An opposition lawmaker on Wednesday said the move of GMA Network Inc. to buy back its Philippine Depositary Receipts (PDR) from foreign investors proved that ABS-CBN Corp. was singled out by Congress when it rejected its franchise renewal application.
READ: GMA Network buys back PDRs to protect franchise
Albay Rep. Edcel Lagman said the right to equal protection of ABS-CBN could have been violated when Congress rejected its application for franchise renewal due to foreign PDRs among other issues raised against the media giant. But Lagman said other media networks are allowed to correct such a supposed violation.
"Granting that 'buying back' is the remedy, ABS-CBN should have been afforded the equal opportunity to 'buy back,' instead of being penalized outright with the denial of its franchise renewal," Lagman said.
READ: Opposition: President showed hand in ABS-CBN franchise denial
Lagman made the statement after GMA Network Inc. said it would buy back PDRs issued to foreign investors.
In a Philippine Stock Exchange filing on Tuesday, the network said its board of directors had approved the acquisition of PDRs issued by GMA Holdings Inc. at P4.55 per share or lower until Oct. 31 this year.
This is about 46.5 percent less than their issue price of P8.50 per share in 2007.
After the buyback, GMA will no longer have any PDRs. GMA Network said once the purchase is completed, it will convert the PDRs into common shares.
According to Lagman, Congress should have exercised fairness by merely allowing the broadcast giant to "correct" what it deemed as violation and given an opportunity to comply with the law–the same way accorded to PDRs of other companies like telecommunications firms.
Lagman also maintained that ABS-CBN did not violate the constitutional prohibition on foreign ownership in media companies with its foreign PDRs.
"I still maintain that PRDs are instruments of investment not equivalent to transfer of equity or ownership of stock. There is no violation of the Constitution on 100 percent Filipino ownership and management of mass media," Lagman said.
Given this, Lagman expressed belief that there was no need for GMA also to buy back its foreign PDRs.
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