ABS-CBN Holdings is a legitimate company and was not created to commit fraud, ABS-CBN legal counsel Atty. Cynthia del Castillo said at the House panel hearing on the network’s franchise today (June 15).
“We stand on our ground na wala pong pananagutan ang ABS-CBN Broadcasting Company na inilipat sa ABS-CBN Holdings. Hindi po ‘yun ini-structure para makaiwas sa pananagutan ng ABS-CBN Broadcasting. It was not organized for purposes of fraud or perpetuating fraud for that matter,” she said.
Del Castillo maintained that it did not act as an alter ego of ABS-CBN Broadcasting Company.
“Hindi po siya alter ego ng ABS-CBN kasi po siya po ay shareholder lang ng ABS-CBN Broadcasting Company, hindi naman po siya nagmamay-ari ng lahat ng ABS-CBN Broadcasting Company,” she said.
Del Castillo, a former dean of the Ateneo de Manila University School of Law, said ABS-CBN Holdings is no different from other holding companies that are registered with the SEC.
She explained that holding companies are legitimate and their business is in investments in other companies.
“Normal po ‘yan na may holding company na ang kanila lang pong business ay mag-invest sa other companies, at ang kanila pong kita ay nanggagaling sa dibidendo na binibigay ng mga kompanya na kanilang ini-investan,” she said.
During the hearing, Rep. Edcel Lagman said ABS-CBN Holdings’ Philippine Deposit Receipts (PDRs) are “completely compliant” with the Constitution.
Lagman said the Securities and Exchange Commission and the Philippine Stock Exchange permitted the issuance of the PDRs.
“There is nothing illegal or irregular about this. To reiterate, the PDRs are not used to avoid or circumvent the pertinent provisions of the Constitution,” he said.
According to Lagman, PDR holders do not have ownership and management of ABS-CBN Corporation since they do not have voting rights and title over the underlying shares.
“No avalanche of adverse comments and speculative innuendos will alter the operative fact that PDRs are divested with voting rights, ownership entitlements or management prerogatives and cannot be converted to shares of stock in favor of alien PDR holders,” he said.
Del Castillo previously stated that foreign and local PDR holders are “passive investors” and have no right to vote, influence or elect officials in the broadcasting company.