Cable operators eye raps vs Fox, AXN

MANILA, Philippines - Local cable operators are preparing to file charges with the Department of Justice (DOJ) against foreign giants AXN Network Philippines Inc. and Fox International Channels Philippines Corp. for alleged “unfair competition.”

The Philippine Cable Television Association Inc. (PCTA) accused Fox and AXN of “wholesale violation of the Constitution, statutes and rules and regulations governing both mass media and advertising industries.”

The group said it will file a complaint with the DOJ’s Office for Competition, which is in charge of the investigation and prosecution of trade and competition cases, in the next few days.

“Both Fox and AXN – foreign companies by any definition – have somehow been able to provide programming content locally while engaging in advertising activities – both expressly prohibited by Philippine laws,” PCTA president Leo Wong told reporters in Manila yesterday.

The Constitution limits the ownership and management of mass media to citizens of the Philippines, or to corporations, cooperatives, or associations, wholly owned and managed by such citizens.

Wong said Securities and Exchange Commission records show that “foreign shares constitute 99.99 percent of ownership for both Fox and AXN. Still, and undeniably to the detriment of local mass media and advertising industries, these foreign giants have been able to marginalize local industries with impunity for the longest time.”

According to the PCTA, “the community antenna television industry is part of the mass media industry, specifically commercial mass media as impliedly recognized by Executive Order 205, series of 1987, the fundamental statute regulating the operation of CATV systems in the Philippines.”

Wong questioned how Fox and AXN “have been able to provide programming content locally,” adding that this anomaly begs “for appropriate government intervention.”

The group argued that both Fox and AXN have also been able to engage in advertising activities in the country despite the Foreign Investments Act Negative List, which states that the mass media industry cannot have foreign equity and the advertising industry can only have up to 30 percent foreign equity.

“Entering into sponsorship and advertising contracts clearly constitutes engaging in advertising, as so does airing of advertisements through programming content given to CATV operators nationwide,” Wong said.