LIKE Rappler, two media companies are also partly owned by foreigners. Yet, it seems the government, through the Securities and Exchange Commission (SEC), decided to pick only on Rappler.

Unlike Rappler, though, ABS-CBN Holdings Corp. and GMA Holdings Inc., have issued their respective Philippine Depositary Receipts (PDRs), which represent their capital stock, and listed them on the Philippine Stock Exchange (PSE).





For reasons known only to the SEC officials, led by Chairperson Teresita Herbosa, the government failed to read the filings of the two companies, particularly their PDR issuances that are convertible into common shares.

No, Due Diligencer is not necessarily defending Rappler. Rather, this is only to point out the fact that the SEC should not be selective in applying the law. If media companies should be owned 100 percent by Filipinos as the Constitution so provides, so be it. But to punish only Rappler and spare the others is not fair, not only to public investors but also to the viewers of television shows and listeners of the radio stations operated by ABS-CBN and GMA 7.

As a regulatory authority, the SEC should scrutinize the individual stockholders of listed companies. Are they really Filipinos as they project themselves to be?

As a matter of fact, Due Diligencer has long ago called on the SEC officials and the PSE’s market watchers to require disclosures of the beneficial owners of common shares attributed to PCD Nominee Corp. as record stockholders.

Ownership profiles

As of Dec. 31, 2017, the public ownership report (POR) of ABS-CBN Holdings Corp. summarized its ownership profile as follows: issued and outstanding shares, 324.844 million; listed shares, 325.547 million; foreign-owned shares, 208.857 million; foreign ownership level, 64.29 percent; foreign ownership limit, 100 percent; number of stockholders, 124; number of shareholders owning at least a board lot each, 122.

On the other hand, GMA Holdings Inc. did not have a POR posted on the PSE website. For public investors, they have only the list of the top 100 stockholders to rely on in perusing the company’s PDRs.

As of Dec. 31, 2017, GMA Holdings listed PCD Nominee as holder of 208.868 million shares, or 26.57 percent, for “non-Filipinos.” It also held as of the same cut-off date 354.305 million shares, or 45.06 percent, for Filipinos.

Like Rappler, ABS-CBN Holdings and GMA Holdings are also PDR issuers. If these two listed companies are in violation of the 100-percent media ownership as mandated by the Constitution, Herbosa should have also taken them to task.

Being a lawyer and chair of the SEC, Herbosa and the four other commissioners should have been running after the two companies for using PDRs to circumvent the ownership provision of the Constitution.

Due Diligencer’s take

Why hide behind PCD Nominee when the identities of stockholders should be properly disclosed? By doing so, the public investors would know who their co-owners are should they decide to buy PDRs issued by ABS-CBN Holdings and GMA Holdings?

Let the public know what the majority stockholders are up to. It is only fair that business owners who are mostly the very rich families in this country, should be required to inform their investors, who are not privy to what’s happening inside the boardroom, what their plans are about their PDRs.

It is really a paradox that the SEC officials know from their files that only Rappler uses PDRs. How about ABS-CBN Holdings and GMA Holdings? Are they not also issuers of the same shares of capital stock? The irony of it all is that the same PDRs are convertible into common shares in their respective listed companies.

How many of these PDRs so far have been converted into common shares of stock in ABS-CBN Corp. and GMA Network Inc.?

For the public to know the answer, they only have to go over the filings of the two media companies. From the disclosures, they will find out not only about the trade of going around the ownership law but, more importantly, how they have been left out as stockholders who are supposed to also be entitled to pre-emptive rights.

Why shouldn’t the SEC also revoke the registration of ABS-CBN and GMA Network for being partly but indirectly owned by foreigners through their PDR holders? Just asking.

esdperez@gmail.com