Press Statement Re: TV5-ABSCBN and Cignal-SkyCable Transactions
To date, the Philippine Competition Commission (PCC) has not been consulted and has not received any notification from MediaQuest Holdings and ABS-CBN Corp. on the “investment agreement” between TV5 and ABS-CBN, and the reported “sale and purchase agreement” between Cignal Cable Corp. and Sky Cable Corp.
The reported transactions refer to ABS-CBN Corp.’s acquisition of shares representing 34.99 percent of stock in TV5 for P2.16 billion, as well as Cignal Cable Corp.’s acquisition of 38.88 percent of Sky Cable Corp. for P2.862 billion.
Transactions that meet the P50-billion thresholds set by the Bayanihan to Recover as One Act (Bayanihan 2) are required to be notified to the PCC for review to ensure that there is no harm to competition and detriment to consumer welfare. With the lapse of the period set under Bayanihan 2 on Sept. 15, the PCC notification thresholds will revert to appropriately lower levels that reflect the relative size and performance of the economy.
While the PCC determines whether the thresholds under Bayanihan 2 have been met, it may also direct its Mergers and Acquisitions Office to conduct an initial assessment if the effects of the transactions involving TV5 and ABS-CBN, and Cignal and SkyCable, warrant a motu proprio review. A merger review will determine if the transaction may result in a substantial lessening of competition in the relevant markets.
The PCC’s mandate to review mergers and acquisitions is centered on protecting consumers from transactions that may result in unchecked market power. Mergers and acquisitions often mean fewer choices for consumers. Lack of competition may lead to higher prices or lower quality products and services, all to the disadvantage of consumers.
The PCC has always been supportive of business expansion activities, especially in this post-pandemic period when the economy is rebuilding and recovering. At the same time, it wants to ensure that measures to help recover from the pandemic do not result in harm to the market in the long run.
—Johannes R. Bernabe
Philippine Competition Commission