AN ACT GRANTING A FRANCHISE TO FAR EASTERN RADIO, INCORPORATED, FOR THE ESTABLISHMENT, MAINTENANCE, AND OPERATION OF RADIO BROADCASTING AND RADIO-TELEPHONIC AND RADIO-TELEGRAPHIC COMMERCIAL SERVICES, AND PRESCRIBING THE CONDITIONS THEREOF.

• Number: Act No. 3180
• Sections: 17

Section 1

SECTION 1. There is hereby granted to Far Eastern Radio, Incorporated, a corporation duly organized under the laws of the Philippine Islands, its successors or assigns, herein referred to as the "grantee," a franchise to establish, maintain, and operate radio-telegraphic and radio-telephonic transmitting and receiving stations in the Philippine Islands for the following purposes :

(a) The broadcasting to the general public of news, governmental messages, instruction, entertainment, and open public communications of all kinds.

(b) The sending of commercial messages from points within the Philippine Islands to points exterior thereto, including vessels even though such vessels be located within the territorial waters of the Philippine Islands, and the receiving of commercial messages from such exterior points.

Section 2

SEC. 2. The broadcasting service shall be open to the general public upon payment of the established broadcasting rates and subject to the general regulations of the grantee for the allotment of time and the class of communications acceptable for broadcasting. The Government of the Philippine Islands, hereinafter referred to as the "grantor," or any branch thereof, shall have priority of service when the public welfare shall require it. The Secretary of Commerce and Communications shall determine the occasions when the public welfare requires such priority.

Section 3

SEC. 3. The grantee, by the acceptance of this franchise, agrees to do, perform, and accept the following:

(a) Within one year from the date of acceptance of this franchise to have in satisfactory operation an efficient radio-telephonic broadcasting station of sufficient power to reach all points in the Philippine Islands under normal static conditions.

(b) Within one year from the date of the acceptance of this franchise to have in satisfactory operation one or more radio-telegraphic stations having an effective range under normal static conditions of not less than one thousand five hundred miles.

(c) Within one year from the date of the acceptance of this franchise to provide efficient receiving and transmitting apparatus and service, adequate to meet the reasonable public demand for radio-telegraphic commercial service.

(d) To improve and augment its apparatus in conformity with the progress of radio science and practice.

(e) To recognize the jurisdiction of the Government of the Philippine Islands, through its duly empowered agencies, to regulate the charges and rates for its services, and to regulate and at any time to inspect the books of accounts of the grantee.

(f) To recognize the jurisdiction of the Government of the Philippine Islands to require that an application be submitted and approved before installing any radio station, and to determine by general regulations the wave lengths which shall be used by the different types of service effective within the Philippine Islands, so long as such regulations shall specify the exclusive use by the grantee of wave lengths for each of its services, commercial radio- telegraphic, commercial radio-telephonic, and broadcasting, respectively, which wave lengths shall be sufficiently inclusive to reasonably preclude interference by other stations and so as to permit expansion of the grantee's services.

Section 4

SEC. 4. The grantee is authorized during the period of five years commencing with the date of the acceptance of this franchise, and thereafter until otherwise ordered by competent public authority, to charge not exceeding the following rates for service.

(a) For the use of the broadcasting service, such rates as competent public authority may approve.

(b) For radio-telegraphic and radio-telephonic commercial service to and from points exterior to the Philippine Islands, as hereinbefore described:

(1) For radio-telegraphic messages, the rates shall conform to those fixed by the international conventions to which the United States of America or the Government of the Philippine Islands shall be a party; or in default thereof reasonable rates which shall not exceed the existing cable rates.

(2) For radio-telephonic communications the rates shall conform to those fixed by the international conventions to which the United States of America or the Government of the Philippine Islands shall be a party; or in default thereof, rates equivalent to the telegraphic rates, computed on the basis of twelve words of telegraphy a minute. Sec. 5. Nothing mentioned in the preceding sections shall be construed as to give the grantee authority to offer lower rates than those now charged or will be charged by the Bureau of Posts for ship to shore service.

Section 6

SEC. 6. The Director of Posts and the management of; any public or private operating telegraphic or telephonic' services within the Philippine Islands may upon agreement with the grantee provide for the relaying of communications over and by means of their respective apparatus, under such terms as to rates and division of income as competent authority may approve.

Section 7

SEC. 7. Nothing in this Act shall prohibit the gratuitous broadcasting by the grantee of programs of general public interest for the purpose of stimulating the public appreciation of, and interest in, radio telephony.

