Then presidential candidate Rodrigo Duterte raising a clenched fist during his campaign sortie in Lingayen, Pangasinan, north of Manila. Photo: AFP/Noel Celis
Then presidential candidate Rodrigo Duterte raises a clenched fist during his campaign sortie in Lingayen, Pangasinan, north of Manila. Photo: AFP/Noel Celis

In a carefully calibrated exercise of vindictive justice, the Philippine government has moved ahead with shutting down Rappler, one of its leading and most credible media critics.

In a highly controversial decision, the Securities and Exchange Commission (SEC) perfunctorily revoked the license of the Manila-based online news site, a popular local version of Huffington Post, which has been a regular target of President Rodrigo Duterte and his well-oiled propaganda machine.

The regulatory body claimed that Rappler, ran and founded by former CNN International journalist Maria Ressa, violated the constitutional restriction against foreign investments in nationalized sectors including media.

It accused the online news site of adopting a “deceptive scheme to circumvent” the law by handing so-called Philippine Depository Receipts (PDRs) to high-profile foreign investors, including E-bay founder Pierre Omidyar’s US-based philanthropic investment fund.

Legal experts, however, contend that the PDRs are legitimate financial instruments for raising capital without handing foreign investors ownership or control over the operation of Philippine-based companies.

Journalists work at the office of Rappler in Pasig, Metro Manila, January 15, 2018. Photo: Reuters/Dondi Tawatao

In fact, the PDRs have been regularly used by Philippine entrepreneurs to raise much needed capital from abroad without violating strict constitutional restrictions on foreign ownership.

As one expert put it, the PDRs “are financial instruments whose value is tied to the price of and dividends from shares in a company that the PDRs reference,” but, contrary to the SEC’s claim, they “do not grant ownership over these shares.”

For years, Rappler and its supporters contend, the company has been using PDRs, but it was only until Duterte’s watch that it became a supposedly legal issue. Other leading media companies also raise funds through PDRs, news reports said.

The controversial president characterized Rappler’s news coverage as “garbage and shit“, and had repeatedly threatened to shut the online publication down through legal instruments. Rappler’s coverage of Duterte’s controversial, lethal drug war has often cast his administration in an unfavorable light.

During his second State of the Nations Address (SONA), Duterte openly warned to silence Rappler, accusing it of being “fully owned by Americans” and forwarding the interests of foreign powers particularly in the West.

Police officers investigate the killing of an alleged drug dealer, his face covered with packing tape in Manila. Photo: AFP/Noel Celis 

The Filipino president has also gone after other major media outlets. ABS-CBN, the Philippines’ largest broadcast television network, has been threatened with non-renewal of their franchise in 2020 by the Duterte-controlled Philippine Congress.

The Philippine Daily Inquirer (PDI), the nation’s leading liberal newspaper, had been threatened with tax evasion cases, before its owners, the Prieto family, were forced to sell to Ramon Ang, a trusted friend of the president.

During his early years in office, Russian President Vladmir Putin, whom Duterte has often described as his “favorite hero”, employed similar tactics to silence independent media. Many fear that the Philippine president is moving in a similar direction of muzzling freewheeling media as he consolidates a popular autocracy.

“What this means for you, and for us, is that the commission is ordering us to close shop, to cease telling you stories, to stop speaking truth to power, and to let go of everything that we have built — and created — with you since 2012,” said Rappler in response to the regulatory body’s decision.

Maria Ressa (L), CEO and editor of online portal Rappler, at their office in Manila on January 15, 2018. Photo: AFP/Ted Aljibe

The news outlet characterized the SEC’s move as “pure and simple harassment,” and part of “relentless and malicious attacks against us since 2016,” when Rappler began to relentlessly cover and expose Duterte’s human rights violations and other abuses.

The Foreign Correspondents Association of the Philippines joined the chorus of condemnation, expressing “deep regret” over the SEC decision which “is tantamount to killing the online news site, sends a chilling effect to media organizations in the country.”

Rappler is expected to challenge the decision at the Supreme Court, and will maintain its operations while the case is under reconsideration. The office of the president, meanwhile, has sought to distance itself from the decision, describing it as a fully independent move on the part of the regulatory body.

“We respect the SEC decision that Rappler contravenes the strict requirements of the law that the ownership and management of mass media entities must be wholly owned by Filipinos,” said presidential spokesman Harry Roque.

In a high-profile speech on January 16, the president echoed a similar line, declaring his government has “never had a hand” and that he “never give a shit if you continue or not continue with your [Rappler] network.”

A College Editors Guild of the Philippines member at a protest outside the presidential palace in Metro Manila, Philippines January 17, 2018. Reuters/Romeo Ranoco

Nevertheless, relishing the impending downfall of one of his chief critics, Duterte implored the media to adopt “moderation” in their criticism of the government, and shunt the “use [of] words that tend to cast aspersion on the character” of people in the government.

A visibly buoyant president, who clearly hopes for a more deferential media, underlined that some media outlets are already towing the line, and “are mine in the sense that they just tell the [official version of] truth.” Duterte meanwhile has consistently accused Rappler of peddling in “fake news.”

His Solicitor General Jose Calida has even threatened Rappler’s management with jail time, saying on Tuesday that his office is exploring filing criminal charges under the Anti-Dummy Law, or Commonwealth Act 108, which prohibits foreigner entities from exercising control over local companies in strategic sectors such as media.

Two years into Dutetre’s presidency, press freedom in the Philippines is now facing its greatest existential challenge since the downfall of the Marcos dictatorship. But it’s not clear yet Filipino journalists, including Rappler’s plucky crew, intend to go down without a fight.

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