Rappler was not fully Filipino owned – CA
Online news website Rappler was not fully Filipino owned since voting rights on corporate matters were shared by Rappler Holdings Corporation (RHC) and American firm Omidyar Network, the Court of Appeals (CA) has ruled.
The CA’s Special 12th Division, in a 72-page ruling, upheld the revocation order issued by the Securities and Exchange Commission (SEC) against the registration of Rappler for violating the 1987 Constitution.
The decision, penned by Associate Justice Rafael Antonio Santos, said that Omidyar Network had “some foreign control” over Rappler when the SEC issued the revocation order against the news website.
“While the Omidyar PDR (Philippine Depositary Receipt) states that the right to vote on the Rappler shares is retained by RHC, said right to vote is being shared with or exercised jointly by RHC, as the owner of the shares, and Omidyar, through Clause 12.2.2,” the CA ruling stated.
“Thus, under a ‘zero’ foreign control standard, it would appear that this is tantamount to some foreign control,” the ruling stated.
However, while Rappler’s petition for review was junked, the CA ordered the SEC to conduct an evaluation of the legal effect of the “supervening donation” made by Omidyar Network of all its Philippine Depositary Receipts to Rappler.
“In view of the donation made by Omidyar of all the Omidyar PDR to the Rappler staff, the negative foreign control found objectionable by the SEC appears to have been permanently removed,”
READ: Omidyar donates $1.5-M investment to 14 Rappler managers
“This case is hereby remanded to the Securities and Exchange Commission for this purpose,” the CA said.
To recall, Omidyar Network has donated all of its $1.5 million worth of PDRs to 14 Rappler managers following the SEC’s issuance of the revocation order. /muf
