ABS-CBN: PDRs do not result in foreign ownership

MANILA, Philippines — But GMA did it, too.

ABS-CBN president and CEO Carlo Katigbak on Monday countered the charge that the broadcast giant skirted the ban on foreign ownership of mass media by issuing Philippine depositary receipts (PDRs) to foreigners, pointing out that its chief competitor GMA Network did the same thing with no trouble from the government.

“Other media companies — including GMA Network—have issued PDRs through their holding companies. This never became an issue in their franchise application,” he said.

Appearing at a joint House hearing, Katigbak argued that issuing PDRs did not circumvent provisions in the 1987 Constitution prohibiting foreigners from owning media companies.

PDRs are investment tools that grant holders the right to the delivery or sale of the underlying share, but it is neither proof nor certificate of ownership of a corporation, according to the Philippine Stock Exchange.

“PDRs do not result in foreign ownership of ABS-CBN. A PDR is not a share in ABS-CBN,” Katigbak told the body.

Katigbak added that the Securities and Exchange Commission (SEC) approved the network’s issuance of PDRs on Oct. 4, 1999. “How can this be against the law if a government agency gave the permit?” he said.