Rappler acquitted in final tax evasion case

MANILA, Philippines — News agency Rappler and Nobel Peace laureate Maria Ressa were acquitted yesterday in the fifth and final tax evasion case filed by the previous Duterte administration.

Rappler, a Filipino-owned company critical of former president Rodrigo Duterte’s policies, described the ruling as a victory for “everyone who has kept the faith that a free and responsible press empowers communities and strengthens democracy.”

“All the dismissed tax cases were based on the false and flimsy premise that, when Rapper issued Philippine Depositary Receipts in 2015, it was not raising capital but earning a taxable profit, which it supposedly willfully did not declare. We are pleased that the court saw through that,” Rappler said in a statement.

Presiding Judge Ana Teresa Cornejo-Tomacruz of the Pasig City Regional Trial Court Branch 157 issued the court’s decision yesterday, eight months after the Court of Tax Appeals dismissed four other tax cases.

The court also dismissed the civil aspect of the case.

“This is one of the five cases... filed by the government in relation to the PDR (Philippine Depositary Receipts) transactions of Rappler. We’re thankful that the court finally dismissed the fifth one and hopefully that’s the end of it,” Francis Lim, Ressa’s lawyer, told reporters.

According to the Philippine Stock Exchange, a PDR is a security that grants its holder the right to the delivery or sale of underlying shares but does not grant ownership rights to the holder. If bought by a foreign entity, it gives the owner the right to all the dividends due the underlying shares.

In 2017, Duterte falsely claimed that Rappler is fully owned by Americans and funded by the Central Intelligence Agency.

In 2018, Rappler Holdings Corp. (RHC) was accused of failing to declare “correct and accurate” information in quarterly sales receipts from the issuance and sale of PDRs worth P2.45 million, which allegedly resulted in a P294,258.58 value-added tax deficiency.

The court found that Rappler did not use PDRs to illegally gain profit and did not act as a dealer in securities.

“The RHC and Ms. Ressa did not violate Section 255 of the Tax Code. The PDR subscription price were not proceeds arising from the sale of the PDRs to NBM (North Base Media) that should have been declared in RHC’s VAT return,” the court concluded.

Rappler is still appealing two other cases: a cyber libel conviction and a Securities and Exchange Commission closure order.

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For Human Rights Watch, Rappler’s latest acquittal shows once more how the charges were politically motivated.

“The tax evasion cases against Rappler were politically motivated and this verdict vindicates the news organization and its journalists,” Human Rights Watch senior researcher Carlos Conde said in a statement yesterday.

“Philippine courts should expedite their ruling on the remaining two cases against Rappler. President Marcos should ensure that legal harassment of Maria Ressa and other journalists ends,” he added.

“We share this with our colleagues in the industry who have been besieged by relentless online attacks, unjust arrests and detentions and red-tagging that have resulted in physical harm,” Rappler said.

For Sen. Risa Hontiveros, the charges against Rappler originated from the Duterte administration’s legal harassment following the fearless reporting on the brutal and failed war on drugs.

“It is unacceptable in a democracy for more journalists like Percy Lapid to be harassed, attacked or worse, killed,” she said.

“Truth-tellers are often attacked and persecuted by those who weaponize the law to trample on their fundamental freedoms. This is exactly the reason why I filed Senate Bill No. 1593 that seeks to decriminalize libel, which has often been used to gag members of the press,” she added. — Janvic Mateo, Cecille Suerte Felipe