SEC upheld its 2018 order to shutdown Rappler

CEO Maria Ressa announced that The Securities and Exchange Commission has affirmed its earlier decision to shut down the online news organization.

File photo: Rappler and SEC logos

Rappler will appeal as it goes on "business as usual"

The 2021 Nobel Peace Prize laureate shared the SEC ruling during her speech at the Hawaii East-West Center (EWC) international media conference. 

The ruling basically mandates the cancellation of the certificates of incorporation of Rappler Inc. and Rappler Holdings Corporation. The news organization issued a statement,

In an order dated June 28, our Securities and Exchange Commission affirmed its earlier decision to revoke the certificates of incorporation of Rappler Inc. and Rappler Holding Corporation. We were notified by our lawyers of this ruling that effectively confirmed the shutdown of Rappler.

 

The SEC confirmed the issuance of its order a few hours after, reiterating Rappler's alleged "violation of constitutional and statutory restrictions on foreign ownership in mass media."

In 2018, the Securities and Exchange Commission demanded to revoke Rappler's certificate of incorporation, asserting that the news organization permitted foreign investor Omidyar Network to hold Philippine Depositary Receipts (PDRs). 

PDR is a financial instrument that foreign entities can purchase for financial returns in a local company but not in the form of dividends which are tied to ownership.

CEO of Rappler Maria Ressa (Photo from Elle)

According to Maria Ressa, Rappler will appeal the decision "especially since the proceedings were highly irregular." As for the organization, it will continue its business operations as usual. "We will adapt, adjust, survive and thrive," the company stated in an internal memo for its staff.

The CEO noted that the shutdown order is not immediate without court approval.

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Source: Rappler