Rappler's incorporation papers revoked by SEC

Elias Hubbard
January 15, 2018

In a blow to press freedom in the Philippines, the Securities and Exchange Commission (SEC) revoked the registration of news organization Rappler allegedly for violating the Constitution and the Anti-Dummy Law.

The two USA -based organisations that invested in Rappler are Omidyar Network, created by eBay founder and entrepreneur Pierre Omidyar, and North Base Media, which advocates independent media and was founded by three prominent foreign journalists.

The news website reported the SEC decision on Monday and denied the SEC's claim that Omidyar Network, a fund created by eBay founder and entrepreneur Pierre Omidyar, controlled its operations.

His spokesman, Harry Roque, said the SEC decision was purely about complying with the constitution. Several large media companies have PDRs.

The Securities and Exchange Commission, in a decision made on January 11 but only revealed on Monday, ruled that Rappler was "liable for violating the constitutional and statutory foreign equity restrictions in mass media".

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". "What this means for you, and for us, is that the Commission is ordering us to close shop, to cease telling you stories, to stop speaking truth to power", the statement read.

Rappler has not shied away from challenging Duterte's policies and its reporters have been subject to frequent threats by his online army of supporters, often in response to postings made by pro-Duterte bloggers, some of whom hold government positions.

Many Filipino journalists see the SEC case as a bid to stop Rappler's dogged and affecting reporting on Duterte's campaign against suspected drug users and dealers.

Earlier, President Rodrigo Duterte accused Rappler of being fully owned by a foreign businessman.

Two foreign investors were bought into the company in 2015 through Philippine Depositary Receipts.

Rappler Holdings, which owns 98.84 percent of Rappler, issued in 2015 a total of almost 20 million PDRs to Omidyar Network and NBM Rappler, both foreign entities. "Rappler remains 100% Filipino-owned", Rappler said in a statement after Duterte's SONA.

"We will continue bringing you the news, holding the powerful to account for their actions and decisions, calling attention to government lapses that further disempower the disadvantaged".

"We will continue to hold power accountable and we will continue to tell the truth", Chay Hofilena, Rappler's acting managing editor, told reporters.

"We thought this day would never come, even as we were warned in the first of week of December past year that the Securities and Exchange Commission (SEC) would be handing down a ruling against us". The SEC investigation was ordered by the Office of the Solicitor General, which wrote the agency on December 14, 2016, to investigate Rappler over its PDRs. Transparency, we believe, is the best proof of good faith and good conduct.

The ruling revealed a special panel was created in July 2017 to look into Rappler's "possible violations of nationality restrictions on ownership".

Philippine journalist groups expressed outrage at the decision and called on media organisations to resist efforts to silence journalists.

The decision was signed by SEC Chairperson Teresita Herbosa, and Commissioners Antonieta Ibe, Ephyro Luis Amatong, and Emilio Aquino.

As news of the revocation broke out, social media was set abuzz with what many perceived to be a very "controversial" move on the part of the Duterte administration.

The above comment translates to: You should have just been a blogger, Rappler.

Other reports by Click Lancashire

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