% on Monday, bucking a 2.47-percent decline in the over-all benchmark index.