Mr. Raul N. Choa

November 8, 1989 Mr. Raul N. Choa VP Public Relations Allied Broadcast Center, Inc. Suite 301 Legaspi Towers 200 Paseo de Roxas, Makati, Metro Manila Dear Mr. Choa: This refers to your letter dated July 10, 1989, requesting opinion on the queries posed therein. The facts presented in your letter appear as follows: On March 11, 1981, the KBP passed a resolution amending Art. VII of its By-laws by creating the KBP Standard Authority composed of five (5) members. This amendment was never filed with the SEC as of November 18, 1985. On October 29, 1986, an amendment was made to the said amendment increasing the composition of the KBP Standard Authority to seven (7) members. On the basis of the foregoing facts, you now seek our opinion on the following queries: 1. Not having been filed with the SEC and not having been approved by SEC, is this amendment (referring to the amendment passed on March 11, 1981) invalid and illegal and therefore has no force and effect? 2. If the amendment to original amendment was filed between October 29, 1986 and August 24, 1987 or the present will it be valid on the date of the filing or on the date the SEC approved such amendment? 3. In relation to Query No. 2, will the filing of the amendment to the original amendment or its approval favorably affect the unfiled original amendment? If so will the force and effect of such an approval by the SEC be retroactive as of the date the original amendment was passed by the KBP Standard Authority on March 11, 1981 or will the actuations of the KBP Standard Authority be void before the SEC approval after the filing of the amendment to original amendment with the SEC? 4. When does an amendment to the By-laws have force and effect. Is it the day of approval by the general membership or the day of filing with the SEC or the day of approval by the SEC? Quoted hereunder is Section 48, paragraph 3 of the Corporation Code which provides, thus: "The amended or new by-laws shall only be effective upon the issuance by the Securities and Exchange Commission of a certification that the same is not inconsistent with this code." Applying the foregoing provision to all your queries, it is clear that approval of the amendments by this Commission is necessary before any amendment can take effect. It is only upon the issuance of the certificate of filing of amended by-laws that its provisions should be followed and observed. In several opinions, the Commission has ruled that "By-laws should be made to apply prospectively and not retroactively and should become operative from the time of their adoption provided they are not contrary to laws, moral and public policy. "(Vol. XXII No. 4 December 1988 issue of the SEC Quarterly Bulletin quoting letters to Mr. Orlando C. Perez, dated July 28, 1987, Atty. Mel Oxciano, November 2, 1987, Concio Neri Sanchez and Associates, March 25, 1983 ) We trust that the foregoing answer your queries. Very truly yours, (SGD.) RODOLFO L. SAMARISTA Associate Commissioner