Section 8

SEC. 8. Subject to the limitations and procedure prescribed by law, the grantee is authorized to exercise the right of eminent domain, in so far as may be reasonably necessary to further the establishment and efficient maintenance and operation of its radio stations and connecting them one to another, and with the prior approval of the Governor-General, the grantee is authorized to construct and maintain its works of public utility and service over and across the public property of the United States, including streets, highways, squares, and reservations, and over similar property of the Government of the Philippine Islands and its branches.

Section 9

SEC. 9. As a condition of the granting of this franchise, the grantee shall execute a bond in favor of the grantor in the sum of fifty thousand pesos in a form and with sureties satisfactory to the Secretary of Commerce and Communications, conditioned upon the faithful performance of the grantee's obligations hereunder during the first five years of the life of this franchise. If, after five years from the date of the acceptance of this franchise the grantee shall have fulfilled said obligations, or so soon thereafter as the grantee shall have fulfilled same the bond aforesaid shall be cancelled by the Secretary of Commerce and Communications.

Section 10

SEC. 10. With the exception of the privileges of broadcasting and of transmitting and receiving communications to and from points exterior to the Philippines as hereinbefore granted, all radio communications between points or stations within the Philippine Islands is expressly reserved to the Government of the Philippine Islands. But as a further condition of this franchise the Director of Posts may require the grantee to transmit and receive radio messages between said grantee's stations within the Philippine Islands, under contract whereby the grantee shall receive not exceeding ninety per cent of the established tolls or rates charged by the Bureau of Posts therefor. Such tolls shall be those agreed upon between the Director of Posts and the grantee, or in default of agreement those established by the Public Utility Commissioner In the event the services, or facilities of the grantee are contracted for as herein stipulated, all officers and employees of the grantee shall be considered as officers and employees of the Bureau of Posts in respect to their criminal liability under the Postal Law.

Section 11

SEC. 11. This franchise is subject to amendment, alteration or repeal by the Congress of the United States of America or by the Philippine Legislature. The grantee is forbidden to declare stock or bond dividends or to issue stocks or bonds, except in exchange for actual cash or for property at a fair valuation equal to the par value of the stocks or bonds so issued.

Section 12

SEC. 12. In case of war, insurrection, or general public disorder the Government of the United States may, by order of the Secretary of War, take possession of and operate any or all radio stations of the grantee, paying unto said grantee reasonable compensation therefor. Under the said circumstances and conditions the Governor- General may exercise the same power.

Section 13

SEC. 13. Acceptance of this franchise shall be given in writing within six months after the approval of this Act. When so accepted by the grantee and the bond aforesaid approved by the Secretary of Commerce and Communications, the grantee shall be empowered to exercise the privileges granted hereby. The grantee, its successors or assigns shall set forth in writing in their acceptance of this franchise that they are aware of the aspirations of the Filipino people to become a free and independent nation; and that said grantee, its successors or assigns, undertake not to engage nor assist, directly or indirectly, whether by money contributions or otherwise, in attempts contrary to said aspirations, either under the pretext of vested interests or any other pretext whatsoever, and that said grantee, its successors or assigns, undertake, furthermore, to require a like obligation from their administrators, agents, attorneys, officials, and other employees.

Section 14

SEC. 14. Any violation of the conditions imposed by this Act shall be sufficient cause for the cancellation of the franchise by means of a proceeding instituted by the Attorney-General, in the name and as the representative of the Philippine Islands, in the Court of First Instance of the City of Manila, upon which jurisdiction is hereby conferred.

Section 15

SEC. 15. The life of this franchise shall be for a period of fifty years from-the date of its acceptance; but at any time after twenty-five years from such date the grantor shall have the right, upon one year's notice, to acquire this franchise by acquiring all the physical properties of the grantee pertaining to the exercise of this franchise at their judicially determined value.

Section 16

SEC. 16. The grantee, its successors or assigns, shall be liable to pay the same taxes on their real estate, buildings, and personal property, exclusive of the franchise, as other persons or corporations are now or hereafter may be required by law to pay. The grantee, its successors or assigns, shall further pay the Collector of Internal Revenue each year, and pursuant to the regulations of the Bureau of Internal Revenue one and one-half per centum of its share of the gross receipts for business transacted under this franchise, and said percentage shall be in lieu of all other taxes on the franchise or earnings thereof.

Section 17

SEC. 17. This franchise is granted upon the condition that the same shall not be construed as to exclude other person or persons or corporations from similarly acquiring like concessions and privileges here granted.

Section 18

SEC. 18. This Act shall take effect upon its approval.

Approved, November 25, 1924.