Campaign finance on the lam

Gaps in law yield ‘creative’
compliance by bets, media

THERE are still a few more weeks to go before the May polls, but the Commission on Elections (Comelec) is already busy counting – political ads, that is, not votes.

Election laws put specific caps on campaign expenditures and political ad airtimes, as well as on the size and frequency of printed campaign ads. With political strategists themselves saying that ads account for as much as 70 percent of the campaign expenditure of a candidate running for a national post, the Comelec has been after documents from broadcast and print media outfits that would show just how many – and for how much – ads candidates have been placing with them since the campaign period began on February 9.

It’s not exactly an easy task, even for the Comelec. For one, as of March 30, only a handful of media outlets – none of them from print – had submitted all the required documents to the Comelec. For another, “creative” interpretations of the law by the handlers of several candidates and political parties seem to have stumped elections commissioners, who are now revisiting the rules to figure out whether there have already been any violations, even as they make new ones to keep up with the latest ad “innovations.”

In fact, the Comelec en banc is now furiously cobbling together a set of rules on how to handle commercials shared by several candidates, some of whom may even belong to parties other than the one that paid for the ad.

“If other candidates are also shown, we should also charge the time and expenses to them,” says Comelec law department chief Ferdinand Rafanan. But the specifics on how the commission will do that remains up in the air as, says Rafanan, the body is still drawing these up.

Clear rules but…

On paper, the current rules seem straightforward enough. The Fair Election Practices Act, for instance, sets the maximum airtime for political advertisements at 120 minutes per TV station (whether free-to-air or cable TV) and 180 minutes per radio station for candidates running for national elective positions. A political party can also air a maximum of 120 minutes per TV station and 180 minutes per radio station.

And there’s Comelec Resolution No. 8758, which requires all election propaganda or political advertisements to bear – as reasonably legible or audible as possible – the words “political advertisement paid for” followed by the name and address of the candidate, political party, or party-list group for whose benefit the political ads are being printed or aired. These ads need to bear as well the phrase “political advertisement paid by” followed by the name and address of the payor.

Rafanan highlights the importance of the paid-for and paid-by clauses: “Without these, it’s very difficult for us to implement the law that sets the limits for spending and the law that requires the compliance because they can always deny that (the ads) belong to them.”

The paid-for clause also serves as another basis for computing the advertising minutes that a candidate has already logged, in addition to the certificates of performance and broadcast logs submitted by the networks.

“You credit the time doon sa ‘paid for’,” explains Comelec spokesperson James Jimenez, “because the ‘paid for’ is the person or the entity for whose benefit the ad is put out.”

Yet while this has ostensibly made it easier for the Comelec to track the candidates’ ads, it has also become a way for some candidates to beat the airtime limits imposed on them by the law, and especially now that several parties have “guest” or “adopted” candidates from other parties.

All NP ads for Villar

Presidential candidate Manuel ‘Manny’ Villar Jr. of the Nacionalista Party (NP), for example, already enjoys the full ad airtime allotment of his party, which had donated this to him. He is also making use of his own allotment. (See sidebar)

The former Senate president, however, appears as well in political ads that are being “paid for” and “paid by” the Nationalist People’s Coalition (NPC), the party of his running mate Senator Loren Legarda.

Interestingly enough, two versions of one of these commercials echo Senator Villar’s “Ipinanganak Kang Mahirap” ad. The first began airing March 24 and had the frame “Vote Loren Legarda for Vice President.” Yet the 45-second ad has the supposed beneficiary, Legarda, appearing for a mere seven seconds, while Villar is featured for a total of 10 seconds.

By March 30, the ad’s shorter version started airing, this time sporting the frame “Manny Villar for President, Loren Legarda for Vice President.”

Villar, though, is hardly the only candidate appearing in ads of a political party other than his own. Senator Miriam Defensor Santiago, whose ads are ‘paid by’ the People’s Reform Party (PRP), also appears in so-called ‘omnibus’ ads that are ‘paid by’ the NPC. In turn, the NPC’s Legarda appears in another version of the same omnibus ad that is ‘paid by’ the PRP.

Within the parties themselves, a virtual merry-go-round of names appearing after the ‘paid by’ and ‘paid for’ clauses has emerged. For example, the NP’s ‘Oposisyon’ ad that features seven of its senatorial candidates alternately names individual candidates in the ‘paid for’ and ‘paid by’ lines in different versions of its end tag. Similarly, the names of each individual candidate take turns in the ‘paid for’ and ‘paid by’ lines of the NP’s ‘Para sa Kababaihan’ ad, which features its female senatorial slate.

Same tack for LP

The Liberal Party (LP) has taken the same approach in its ads for 11 of its senatorial candidates. And just like his counterpart in the NP, LP standard bearer Senator Benigno ‘Noynoy’ Aquino III appears in all these commercials, which also share the theme of anti-corruption.

Pwersa ng Masang Pilipino, meanwhile, seems to have applied a slightly different tactic. While its omnibus ad features its standard bearer Joseph Estrada, its vice presidential candidate Jejomar Binay, and the party’s entire senatorial slate, the ad is attributed to just one of its senatorial candidates, Rep. Rodolfo ‘Ompong’ Plaza, who appears for just a few seconds in the commercial.

Some observers have taken to calling all these as “creative” ways of staying below the airtime limit. Yet although these have also seemed to have prompted some concern from the Comelec’s Rafanan, his colleague Jimenez maintains that these are still in keeping with the spirit of fair elections.

