SolGen Calida: DOJ to probe Rappler liability under anti-dummy law

Solicitor General Jose Calida on Tuesday said the Department of Justice (DOJ) will have to determine whether criminal charges should be filed against online news site Rappler, whose incorporation papers have been revoked by the Securities and Exchange Commission (SEC), for possible violation of the Anti-Dummy Law.

The Anti-Dummy Law or Commonwealth Act 108 prohibits foreigners from intervening in the management, operation, administration, or to control nationalized business, whether as officers or employees, with or without compensation.

“It was a referral by the SEC to the DOJ to investigate whether there was a violation of the Anti-Dummy Law,” Calida told reporters ahead of the oral arguments on the petitions against the Mindanao martial law extension at the Supreme Court.

“It depends on the DOJ now,” he added.

Calida said that he is not looking into the incorporation details of other media outfits.

“Unless you want me to do what I did in December 2016,” the solicitor general said, referring to the time he asked the SEC to probe Rappler.

Calida recalled reading the newspaper articles of former ambassador to Cyprus and Greece Rigoberto Tiglao, who disclosed in October 2016 that two American companies, Omidyar Network, Inc. and North Base Media, “made substantial investments” in Rappler in 2015.

After more than a year, the SEC ruled on January 11 that Rappler violated the constitutional provision against foreign ownership in mass media when it welcomed Omidyar Network of eBay founder Pierre Omidyar as an investor in the online mass media outlet.

The corporate regulator said Rappler also issued derivatives to North Base Media in 2015, but the derivatives did not carry the same terms as that of Omidyar's.

"Because Omidyar was the later purchaser... it caused the insertion of certain provisions that assure control over other PDR Holders, and also over the corporate policies of Rappler Inc. and its alter ego Rappler Holdings Corporation," the SEC said.

Rappler questioned the timing of the decision, labeling it as harassment.

The media outfit said it would contest the decision before the courts. Calida said he is prepared to defend the SEC ruling. —KBK, GMA News