There could be a legal issue in the “block time deal” between ABS-CBN Corp. and Zoe Broadcasting Inc., a newly-elected House Minority Leader said on Wednesday.
“There is a legal issue about it but let the NTC (National Telecommunications Commission) do its work,” Abang Lingkod Partylist Representative Joseph Stephen Paduano told the reporters in a virtual press briefing.
“Let the NTC do its study or investigation on the matter then NTC will be the one to recommend it to Congress,” he explained.
Paduano initially supported the grant of franchise to ABS-CBN by co-authoring an ABS-CBN franchise renewal bill but later withdrew from this after 12 House hearings.
The new Minority Leader noted that the embattled media network has the “luxury of time” to file for renewal next year then it will be handled by the House Committee on Franchise.
Meanwhile, on the matter of taxes, Paduano said the Bureau of Internal Revenue can look into it, considering that Zoe enjoys its tax-exempt status as it is limited to religious broadcasting.
Zoe TV is a broadcast media arm of the religious group Jesus Is Lord Church, whose founder is House Deputy Speaker Eddie Villanueva. He is also the representative of the CIBAC Partylist.
“Once you’re a commercial network, you have to pay your taxes. That’s the issue I found before on ABS-CBN. Its profits go to Big Dipper as they are accredited by PEZA (Philippine Economic Zone Authority),” he noted.
Paduano in July 2020 withdrew his support to the renewal of franchise of the media giant due to its alleged “engagement in tax avoidance schemes.”
Now that Zoe broadcasts commercial programs of ABS-CBN through the rebranded A2Z and if Zoe will be proven to have gone commercial, Paduano said it has to pay taxes.
“If somebody questions about it then the Court decides, we (congressmen) will not meddle on the issue,” he explained.
Atty. Miko Jim Paulo V. Panganiban, a business columnist of this paper and an Associate of Aranas Cruz Araneta Parker & Faustino law offices pointed out that if ABS-CBN is merely using Zoe to air its programs, “that may be a violation of the law.”
“But if Zoe will be having the rights over those programs, it is a different story,” he said.
Anakalusugan Partylist Rep. Mike Defensor, one of the 70 congressmen who junked ABS-CBN’s franchise renewal application, said he has no problem with the issue.
“I have no problem with that, because their arrange is for blocktime, it is not utilization of the of the franchise, it is the franchise of Zoe and they are buying into it. So ABS-CBN is still a corporation and it is within their right to do so.”
Presidential spokesperson Harry Roque, meantime, said: “We neither welcome it nor we have reaction to it because they’re a content provider. For all intents and purposes, it is Zoe that will be subject to regulation because Zoe is the franchise holder.”
Justice Secretary Guevarra likewise deferred any comment until he has read the blocktime contract itself.
“I do not wish to pre-empt congress by making any statement about the matter at this time, as the issues involved may relate to the use of a broadcast franchise that falls within the exclusive jurisdiction of the legislature,” he said.