Also the commission’s education and information department director, Jimenez says that so long as all the candidates are similarly situated — meaning that they can all indulge in the so-called “creative means” of maximizing airtime —  “then, it’s a level playing field.”

“The point of fair elections—the fair part—is that equal opportunities are available for everyone,” he says. “Whether a particular candidate can take advantage of that particular opportunity, that’s a different story altogether.”

Spread the count

The way election lawyer Luie Tito F. Guia sees it, though, the essence of the airtime caps under the Fair Election Practices Act is to limit the exposure of candidates in tri-media. He also argues that since whoever appears in an ad is the one who benefits from the ad placement, the minutes should be credited to that particular candidate or group of candidates.

In any case, the Comelec may first have to tackle the more basic problem of how to have complete and up-to-date sets of campaign ads-related documents that it requires all media entities to submit.

As yet, not a single print media outfit has submitted copies of any advertising contract to the Comelec even though the media research group Nielsen says 11 Metro Manila-based broadsheets and tabloids had run political ads between February 9 and 28 alone.

Among the broadcast networks, only ABS-CBN (including channel 2, its cable channels ANC and Teleradyo, its AM station DZMM, and its FM station DWRR), TV5, NBN 4, RPN 9, and Sky Cable have fully complied in submitting all three required sets of documents—advertising contracts, broadcast logs, and certificates of performance—to the Comelec.

Rafanan explains the importance of each kind of document: “Doon sa contract, s’yempre that proves that they own the advertisements that are being shown on TV or being broadcast on radio. The contracts also show how much they agreed to pay, and for what duration, and how frequent. The broadcast logs and the performance logs would show us that these are actually aired. So these are good pieces of evidence to show how much indeed they spent.”

Not industry norm?

But TV5 Legal Department Director Christine C. Ona says submitting advertising contracts to the Comelec within five days after these are signed (as stipulated in the Fair Elections Practices Act) is not as simple as it sounds. According to Ona, it is not “industry practice” for networks to have advertising contracts prior to airing advertisements, political or otherwise.

“Ads are aired without actual contracts,” she says. “We just receive the TO, these are telecast orders. We only get broadcast contracts eventually. But under the law, it says [submit] ‘prior to implementation’. So we had to explain…that we don’t have contracts prior to implementation in the industry.”

Traditionally, she adds, broadcast or telecast orders had sufficed for media outlets and advertising agencies because of the immediate nature of their transactions, with advertisers placing ads sometimes as late as an hour before airing.

Kapisanan ng mga Brodkaster ng Pilipinas (KBP) legal counsel Rejie Jularbal also points out that the broadcast industry “does not see a necessity of a broadcast contract or an advertising contract because all the (necessary) details are already in the broadcast order.”

For radio, requiring advertising contracts before airing is even more difficult because of “commando placements,” says Jularbal, explaining that ad placements on radio are subject to last-minute changes, depending on shifts in a candidate’s campaign tactics.


Jularbal, who also heads the Regulatory Compliance Group of the Manila Broadcasting Company, owner of DZRH, one of the country’s top AM radio networks, says that in cases like these, putting together a contract is “impractical” and that issuing a broadcast order or a telecast order should suffice because it is “respected in the industry.”

“It’s not that we don’t want to comply with the requirement for a broadcast contract,” he says, noting that the matter is now the subject of a KBP petition to the Comelec. “There is just simply no practice of a broadcast contract.  The broadcast order is the broadcast contract in the industry.”

This same principle is being espoused by GMA Network, which submitted to Comelec its telecast orders in lieu of the contracts “in long form,” along with its broadcast logs and certificates of performance.

Atty. Jose Vener C. Ibarra, GMA7 research, contracts, and litigation lawyer, says that a contract is not necessarily a written document but “a meeting of the minds or a relationship.”   Telecast orders, according to him, are enough to illustrate that relationship.

Ibarra says that the authorization letters candidates issue to their media agencies – so the latter may place political ads on their behalf – would prove that the candidates actually “own” the ads aired. However, he concedes that, while GMA has these documents on file, the network has not submitted these to Comelec yet, but is inclined to “eventually submit” the same.

He maintains it would be difficult for GMA to produce the “long-form or written” contracts but that “it’s not impossible.” However, for the remaining weeks of the campaign period, Ibarra says he sees no reason to “deviate” from the practice of submitting to Comelec telecast orders as GMA’s contracts for political ads.

Both Jularbal and Ona say that in previous elections, the Comelec had accepted broadcast orders in lieu of advertising contracts.  But Jimenez maintains that while the body will accept telecast or broadcast orders for now, it will still require networks, “upon reasonable time, to submit [their] broadcast contract.”

“If you don’t have a broadcast contract…right now, that doesn’t mean you’ll never have a contract because you need it for your records as well, for tax purposes,” he says. “You can’t submit just telecast orders to the BIR (Bureau of Internal Revenue). So we want a copy of that as well.”

He stresses that there are penalties for those who fail to comply with the law: “Administrative fine for the networks and then kulong (jailtime). May kulong, one to six years.” The same sanctions apply to errant print media outfits.

“For candidates,” says Jimenez, “fine at saka imprisonment and disqualification from holding office.” With additional reporting by Karol Ilagan and research by J.C. Cordon, PCIJ, April 2010